Will midterm elections kill the EV and energy tax breaks just approved?


A change in the makeup of Congress in Tuesday’s U.S. midterm elections would mostly involve tougher roadblocks and potential delays for future green energy and climate change legislation, not a full reversal of targeted tax incentives to solar, electric and other consumer-focused vehicles. policy just approved in the Inflation Reduction Act.

This is the belief of most election watchers and green energy groups.

Of course, only the actual count of the midterm votes will confirm the fate of what many have described as America’s most comprehensive climate change and energy efficiency policy ever, within the IRA. And there’s nothing stopping Republican lawmakers from advancing their own vision of energy legislation in a new Congress, especially in the run-up to the presidential election and the next legislative session in 2024.

Related: For electric vehicles, solar tax breaks and climate change, here are the midterm elections that matter

Most taxpayers have not yet used their credits and allowances

The IRA includes nuggets for homeowners seeking more efficient heating and cooling, at least according to those promoting a switch to electricity, ideally powered by solar, wind, nuclear or hydrogen, all cleaner fuel sources. which have become increasingly operational once it became more cost competitive with natural gas NG00,
+1.13%.
Transmitting cleaner electricity at scale remains the challenge.

In addition, the IRA targeted EV buyers ready to make the switch with a $7,500 tax break on select new models (too limiting, some say) and a $4,500 reduction on used options. And the law pointed to manufacturers switching from CL00 fossil fuels,
-0.01%
dependence on alternative means to drive their business. President Biden signed the legislation, which included drug pricing and more, in August. Most taxpayers haven’t had a chance to use it until they file their 2022 return.

Read more about what the IRA means for homeowners. And find out which EVs tend to qualify and which vehicles could see their rating increase as more foreign manufacturers build electric vehicle battery plants in the United States. Plus, how to navigate your tax return if you want the TSLA EV Break,
-3.64%

F,
+1.89%.

Democrats have created several major climate change initiatives, including executive orders that Biden or any president could authorize, at the national level. The US Department of Energy also announced funds available to states and tribes as part of the IRA for consumer energy rebate programs. All in all, many Republicans would like to reverse these efforts. But to do that, they’ll need a landslide victory, a two-thirds majority in both the House and Senate to repeal the bill. They would have to overcome Biden’s veto of a law the administration sees as a hallmark of his time in office.

In addition, Republicans would need a consensus that included a good number of Democrats on their side if they were to advance fossil fuel-friendly legislation that would replace all or part of the IRA. In other words, hitting the undo button will be a real challenge.

In addition, the spending bill tended to promote action on climate change through tax breaks, a method that, in theory, most Republican-voting Americans tend to favor. Political reality dictates that once a major bill like the IRA is passed, and the longer it is in place, the less likely it is to be overturned.

Do not miss: Midterm elections: State ballot measures take aim at gig jobs, immigration, abortion and more

What could the Republicans advance?

To be sure, Republican campaign messages have included complaints about high gas prices and global concerns about the availability of NG00 natural gas,
+1.13%
and the cost of alternatives, such as liquefied natural gas, following the disruption of markets in the months since Russia invaded Ukraine. That message matches the GOP’s argument that the US should pump more energy to avoid the geopolitical stress of relying on Russia and the Middle East.

“Americans will face higher energy costs this winter and should be concerned that the government is implementing programs that will make choices about the appliances you use to heat your home or cook your family meals that may increase your energy consumption. energy and utility bills,” said Karen Herbert. president and CEO of the trade group American Gas Association. His message resonates with most Republican platforms.

Fossil fuel interests and their mostly Republican supporters have pushed for natural gas to remain a staple in a mixed energy supply that includes wind, solar and other alternatives.

“The administration’s policies ignore the cost and emissions savings that would be achieved through a portfolio approach that includes efficient gas end-use applications,” Harbert said.

Reads: In the midterm elections, voters in Massachusetts and California will decide whether millionaires should pay more taxes

Observers expect a version of a Republican energy platform previously advanced by House Minority Leader Kevin McCarthy, R-Calif., to see new light in a new Congress. In it, the party sought to keep U.S. natural gas production alive and streamline permits for clean energy infrastructure, as well as LNG terminals and mines to produce critical minerals that go into batteries electric vehicles

It remains to be seen whether a Congress tightly controlled in either direction could produce even a small consensus if energy and climate change come together.

“The usual story about climate change during the 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 the Sanford School of Public Duke University Policy.

“Republican politicians have historically over the past few decades had a pretty close relationship with the fossil fuel industry, which directly or indirectly funds many of their campaigns,” he said. “But that kind of dynamic belies Republican voters’ support for policies that would have an impact on reducing carbon pollution.”

Related: About 75% of Americans surveyed would take a “green” job in solar, wind or electric vehicles, which tend to pay 21% more.

And it’s unclear what concession President Biden might seek as he presumably eyes the 2024 race. Biden and Democratic lawmakers, such as West Virginia Sen. Joe Manchin, still hope to pass permitting legislation this year that would make it easier to pass ‘oil and gas infrastructure along with clean energy sources such as wind and solar energy.

However, the durability of the IRA’s more stringent climate provisions remains key for voters, activists and policymakers, particularly concerned as scientists continue to warn that without immediate and deep emissions reductions across all sectors economic targets that limit global warming to 1.5 degrees Celsius will be out of reach. This temperature, set in the 2015 Paris Agreement, is considered a point of no return to curb the effects of acidic oceans, eroding coastlines, deadly heat and more.

In recent days, the United Nations has hit back at reports calling on rich, developed nations like the United States to move too slowly when it comes to the lifestyle changes that will be needed to make a big impact on global warming .



Source link

Leave a Comment