A weekly reckoning with life in a warming world—and the fight to save it

As last week’s newsletter noted, the true climate legacy of the Inflation Reduction Act will probably only be discernible in the rearview. But in the past few days, experts and journalists have started to try to understand how exactly this legislation will play out in practice. From tax credits to the role of the Supreme Court, there is a lot to figure out. 

The IRA’s climate implications are not exactly intuitive. As eager consumers tired of gas prices look to take advantage of the IRA’s tax credit for electric vehicles, for example, lists are starting to circulate of which cars, specifically, qualify and which don’t. The made-in-America stipulations on these tax credits are not just stringent but complicated, as TNR’s Kate Aronoff wrote earlier this week:

Off the bat, for instance, 40 percent of the components of cars will need to be made in the U.S. or in a free trade partner to qualify for a new $7,500 electric vehicle tax credit furnished by the IRA. That requirement will ramp up by 10 percent per year, toward an 80 percent requirement by 2027. As of now, only 21 of the 72 electric vehicles now available in the U.S. are eligible for the credit through the end of this year.

The implications of this provision are not entirely clear. Will it jump-start the domestic E.V. battery market, as doubtless intended? Or will it slow down the transition to electric vehicles—a plausible outcome because factories take time to build, and the raw materials can be hard to source? Or will it simply trigger a wave of trade complaints against the U.S.? 

“Trying to protect the nascent domestic clean energy industry,” Kate wrote, “could run up against international trade rules that the U.S. has had a heavy hand in crafting,” including both World Trade Organization rules and the U.S.-Mexico-Canada Trade Agreement. 

So that’s one unknown. Another, identified in a piece Kate just published, is how the IRA will affect various court challenges to the administration’s attempts to regulate greenhouse gases. Earlier this week, “numerous commentators—including members of Congress—suggested that cunning Hill staffers had managed to sneak in language upending the Supreme Court’s recent decision in West Virginia v. EPA, which limited the ways the Environmental Protection Agency can regulate greenhouse gas emissions under the Clean Air Act.” 

Unfortunately, this probably isn’t the case. While the IRA does contain extra language defining greenhouse gases as pollutants, it doesn’t do much to change the fundamental problem posed by West Virginia v. EPA, which, as Kate summarized, is that a majority of justices on the current court believe “it’s the court’s job—not federal agencies’—to interpret congressional statutes when it comes to questions of ‘vast economic or political significance.’” This thesis is also known as the major questions doctrine. And the challenges to regulators’ actions under this doctrine keep coming. Just this week, Kate noted, “a complaint from Republican attorneys general argued that a proposed rule … to require that companies disclose their emissions—was a violation of major questions doctrine, likely setting the scene for a legal battle.”

So exactly how all this will settle in the Supreme Court remains another big unknown. Expect more of these questions to emerge in the coming weeks.

—Heather Souvaine Horn, deputy editor

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—Heather Souvaine Horn, deputy editor