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Can Local Economic Interests Affect Congressional Votes on Climate? Evidence from Solar Tariffs
Photo: DANIEL LEAL/AFP/Getty Images
This piece is part of the CSIS Energy Security and Climate Change Program’s Energy Futures Forum 2024 (EFF). EFF explored policy uncertainty about future trajectories for the energy sector.
The “One Big Beautiful Bill Act” (OBBBA), passed by the Senate, rolls back many of the provisions in the Inflation Reduction Act (IRA). By moving up phase-out timelines for some incentives and imposing onerous “foreign entity of concern” requirements for others, the reconciliation bill essentially amounts to a full repeal of the IRA, especially for the policies pertaining to the wind and solar industries.
This is despite the fact that most of the economic gains from the IRA—85 percent of investment and 68 percent of jobs—were slated to go to Republican-controlled districts. Politically, this was intentional: By enabling businesses and workers to benefit from green industrial policy, the IRA aimed to create interest groups with a stake in sustaining the legislation. These “winning coalitions” would push legislators to protect their interests. This theory is now in question, as Republicans were willing to sacrifice jobs and investment in their districts to roll back Democratic legislation.
Making climate policy durable is proving to be a tall order. When it comes to a legislator’s incentives, economic interests have to compete with extreme partisan polarization on climate policy and the pressure for legislators to vote the party line. These forces proved too powerful to be outweighed by the jobs and investments from the incentives. Can local green economic interests ever win out on climate policy votes? A vote on solar tariffs during the Biden administration is one instance where they did, with some possible lessons for understanding when the political theory of green industrial policy can work.
Congress Voted on Whether to Expand Solar Tariffs
In 2023, Congress held a series of votes on a solar tariff bill (H.J. Res. 39). The bill stemmed from the Biden administration’s decision to intervene in a Department of Commerce investigation and prevent new tariffs from being enacted on solar panel imports that might have originated from Chinese firms. In response, Congress voted on a bill disapproving of the administration’s actions, which effectively amounted to support for new tariffs.
A district’s economic interests on this vote were driven by the position of its solar businesses in international supply chains. While firms that directly compete with solar imports would benefit from tariffs, businesses that rely on imported materials and components would be hurt by them. As a result, most U.S. solar manufacturers—whose products compete with imports—stood to benefit from trade protections. Solar businesses that source components internationally and/or install imported solar panels stood to lose out, as their input costs would increase.
If local economic interests impacted the vote, legislators from districts where solar panels and component manufacturers are concentrated should have been more likely to support tariffs on solar imports. Meanwhile, legislators representing districts with a high concentration of solar developers and installers should have been more likely to oppose tariffs.
Did Local Clean Energy Interests Impact Congressional Voting?
Figure 1 shows the results of an analysis of legislative voting behavior for one of the House votes on H.J. Res. 39. This vote to disapprove the injunction on new solar tariffs passed with 221 “yea” votes and 201 “nay” votes. The horizontal axis represents how strongly a variable was correlated with vote choice.
Unsurprisingly, most of the voting was driven by partisanship. The Democrats largely voted in line with the president’s policy at the time (against new tariffs), whereas the Republicans coalesced in opposition to the president (in favor of new tariffs). However, partisanship was not the only factor in the vote, as there were substantial defections from the party line on both sides: 12 Democrats (out of 206 who voted) and 8 Republicans (out of 217 who voted).
Nathan Mariano
Postdoctoral Scholar, University of California, Santa Barbara.
Remote Visualization
We find that local solar manufacturing interests were crucial for explaining which Democrats defected from the party line to support new tariffs on solar. For every solar manufacturing facility in their district, a representative was more than twice as likely to vote in favor of tariffs. Statements by Democrats who crossed the aisle suggest that this was indeed the rationale for their votes, as they consistently highlighted the importance of protecting U.S. solar manufacturing.
On the other hand, the strength of solar developers in a district had no significant correlation with a legislator’s vote choices. By this metric, it appears that businesses benefiting from Chinese solar imports were not as successful in lobbying for their interests. At the same time, Republicans who defected in the vote also highlighted the importance of local solar business interests in their decision to oppose tariffs (presumably referring to firms that depend on imported solar). While there is no significant statistical relationship with the measure used here, we might not rule out that local green economic interests influenced Republican votes, too.
Implications for Climate Policy
The solar tariff episode shows that the dynamic interest group politics of industrial policy has impacted congressional votes. Solar manufacturers that benefited from public support and investment were able to assert their interests in Congress, driving defections from partisan majorities.
However, the space for partisan defections on climate likely varies across policy issues. Republicans were more willing to protect local economic interests when the policy issue was tariffs on China, rather than the tax incentives in the IRA. The solar tariff issue was also an isolated vote on climate policy, whereas a budget bill such as the OBBBA requires defectors to hold up the national policy agenda to protect local economic interests.
Another unique feature of the solar tariff vote was that global value chains produced a split within the clean energy industry on policy positions. One part of the solar industry supported the tariffs, while another opposed them. There was also no clear pro–fossil fuel position on the solar tariff vote. These dynamics may have given Republicans room to defect from the party line and protect local interests without being seen as outright favoring “clean energy,” and vice versa for Democrats.
Interestingly, other clean energy policy issues that polarize interest group coalitions have spurred bipartisan action. Nuclear energy is notoriously controversial among environmentalists, but it will receive continued support in the OBBBA from Republicans. In 2021, a debate on methane regulation policy split the oil and gas industry, with larger firms supporting regulation. This drove a number of Republicans to either vote with Democrats or abstain from a vote on the bill. While more evidence is needed, it may be that splits within economic coalitions facilitate bipartisan voting on climate. When this happened with solar tariffs, it allowed local economic interests to matter for the vote.
In the wake of the OBBBA’s passage by the Senate, the future of green industrial policy in the United States is uncertain. There will be a debate on the merits of the political theory underpinning the IRA and the strategies that advocates should pursue moving forward. As these discussions take place, the solar tariff vote suggests that the idea that local economic interest groups can drive climate policy may not be entirely mistaken but requires a more nuanced understanding and approach.
Nathan Mariano is a postdoctoral scholar with The 2035 Initiative at the University of California, Santa Barbara.