what’s at stake
President Donald Trump’s sweeping tax-and-spending bill is dividing Republicans on a handful of issues — including how aggressively to pare back clean energy tax credits that were enacted under the Biden administration.
Republicans have hammered the Inflation Reduction Act, a sweeping party-line Democratic policy bill that passed in 2022 which stands as the largest-ever US spending package to fight climate change. This year’s House-passed GOP megabill would repeal most of the electric vehicle tax credits after 2025; require many clean energy projects to begin construction within 60 days to receive credits; and mandate projects come online by 2028.
It also gets rid of transferability, which allows companies to sell tax credits, by 2027.
Some Republicans are calling for a lighter touch as the debate moves to the Senate, arguing that rolling the subsidies back too aggressively threatens economic damage.
In this article:
who’s making the case
Sen. Ted Cruz, R-Texas, argued in favor of the cuts to clean energy credits and said that the Senate should go even further than the House in slashing subsidies more quickly.
“I think you will see those IRA cuts in the Senate bill. My hope is that we go further and remove the wasteful subsidies that the IRA put in initially, but we’ll see what the Senate does.
“There is a reasonable case to be made for having a glidepath to phase out some credits, so that businesses have time to alter their investment strategy, but the IRA was not about reducing inflation — even though its title was Orwellian in suggesting that it was. The IRA fueled inflation, and what it was about was essentially payoffs to the special interests that fund the Democratic Party. And I see no reason why a Republican Congress would want to continue those.”
Rep. Mark Amodei, R-Nev., who is among a group that wrote to the Senate recently urging tweaks to the House-passed package, said Congress should look at preserving tax credits that impact alternative sources like nuclear and geothermal.
“We were interested in having them think about stuff that sticks with [Interior Secretary Doug] Burgum’s stuff — if the sun’s down, you’re not generating, if the wind’s not blowing, you’re not generating — so that’s still geothermal, nuke, whatever. My involvement is based on, I think a lot of that stuff is the future. … That doesn’t mean you kill everybody who’s still got clean coal, natural gas, all that other sort of stuff. We want to keep those [alternative-energy] guys going.”
“I don’t want to see those guys zeroed out, if you will, if in a [triple net zero] sense this is a good place to put money.”
Notable
- The IRA credits have a powerful advocate in the tech industry, The Wall Street Journal reported.
- Former Biden Energy Secretary Jennifer Granholm said Democrats need to get better at selling clean energy, Politico reported.
- The clean energy tax credits are among two provisions in the House-passed bill that senators are definitely going to rewrite, Punchbowl News reported.