The House Ways and Means budget proposal would gut the Inflation Reduction Act and slow the rollout of solar, wind, and storage. It'd crimp EV adoption and crush clean-energy manufacturing. Energy costs and carbon emissions would rise. Green hydrogen would remain forever a whisper in the wind, even after so much screaming about the arcane rules governing its incentives.
But it'd also derail two Republican hobbyhorses: nuclear power and advanced geothermal.
The proposal introduced Monday is "a backdoor repeal" of the Inflation Reduction Act, Ted Lee, a former Biden administration Treasury official, told Canary Media's Jeff St. John.
Onerous "foreign entity of concern" requirements would likely render an important incentive available to all carbon-free energy sources useless for any project not already underway, including nuclear and geothermal installations. Lee described it as "death by red tape."
That could be painful for advanced geothermal projects, which are few in number but crucial to developing an industry whose promise of 24/7 carbon-free energy has captivated Republicans, Democrats, and even Big Tech firms. Tax credits help make these early-stage projects financially feasible and repealing them could cause developers to "struggle to secure financing and price output competitively," per a March Rhodium Group report.
The proposal would also end the 45U nuclear power tax credit three years early, in 2031, meaning it could disappear before any planned nuclear power plant can even use it. A tax expert told Latitude Media that nuclear would be "by far the most disadvantaged" if the bill became law.
