The Biggest Winners in America’s Climate Law: Foreign Companies | Kanebridge News
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    HOUSE MEDIAN ASKING PRICES AND WEEKLY CHANGE     Sydney $1,526,212 (+1.41%)       Melbourne $950,600 (-0.81%)       Brisbane $848,079 (+0.39%)       Adelaide $783,680 (+0.69%)       Perth $722,301 (+0.42%)       Hobart $727,777 (-0.40%)       Darwin $644,340 (-0.88%)       Canberra $873,193 (-2.75%)       National $960,316 (+0.31%)                UNIT MEDIAN ASKING PRICES AND WEEKLY CHANGE     Sydney $711,149 (+0.79%)       Melbourne $480,050 (-0.07%)       Brisbane $471,869 (+1.52%)       Adelaide $395,455 (-0.79%)       Perth $396,215 (+0.44%)       Hobart $535,914 (-1.67%)       Darwin $365,715 (+0.11%)       Canberra $487,485 (+1.06%)       National $502,310 (+0.25%)                HOUSES FOR SALE AND WEEKLY CHANGE     Sydney 8,985 (+170)       Melbourne 11,869 (-124)       Brisbane 8,074 (+47)       Adelaide 2,298 (-22)       Perth 6,070 (+20)       Hobart 993 (+24)       Darwin 282 (-4)       Canberra 809 (+43)       National 39,380 (+154)                UNITS FOR SALE AND WEEKLY CHANGE     Sydney 7,927 (+125)       Melbourne 6,997 (+50)       Brisbane 1,822 (+3)       Adelaide 488 (+5)       Perth 1,915 (-1)       Hobart 151 (+3)       Darwin 391 (-9)       Canberra 680 (+5)       National 20,371 (+181)                HOUSE MEDIAN ASKING RENTS AND WEEKLY CHANGE     Sydney $750 (-$20)       Melbourne $580 ($0)       Brisbane $590 (+$10)       Adelaide $570 (-$5)       Perth $600 ($0)       Hobart $550 ($0)       Darwin $700 (+$5)       Canberra $670 (+$10)       National $633 (-$1)                    UNIT MEDIAN ASKING RENTS AND WEEKLY CHANGE     Sydney $700 (-$20)       Melbourne $558 (+$8)       Brisbane $590 ($0)       Adelaide $458 (-$3)       Perth $550 ($0)       Hobart $450 ($0)       Darwin $550 ($0)       Canberra $540 (-$10)       National $559 (-$4)                HOUSES FOR RENT AND WEEKLY CHANGE     Sydney 5,224 (-134)       Melbourne 5,097 (+90)       Brisbane 3,713 (-84)       Adelaide 1,027 (-3)       Perth 1,568 (-46)       Hobart 471 (-3)       Darwin 127 (+13)       Canberra 658 (-32)       National 17,885 (-199)                UNITS FOR RENT AND WEEKLY CHANGE     Sydney 8,171 (-343)       Melbourne 5,447 (-170)       Brisbane 1,682 (-22)       Adelaide 329 (+3)       Perth 561 (-11)       Hobart 159 (-6)       Darwin 176 (+16)       Canberra 597 (-12)       National 17,122 (-545)                HOUSE ANNUAL GROSS YIELDS AND TREND         Sydney 2.56% (↓)       Melbourne 3.17% (↓)     Brisbane 3.62% (↑)        Adelaide 3.78% (↓)       Perth 4.32% (↓)     Hobart 3.93% (↑)      Darwin 5.65% (↑)      Canberra 3.99% (↑)        National 3.43% (↓)            UNIT ANNUAL GROSS YIELDS AND TREND         Sydney 5.12% (↓)       Melbourne 6.04% (↓)       Brisbane 6.50% (↓)     Adelaide 6.02% (↑)        Perth 7.22% (↓)     Hobart 4.37% (↑)      Darwin 7.82% (↑)        Canberra 5.76% (↓)       National 5.79% (↓)            HOUSE RENTAL VACANCY RATES AND TREND       Sydney 1.0% (↑)      Melbourne 0.7% (↑)      Brisbane 0.8% (↑)      Adelaide 0.4% (↑)        Perth 0.4% (↓)       Hobart 1.2% (↓)     Darwin 0.5% (↑)      Canberra 1.5% (↑)      National 0.8% (↑)             UNIT RENTAL VACANCY RATES AND TREND         Sydney 1.3% (↓)     Melbourne 1.6% (↑)      Brisbane 0.9% (↑)      Adelaide 0.5% (↑)      Perth 0.7% (↑)      Hobart 2.2% 2.0% (↑)      Darwin 1.0% (↑)        Canberra 1.7% (↓)     National 1.3% (↑)             AVERAGE DAYS TO SELL HOUSES AND TREND       Sydney 27.0 (↑)        Melbourne 28.3 (↓)     Brisbane 32.3 (↑)      Adelaide 26.3 (↑)      Perth 34.9 (↑)        Hobart 33.4 (↓)     Darwin 48.7 (↑)        Canberra 27.6 (↓)     National 32.3 (↑)             AVERAGE DAYS TO SELL UNITS AND TREND         Sydney 27.0 (↓)       Melbourne 29.0 (↓)     Brisbane 33.0 (↑)        Adelaide 27.5 (↓)     Perth 38.2 (↑)      Hobart 33.4 (↑)      Darwin 48.3 (↑)      Canberra 33.2 (↑)      National 33.7 (↑)            
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The Biggest Winners in America’s Climate Law: Foreign Companies

U.S. seeks to build domestic supply chains but needs overseas expertise

By AMRITH RAMKUMAR and Phred Dvorak
Fri, Jul 21, 2023 8:49amGrey Clock 4 min

The 2022 climate law unleashed a torrent of government subsidies to help the U.S. build clean-energy industries. The biggest beneficiaries so far are foreign companies.

The Inflation Reduction Act has spurred nearly $110 billion in U.S. clean-energy projects since it passed almost a year ago, a Wall Street Journal analysis shows. Companies based overseas, largely from South Korea, Japan and China, are involved in projects accounting for more than 60% of that spending. Fifteen of the 20 largest such investments, nearly all in battery factories, involve foreign businesses, the Journal’s analysis shows.

These overseas manufacturers will be able to claim billions of dollars in tax credits, making them among the biggest winners from the climate law. The credits are often tied to production volume, rewarding the largest investors.

Japan’s Panasonic, one of the few companies to publicly estimate the impact of the law, could earn more than $2 billion in tax credits a year based on the capacity of battery plants it is operating or building in Nevada and Kansas. The company, which supplies batteries to electric-vehicle maker Tesla, is considering a third factory in the U.S. that would lift that total.

The climate law is designed to build up domestic supply chains for green-energy industries, but the reality is that the technology for building batteries and renewable-energy equipment resides overseas. The incentives are leading these companies to invest in the U.S., often alongside domestic businesses.

“It’s a testament to the fact that we still live in a globalised economy,” said Aniket Shah, head of environmental, social and corporate governance—or ESG—strategy at investment bank Jefferies. “You can’t just out of nowhere put up borders and say, ‘It has to be made in America by American companies.’ ”

The Journal looked at roughly 210 clean-energy projects and company initiatives spurred by the law, including projects tracked by industry groups American Clean Power and E2 (Environmental Entrepreneurs); announcements from companies and state and local governments; and media reports. Of those, about 140 disclosed investment amounts totalling roughly $110 billion.

Projects were characterised as either wholly U.S. ventures or foreign if overseas companies are contributing significant investment or technology. Renewable-power facilities and projects already in the works before the law passed were excluded.

Forecasters estimate the climate law could unleash some $3 trillion in total clean-energy investments over the next decade. U.S. companies are also investing heavily, including Tesla, solar-panel maker First Solar and hydrogen producer Air Products and Chemicals.

Full domestic supply chains for batteries or solar panels are still years away because foreign companies dominate nearly every step in the process, from raw materials to sophisticated parts.

Panasonic is considering the addition of a third battery factory in the U.S. that would increase the Japanese company’s tax-credit haul. PHOTO: JACOB KEPLER FOR THE WALL STREET JOURNAL

The large investments by overseas businesses have generally been welcomed by U.S. communities, many of which have benefited for decades from spending and jobs created by foreign automakers and other companies. But some investments from Chinese companies have fuelled a backlash as tensions between the two countries escalate.

At least 10 of the projects representing nearly $8 billion in investments included in the Journal’s analysis involve companies either based in China or with substantial ties to China through their core operations or large investors.

Some projects are facing resistance, including two in Michigan: a $3.5 billion battery factory that Ford Motor is building with technology and expertise from China’s CATL; and a $2.4 billion battery-component factory from China-based Gotion. Ford is keeping 100% ownership of the battery factory—in part to sidestep the issue of public funds flowing to CATL, according to a person with knowledge of the deal. Ford is licensing the battery-making know-how and services from CATL, the companies said.

But China hawks say the payments Ford makes to CATL mean the Chinese company reaps indirect benefits from government support.

“What we’re seeing is foreign policy conflict with climate policy and trade policy,” Shah said. “We’re going to have to decide as a country what matters more: our enmity with China or our desire to decarbonise quickly.”

Microvast, a startup that was planning to build a more than $500 million battery-component plant in Kentucky, was named as a potential recipient of a $200 million grant from the Energy Department last year. The department later rejected the application. The move followed criticism from Republicans about the company’s ties to China, which include a China subsidiary that accounts for more than 60% of its revenue.

The Energy Department didn’t give a reason for withdrawing the grant. The department takes a number of factors into account when evaluating such projects, including technology risks and the potential for foreign influence, a spokeswoman said.

Microvast, based in Stafford, Texas, says it is a U.S. company and that Chief Executive Yang Wu is an American citizen. The company recently scrapped plans for the Kentucky plant.

“We must be assured that these taxpayer dollars are not being funnelled to the Chinese,” said Cathy McMorris Rodgers (R., Wash.), chair of the House of Representatives committee on energy and commerce, during a June hearing.

Microvast is committed to its goals of investing in the U.S. through other facilities, a spokeswoman said.

The issue is expected to come to a head when the Treasury Department completes rules for electric-car tax credits. The department has proposed that cars using battery materials that were produced by a “foreign entity of concern” such as a Chinese company wouldn’t qualify for tax credits beginning in 2025.

Many expect Treasury to use a loose standard so that some cars qualify, potentially fuelling criticism from some politicians who crafted the climate law such as Sen. Joe Manchin (D., W.Va.), who has argued more lenient criteria go against the intent of the Inflation Reduction Act. Treasury is monitoring shifting markets and supply chains while making rules that advance the law’s goals, a spokeswoman said.



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First, the good news for office landlords: A post-Labor Day bump nudged return-to-office rates in mid-September to their highest level since the onset of the pandemic.

Now the bad: Office attendance in big cities is still barely half of what it was in 2019, and company get-tough measures are proving largely ineffective at boosting that rate much higher.

Indeed, a number of forces—from the prospect of more Covid-19 cases in the fall to a weakening economy—could push the return rate into reverse, property owners and city officials say.

More than before, chief executives at blue-chip companies are stepping up efforts to fill their workspace. Facebook parent Meta Platforms, Amazon and JPMorgan Chase are among the companies that have recently vowed to get tougher on employees who don’t show upIn August, Meta told employees they could face disciplinary action if they regularly violate new workplace rules.

But these actions haven’t yet moved the national return rate needle much, and a majority of companies remain content to allow employees to work at least part-time remotely despite the tough talk.

Most employees go into offices during the middle of the week, but floors are sparsely populated on Mondays and Fridays. In Chicago, some September days had a return rate of over 66%. But it was below 30% on Fridays. In New York, it ranges from about 25% to 65%, according to Kastle Systems, which tracks security-card swipes.

Overall, the average return rate in the 10 U.S. cities tracked by Kastle Systems matched the recent high of 50.4% of 2019 levels for the week ended Sept. 20, though it slid a little below half the following week.

The disappointing return rates are another blow to office owners who are struggling with vacancy rates near record highs. The national office average vacancy rose to 19.2% last quarter, just below the historical peak of 19.3% in 1991, according to Moody’s Analytics preliminary third-quarter data.

Business leaders in New York, Detroit, Seattle, Atlanta and Houston interviewed by The Wall Street Journal said they have seen only slight improvements in sidewalk activity and attendance in office buildings since Labor Day.

“It feels a little fuller but at the margins,” said Sandy Baruah, chief executive of the Detroit Regional Chamber, a business group.

Lax enforcement of return-to-office rules is one reason employees feel they can still work from home. At a roundtable business discussion in Houston last week, only one of the 12 companies that attended said it would enforce a return-to-office policy in performance reviews.

“It was clearly a minority opinion that the others shook their heads at,” said Kris Larson, chief executive of Central Houston Inc., a group that promotes business in the city and sponsored the meeting.

Making matters worse, business leaders and city officials say they see more forces at work that could slow the return to office than those that could accelerate it.

Covid-19 cases are up and will likely increase further in the fall and winter months. “If we have to go back to distancing and mask protocols, that really breaks the office culture,” said Kathryn Wylde, head of the business group Partnership for New York City.

Many cities are contending with an increase in homelessness and crime. San Francisco, Philadelphia and Washington, D.C., which are struggling with these problems, are among the lowest return-to-office cities in the Kastle System index.

About 90% of members surveyed by the Seattle Metropolitan Chamber of Commerce said that the city couldn’t recover until homelessness and public safety problems were addressed, said Rachel Smith, chief executive. That is taken into account as companies make decisions about returning to the office and how much space they need, she added.

Cuts in government services and transportation are also taking a toll. Wait times for buses run by Houston’s Park & Ride system, one of the most widely used commuter services, have increased partly because of labor shortages, according to Larson of Central Houston.

The commute “is the remaining most significant barrier” to improving return to office, Larson said.

Some landlords say that businesses will have more leverage in enforcing return-to-office mandates if the economy weakens. There are already signs of such a shift in cities that depend heavily on the technology sector, which has been seeing slowing growth and layoffs.

But a full-fledged recession could hurt office returns if it results in widespread layoffs. “Maybe you get some relief in more employees coming back,” said Dylan Burzinski, an analyst with real-estate analytics firm Green Street. “But if there are fewer of those employees, it’s still a net negative for office.”

The sluggish return-to-office rate is leading many city and business leaders to ask the federal government for help. A group from the Great Lakes Metro Chambers Coalition recently met with elected officials in Washington, D.C., lobbying for incentives for businesses that make commitments to U.S. downtowns.

Baruah, from the Detroit chamber, was among the group. He said the chances of such legislation being passed were low. “We might have to reach crisis proportions first,” he said. “But we’re trying to lay the groundwork now.”

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