The following commentary was written by Daksh Arora, a project engineer at GameChange Solar, content director for the MIT Energy Conference 2025, and a fellow at the Clean Energy Leadership Institute. See our commentary guidelines for more information.

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States like Massachusetts must take the lead in advancing the United States’ climate goals, especially under the incoming Trump administration. While the Biden Administration’s landmark Inflation Reduction Act (IRA) of 2022 made significant strides, the U.S. is still on track to achieve only 66% of its greenhouse gas reduction targets by 2030.

With the potential for further setbacks, such as a possible second withdrawal from the Paris Agreement, states like Massachusetts must step up to drive the deployment of clean energy and climate solutions.

The “Direct Pay” provision in the Inflation Reduction Act (IRA) is a game-changer for municipalities, state and local governments, and other tax-exempt entities to access federal clean energy tax credits. This provision allows entities such as nonprofits, schools, tribal governments, and municipal utilities to receive tax credits directly from the IRS, rather than relying on tax liability to claim them.

Before the IRA, only private entities could benefit from these credits, putting public entities at a disadvantage in developing clean energy projects. The Direct Pay provision has no cap on government spending through 2032, offering new opportunities for public sector investment in clean energy. Furthermore, IRA also increases the maximum available tax credit for certain clean energy projects, from 30% to 50%, with the potential for up to 70% or more for projects in energy or low-income communities, or those using American-made materials, helping overcome financial barriers that previously slowed public clean energy development.

To claim direct pay, eligible entities must complete their energy projects before receiving payment from the federal government, which will occur the following year. While the tax credits will lower overall project costs, upfront capital is still needed to finance projects before the refund arrives.

To help address this, the Greenhouse Gas Reduction Fund (GGRF), a $27 billion program established by another IRA provision, provides increased green bank financing, supporting an equitable green financing ecosystem across the U.S. The IRS just finalized the direct pay rules and it would be really difficult for the next administration to repeal it. 

City governments like in Somerville and Cambridge can use direct pay to supplement the costs of deploying renewable energy infrastructure such as solar panels and storage technologies on public lands and buildings; electrifying vehicle fleets; and building out electric vehicle charging infrastructure.

The cities can also establish their own municipal clean energy utility. In 2024, voters in Ann Arbor approved the creation of a “Sustainable Energy Utility” (SEU) with 79% support. The SEU is designed to supplement the existing energy grid and help residents transition to cleaner, more reliable energy sources. The SEU plans to initially secure 20 megawatts of demand, using that to finance and install solar panels, batteries, and energy-efficiency upgrades for customers. The utility will own and maintain the solar systems, providing power to customers at cost, with no markup, allowing residents to access solar and backup power without upfront costs or debt.

Direct Pay is also a significant shift that allows public power entities, like the New York Power Authority (NYPA), to directly own renewable energy projects instead of relying on complex public-private partnerships. This makes it easier for NYPA to scale up clean energy projects by bypassing the need for third-party ownership structures that were previously required.

While there is an urgent need for funding in renewable energy, infrastructure, and other green initiatives, challenges like high capital costs and slow land acquisition complicate the transition. Some critics argue that financial de-risking may lead to the privatization of public goods and place the private sector in control of the green transition, raising concerns about the fairness of these arrangements. Despite these challenges, the question remains whether private investors can truly finance the world’s vast unmet green infrastructure needs and whether it’s technically possible to overcome the barriers in place. 

Regardless of this question, investing in public capacity is a net win for the environment as direct pay not only levels the playing field between for-profit and tax-exempt entities but also shifts energy generation ownership from private to public and nonprofit sectors, enabling more consumer-focused management of energy assets. States like Massachusetts should ensure that benefits from the IRA reach low-income and marginalized communities.

Massachusetts just streamlined the process for building solar and wind farms, transmission lines, and other energy infrastructure to help meet its climate goals by 2050. The state can do more by working to help communities understand the types of investments eligible for direct pay and how to secure financing for clean energy projects, making access to this funding easier and more efficient. The state can also lead by setting an example by deploying climate solutions at scale and ensuring utilities maximize the federal clean energy tax credits by regulatory oversight.

At the moment, when the state is experiencing a historic drought fueled by climate change, the inaction to expand clean energy infrastructure and advance environmental justice is no longer an option.

Commentary: Trump may struggle to repeal this IRA provision; Massachusetts should use it is an article from Energy News Network, a nonprofit news service covering the clean energy transition. If you would like to support us please make a donation.

The Biden administration has enacted the most consequential federal clean energy and climate policy in U.S. history, giving the nation a fighting chance at reducing greenhouse gas emissions fast enough to deal with the climate crisis. Former President Donald Trump, who has won the 2024 presidential election, has pledged to undo that work.

Though Trump’s executive powers will allow him to slow the energy transition in a number of ways, the extent to which he rolls back Biden’s clean energy accomplishments will be dictated in part by whether Republicans retain control of the House of Representatives. The GOP flipped the U.S. Senate, but votes are still being counted in key House races as of Wednesday morning.

Here’s what clean energy and climate experts say is most likely to be lost under a second Trump administration — and what might survive.

What Trump has said about energy

Trump’s rhetoric presages a worst-case future. He has called climate change a hoax and the Biden administration’s climate policies a ​“green new scam.” He has said he wants to repeal the landmark Inflation Reduction Act and halt the law’s hundreds of billions of dollars of tax credits, grants, and other federal incentives for clean energy, electric vehicles, and other low-carbon technologies.

Trump has also made ​“drill, baby, drill” a call-and-response line at his rallies, pledging to undo any restraints on production and use of the fossil fuels driving climate change. U.S. oil and gas production is already at a record high under the Biden administration.

“He has pledged to do the bidding for Big Oil on day one,” Andrew Reagan, executive director of Clean Energy for America, said during a recent webinar.

“Oil and gas lobbyists are drafting executive orders for him to sign on day one,” Reagan added, citing news reports of plans from oil industry groups to roll back key Biden administration regulations and executive orders.

A Trump administration would be all but certain to reverse key Environmental Protection Agency regulations limiting greenhouse gas emissions from power plants, light-duty and heavy-duty vehicles, and the oil and gas industry, all of which analysts say are necessary to meet the country’s climate commitments. It’s also almost sure to lift the Biden administration’s pause on federal permitting of fossil-gas export facilities.

Trump has also promised to withdraw the U.S. from international climate agreements (again), including the Paris agreement aimed at limiting global warming to no more than 2 degrees Celsius above pre-industrial levels.

“We know that Trump would take us out of the Paris agreement, and that would be the last time his administration uttered the word ​‘climate,’” Catherine Wolfram, an economist at the MIT Sloan School of Management and former deputy assistant secretary for climate and energy economics in the Biden administration’s Treasury Department, told Canary Media. ​“Losing that global leadership would be one of the greatest losses of a Trump presidency.”

What will happen to the Inflation Reduction Act? 

Trump won’t have the power to enact all of his promises on his own. Some of the decisions must be made by Congress, including any effort to repeal the Inflation Reduction Act or to claw back unspent funds from that law or the 2021 bipartisan infrastructure law.

Complete repeal of the Inflation Reduction Act would be highly disruptive to a clean energy sector that has seen planned investment grow to roughly $500 billion since the law was passed in mid-2022.

It would also undermine clean energy job growth, which has increased at roughly twice the pace of U.S. employment overall. A recent survey of clean energy companies found that a repeal of the law would be expected to lead to half of them losing business or revenue, roughly one-quarter losing projects or contracts, about one-fifth laying off workers, and about one in 10 going out of business. 

“We found that especially rural areas and smaller rural communities would experience the largest negative impacts of repeal of the Inflation Reduction Act,” Shara Mohtadi, co-founder of S2 Strategies, said in an October webinar presenting the survey data. ​“These are the regions of the country that have seen the biggest uptake in the economic benefits and the manufacturing jobs coming from other countries into the United States.”

Indeed, most of the investment and job growth the IRA has spurred has taken place in states and congressional districts represented by Republicans.

These on-the-ground realities have driven expectations that large swaths of the law’s tax credits would be likely to survive even with Republican control of the White House and both houses of Congress. Trump would face pushback within his own party to undoing the law entirely.

In an August letter to current Speaker of the House Mike Johnson (R-Louisiana), 18 House Republicans warned against repealing the clean energy and manufacturing tax credits created by the Inflation Reduction Act, which have ​“spurred innovation, incentivized investment, and created good jobs in many parts of the country — including many districts represented by members of our conference.”

“Prematurely repealing energy tax credits, particularly those which were used to justify investments that already broke ground, would undermine private investments and stop development that is already ongoing,” the 18 House Republicans wrote. ​“A full repeal would create a worst-case scenario where we would have spent billions of taxpayer dollars and received next to nothing in return.”

Republicans would need a roughly 20-seat majority to overcome opposition from these party members opposed to a full repeal, said Harry Godfrey, head of the federal investment and manufacturing working group of trade group Advanced Energy United.

“I don’t envision Republicans holding the House with 20-plus seats,” he said.

Godfrey also doubted that a Trump administration would be eager to undermine the domestic manufacturing boom that the law’s tax credits have spurred. He noted that at the October 1 vice-presidential debate, J.D. Vance, the Republican Ohio senator and Trump’s running mate, emphasized the need for the U.S. to ​“consolidate American dominance” in key energy sectors and industries now dominated by China.

While Vance went on to falsely accuse the Biden administration of failing to bolster U.S. industries against China, the goal of emphasizing domestic competitiveness could lead Republicans to avoid undermining progress in that direction, he suggested.

How Trump’s second term could derail the clean energy transition is an article from Energy News Network, a nonprofit news service covering the clean energy transition. If you would like to support us please make a donation.

A prospective buyer’s recent commitment to reinvest in a Gary, Indiana, steel plant sought to address union and government leaders’ worries about the sale’s potential impact on jobs and U.S. steelmaking capacity.

The plan to extend the life of the country’s largest and most carbon-emitting coal-fired blast furnace, however, has also heightened concerns from Northwest Indiana residents most affected by the facility’s air pollution.

“This is not acceptable,” said Susan Thomas, director of legislation and policy for Just Transition Northwest Indiana. “We now have technology for doing this much more sustainably.”

A study released Monday quantifies the public health threat highlighted by local clean air advocates, linking the Indiana plant to dozens of annual emergency room visits and premature deaths, as well as thousands of asthma attacks. 

Japan-based Nippon Steel is seeking approval from U.S. regulators for a $15 billion acquisition of U.S. Steel, the storied domestic steelmaker whose facilities include the Gary Works plant in Northwest Indiana, along with others in Ohio, Michigan and Pennsylvania, key battleground states where the proposed sale has been a subject of presidential campaigning. Vice President Kamala Harris and former President Donald Trump oppose the sale, as does President Joe Biden.

Much of the public discussion around the proposed sale has centered on its economic and national security implications, but those living near the plant have different concerns and demands. They say they’ve suffered for too long from steel industry pollution, and they only want Nippon as a neighbor if the company installs a new type of furnace that burns with lower or even zero emissions. 

“I would love to see Gary Works transform to green sustainable steel, bringing more jobs, cleaning up the area, that would be an amazing win-win,” said Libré Booker, a librarian who grew up near the mill. “The people have lived under these conditions for far too long. It’s definitely time for a change.”

Gary Works is the largest integrated steel mill in North America, employing about 2,200 people. Northwest Indiana is also home to two other steel mills — Burns Harbor and Indiana Harbor — and two coke plants that turn coal into the high-density raw material for steel. 

The populations in a three-mile radius of the Gary Works and Indiana Harbor steel mills are 96%-97% people of color, and almost two-thirds low-income people. The new study by Industrious Labs, a nonprofit focused on emissions reduction, used the EPA’s COBRA model to find emissions from the Gary Works plant likely are linked to 57-114 premature deaths, 48 emergency room visits and almost 32,000 asthma attacks each year.

The report cited the mills’ and coke plants’ emissions of sulfur dioxide, nitrogen oxides, carbon monoxide, particulate matter, and lead, all pollutants with direct impacts on public health. Gary Works is the number one emitter of PM2.5 particulate matter in the state, according to the company’s self-reported data analyzed by Industrious Labs. 

Industrious Labs steel director Hilary Lewis said the results bolster the demands of clean steel advocates, who want to see coal-fired blast furnaces replaced by direct-reduction iron, or DRI, furnaces powered by hydrogen made with renewable energy, known as green hydrogen. 

Booker was among 15 locals who participated in a recent “Sustainable Steel Community Cohort” run by Industrious Labs, attending five workshops learning about the science and policy of cleaner steel. 

Green hydrogen, green steel 

Green hydrogen is still not produced in large quantities anywhere in the U.S., and all the hydrogen currently produced in the country would not even be enough to power one steel mill, noted Seth Snyder, a partner in the Clean Energy Venture Group, at a recent conference in Chicago focused on clean hydrogen. 

But DRI furnaces can be powered by natural gas, which results in much lower emissions than coal. Cleveland Cliffs — which owns the Indiana Harbor and Burns Harbor mills — is transforming its Middletown, Ohio steel mill to gas-burning DRI with the help of a $500 million incentive under the Inflation Reduction Act. The company says the conversion will make it the steel mill with the lowest emissions in the world. 

With some modifications, DRI furnaces can burn a blend of natural gas and hydrogen or almost entirely hydrogen, experts say, meaning investment in a gas-burning DRI furnace could be a step on the way to “clean steel.” Lewis and other advocates, however, say gas-burning furnaces are not their goal, and they want the industry to transition off fossil fuels entirely. 

Hydrogen can be blended into fuel for traditional blast furnaces too, but the maximum emissions reductions that can be achieved that way are 21%, according to a paper on hydrogen-powered steel production in Europe by the Norwegian non-profit science organization Bellona. 

Nippon has announced it would invest $300 million in restoring the aging blast furnace at Gary Works, keeping it running for another 20 years. Installing a DRI furnace, meanwhile, typically costs over $1 billion.

“There is a gap,” said Lewis. “But these companies have the funding available. They have the money to make these decisions, they’re just choosing not to.” 

Incentives for change 

The IRA incentives tapped by Cleveland Cliffs are no longer available, but this summer California U.S. Rep. Ro Khanna introduced the Modern Steel Act, which would provide $10 billion in low-cost loans and grants, plus tax breaks and other incentives for new and revamped low-emissions steel mills, including hydrogen-fueled DRI.

Separately, lucrative tax credits soon to be available for “clean hydrogen” under the IRA could also make hydrogen-powered steel more financially viable. The specific rules for the tax credit — known as 45V — are still being finalized, amid controversy over what should qualify a project’s hydrogen as “clean.” 

“There are a number of different incentives in the IRA that can help steel companies build out their own green hydrogen infrastructure,” Lewis said. “Everything should be on the table. Steel companies would be such huge off-takers for green hydrogen, they can build their own economy here.”

At the BP Whiting oil refinery, 10 miles from Gary Works, there are plans underway for production of blue hydrogen, or hydrogen made with natural gas followed by capture and sequestration of the emissions. The plan is a marquee part of the Midwest (MachH2) hydrogen hub, one of seven planned hubs nationwide slated to receive $7 billion total in federal funding. Such blue hydrogen could be used to power a steel mill, with theoretically no resulting greenhouse gas or public health-harming emissions.

However, local environmental and public accountability leaders are strongly opposed to blue hydrogen production in the region, since carbon sequestration has not yet been done successfully on a large scale in the U.S., and it would entail pipelines carrying carbon dioxide from the refinery to a sequestration site. 

“The carbon capture component makes us very nervous, it seems to me they’re rushing into this without really taking the time to study it more seriously,” said Northwest Indiana resident Connie Wachala, another graduate of the sustainable steel program. “That might be because of all the money DOE is making available to industry. I wish our elected and industry officials would start thinking more creatively about how to make [green hydrogen] happen, how to make things better for the people in the neighborhoods and around the steel mills as well as for the shareholders.”

A different future 

All four of Wachala’s grandparents came from Poland to work in the steel mills. 

“Growing up in the 1950s, I remember my mom hanging the laundry up in the yard on a clothes line. If the wind was blowing a certain way, you’d get black particles on the clothes,” remembered Wachala, who worked as a creative writing teacher before retiring. “My dad’s car was always covered with that soot.”

Booker’s mother worked as a crane operator at the now-closed Bethlehem Steel mill in Burns Harbor, Indiana — among the first wave of women of color to be hired.

“I was proud she worked in the mill and took care of us, but I did not want [that job] whatsoever, seeing her come home every night after the swing shift, with the big old boots and jacket,” said Booker. “I wanted to go to college. It was a source of contention with my mom and I for some years.” 

That was in the days when locals largely believed, “if you want a good partner, you’ve got to get one that works in the mill,” she continued. “It was like a prestigious job and position. People looked up to people who worked in the mill.” 

Now, Booker laments, “Gary is like a joke,” scorned for its economic decline since the steel industry automated and shrunk — hemorrhaging jobs, and for the pollution that is still emitted. If the merger with Nippon does not go through, it’s widely believed U.S. Steel would eventually close the mill, as it closed its South Works plant in Southeast Chicago decades ago. At their height, the South Works and Gary Works plants together employed about 40,000 people in the Chicago area. 

Thomas wrote a frustrated rebuttal to the Chicago Tribune editorial board opining that the Nippon merger was crucial to Gary’s future. She and other local leaders say they don’t want the mill to close, but they can demand better than the extension of heavily polluting industry. 

“It’s just perpetuation of this as a sacrifice zone,” said Thomas. “‘This is what you’ve always been, this is how we’re going to keep you.’ But that’s not going to fly anymore.”

Steelmaker’s bid to buy U.S. Steel would extend life of Indiana plant — along with its emissions is an article from Energy News Network, a nonprofit news service covering the clean energy transition. If you would like to support us please make a donation.