(DCNF)—Congressional Republicans are making a last-ditch effort to gut the Biden-era Inflation Reduction Act’s (IRA) green energy subsidies via President Donald Trump’s “one big, beautiful bill.”
The House Ways and Means Committee unveiled a draft bill Monday afternoon to repeal several IRA subsidies including those for electric vehicles and so-called clean hydrogen while preserving tax credits for carbon sequestration, biofuels and advanced manufacturing, which primarily benefit solar and battery storage projects. Republican Utah Sen. Mike Lee and Reps. Chip Roy of Texas and Josh Brecheen of Oklahoma’s Energy Freedom Act would take an even more aggressive approach by proposing a wholesale repeal of all the green energy subsidies within former President Joe Biden’s law, according to bill text exclusively obtained by the Daily Caller News Foundation.
The bill proponents argue that Trump pledged during the 2024 election cycle to completely dismantle the Biden’s “Green New Scam” and that GOP lawmakers must live up to that promise.
The budget reconciliation process that congressional Republicans are undertaking to pass vast swathes of Trump’s legislative agenda in a single package allows them to circumvent Democratic opposition with a simple majority vote in both chambers.
Pursuing a complete repeal of the IRA’s green energy subsidies in the budget reconciliation package could be the lone opportunity GOP lawmakers get during Trump’s second term to dismantle Biden’s climate policies. Congressional Democrats also used the budget reconciliation process to pass the IRA in August 2022 and avoid a Senate filibuster, despite the opposition of every GOP lawmaker.
“The Inflation Reduction Act, better known as the Green New Scam, is providing massive unlimited subsidies to billion dollar corporations and Chinese manufacturers to the detriment of American energy freedom and dominance,” Roy told the DCNF in a statement. “If Republicans want to unleash American energy dominance and support the President’s energy agenda, we have no choice but to fully — and immediately — repeal the Green New Scam.”
“America’s energy policy should be about keeping the lights on and costs low — not lining the pockets of special interests,” Lee, the chairman of the Senate Energy and Natural Resources Committee told the DCNF. “The Biden Administration’s green energy subsidies have rigged the market, driven up costs, and left our grid more vulnerable.”
The GOP lawmakers’ IRA repeal legislation would eliminate more than 20 tax credits, including subsidies favored by moderate Republicans, for tax years beginning after December 31, 2025. The bill would also repeal the Biden-era law’s petroleum tax and end the ability of project developers to buy and sell green energy tax credits through a practice known as transferability, according to background on the bill obtained by the DCNF.
Though the nonpartisan Congressional Budget Office originally estimated that the green energy subsidies in the IRA would cost roughly $370 million over a ten-year period, the price tag of Biden’s sweeping law has ballooned over the past several years. The energy subsidies could cost taxpayers up to $2 trillion by 2034 and up to roughly $4.7 trillion by 2050, according to analysis from the libertarian-leaning CATO Institute.
The largest subsidies within the Biden-era law would only expire if greenhouse gas emissions are reduced to a level that is likely unattainable within the next several decades, which is partly attributable to the IRA’s skyrocketing cost, according to background obtained by the DCNF from Lee’s office.
“The IRA turned our tax code into a multi-trillion energy entitlement program, creating subsidies without caps, sunsets, or accountability,” Adam Michel, director of tax policy studies at the Cato Institute, said in a statement. “If Congress is serious about energy independence, reliable energy, or the national debt, repealing the IRA is the only responsible path forward.”
Roy previously told the DCNF that failure to include a full repeal of the IRA would jeopardize the passage of the budget reconciliation package in the House.
“If Republicans are going to refuse to repeal the Inflation Reduction Act, they are not going to get a Republican tax bill through the House,” Roy told the DCNF. “It’s costly, it’s inflationary, and we should repeal every dollar of it.”
The lawmakers are expected to introduce the bill early Tuesday ahead of the tax-writing panel’s markup scheduled to begin in the afternoon.
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