The Dive: Funding Freeze

Since taking office last month, President Donald Trump has been bulldozing the previous administration’s clean energy initiatives. His funding freezes could impact several projects underway in North Carolina that relied on past federal promises. 

One of Trump’s first executive orders was to halt all appropriations through the Inflation Reduction Act, legislation approved under President Joe Biden in 2022. While no Republicans voted for it, the measure kickstarted billions of dollars in funding for clean energy projects in mostly red states.

In the days before Trump’s inauguration, Biden’s administration ushered through $6 billion in tax credits under the Inflation Reduction Act to support 140 projects, including a mammoth plan for an electric vehicle battery plant in Brunswick County.

India-based Epsilon Advanced Materials announced plans for a $650 million graphite plant in 2023 to hire 500 workers. Epsilon manufactures synthetic graphite that helps power batteries, the most expensive component of electric vehicles. The planned plant would be the company’s first outside of India and has been approved for millions of dollars through a mix of local and state economic incentives, but nothing rivals the $115 million it’s depending on from the IRA.

Sunit Kapur, the firm’s CEO, told The Dive the threatened repeal has created uncertainty in the business. Even so, he said Epsilon remains steadfast in its local plans. 

Kapur said the Inflation Reduction Act has been a cornerstone of the U.S. strategy to strengthen domestic supply chains to advance the clean energy transition. A repeal could slow investment and increase competitiveness with Chinese counterparts, Kapur said. “The IRA has helped level the playing field,” he said. 

Though the plant is a little behind its initially announced schedule, Kapur said Epsilon is still on track to deliver 30,000 tons of graphite annually by 2027.

Trump’s anti-clean energy crusade has put many Republican lawmakers in the uncomfortable position of wanting to appear loyal to the president but still avoid killing job-creating projects in their districts. 

U.S. Congressman David Rouzer opposed the Inflation Reduction Act but supported the announcement of the Epsilon plant. Though Rouzer has campaigned and aligned himself with the president, he has demonstrated some level of political independence. 

This week Rouzer cosponsored legislation that would save a portion of the U.S. Agency for International Development, the government agency Trump derailed this month. The bill would transfer the Food for Peace program which purchases U.S.-grown food to the U.S. Department of Agriculture. In 2021, Rouzer asked Congress to greenlight the leasing of offshore wind farms, which were under the threat of a moratorium previously imposed during Trump’s first administration. Rouzer hasn’t responded to whether he would ask Trump to lift his latest offshore wind moratorium, which could impact North Carolina projects including one in his district, or if he supported the ongoing attempt to repeal the Inflation Reduction Act. 

Meanwhile, Trump’s iciness toward the electric vehicle industry could imperil other aspects of the nascent domestic supply chain. This week the president nixed a federal $5 billion charging station program, of which the state’s transportation department had already been awarded $109 million to construct 40 stations. Nine charging stations were already under construction and can continue, the News & Observer reported, but the rest are suspended. 

Questions about the legality of Trump’s sweeping orders remain and impacts on other major projects in the state are unknown. 

Locally, GE Hitachi stands to benefit from IRA funding, which includes a carve-out for supporting domestic production of high-assay low-enriched uranium—fuel required by the next generation of nuclear reactors. 

Headquartered in Wilmington, GE Hitachi is building one of the first domestic fuel facilities to manufacture the advanced fuel for a new nuclear facility in Wyoming designed by the firm and its partner, TerraPower. The companies were already approved to net nearly $2 billion in tax credits for the projects under the Infrastructure Investment and Jobs Act, another landmark of Biden’s clean energy mandate that Trump froze upon taking office. 

It’s unclear if that halt has already impacted GE Hitachi. The company didn’t directly address whether the funding freezes had interrupted its operations, but a company spokesperson said it plans to move forward with its announced investments in Wilmington over the next two years. Given Trump’s warmer outlook on nuclear energy, the firm may be insulated from freeze fallout. 

– Johanna F. Still

Catch up on an audio conversation on last week’s edition here. Contact The Dive team with tips and feedback at wilmington@theassemblync.com.

One in the Chamber

The next front line in the war over DEI is, surprisingly, the chamber of commerce. 

Organizations like the Wilmington Chamber of Commerce support local businesses, which means they usually represent entrepreneurs and small business owners from a broad ideological spectrum. They rely on membership dues and some government support, so they’re unlikely to advocate for anything too far right or left. Still, they have a more conservative, pro-business bent. 

Not where you’d go hunting for the “woke mind virus,” as Elon Musk would have it.

So I was surprised last week when Republican New Hanover County Commissioner Dane Scalise took to X to voice his opposition to the chamber’s “recent organizational focus on DEI initiatives.” While acknowledging he was just one of five votes, Scalise said he couldn’t support taxpayer funding for the chamber if they “continue to focus on divisive programming.” In past years, the county has provided nearly $200,000 in annual funding to the chamber (although last year, as the county tightened its budget, it provided closer to $130,000). 

As Woody White, a longtime conservative leader, posted in response: “Wait, what?”

Scalise didn’t respond to my request for comment, but a few days later, he issued an update. He posted that he’d had “extremely productive” conversations with the Wilmington Chamber and could now offer support.

“We agree that the best thing for the business community–and everyone else–in our community is to be totally focused on creating excellent opportunities FOR ALL,” Scalise wrote. “They explained to me that they were already discussing removing DEI terminology from their website and, thankfully, have now done so. Bravo!”

I again asked Scalise on X if he could provide details on the specific changes, but he didn’t respond. The Wilmington Chamber’s CEO and board chairman also did not return requests for comment.

The Wilmington Chamber does have demographically focused councils, including the African American Business Council and the Latin American Business Council. Both, it’s worth noting, predate protests in 2020 that spurred DEI efforts by businesses, non-profits, and government agencies. 

In the end, while Scalise has claimed victory, the Wilmington Chamber still appears interested in supporting businesses based on the owner’s race or gender, in addition to focusing on young professionals and supply chain logistics. 

Last month, Scalise made a public point of opposing a National Day of Racial Healing proclamation, a symbolic resolution that he criticized as being rooted in racialized ideology. He also advocated cutting the county’s Diversity & Equity department. Scalise has reiterated his critique of DEI—both locally and more broadly—and has said he intends to fight it however he can. He’s garnered much support for that, but I’m not sure he can consider the Wilmington Chamber a feather in his cap.

– Benjamin Schachtman

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Around the Region

Bureaucratic Purgatory: Despite promises made to rebuild homes damaged from Hurricane Florence and Matthew, hundreds of families across North Carolina, including in Wilmington, remain in limbo due to a funding-strapped state program, WHQR reports. 

That’s a Wrap: Film productions across the state brought in $302 million last year, the most since 2021’s breakout $416 million year, Greater Wilmington Business Journal reports.
Outsourcing It: Pender County Commissioners are discussing whether it’s worth bringing its fire and emergency protection services in-house, Port City Daily reports. The county paid a nonprofit more than $20 million for the services last year.

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Around the State

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