Elon Musk Is Why We Shouldn’t Cast CEOs as Climate Saviors

Tax incentives make the investments attractive, but businesses, along with rural cooperatives, nonprofits and others, must judge whether investing their own money in a hydrogen factory or a wind farm will pay off. In the end, the law will be only as successful as their appetite to invest at a scale that will meaningfully reduce emissions warming the planet and increase the nation’s energy security.

This is all well and good. The private sector is traditionally risk averse. Offering them subsidies is a well-worn way to get them to do things they otherwise wouldn’t, including making much-needed investments in domestic supply chains for green energy technologies. I’ve written before that—on its own limited terms—the Inflation Reduction Act has been reasonably successful at driving additional investment in green export sectors. It didn’t seem to make much of an impression with voters, though. It also didn’t whet their appetites for more aggressive climate policy. Two-thirds of the IRA’s energy-related subsidies are expected to flow to corporations. Consumers hoping to take advantage of incentives for things like solar panels and energy efficient appliances still need to have a decent amount of cash on hand to buy those things. Neither has Biden’s growth agenda endeared climate policy to many Republican lawmakers. Nine out of ten of the Congressional districts that have received the most new clear energy investment since the IRA passed are represented by Republicans; still, the 18 GOP Congressional representatives urging their colleagues to preserve that law remain a lonely bunch.

In retrospect, the prospect of U.S. industrial strategy getting preoccupied with creating “a lot more Elon Musks” should have sounded scarier. The dangers of leaving decarbonization up to some mercurial billionaires should have been clear even before Musk turned MAGA. Exciting as it is, the billions of dollars worth of investment that the IRA directed toward cleaner manufacturing and energy production has not created some novel political constituency for decarbonization, including in c-suites. Musk is arguably representative of a broader shift in so-called “green capital,” an increasingly meaningless category that may well include anyone looking to make money in 2024. Even companies who’ve benefited from IRA funds, like Ford and Oxy, seem happy to swallow Republican attacks on that law in exchange for massive corporate tax cuts and looser regulations.

As the Biden years showed, too, fossil fuels and zero-carbon energy can grow simultaneously. Growing electricity demand from data centers, for instance—including to power AI—could be lucrative for energy providers of all kinds. OpenAI founder Sam Altman has been trying to enlist investors in the United Arab Emirates, Asian chip makers and U.S. officials in his quest to build a global fleet of data centers that could use as much as 5 gigawatts of electrical power each, about a thousand times more than the average data center. At the White House earlier this fall, Altman reportedly presented an OpenAI report entitled “Infrastructure Is Destiny,” orbiting around the need to start building such facilities in the U.S. for the sake of competing with China and “re-industrialization.”