What will Republican defenders of the IRA do now?

E&E News

14-05-2025

House Republicans who spent months defending renewable energy tax credits expressed disdain for a proposal that would all but eradicate such incentives in the GOP-led megabill.
But that small subset of Republicans say they are running short on time and options in the lower chamber. The House Ways and Means Committee is poised to advance a measure that phases out or eliminates billions of dollars in Inflation Reduction Act renewable energy and other tax benefits.
'I hate to say — it's not as bad as I thought it was going to be, but it's still pretty bad,' Rep. Andrew Garbarino (R-N.Y.) said of the Ways and Means plan.
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Garbarino, who led roughly two dozen Republicans in calling for protecting clean energy subsidies, noted he and others last week floated IRA language he hoped would influence the base text.
It's unlikely that could be offered as an amendment in committee, he said, but noted there would be a broad amendment of changes before a final House package hits the floor.
'I think there are a lot of people on the House side who want some things corrected,' said Garbarino, co-chair of the bipartisan Climate Solutions Caucus. 'I also think the Senate is not thrilled.'
The Ways and Means proposal is part of the GOP budget reconciliation package to extend the 2017 tax cuts, ramp up border security and boost domestic energy. It can pass with simple majorities in both the House and Senate. And while Republicans have a mere three-seat majority in the House, it's unclear whether lawmakers like Garbarino would scuttle the bill absent changes to their favored priorities.
The tax portion of the megabill would scrap credits for electric vehicles buyers, as well as household products like heat pumps and energy-saving doors and windows by year's end.
In addition, credits for hydrogen production would be phased out. And by 2032, advanced manufacturing and nuclear power production would be gone. And it would wind down the practice known as 'transferability,' which allows project sponsors to transfer the credit to a third party.
'Don't show up at the ribbon cutting'
Members of the House Ways and Means Committee on Tuesday. | Francis Chung/POLITICO
The Ways and Means markup, which extended into Wednesday morning amid Democratic opposition, was not done by publication time. Indeed, it may continue well into Wednesday.
One Democratic amendment, introduced by Rep. Mike Thompson (D-Calif.), which would have struck the sections targeting the IRA, failed 19-25. Absent from that vote was Rep. Brian Fitzpatrick (R-Pa.), who said he's stuck up for clean energy incentives.
'In order to pay trillions in more tax cuts for those who don't need them, Republicans are gutting clean energy tax credits, which will be devastating,' Thompson said. 'It's the American worker who will suffer, with many of them represented by my colleagues on the other side of this dais.'
Massachusetts Rep. Richard Neal, the committee's top Democrat, laid into Republicans who show up to events celebrating new projects that they voted against. 'Surely don't show up at the ribbon cutting hoping people had amnesia as what has happened,' he said.
Swinging back, Rep. Rudy Yakym (R-Ind.) argued the Inflation Reduction Act had the opposite effect: 'Democrats passed the Inflation Reduction Act, and what happened?' he asked. 'Inflation shot through the roof.'
He also harped on the fact that Chinese firms could access the credits. 'Why should the Chinese government be allowed to come in here and take advantage of American taxpayer dollars loopholes?' he asked. 'We shouldn't allow that.'
But the House bill's targeting of nuclear power could spur several Republicans who have long been big fans of the energy source. Rep. Dan Newhouse (R-Wash.) said he was 'disappointed' the text targeted nuclear investments 'at a time when the country is facing unprecedented power demands.'
He said that Energy Secretary Chris Wright 'has made clear the need to expand our nuclear fleet, and that cannot be done without certainty in our tax code,' adding the proposal would hurt US-made nuclear power while the Chinese industry thrives.
Asked Tuesday evening for her thoughts on the measure, Conservative Climate Caucus Chair Mariannette Miller-Meeks (R-Iowa) declined comment. Another leader of the caucus, Rep. Buddy Carter (R-Ga.), who is running for Senate, said he had not read the Ways and Means proposals. Neither are members of that committee.
Carter did have plenty to say at the Energy and Commerce Committee's markup of its own budget reconciliation legislation Tuesday, alleging that the Greenhouse Gas Reduction Fund was rife with problems. No wrongdoing has thus far been found, as Democrats pointed out.
The oil lobby, however, has read it closely. The American Petroleum Institute and dozens of trade groups and hydrogen companies urged congressional leaders to keep the hydrogen production tax credits, or 45V.
'Retaining the 45V incentive without new limitations will drive domestic innovation, manufacturing, and infrastructure development — ensuring America leads in the clean hydrogen economy, rather than ceding ground to strategic competitors,' the letter reads.
During the Ways and Means markup, Democrats spent many hours arguing the proposal was a handout for the uber-wealthy at the expense of hardworking families. An intraparty fight over state and local income taxes, or SALT, consumed a fair amount of time.
Rep. Lloyd Doggett (D-Texas) pointed out the bill would change the law so only projects that supply electrons to the grid — rather than when construction starts — would quality for tax breaks. He said 'all the chaos' from the trade wars, natural disasters and business uncertainty spells disaster for the renewable industry, including wind power.
Senate questions
Some Republican members may be hoping the Senate bails them out.
Already, Garbarino said he's talked to a few senators and envisioned a scenario where the language passes the House with minor tweaks. Or changes could happen in a conference with House and Senate leadership.
Indeed, some senators indicated the House plan would not fly in the upper chamber. Sen. Kevin Cramer (R-N.D) told POLITICO that the provision to phase out technology-neutral clean electricity tax credits beginning in 2029 would hurt nascent power sources that the GOP favors like advanced nuclear reactors and geothermal.
'They definitely need more time than that,' Cramer said. 'It's too short for truly new technologies. We'll have to change that. I don't think it's fair to treat an emerging technology the same as a 30-year-old technology.'
If he had his druthers, Cramer would phase down wind and solar, reasoning those no longer need the government's financial help.
And Sen. Shelley Moore Capito (R-W.Va.), chair of the Environment and Public Works Commitee, told POLITICO she expected the 'blanket' approach would likely change by the final product. 'There has been job creation around these tax credits,' she said.
Meanwhile, on the far end of the spectrum, Energy and Natural Resources Chair Mike Lee (R-Utah) wants all the IRA tax credits gone by the end of the year. He introduced the 'Energy Freedom Act' Tuesday with conservative Reps. Josh Brecheen (R-Ok.a.) and Chip Roy (R-Texas) which 'rips out these taxpayer-funded giveaways, reduces the deficit and puts America back on a path to energy security, affordability and reliability.' The bill is not expected to go anywhere.
For his part, Garbarino added he's going to 'continue to push.'
'I know we have a lot of support on the outside,' he said, referring to lobbying from energy industries, renewable and fossil fuel. 'A lot of people are trying to work it.'
Reporters Nico Portuondo and Joshua Siegel contributed.