By Rebecca Chilton

As with many, we in the Foley Hoag energy and climate practice have felt the results of the 2024 election reverberate through our industry. We’ve gathered and digested the most current information available and debated the repercussions of a second Trump term on everything from tax credits and EPA funding streams to permitting and tariffs. In this issue of Climate Law Matters, my colleagues give their thoughts about how different actors in the green economy, particularly state governments, together with dramatic upward trends in manufacturing, investment and electricity demand, can be stabilizing forces against a rapidly changing federal landscape and can help build on our current industry momentum. First and foremost, however, we’ve been in close touch with our clients, helping them plan and pivot, regroup and recharge. One of the most vital aspects of the renewable energy sector is our ability to agilely adapt to change. Alongside our allies in the fight against climate change, we’re preparing to step up and step forward with cautious optimism into an uncertain future.

Still, in a time of great upheaval, it can be helpful to reorient towards first principles, going back to the original reasons why we do what we do. For some, it is the opportunity to radically transform the way we generate and distribute power in order to create not only a more just energy economy, but also a more robust one. For others, it is the conviction that capitalism’s inherent creativity and disruptive power deliver the innovation, scale and efficiency that are critical to achieving measurable climate solutions. Returning to these fundamental tenets -- purpose and profit, mission and market – we discover that they are, in many ways, two sides of the same coin.

The genius of the Inflation Reduction Act was to combine these two imperatives into one watershed legislation, pushing catalytic capital down and into corners not yet served by the energy transition, and in turn opening new pathways to growth and generating even more energy and ClimateTech solutions. In only two years, the IRA has spurred an unprecedented wave of adaptation, expansion, investment, equity and innovation in renewable energy and ClimateTech that cannot now be turned back, no matter what administration or Congress sits in Washington.  

Sustaining this momentum depends on a “both/and” mentality that, while it may make for a few strange bedfellows, ultimately forges powerful partnerships for the common good. A robust market of direct tax credit transfers would have seemed almost fanciful in August of 2022: now it’s an established industry with evolving standards and booming demand which opens up capital for smaller and more distributed projects that serve a wide spectrum of consumers. Only a few years ago, it would have been unusual to see nonprofits leading renewable energy development; today, these organizations are using direct pay to structure complex financing for high impact projects.  Red districts are welcoming solar module manufacturers. Communities with deep roots in the coal mines are training the next generation of skilled labor for the energy transition. Community development organizations are designing microgrids that make their whole city more resilient. By including environmental justice as an essential part of our analysis, we are pushed to see past perceived risks and outdated assumptions to bring new, creative players into the energy mix and, as a result, the pie grows bigger. With renewed appreciation for our interdependence and confidence in the unstoppable power of good ideas, we can pick up the twin tools of mission and market and, together, maintain our trajectory and continue the IRA’s sweeping changes into 2025 and beyond.

Read the full report here.