Granholm gets grilled on China

Energy Secretary Jennifer Granholm’s latest Hill appearance showed how the Biden administration will rebut energy-focused China attacks from Sen. Joe Manchin and the GOP.

Why it matters: The fight over renewables and EV supply chains is fundamental to energy politics right now, and Granholm is the administration’s messaging point person.

Here are three big items from her testimony today in Senate Energy and Natural Resources:

🚘 EV hot seat... Granholm got a grilling from Manchin on DOE’s role in developing guidance for the IRA EV tax credit.

What they’re saying: Manchin zeroed in on how the guidance defines “processing” as part of its supply chain rules.

• “You're going to bust the budget” by allowing too many EVs to qualify, Manchin said.
• At one point, Manchin stood up and raised his voice as he pointed to a poster and said that DOE “broke the law” by using a technical definition from the bipartisan infrastructure bill.
• “The bottom line on this is you're totally right in that we want all of it manufactured in America, or as much of it as possible, or with countries whose values we share,” Granholm replied.

Of note: Granholm said China would potentially end up a “foreign entity of concern,” meaning EVs with supply chains coming from there won’t qualify.

Our thought bubble: This fight is going to keep coming up, and we’ll be watching for how the administration responds.

👀 China grappling... Granholm said DOE is reviewing a potential grant to Microvast — a prominent target of anti-China ire.

Context: The Texas-based battery firm does business in China and was selected for a $200 million grant to build a facility in Tennessee.

• That’s led to intense GOP scrutiny. Sen. John Barrasso asked Granholm to commit to backing out of the grant.

The other side: “I can assure you that we are very vigilant about making sure that no taxpayer dollars goes to any state-owned enterprise or Chinese-influenced company. That particular award is still under negotiation,” Granholm told the panel.

⚡️Pushing permits... Granholm made multiple pleas for a bipartisan environmental permitting overhaul.

• Top of mind for Granholm and committee Democrats was a transmission buildout, which will be needed to get the renewable power incentivized by the IRA onto the grid.
• “I hope we can have a discussion about this question of permitting, because I do think that there's bipartisan support for permitting, including for transmission,” she said.

Our thought bubble: Granholm has been among the loudest Biden camp voices on this, and she could be a big figure in striking a deal.