GOP releases megabill text with land sales, tax credit rollbacks

E&E News

12 hours ago

The Senate released new megabill text overnight with stricter treatment for renewable energy incentives from the Democrats' climate law — a major blow to companies and some lawmakers lobbying for more leniency.
The updated legislation also includes Senate Energy and Natural Resources Chair Mike Lee's latest plan to sell certain federal public land for housing.
The new Senate Finance Committee text looks a lot more like the House-passed bill when it comes to an array of contested tax credits.
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It would drastically phase out wind and solar credits while maintaining incentives for Republican-friendly energy sources like nuclear and geothermal.
Specifically, the bill would cut off incentives for projects that aren't 'placed in service' — or plugged into the grid — by the end of 2028. That's more aggressive than the previous Senate draft that preserved those credits for projects that merely 'start construction' by the end of the year.
On the other hand, the legislation has a notable victory for hydrogen. It would extend incentives for clean hydrogen production to 2028, instead of eliminating them this year, as the previous Senate version proposed.
Some provisions stayed the same. Senators kept credits for non-carbon energy sources, including nuclear, hydropower and geothermal, for projects that start construction by 2033.
Senators also kept 'transferability,' which allows project sponsors to transfer credits to a third party. And the new language largely kept provisions barring companies from using materials from China or other adversary nations, while moving some deadlines for compliance sooner.
The Senate parliamentarian was reviewing at least portions of this section. Companies were hoping for more lenient treatment to allow supply chains to develop.
Senators continued to target wind turbines and their parts, which would no longer receive advanced manufacturing tax credits by 2028. Critical mineral incentives would be phased out, as well, except for metallurgical coal.
The bill proposes moving the end of the electric vehicle tax credits to Sept. 30, up from the six-month timeline previously proposed, while credits for charging infrastructure would end in June 2026.
Negotiators added a new bonus tax incentive for certain advanced nuclear power facilities built in areas with significant nuclear industry employment.
A number of House and Senate defenders of the climate law credits, under intense lobbying from companies, were looking to make sure renewable energy projects had more time to benefit. But conservatives and President Donald Trump fought in the opposite direction.
Public lands
Lee's latest proposal would order the sale of up to 0.5 percent of Bureau of Land Management land across 11 states. Only lands that fall within five miles of a population center would be eligible, and protected lands excluded.
The parliamentarian had ruled an earlier land sales plan ineligible for passage by simple majority under the budget reconciliation process. She had yet to rule on Lee's new framework Friday night.
The updated text would set aside money from each sale for hunting, fishing and recreational amenities. That after outdoor advocates on the right expressed concern.
Still, a number of Republican lawmakers in both chambers have balked at any public land sale plan in the megabill and would push to strip it before final passage.
Other provisions
The Energy and Natural Resources portion of the budget reconciliation package would still claw back Department of Energy money from the Inflation Reduction Act.
However, it would expand to $1 billion a new energy dominance loan program. Energy Secretary Chris Wright had lobbied for loan office funding, particularly for nuclear projects.
The broader legislation includes other IRA spending rollbacks, a decade-long delay of the methane fee and zero fees on automakers for not complying with the Department of Transportation's Corporate Average Fuel Economy (CAFE) standards.
The megabill would mandate oil and gas lease sales onshore and offshore, including in Alaska's Arctic National Wildlife Refuge. The state would increasingly share the revenues from development there.
Sen. Lisa Murkowski (R-Alaska) has been a holdout on several big ticket items during the negotiations, particularly related to Medicaid cuts.