A shift in the makeup of Congress in Tuesday’s U.S. midterm elections would mostly involve tougher roadblocks and possible delays for future green energy and climate-change legislation, not a wholesale reversal of tax-friendly incentives targeting home solar, electric vehicles and other consumer-focused policy just passed in the Inflation Reduction Act.
That’s the belief of most election watchers and green-energy groups even as some late polling shows Republicans on the verge of a House takeover and perhaps gaining the few key Senate seats necessary for a leadership change.
Of course, only the actual tally of midterm ballots will confirm the fate of what many have billed as the most sweeping U.S. climate-change and energy-efficiency policy ever, within the IRA. And there’s nothing stopping Republican lawmakers from advancing their own take on energy legislation within a new Congress, especially on the road to the presidential elections and next congressional reshuffling looming in 2024.
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Most taxpayers haven’t yet used their credits and rebates
The IRA includes nuggets for homeowners seeking more efficient heating and cooling, at least according to those who promote a switch to electric, ideally powered by solar, wind, nuclear or hydrogen, all cleaner burning fuel sources that have increasingly been brought on line once they became more cost-competitive to natural gas NG00, +1.13%. Transmitting cleaner electricity at scale remains the challenge.
What’s more, the IRA targeted EV shoppers ready to make the switch with a sweetened $ 7,500 tax break on select new models (too limiting, some argued), and a $ 4,000 break on used options. The law also singled out manufacturers transitioning from fossil-fuel CL00, -0.01% reliance toward alternative means to power their business. President Biden signed the legislation, which included drug-pricing and more, into law in August. Most taxpayers haven’t had a chance to use it until they file 2022’s return.
Read more on what the IRA means for homeowners. And find out which EVs tend to qualify and which vehicles could see their qualification increase as more foreign makers build U.S. EV battery plants. Plus, how to navigate your tax return if you want the EV break TSLA, -3.64% F, +1.89%.
Democrats have set up several major climate-change initiatives, including executive orders that Biden or any president can authorize, at the national level. The U.S. Department of Energy also announced funds available to states and tribes as part of the IRA for consumer home energy rebate programs. In all, many Republicans would like to roll back these efforts and the IRA. But to do so, they will need a landslide victory this midterm, a two-thirds majority in both the House and the Senate for the bill’s reversal. They would need to overcome a Biden veto on a piece of legislation that the administration considers a hallmark of their time in power.
On top of that, Republicans would need a consensus that would include a fair number of Democrats coming over to their side if they wanted to advance fossil fuel-favoring legislation that would replace the IRA in part or whole. In other words, hitting the undo button will be a real challenge.
The spending bill tended to promote climate-change action through tax breaks, a method that in theory most Americans voting Republican tend to favor. Political reality dictates that once a major bill such as the IRA is passed, and the longer it is in effect, the less likely it is to be overturned.
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What might Republicans advance instead?
Republican election campaign messaging has included complaints about high gasoline RB00, +0.22% prices and global concerns about the availability of natural gas NG00, +1.13% and the cost of alternatives, such as liquefied natural gas, in the wake of disrupted markets in the months since Russia invaded Ukraine. That messaging dovetails with a GOP argument that the U.S. should pump more of its own energy to avoid the geopolitical stress of relying on Russia and the Middle East.
“Americans will be facing higher energy costs this winter and should be concerned that the government is implementing programs that will choose the appliances you use to heat your home or cook your family meals which can increase energy use and utility bills,” said Karen Harbert, president and CEO of trade group the American Gas Association. Her message is one echoed throughout most Republican platforms.
Fossil-fuel interests and their mostly Republican backers have pushed for natural gas to remain a fixture in a mixed energy offering that includes wind, solar and other alternatives.
Biden administration and Democratic congressional “policies ignore the cost and emissions savings that would be achieved through a portfolio approach that includes efficient gas end-use applications,” Harbert said.
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Observers do expect a version of a Republican energy platform previously advanced by House Minority Leader Kevin McCarthy, the Republican of California, to find fresh daylight in a new Congress. In it, the party sought to keep alive U.S. natural gas production, as well as streamline government permitting for clean-energy infrastructure, liquified natural gas terminals and mines to produce critical minerals that go into EV batteries.
It’s yet to be determined whether a tightly controlled Congress in either direction could yield small consensus if energy and climate change are bundled.
“The usual story about climate change during campaign season is that it’s Democrats vs. Republicans. But it’s actually worth breaking that down to politicians and voters,” said Geoffrey Henderson, a postdoctoral associate at Duke University’s Sanford School of Public Policy.
“Republican politicians historically over the last few decades have had a pretty close relationship with the fossil-fuel industry, which directly or indirectly funds many of their campaigns,” he said. “But that sort of dynamic belies the support among Republican voters for policies that would make an impact in reducing carbon pollution.”
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And it’s unclear how much of a concession President Biden might seek as he presumably keeps an eye on the 2024 race. Biden and Democratic lawmakers such as West Virginia Sen. Joe Manchin are still hoping to pass permitting legislation this year that would ease approvals of oil and gas infrastructure along with clean energy sources like wind and solar power.
Read: Oil companies can’t just ‘drill baby drill’ at will. Here’s what it really takes to ramp up energy production.
In recent days, the United Nations reupped reports calling out developed wealthy nations like the U.S. for moving too slowly when it comes to the lifestyle changes that will be necessary to make a serious dent in global warming.
That means the durability of the IRA’s most rigorous climate provisions remains key for voters, activists and policy brokers who are especially worried as scientists continue to warn that without immediate and deep emission reductions across all economic sectors, limiting global warming to 1.5 degrees Celsius will stretch beyond reach. That temperature change, set in 2015 with the Paris accord, is seen as a point of no return to slowing the effects of costly acidic oceans, eroding coastlines, deadly heat and more.