Senate Republicans said Monday they spent the weekend haggling over the fine print of energy tax provisions in their megabill, but they don’t expect major changes from the draft released last week, especially with conservatives mounting a counteroffensive.
Senate Majority Leader John Thune (R-S.D.) wants to vote on a final bill later this week. With Medicaid and other issues still generating controversy, negotiators don’t appear to be focusing too much on the fate of Inflation Reduction Act energy credits.
Still, companies and lobby groups from across the ideological spectrum continue playing tug-of-war with lawmakers over billions of dollars in incentives. It may not make much difference.
“We’re just trying to create more certainty for projects that have already gotten going,” said Sen. John Hoeven (R-N.D.). “But other than that, I think it’ll be much like you’ve seen.”
Sen. John Curtis (R-Utah), who has been calling for softening the credit phasedowns, said, “We’re hearing it won’t change much. Everything between now and the vote is subject to change, so we’ll see.”
The Senate Finance Committee last week released language that would favor energy sources like geothermal, nuclear and hydropower but quickly phase out subsidies for solar and wind projects that don’t start construction by the end of the year.
The Senate legislation did offer more favorable terms for all types of energy developers to transfer tax credits, and it would relax the timeline to begin construction.
On Friday the American Clean Power Association led dozens of organizations in calling on senators to retain their construction timeline and not go back to language in the House’s “One Big Beautiful Bill Act.”
“Such a change would upend investment expectations, introduce substantial business uncertainty, harm electricity customers, and risk delaying or even canceling critical U.S. energy infrastructure projects already underway,” the group said about the House limits.
Sen. Thom Tillis (R-N.C.) told reporters Monday night that lawmakers had made “great progress” on the climate law credits but didn’t provide details.
He has been among the most vocal of lawmakers calling for leniency in phasing out climate law tax credits. But as evidence that not much may change, Tillis said he was “generally satisfied” with the Finance Committee draft.
Conservatives fight back
Over the weekend, the conservative American Energy Alliance launched a six-figure ad campaign targeting key Republicans, including Sens. Lisa Murkowski of Alaska, Curtis and Finance Chair Mike Crapo of Idaho. The digital ads are running in Utah, Alaska, Idaho and Washington.
“Senators Curtis and Murkowski both opposed the original IRA because they knew it would lead to higher energy prices and compromise the reliability of the energy grid in their state. So why are they now working so hard to preserve these costly and unnecessary programs?” said American Energy Alliance President Tom Pyle.
“It’s time for the Senate to put taxpayers first and dismantle the IRA’s green subsidy machine,” he added.
The group urged Crapo “to use his leadership role to fight to eliminate these costly subsidy programs.”
When asked whether the conservative pressure campaign has deterred him and others from wanting to keep certain climate law credits, Curtis said, “I would say they have close to zero impact.”
Crutis added, “I want us to do the right thing for the country. I believe some of these should phase out — and soon. But the way we phase them out is the difference between these energy companies staying in business or not.”
Pyle and a coalition of 26 other individuals and groups also sent a letter to President Donald Trump saying that zeroing out the subsidies is the only way to get rid of them.
“Take the wind production tax credit (PTC), for example,” they wrote. “Originally set to expire in 1999, it has been extended repeatedly — in 1999, 2002, 2004, 2005, 2006, 2008, 2009, 2012, 2014, 2015, 2016, 2019, and again in 2021.”
Trump weighs in, again
The president appears to be listening. Over the weekend, he posted on social media: “I HATE ‘GREEN TAX CREDITS’ IN THE GREAT, BIG, BEAUTIFUL BILL. They are largely a giant SCAM.”
And on Monday he told conservatives he indeed wanted a full repeal of the Inflation Reduction Act, according to Sen. Rick Scott (R-Fla.) and others familiar with the discussions. That’s what Rep. Chip Roy (R-Texas) and other members of the House Freedom Caucus were eager to hear.
But with Republican leaders needing to secure enough support from different ideological factions to make the megabill law, nobody is likely to get exactly what they want.
Curtis said he has discussed the issue with fellow Utah Republican and IRA foe Mike Lee, chair of the Energy and Natural Resources Committee and who met with Trump at the White House on Monday.
“It’s fair to say we have different opinions, but we both want to land in the right place,” Curtis said.
Reporters Nico Portuondo, Jordain Carney and Meredith Lee Hill contributed.
