Federal cuts spark debate over clean energy future in North Carolina

As
North Carolina positions itself as a leader in clean energy, federal spending
cuts are raising concerns about the future of renewable energy investments and
jobs in the state. At a press event Thursday, climate and economic policy
experts warned that reductions in federal funding threaten progress made under
the Inflation Reduction Act, while some conservatives argue that market forces
will sustain clean energy growth regardless.

Concerns over federal cuts

Since
the Inflation Reduction Act was signed into law in 2022, North Carolina has
seen more than $20.44 billion in clean energy investments—the fifth-highest in
the nation—and more than 17,000 new jobs, particularly in rural areas,
according to Climate Power. But panelists at the event, including State House
Democratic Leader Robert Reives, warned that recent federal spending cuts could
jeopardize that progress.

“This
does nothing but set us back,” Reives said. “It takes away jobs, it takes away
people’s ability to have choices on energy, and ultimately, it takes away North
Carolina’s ability—and the United States’ ability—to stay competitive in what
is clearly a growing market.”

Panelists
emphasized that incentives from the Inflation Reduction Act have driven clean
energy investments, with consumer tax credits and rebates helping more than
85,000 North Carolina families afford home energy upgrades in 2023 alone.

“Federal
cuts will make it harder for the people of our state to make ends meet and for
us to meet our climate goals,” said Alex Campbell of the NC Budget and Tax
Center. “Without these programs, families in North Carolina are going to face
higher costs—not just from reduced public services, but from ripple effects
throughout our economy.”

Business impact

Much
of the debate centers around North Carolina’s booming electric vehicle and
battery manufacturing industry, which has attracted billions in private
investment.

“In
the past two years, North Carolina has become a leading hub for electric
vehicle and battery production,” said Stan Cross of the Southern Alliance for
Clean Energy. “As of June 2024, our state ranked third in the country for EV
and battery manufacturing investments, at $20.2 billion, creating over 16,000
jobs—many of them in rural communities.”

Cross
argued that federal incentives have played a critical role in attracting these
companies. “If these tax credits are eliminated, we risk losing our competitive
edge,” Cross said.

But
not everyone sees it that way.

Mark
Fleming, president and CEO of Conservatives for Clean Energy, said he isn’t
concerned that federal cuts will slow the state’s progress.

“North
Carolina has been a leader for years in the clean energy economy, a leader in
the Southeast and in the country,” Fleming said. “And we believe that the clean
energy economy will continue to grow in North Carolina due to private
investment.”

Fleming
said technological advancements have made clean energy increasingly
cost-competitive and expects the industry to keep expanding without federal
mandates.

“We
believe in free markets,” Fleming said. “Technology is leading to rapid
decreases in the cost of solar and wind, and we believe that will continue.
Clean energy technologies can compete on their own.”

State
vs. federal policy

Fleming
pointed to support across the aisle for clean energy at the state level as a key
reason why North Carolina will remain a leader in the sector.

“There
has been bipartisan leadership in North Carolina on clean energy going back a
decade plus,” Fleming said. “Clean energy has provided jobs, and it has
provided revenue for our state’s counties that, quite frankly, are struggling
and need that revenue.”

While
Fleming believes North Carolina’s clean energy future is secure without federal
intervention, Reives warned that even the perception of reduced federal support
could discourage further investment.

“If
businesses are getting the signal that the U.S. is deciding to pull out of the
clean energy space, they’re not going to be as anxious to locate here,” Reives
said. “We spent years recruiting companies like Toyota to build in North
Carolina. If we stop supporting clean energy, we could lose that momentum.”

What’s next?

The
North Carolina General Assembly is expected to debate energy-related
legislation in the coming months, and stakeholders on both sides will be
watching to see whether state lawmakers move to reinforce or roll back clean
energy initiatives. Meanwhile, businesses and workers in the clean energy
sector wait to see how federal policy shifts will impact their industries, which make take years to play out.

Gov.
Josh Stein, a Democrat, has expressed strong support for clean energy and is
expected to continue advancing the North Carolina Clean Energy Plan, which aims
to cut greenhouse gas emissions, modernize the grid and expand renewable
energy across the state.