The fight over hundreds of billions of dollars in clean energy tax credits has intensified in recent days as Republicans stare down a self-imposed July 4 deadline for approving their party-line budget reconciliation package.
The Senate is looking to finish reworking the House-passed “One Big Beautiful Bill Act” by the end of this week, though discussion on tax measures could go into next week. The fate of language on public land sales, regulations and electric vehicle fees is also in play.
On Friday, a band of 13 House Republicans launched their latest salvo in the war over the fate of energy credits tied to the Democrats’ 2022 climate law. Led by Rep. Jen Kiggans (R-Va.), the lawmakers urged Senate leaders to “substantially and strategically” fix the language that passed the House, which would dramatically roll back incentives for wind, solar, hydrogen and other sources.
“We believe the Senate now has a critical opportunity to restore common sense and deliver a truly pro-energy growth final bill that protects taxpayers while also unleashing the potential of U.S. energy producers, manufacturers, and workers,” the letter said.
There are enough Senate Republicans keen on changing the House language to make a difference. Sen. Thom Tillis of North Carolina told POLITICO “every one of [the credits] is going to have some sort of extension” compared to the House package. He has also said the House supply chain requirements are “void of any understanding of just how these supply chains work.”
Sen. Lisa Murkowski (R-Alaska) said she’s trying to ensure more reasonable timelines that treat different energy sources the same. And Environment and Public Works Chair Shelley Moore Capito (R-W.Va.) said a provision requiring projects to start construction within 60 days of the law’s enactment is unfeasible for her state’s hydrogen development hub.
“It’s problematic for us, and it would be a lot of jobs and a lot of ‘energy of the future’ types of opportunities for our state,” Capito said last Thursday. “So I’m trying to work with other folks who have difficulties with this.”
Conservatives are fighting back. The group Club for Growth has been taking out ads against some Senate Republicans, including Murkowski, Kevin Cramer of North Dakota and Jerry Moran of Kansas.
The far-right House Freedom Caucus was quick to respond Friday against the new letter by saying it would not accept more lenient treatment of the climate law credits. Rep. Chip Roy (R-Texas), one of the caucus’ most vocal members, also issued a warning.
“You backslide one inch on those [Inflation Reduction Act] subsidies, and I’m voting against this bill,” Roy said, knowing House leaders can only afford to lose a handful of members.
Beyond taxes
The Environment and Public Works Committee was one of the first Senate panels to release reworked text last week. Its bill includes cuts to climate spending and proposals to accelerate permitting reviews.
The Commerce, Science and Transportation Committee’s bill targets Biden-era vehicle efficiency standards. It would also claw back money for NOAA programs.
And the Banking, Housing and Urban Affairs Committee’s offering, released Friday, would rescind approved spending on climate law green housing programs.
Missing so far are House provisions to charge electric and hybrid vehicle drivers new fees. Capito has said the parliamentarian will decide whether they follow the rules for budget reconciliation, which allows certain budget bills to bypass the Senate filibuster.
Senators are also eyeing rulings from the parliamentarian on a host of permitting policies, which would ease approvals for companies that pay certain fees. Democrats have them “pay to play” provisions.
Senate Energy and Natural Resources Chair Mike Lee (R-Utah), who has been working on securing permitting and drilling mandates, is also working with the parliamentarian to secure the fate of rule-busting legislation. It would give Congress a say over certain rules.
“There’s been some back-and-forth with the parliamentarian, and we’re still working on it,” Lee said. “I am confident in the merits of the argument and in the need for it and in the reasons why it’s a good idea to do it and the budgetary-ness of it.”
Lee is similarly set on including some language to ease the sale of public lands. Sen. Steve Daines (R-Mont.) said last week he’s working with Lee to keep the sales out or to a minimum.
Reporters Nico Portuondo, Amelia Davidson, Garrett Downs and Joshua Siegel contributed.
