Climate watch: Keep clean energy tax credits in the budget bill
The word “bipartisan” is bandied about far too often in politics. Sometimes, however, it takes on real meaning.
There appears to be growing bipartisan support for keeping clean energy tax credits in the federal budget now being considered in Congress through the budget reconciliation process.
In fact, 21 House Republicans signed a letter to Ways and Means Committee Chair Jason Smith urging that the tax credits stay in the budget. It’s not hard to understand why. The tax credits contained in the Inflation Reduction Act disproportionately spurred job creation in primarily “red” districts.
It’s not a small number. According to a report by Climate Power, more than 216,000 new jobs and $204 billion in investments have been announced across 405 clean energy projects in 152 Republican-held Congressional districts.
Jennifer Tyler, Citizens’ Climate Lobby’s vice president of government affairs, said, “More and more Republican House members are recognizing that clean energy tax credits are benefiting their districts — and that constituents and businesses don’t want to lose them. It’s clear that these policies are delivering real economic value in communities nationwide.”
Although PA-15 Congressional District Representative Glenn Thompson was not among the signers of that letter, our Republican-held district also has benefited from the clean energy tax credits.
An analysis provided by Citizens’ Climate Lobby shows that eight companies in PA-15 have initiated solar energy projects with aid from the tax credits. A ninth is involved with building transmission lines. Together they represent $1.76 billion in investment. And according to company estimates they could create 2,550 jobs.
America is moving to a clean energy economy. It’s not happening as quickly as needed and certainly slower than some other parts of the world, but it is taking place. Due to clean energy tax credits, businesses have invested billions of dollars into communities across the nation to make solar panels, batteries, and more.
The Inflation Reduction Act (IRA) became law in 2022. It put America on schedule to reduce carbon pollution 40% by 2030 because it included a range of climate provisions. Some of those are clean energy tax credits, which are responsible for most of the law’s potential emissions reductions.
It is vitally important that clean energy tax credits be included in the federal budget now being debated in Congress. But they could be on the chopping block in the Republicans’ budget reconciliation bill.
Some of the clean energy tax credits CCL is interested in preserving include:
Clean electricity investment and production tax credits for clean electricity facilities.
Advanced manufacturing investment and production tax credit for domestic manufacturing of components for carbon capture, solar and wind energy, inverters, battery components, critical minerals, waste reduction, and energy efficiency.
Tax credit for carbon dioxide capture and sequestration.
On his first day in office, Mr. Trump signed an executive order pausing the disbursement of funds from the Inflation Reduction Act. These funds, however, were legally appropriated by Congress. Thus, Mr. Trump should not be able to halt them permanently.
But don’t be confused. Those “paused” direct investments are different from the clean energy tax credits. The executive order has not stopped the tax credits. And Congress needs to keep them in place.