Sen. Joe Manchin predicted Wednesday that the Biden administration will interpret new restrictions on electric vehicle tax credits in ways that are too permissive and don’t align with the climate change law he wrote last year.
The West Virginia Democrat, chair of the Senate Energy and Natural Resources Committee, said at a Washington event hosted by energy security advocacy group Securing America’s Future Energy and the Electrification Coalition that he would fight for his interpretation of the law, even suing the administration if he has to.
“I think they’re going to try to screw me on this,” Manchin said of the Treasury Department’s forthcoming guidance on the tax credit’s changes in the Inflation Reduction Act, the law he wrote last year with the goal of boosting U.S. energy security.
“And I’m willing to go to court. I’m willing to stop it all, because that’s not the intent,” he said.
“If it goes off the rails, where they’re liberalizing and opening up and blowing the cap off the pricing that we have and the intent of what we want — if all that happens, I’ll do whatever I can,” he later told reporters. “If that means going to court and I can do it, I’ll do it.”
Manchin went on to call Biden administration officials “crazy” for the president’s goal that all new cars sold by 2030 would be zero-emission.
“I know they’re trying. But they’re catering to the far left, and the far left has a pretty good grip on them,” Manchin said of officials like senior Biden adviser John Podesta and Treasury Secretary Janet Yellen.
The Treasury is due this week to issue proposed guidance on how it will enforce the Inflation Reduction Act’s new restrictions on the $7,500 tax credit for EV purchases.
Half of the credit requires a certain portion of the car’s critical minerals to be mined and processed in North America or countries with U.S. free-trade agreements — or recycled in North America.
Getting the other half of the credit requires that certain levels of battery components be manufactured in North America. Cars must be manufactured in the United States, and the credit is also subject to income and price limits.
But Manchin suspects that the Treasury might allow the processing part that can happen in free-trade-agreement countries to encompass what he considers to be manufacturing for the purpose of the credit, which should happen in North America.
“Does that mean basically the processing of the raw product into a form that we can take it and put it in a manufacturing form? Or is it basically the making the powders in the wafers and everything that we need and foils and calling that processing?” he asked.
“It’s not basically allowing everyone to put all the parts and do everything we can to that battery somewhere else and then send it here for assembly,” Manchin later told reporters about his intent in the Inflation Reduction Act.
It’s not the first problem Manchin has had with the Treasury’s implementation of the EV tax credit rules. In December, the agency said leased EVs wouldn’t be subject to the sourcing requirements because they are purchased commercially, and it allowed the battery sourcing rules to be waived until it could write the full guidance.
Both decisions irked Manchin, and he introduced legislation to undo them.
“Until you get the rules and regs out, why should they start giving credits?” he said Wednesday.