Twenty-one House Republicans have signed a letter advocating to keep the clean energy tax credits from the Inflation Reduction Act (IRA), threatening to oppose the Republican budget bill if their request is not met, POLITICO reports.
In the letter shared with POLITICO, the 21 Republicans argue clean energy is a crucial part of President Trump’s “energy dominance” edict, and spoke against efforts to cut the tax credits to pay for the GOP’s tax-cut package. The letter was addressed to Republicans on the House Ways and Means Committee, who will likely start meeting this week to draft the budget bill legislation
“We have 20-plus members saying, ‘Don’t just think you can repeal these things and have our support,’” Rep. Andrew Garbarino (R-N.Y.), who organized the letter, told POLITICO. “We need the projects that are currently under development to be brought online so we can continue the President’s ‘America First’ agenda. These [credits] are helping the president accomplish what he said he wanted to do in his campaign, and that was to make America an energy dominant country.”
The letter, meant to appeal to Trump, argues that repealing some tax credits “would increase utility bills the very next day,” and maintains that the incentives for manufacturing and energy production are helping to meet the projected growing power demand. It also notes that “many credits were enacted over the course of a ten-year period, which allowed energy developers to plan with these tax incentives in mind.”
Those Republican signatories to the letter likely have a good reason to keep the IRA and its tax credits around: red states and districts are benefitting from them the most. A report released last year by the national nonpartisan business organization E2 indicates Southeast states and Republican congressional districts are seeing the most return from the legislation. About 60% of all IRA-related clean economy projects – and 85% of total private-sector investments announced at the time of the report – have gone to Republican congressional districts, despite the fact that no Republican member of Congress voted in favor of the IRA. 19 of the top 20 congressional districts for clean energy investments are held by Republicans.
According to the E2 analysis, Michigan leads the country in post-IRA clean economy announcements, with 30, including a dozen in the past year before the report’s release. Georgia, South Carolina, Texas, and North Carolina rounded out the rest of the top five, in order.
Last summer, the U.S. Department of the Treasury released data from the IRS and an analysis by the Office of Economic Policy demonstrating that more than 3.4 million American families benefitted from $8.4 billion in Inflation Reduction Act tax credits in 2023.
American families claimed more than $6 billion in credits for residential clean energy investments on 2023 tax returns filed and processed through May 23, 2024. This credit works toward investments in solar electricity generation, solar water heating, battery storage and more. Families have also claimed more than $2 billion for energy-efficient home improvements, including heat pumps, efficient air conditioners, insulation, windows and doors during the same period. These estimates are expected to increase as additional returns are filed and processed, says Treasury.
Shortly after his inauguration, President Trump halted the disbursement of all funding provided by the IRA and the Infrastructure Investment and Jobs Act (IIJA), policies he calls the “Green New Scam.” He also cleared the way for drilling on federal lands to combat an “energy emergency” blamed on the previous administration, halted leasing and permitting for offshore wind projects and restarted the process of withdrawing the U.S. from the Paris Agreement, a legally binding international treaty combatting climate change.
The GOP aims to complete the reconciliation bill by Memorial Day, which means there might not be long to wait to see where the wind blows regarding the IRA and its tax credits.
