The Electric: A Rift Over the Climate Law Bursts Into the Open

Tension over the $369 billion climate law boiled over Wednesday, with Sen. Joe Manchin (D-W.Va.) threatening to sue to stop implementation of the legislation if he believes the White House is doing it the wrong way. His admonishment came ahead of the Biden administration’s scheduled release of guidance Friday for which electric vehicles will qualify for $7,500 per vehicle in consumer tax credits.

Manchin, whose staff wrote key parts of the climate law, told a conference that the administration is not interpreting the law to force the EV, battery and mining industries to establish their factories in the U.S. Instead, the administration, seeking to loosen China’s grip on the battery supply chain, is “friend-shoring,” allowing too much of the industry to take root in countries with which the U.S. has free trade agreements.

The outburst reflects competing ideas of how to build a U.S. battery industry to promote the use of EVs while also thwarting China’s dominance of the industry. When his staff wrote the battery provisions of the Inflation Reduction Act last year, Manchin sought to spur a robust refining industry that would convert raw metals like nickel, cobalt and lithium into chemicals, electrodes and finally EV batteries—somewhat replicating the midstream battery-making industry currently dominated by China.