Senate Majority Leader Chuck Schumer and Senator Joe Manchin have come to a breakthrough deal on a bill that contains a number of goals set by President Biden and Democrats.
While many details have not been disclosed, the measure would invest $369 billion into energy and climate change programs, with the goal of reducing carbon emissions by 40% by 2030, according to a one-page fact sheet.
Manchin had been a holdout on a climate deal, stating earlier this month that he could not support a climate bill because of concerns over inflation.
- The bill would affect nearly every aspect of U.S. energy production. It includes $30 billion in incentives for companies to build solar panels, wind turbines and batteries and to process critical minerals in the United States, aiming to reverse the longstanding migration of clean energy manufacturing to China and elsewhere.
- The new legislation would provide longer term subsidies for renewable energy industries to make long-term investment strategies.
- The bill also concedes some support for fossil fuel, including a mandate to new lease sales for oil drilling in the Gulf of Mexico. Manchin called it “a “realistic energy and climate policy.”
- There is a separate measure supporting infrastructure, potentially for natural gas pipelines. This could ease the way for a project in which Manchin has taken a personal interest, the Mountain Valley Pipeline, which would transport Appalachian shale gas from West Virginia to Virginia.
The bill aims to tackle global warming by using billions of dollars in tax incentives to ramp up wind, solar, geothermal, battery and other clean energy industries over the next decade. Companies would receive financial incentives to keep open nuclear plants that might have closed, or to capture emissions from industrial facilities and bury them underground before they can warm the planet. Car buyers with incomes below a certain level would receive a $7,500 tax credit to purchase a new electric vehicle and $4,000 for a used one. Americans would receive rebates to install heat pumps and make their homes more energy-efficient.New York Times
- The deal also keeps the prescription drug prices changes that Manchin had previously agreed to, empowering Medicare to negotiate the price of certain costly medications; revamping Medicare Part D to reduce out of pocket costs for seniors and the disabled; and enhancing ACA subsidies.
- The deal would also provide more funding to the IRS for tax enforcement.
- To raise revenue to pay for the bill, a 15% minimum tax on corporations, which would raise $313 billion over a decade, would be imposed.
Of course Senate Republicans are opposed to the bill.
“It is nothing short of an attack on the American family,” Senator John Barrasso, Republican of Wyoming, said in a statement. “If we want to reduce inflation, lower energy costs, and cut the deficit, the recipe is clear. Congress should cut spending and unleash American oil and natural gas production.”New York Times
Mitch McConnell had also vowed to halt a semiconductor deal if Democrats followed through on a climate and drug prices bill. Democrats say the deal would reduce the deficit by more than $300 billion.