Senate Deal Breaks Logjam on Billions for Decarbonization and Energy Infrastructure

Abstract

Although GOP lawmakers and some business groups say they oppose the bill because of its labor and tax provisions, Senate Democrats hope to clear the measure using the budget reconciliation process-which only requires a simple majority to pass-before they depart for their August recess. Climate-Related Provisions The new bill, called the Inflation Reduction Act of 2022, includes $369 billion for carbon-emissions and other climate-related infrastructure projects but is more narrowly focused than the stalled Build Back Better bill, which environmental advocates considered a necessary companion to the Infrastructure Investment and Jobs Act, which they saw as more focused on advancing projects than on tackling climate change. Steve Hall, vice president of government affairs for the American Council of Engineering Cos., says that although the 15% corporate minimum tax rate could potentially affect some larger group members, on balance there are many more positives than negatives in the bill. "Recent power outages and reliability issues due to severe storms and nationwide heat waves underscore the ongoing need to prepare for new realities," she said in an email to ENR. ASCE is not taking a position on the bill overall, but "Elements like funding for transmission planning and construction to connect to new sources of renewable energy and incentives for low-embodied carbon construction materials would help leverage the impact of the IIJA funding that is starting to flow to states and cities," she said. Joe Britton, executive director of the Zero Emissions Transportation Association, told ENR that although the bill is a smaller package than the Build Back Better Act, it "Refocuses the lens through which we see our joint goals of driving down prices for domestic manufacturing and achieving our emission reduction goals." The bill would need to pass the House before it would be signed by President Biden, who says he supports the measure. Bill Still Has OpponentsThe Manchin-Schumer bill has its critics, including the U.S. Chamber of Commerce, which opposes the corporate tax increase, and lawmakers who say it would have negative effects on the economy. Kristen Swearingen, ABC vice president of legislative and political affairs, said in a statement, "This bill delivers political favors to the president's and Democrats' labor backers, penalizing employers that believe in fair and open competition and pay wages based on experience, quality and market rates and limiting opportunities for thousands of industry-skilled apprentices." She added that its corporate tax hikes could affect association members and result in higher construction materials costs, which have already increased by 20% over the past year.