January 31, 2023

But the campaign by US states and localities has intensified, including visits by the governors of Michigan, Georgia and Illinois to the World Economic Forum in Davos last week, as well as by West Virginia Senator Joe Manchin, a Democrat who was one of the architects of the IRA . Georgia Governor Brian Kemp, a Republican, was seen presenting his state as a clean technology investment destination at a luncheon hosted by the Forum.

“I was amazed at the amount of activity from state governments, from business development agencies, state business development agencies trying to lure us in,” said Gunter Erfurt, CEO of Meyer Burger, a Swiss-based manufacturer of solar panels.

Solarwatt, a German solar manufacturer, said they were recently recruited by Minnesota and Georgia.

“If the EU doesn’t come up with something similar [to the IRA] then we can grow further outside, particularly in the US, instead of continuing to invest in Europe,” added Mr. Erfurt. The company has a US location in Arizona.

competition for Europe

But European politicians were less impressed. Germany and France have expressed their unease with the IRA. Belgian Prime Minister Alexander De Croo complained about the “very aggressive way” the US had taken towards EU companies.

European Commission President Ursula von der Leyen told delegates in Davos that the “need to be competitive with offers and incentives currently available outside the European Union” could prompt the EU to introduce its own subsidy restrictions to loosen.

At least 20 new or expanded clean energy production facilities have been announced in the United States since the IRA was enacted, according to the American Clean Power Association. More than half comes from foreign companies.

In October, BMW announced it would spend $1.7 billion on new electric vehicle and battery manufacturing capacity in South Carolina. South Korean company Hanwha Q-Cells this month announced a $2.5 billion solar factory expansion in Georgia.

The US sales talk shows little sign of stopping.

Chris Camacho, executive director of Arizona’s Greater Phoenix Economic Council, said “every state in the union” is now competing to attract European companies.

“We are working with a number of European clean tech companies building into their model and expect they will have access to them [IRA] medium,” he said.

Gretchen Whitmer, governor of Michigan, a burgeoning center for clean energy investment, this month led a state delegation on her first economic investment mission to Europe, including stops in Switzerland and Norway.

Ms Whitmer urged investors to “come to Michigan,” adding that alongside the recently passed Chips and Science Act – designed to boost semiconductor production in the US – the IRA would mean “we’re moving manufacturing out of of the entire value chain will see”.

Tom Jensen, CEO of Freyr, a Norwegian battery company that announced a proposed $2.6 billion battery factory in Georgia in November, said Europe should implement its own subsidy package if it wants to stay competitive.

“Europe has criticized the US for being too slow,” Mr Jensen said in climate and energy policy. “When they finally put the best climate protection policy on the table, they will be criticized for it.”

The IRA passed party lines, with no votes from Republicans in Congress. New clean energy investments announced since the law were announced in states led by Democratic and Republican governors.

Georgia Gov. Brian Kemp’s press secretary said of his trip to Europe, “If the anti-inflation bill was mentioned, it was in reference to the troubling provisions that the governor remains committed to changing.” He added that Mr. Kemp traveled to Davos and Germany as part of an economic development mission to introduce Georgia to European companies.

In Georgia, “clean energy has never been quite… on the front lines [Governor] Kemp’s platform,” said Jason Shepherd, a professor of political science at Kennesaw State University and former Cobb County Republican leader. “But Republican governors who want to increase investment in their states, look at where the future is going, look at where the business is going.”

financial times

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