The Midterm Outlook for Clean Energy Policy

October 6, 2022

WASHINGTON—Republicans and Democrats have dramatically different priorities for clean energy policy, but when the dust settles after the coming midterm elections there will be plenty of room for bipartisan collaboration in the next Congress, according to the Information Technology and Innovation Foundation (ITIF).

ITIF’s analysis comes in a blog post by David Hart, director of ITIF’s Center for Clean Energy Innovation, and Stefan Koester, a senior policy analyst with the Center. A summary of the authors’ analysis follows.

Table 1: Democratic and Republican policy priorities to accelerate clean energy innovation

Issue	Democratic Priorities	Republican Priorities	Bipartisan Support
Energy RD&D and Congressional Oversight	▪ Fully fund recently passed legislation expanding support for federal RD&D ▪ Approach Congressional oversight with a portfolio-based view of risk management	▪ Encourage private sector innovation and RD&D through tax reform ▪ Focus on project-by-project Congressional oversight	▪ Seek U.S. leadership, recognizing key role for private sector led innovation in domestic and global markets ▪ Grow and sustain federal RD&D funding for existing and authorized programs ▪ Support more RD&D spending for specific technologies particularly in hard-to-abate and industrial sectors
Developing and Regulating Domestic Energy Resources	▪ Avoid investing in long-lived fossil fuel assets, with mixed support for expanding short-term domestic fossil fuel supplies to address price increases ▪ Support stringent regulatory-based approaches to regulate GHGs including CO₂ and methane	▪ Support legislation to enhance fossil fuel production on federal lands and offshore, as part of an ‘All of the Above’ energy strategy ▪ Oppose EPA regulation of GHGs for stationary and mobile sources ▪ Support voluntary methane emission reduction strategies	▪ Support legislative and executive actions enabling short-term increases in domestic fossil fuel production to address energy inflation and geopolitical concerns
Clean Energy Manufacturing and Supply Chains	▪ Support reshoring supply chains and domestic manufacturing for solar, wind, EVs and batteries ▪ Expand domestic clean energy manufacturing through tiered tax credits for manufacturing with domestic content and labor/wage requirements	▪ Reform permitting for processing and mining facilities along critical mineral supply chains ▪ Limit China’s role in clean energy transition, due to human rights abuses, IP theft, and U.S. dependence	▪ Support legislation to strengthen EV battery supply chains and reduce foreign dependence for critical minerals ▪ Respond to concerns over Russian control of vital nuclear fuel resources ▪ Support limiting or excluding Chinese clean energy products made with forced labor
Permitting Reform	▪ Reform federal permitting and NEPA to make it easier to build clean energy projects, but tempered by concern about environmental justice ▪ Support expanding FERC transmission sitting authority	▪ Reduce federal permitting and oversight of energy projects, primarily pipelines, LNG terminals and offshore drilling by reforming or limiting NEPA review ▪ Oppose expanding FERC authority over interstate transmission given federalism and oversight concerns	▪ Support NEPA streamlining to speed approvals of critically necessary energy infrastructure and resource development
Climate, Trade, and International Negotiations	▪ Set up carbon border adjustments to protect manufacturers and encourage greater efficiency, with possible export fee for domestic exporters above the benchmark ▪ Support policies that tax emissions of imports and exports ▪ Favor robust international climate engagement	▪ Support a carbon border adjustment with focus on protecting American manufacturers, without export fee for domestic manufacturers ▪ Counter reciprocal border adjustments from EU and elsewhere ▪ Discourage international climate engagement	▪ Create a U.S. carbon border adjustment system based on industrial emissions-intensity that accounts for non-pricing domestic climate and energy policies
Industrial Decarbonization	▪ Frame decarbonization of domestic industry as opportunity to create jobs and improve American competitiveness ▪ Support federal clean procurement policies	▪ Promote voluntary emissions targets for U.S. manufacturing ▪ Oppose mandatory emissions regulation and clean procurement policies	▪ Support continued investment in manufacturing energy RD&D, DOE industrial assessment offices and technical assistance ▪ Endorse industrial policies that strengthen U.S. manufacturing and reduce costs
Next Generation Energy Technologies	▪ Support with caveats RD&D funding for advanced nuclear, CCS, and hydrogen ▪ Support continued deployment of long-duration storage, offshore wind, smart grids, and building efficiency ▪ Support strong environmental justice protections in federal spending and regulatory programs	▪ Strongly support advanced nuclear, CCS, and carbon utilization, LNG, expanded hydropower, and hydrogen technologies	▪ Support federal RD&D spending for advanced nuclear, CCS, and hydrogen, alongside long-duration battery storage, battery recycling, and industrial decarbonization technologies
Transportation Innovation	▪ Support federal regulations and tax credits to push demand for EVs ▪ Adopt policies to develop EV supply chains increase, domestic production, and expand infrastructure ▪ Support efforts to drive down gasoline prices by limiting price gouging and windfall profits	▪ Strongly oppose EV mandates and combustion engine bans ▪ Favor technology neutral tax credits for lower carbon transportation alternatives while limiting EV tax credits for higher income consumers ▪ Support efforts to drive down gasoline prices by increasing domestic oil and refinery production	▪ Support legislation that would increase U.S. ability to supply both raw materials and EV components and vehicles ▪ Support permitting and regulatory reforms to develop domestic EV battery supply chain ▪ Support policies to drive down domestic gasoline prices
Export Policies	▪ Support policies to develop and export clean energy technologies ▪ Support low-carbon development through national and international financing mechanisms	▪ Robust support for exporting domestic fossil fuel, particularly LNG, including through regulatory reform, increased market access, and limits on Russian fossil exports	▪ Support legislation to speed global access to domestic energy exports ▪ Support policies that limit Russian fossil fuel exports ▪ Support legislative measures to expand energy export market opportunities to serve developing countries ▪ Support with caveats expanding list of countries eligible for export of civilian nuclear technologies

Issue

Democratic
Priorities

Republican
Priorities

Bipartisan
Support

Energy RD&D and Congressional Oversight

▪ Fully fund recently passed legislation expanding support for federal RD&D

▪ Approach Congressional oversight with a portfolio-based view of risk management

▪ Encourage private sector innovation and RD&D through tax reform

▪ Focus on project-by-project Congressional oversight

▪ Seek U.S. leadership, recognizing key role for private sector led innovation in domestic and global markets

▪ Grow and sustain federal RD&D funding for existing and authorized programs

▪ Support more RD&D spending for specific technologies particularly in hard-to-abate and industrial sectors

Developing and Regulating Domestic Energy Resources

▪ Avoid investing in long-lived fossil fuel assets, with mixed support for expanding short-term domestic fossil fuel supplies to address price increases

▪ Support stringent regulatory-based approaches to regulate GHGs including CO₂ and methane

▪ Support legislation to enhance fossil fuel production on federal lands and offshore, as part of an ‘All of the Above’ energy strategy

▪ Oppose EPA regulation of GHGs for stationary and mobile sources

▪ Support voluntary methane emission reduction strategies

▪ Support legislative and executive actions enabling short-term increases in domestic fossil fuel production to address energy inflation and geopolitical concerns

Clean Energy Manufacturing and Supply Chains

▪ Support reshoring supply chains and domestic manufacturing for solar, wind, EVs and batteries

▪ Expand domestic clean energy manufacturing through tiered tax credits for manufacturing with domestic content and labor/wage requirements

▪ Reform permitting for processing and mining facilities along critical mineral supply chains

▪ Limit China’s role in clean energy transition, due to human rights abuses, IP theft, and U.S. dependence

▪ Support legislation to strengthen EV battery supply chains and reduce foreign dependence for critical minerals

▪ Respond to concerns over Russian control of vital nuclear fuel resources

▪ Support limiting or excluding Chinese clean energy products made with forced labor

Permitting Reform

▪ Reform federal permitting and NEPA to make it easier to build clean energy projects, but tempered by concern about environmental justice

▪ Support expanding FERC transmission sitting authority

▪ Reduce federal permitting and oversight of energy projects, primarily pipelines, LNG terminals and offshore drilling by reforming or limiting NEPA review

▪ Oppose expanding FERC authority over interstate transmission given federalism and oversight concerns

▪ Support NEPA streamlining to speed approvals of critically necessary energy infrastructure and resource development

Climate, Trade, and International Negotiations

▪ Set up carbon border adjustments to protect manufacturers and encourage greater efficiency, with possible export fee for domestic exporters above the benchmark

▪ Support policies that tax emissions of imports and exports

▪ Favor robust international climate engagement

▪ Support a carbon border adjustment with focus on protecting American manufacturers, without export fee for domestic manufacturers

▪ Counter reciprocal border adjustments from EU and elsewhere

▪ Discourage international climate engagement

▪ Create a U.S. carbon border adjustment system based on industrial emissions-intensity that accounts for non-pricing domestic climate and energy policies

Industrial Decarbonization

▪ Frame decarbonization of domestic industry as opportunity to create jobs and improve American competitiveness

▪ Support federal clean procurement policies

▪ Promote voluntary emissions targets for U.S. manufacturing

▪ Oppose mandatory emissions regulation and clean procurement policies

▪ Support continued investment in manufacturing energy RD&D, DOE industrial assessment offices and technical assistance

▪ Endorse industrial policies that strengthen U.S. manufacturing and reduce costs

Next Generation Energy Technologies

▪ Support with caveats RD&D funding for advanced nuclear, CCS, and hydrogen

▪ Support continued deployment of long-duration storage, offshore wind, smart grids, and building efficiency

▪ Support strong environmental justice protections in federal spending and regulatory programs

▪ Strongly support advanced nuclear, CCS, and carbon utilization, LNG, expanded hydropower, and hydrogen technologies

▪ Support federal RD&D spending for advanced nuclear, CCS, and hydrogen, alongside long-duration battery storage, battery recycling, and industrial decarbonization technologies

Transportation Innovation

▪ Support federal regulations and tax credits to push demand for EVs

▪ Adopt policies to develop EV supply chains increase, domestic production, and expand infrastructure

▪ Support efforts to drive down gasoline prices by limiting price gouging and windfall profits

▪ Strongly oppose EV mandates and combustion engine bans

▪ Favor technology neutral tax credits for lower carbon transportation alternatives while limiting EV tax credits for higher income consumers

▪ Support efforts to drive down gasoline prices by increasing domestic oil and refinery production

▪ Support legislation that would increase U.S. ability to supply both raw materials and EV components and vehicles

▪ Support permitting and regulatory reforms to develop domestic EV battery supply chain

▪ Support policies to drive down domestic gasoline prices

Export Policies

▪ Support policies to develop and export clean energy technologies

▪ Support low-carbon development through national and international financing mechanisms

▪ Robust support for exporting domestic fossil fuel, particularly LNG, including through regulatory reform, increased market access, and limits on Russian fossil exports

▪ Support legislation to speed global access to domestic energy exports

▪ Support policies that limit Russian fossil fuel exports

▪ Support legislative measures to expand energy export market opportunities to serve developing countries

▪ Support with caveats expanding list of countries eligible for export of civilian nuclear technologies

▪ Read the blog.

▪ To arrange an interview with the authors, contact Alex Ambrose.

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The Information Technology and Innovation Foundation (ITIF) is an independent, nonprofit, nonpartisan research and educational institute focusing on the intersection of technological innovation and public policy. Recognized by its peers in the think tank community as the global center of excellence for science and technology policy, ITIF’s mission is to formulate and promote policy solutions that accelerate innovation and boost productivity to spur growth, opportunity, and progress.