It’s official: Republican Senate Leadership has released an updated version of their tax megabill, which will likely be the version that goes to the floor for a final vote. And somehow, it’s even worse than before. Senate Republicans are proposing passing legislation that will lock in higher household energy bills, kill American jobs, sell out the health of working and frontline communities, harm Medicaid, jeopardize food assistance, and torch our future.

If this bill passes, Republicans would be responsible for the loss of over 800,000 jobs, raising the average American’s electricity bills by 10 percent, and in a time of intense heat and grid demand, they’ll be reducing new energy capacity installed on the grid by at least 50 percent. All this—simply to line the pockets of billionaires, fossil fuel executives, and their top corporate backers with massive tax cuts.

We analyzed the latest proposed Senate bill text for the Senate Finance Committee (“Finance”), the Senate Energy and Natural Resources (“ENR”) Committee, and the Senate Environment and Public Works (“EPW”) Committee, to explain how these sweeping cuts will harm pocketbooks, health, and our planet.

In the coming days, the Senate is expected to put this chilling legislation to a vote. If it passes, the GOP’s megabill will return to the House for passage. As this process unfolds, we will continue to provide updates on the disastrous tax package.

What’s the Status of the So-Called One Big Beautiful Bill?

In August 2022, Congress passed historic clean energy investments as part of the Inflation Reduction Act (IRA). These investments were strategically designed to make energy bills more affordable, revitalize American manufacturing, create millions of good jobs for working Americans, and cut pollution to tackle the escalating climate crisis. But Congressional Republicans are now unleashing a full-scale attack on these transformational investments, even though the lion’s share of the benefits from these investments have been flowing to GOP districts.

The first part of the GOP’s plan culminated in May, when House Republicans passed their so-called “One Big Beautiful Bill.” This bill lumped together a series of devastating cuts to Medicaid and food assistance with an attempt to functionally repeal or completely eliminate critical programs like clean energy tax credits, advanced manufacturing tax credits, Environmental Justice Block Grants, and the Greenhouse Gas Reduction Fund (GGRF).

The GOP’s disastrous tax bill then moved to the Senate, where Republicans proposed further cuts to clean energy provisions, food assistance, and Medicaid during the committee markup process. Next, the Senate Parliamentarian combed through the legislation to determine which provisions of the GOP’s megabill must be taken out of the package, a procedural prerequisite for passage of any reconciliation bill. Among the provisions knocked out of the bill were the previously proposed repeal of the light-duty and medium-duty vehicle emissions standards and a former provision that would have allowed natural gas exporters to pay a fee to have dangerous liquefied natural gas (LNG) projects automatically deemed in the public interest. Now that the Parliamentarian’s review is mostly over, the Senate has released its updated text.

Make no mistake: The updated Senate text is still a staggering affront to American communities who are already struggling with a cost-of-living crisis, working people who are trying to support their families, those living in sacrifice zones with polluted air and water, and anyone counting on a livable future on our planet.

Finance Committee

Summary of What the Senate Finance Committee Proposed

The Senate Committee on Finance (“Finance”) covers the tax-writing and revenue-raising elements of the reconciliation bill. The updated bill text includes major cuts to the federal energy tax credits that are already delivering enormous benefits, particularly in Republican districts. This proposal will be disastrous for households across America, raising the average American’s electricity bills by 10 percent. The proposed cuts to tax credits will kill energy and manufacturing jobs at a time of economic hardship for many families across the nation.

• The Senate Finance bill guts critical tax credits for clean energy, clean vehicles, home efficiency, and clean manufacturing. The updated text proposal goes beyond the repeal of clean energy tax credits—even imposing new taxes on solar and wind energy projects, which throws up further obstacles to clean energy growth. These changes will kill clean energy and manufacturing jobs, raise energy prices, and increase pollution.

• Tax credits for wind and solar will be effectively repealed immediately, and new taxes will be applied to solar and wind projects. These changes will make the grid less reliable by cutting back 50 percent of the new capacity that was expected to be added to it within the next decade.

• The bill eliminates tax credits for new and used electric vehicles, commercial clean vehicles, and fueling infrastructure. This would stall the American-made EV industry, resulting in significant job losses across the auto industry.

• The Senate Republicans’ text accelerates the phase-out of manufacturing tax credits that support American businesses and supply chains, and which have brought billions of investments to the U.S.

• The bill cuts tax credits that make homes and buildings more efficient and more affordable to operate. Eliminating these credits will not only take money out of the pockets of Americans who rely on these credits but also add more pressure to the electric grid.

Clean Energy Tax Credits (45Y and 48E)  

Let’s start with one of the most powerful tools supporting the rapid deployment of new energy generation and a modern, reliable, and affordable electricity grid for American homes and businesses: the IRA’s clean electricity tax credits.

The Production Tax Credit (PTC) (45Y) is a technology-neutral tax credit that subsidizes the production of zero-emission energy sources like solar, wind, nuclear, hydropower, and geothermal. For every kilowatt hour (kWh) of clean energy generated, the producer gets a base credit of 2.6¢/kWh if they meet certain criteria. Similarly, the Investment Tax Credit (ITC) (48E) provides a credit of 30 percent (or more) of the investment into these same zero-emission energy generation technology projects, including energy storage.

Summary of Senate Text:

The GOP’s latest bill contains the immediate effective repeal of the investment tax credit (ITC) and production tax credit (PTC) for wind and solar projects. It requires projects to be placed in service by December 31, 2027, to get the credit, which applies to wind and solar only. Foreign Entity of Concern (FEOC) requirements begin immediately. In addition, a new excise tax is imposed on all solar and wind facilities—not only those that would have qualified for 45Y/48E—in the amount equal to 30 percent (solar) or 50 percent (wind) times the percentage by which a facility fails the material assistance cost ratio times the facility’s manufactured component cost. This means that after the credit is gone, the supply chain requirements are still imposed as a penalty on both utility-scale wind/solar and rooftop solar projects. ITC/PTC credit remains for other zero-emission energy generation (geothermal, hydropower, nuclear) and energy storage, although FEOC restrictions apply.

Changes from Previous Versions:

The previous version from Senate Finance phased out wind and solar beginning in 2026, at which time wind and solar projects would only get 60 percent of the value of the credit (i.e., an 18 percent credit). In 2027, that percentage would have dropped to 20 percent of the value of the credit (i.e., a 6 percent credit), and by 2028, the credit would be completely phased out. For hydropower, nuclear, and geothermal, the credit remained available at 100 percent of the credit value through 2033, 75 percent of the value in 2034, 50 percent of the value in 2035, and 0 percent in 2036. By contrast, the latest Senate bill is much more punitive to clean energy. It applies a placed-in-service standard on an even shorter timeline than the House, as well as FEOC restrictions. It also levies an extremely punitive new tax on solar and wind.

Key Impacts: 

The latest Senate version will effectively repeal the credits immediately and crush the booming manufacturing and clean energy industries in communities across the United States. Repealing the clean energy tax credits would worsen the affordability crisis, raise energy bills, harm grid reliability, kill jobs, and inflame the climate crisis.

• Skyrocketing energy prices: The Senate’s proposed repeal of the clean energy tax credits would raise American household energy bills. It could increase annual energy bills up to $140-$220 per household across the country in 2040, and over $500 per year in some states.

• Kill good-paying jobs: Full repeal of the 45Y and 48E clean energy tax credits alone would result in roughly 100,000 fewer full-time jobs across the country by 2040. The updated Senate bill could approach those levels of job loss.

• Harm grid reliability: These tax credits are enhancing grid reliability in the face of increased electricity demand and extreme weather. Clean energy is the fastest, cheapest way to add new power to the grid. In fact, clean energy accounted for 93 percent of the new energy capacity added to the U.S. grid last year.

• These changes jeopardize billions of dollars of existing investments, including any project underway now that won’t be fully operational by 2027. By stifling the booming solar and wind industries, Republicans are ensuring that our international competitors take the lead on clean energy development, setting back American energy dominance.

• Slashing the clean energy tax credits would worsen the climate crisis. Saving the 45Y and 48E tax credits would cut climate pollution by 300 to 400 million tons compared to no tax credits in 2035. That’s 29-46 percent lower than a scenario without clean energy tax credits. After a year marked by devastating, billion-dollar climate disasters, floods, and fires, it’s more important than ever that we address climate head-on.

Electric Vehicle Credits (45W, 30D, 30C, 25E)

The IRA’s electric vehicle (EV) tax credits have been rapidly accelerating America’s clean auto industry and job growth. At the same time, these tax credits have made EVs more financially accessible for some families. Households and commercial companies can receive tax credits for purchasing new electric vehicles (up to $7,500) and used electric vehicles (up to $4,000), as well as for chargers and installation.

Summary of the Updated Senate Text

This proposal would end EV tax credits for new EVs (30D) and used EVs (25E), commercial clean vehicles (45W), and fueling infrastructure (30C). This bill distinguishes between heavy-duty commercial vehicles (considered under commercial vehicle requirements) and light-duty commercial vehicles (considered under personal vehicle requirements).

Changes from Previous Versions

The updated Senate bill would eliminate credits faster than the House bill proposal. The bulk of the credits (25E, 30D, and 45) end after September 2025. Vehicle charging infrastructure ends after June 2026.

• The used EV (25E) tax credit is eliminated by September 30, 2025. In the House version, it was the end of 2025. In the previous Senate version, it was within 90 days of passage.

• The new EV (30D) tax credit is eliminated by September 30, 2025. In the previous Senate version, it was within 90 days of passage. In the House version, it was the end of 2025. In the House bill, drivers can get a tax credit for qualified vehicles from manufacturers who have not yet hit the 200,000 EV cap through December 31, 2026. There is no such provision in the updated Senate bill.

• The new clean commercial vehicle (45W) tax credit is eliminated by September 30, 2025. In the House bill, it was the end of 2025.

• The vehicle charging infrastructure (30C) tax credit is eliminated by June 30, 2026. This stands in contrast to the House bill, which ended the credit at the end of 2025. In the previous Senate bill, the credit was eliminated a year after the bill’s enactment.

Key Impacts

Fully repealing the IRA’s EV tax credits would drive a wrecking ball through the American-made EV industry and would cause major job losses, according to the CEO of the Ford Motor Company, and would benefit China, according to General Motors. For households, new and used electric vehicles would become less financially accessible, meaning consumers would have fewer transportation options.

Manufacturing Tax Credits (45X and 48C)

The Advanced Energy Manufacturing Production Credit (45X) provides an incentive to manufacturing facilities that produce clean energy components or systems in the U.S. Facilities that produce solar, wind, advanced batteries, and certain critical minerals are rewarded for re-shoring supply chains in America. The Advanced Manufacturing Investment Credit (48C) incentivizes investment in advanced energy projects, such as clean energy manufacturing and recycling, critical mineral processing, and industrial decarbonization projects. The 48C tax credit supports the development of a domestic supply chain for these clean energy projects.

Summary of the Updated Senate Text

The GOP’s bill accelerates the phaseout of 45X tax credits for manufacturing batteries, wind turbines, and critical minerals. It also adds metallurgical coal to the list of eligible critical minerals. The new text does maintain credit stackability, allowing manufacturers to claim the 45X credit for subcomponents (e.g., a photovoltaic cell) and additional IRA tax credits for the final product (e.g., a finished solar panel). The Senate bill also tightens FEOC restrictions to limit the pool of manufacturers that can receive the credit, arbitrarily excluding facilities with a certain proportion of investment from “prohibited foreign entities.”

It’s a slightly different story for 48C. The Senate text severely limits 48C projects’ viability by instituting a two-year “placed in service” requirement, which will inject uncertainty for developers and investors who counted on receiving the credit before the artificial two-year timeline was put in place. The Senate’s changes will also effectively repeal the credit after two years by not allowing for the recycling of rescinded credits from failed projects to qualified ones.

Changes from Previous Versions

For 45X, this version adds metallurgical coal as an eligible critical mineral. It adjusts the FEOC provisions covering this credit, including setting an escalating “material assistance cost ratio,” which establishes the proportion of material financial assistance allowed for eligible components. While the previous Senate text eliminated credit eligibility for components that have been integrated into other eligible components, this version restores that eligibility (in keeping with the House text). Phaseout timelines are only slightly tweaked from the previous Senate version. The general thrust of prematurely winding down the credits remains.

Meanwhile, the 48C section remains identical to the previous Senate Finance text, and 48C was untouched in the House version.

Key Impacts

The 45X Advanced Energy Manufacturing Credit has sparked a renaissance in U.S. manufacturing, especially for electric vehicles, advanced batteries, and solar energy and their supply chains. The credits have helped incentivize over $200 billion in new investment in the U.S. and positioned the U.S. to be competitive in critical 21st-century global industries. This incentive has contributed to job and manufacturing growth—most of which is in districts that Republicans represent. The GOP’s call for repeal would directly harm the jobs and livelihoods of their constituents, while sending American manufacturing jobs overseas.

The 48C’s “placed in service” restriction will inject uncertainty for developers and investors who were counting on receiving this credit before the Senate GOP inserted this artificial two-year timeline. It will threaten the certainty of building these facilities and the jobs that come with them. It also means the credit will be repealed after two years, not allowing for the recycling of rescinded credits from failed projects to qualified ones.

Home Energy Efficiency Tax Credits (25C, 45L, 179D)

Thanks to the IRA, households can take tax credits of 30 percent off (up to $2,000) for installing a heat pump or heat pump water heater, plus $1,200 for weatherization and insulation via the Energy Efficient Home Improvement Credit (25C). The 25C tax credit helped 2.3 million American families improve their homes and reduce their monthly energy bills in 2023. Families are saving an average of $130 a year in energy costs. By 2032, homeowners are expected to use the credit enough to cut peak electric demand by 3,400 MW.

The New Energy Efficient Home Credit (45L) provides incentives to builders of homes that meet Energy Star or Zero-Energy Ready Home standards. This credit assisted with the construction of nearly 350,000 efficient new homes in 2024 and cut homeowner energy bills by about $450 per year.

The Energy Efficient Commercial Buildings Deduction (179D) provides a tax deduction for installing energy-efficient appliances and equipment in commercial buildings, like energy-efficient heating, lighting, and hot water. This deduction applies to building upgrades on existing properties, as well as new construction.

Summary of the Updated Senate Text

The GOP’s bill would eliminate the Energy Efficient Home Improvement Credit (25C) at the end of 2025. It would eliminate the New Energy Efficient Home Credit (45L) after June 2026. The Energy Efficient Commercial Buildings Deduction (179D) is amended so that it does not apply to property whose construction begins after June 2026.

Changes from Previous Versions

In the updated Senate text, the Energy Efficient Home Improvement Credit (25C) is eliminated at the end of 2025. This is the same timeline as the House version. The previous Senate version proposed 180 days after bill enactment. In the updated Senate text, the New Energy Efficient Home Credit (45L) is eliminated for homes acquired after June 30, 2026. The House bill eliminates the credit at the end of 2025 unless the home construction begins before May 12, 2025. The House bill did not include the elimination of the Energy Efficient Commercial Buildings Deduction (179D).

Key Impacts

Cutting building energy efficiency credits takes money out of people’s pockets by making home energy upgrades more expensive and raises everyone’s utility bills by reducing efficiency and putting more pressure on the electric grid. Households can currently save $990 per year on utility bills if they utilize the 25C tax credit, and these credits create 240,000 jobs. By effectively terminating the Energy Efficient Home Credit for new buildings, this is a major gut punch to any builders trying to provide new homes to address the housing crisis.

Residential Clean Energy Tax Credits (25D)

Dating back to 2005, the Residential Clean Energy Tax Credit provides households with a 30 percent tax credit for rooftop solar, wind power, geothermal heating systems, and battery systems. In 2023, 1.2 million American families took advantage of the residential clean energy tax credit, and now 5 percent of US households have solar. And all of that small-scale solar adds up, with over 66GW installed, amounting to more than one-third of US solar capacity.

Summary of the Updated Senate Text

This bill would eliminate the Residential Clean Energy Credit—which incentivizes homeowners to install solar panels, water heating, fuel cells, wind, geothermal heat pumps, and battery storage facilities—after December 31, 2025. The credit will no longer apply “with respect to any expenditures made after December 31, 2025.”

Changes from Previous Versions

The House version is the same, eliminating the credit at the end of 2025. The previous Senate bill eliminated the credit 180 days after the bill’s enactment.

Key Impacts

Households would see higher costs for home energy upgrades and lose access to $1,250 in savings per year on utility bills. At the same time, we would be cutting a huge source of new energy capacity just as demand on the grid is increasing, which will raise energy costs for everyone. Plus, cutting the residential clean energy tax credits would kill hundreds of thousands of jobs in the home energy and rooftop solar sector.

Foreign Entity of Concern

The Senate Finance bill contains extreme restrictions on the clean energy tax credits through the “Foreign Entity of Concern” (FEOC) provisions. A FEOC has previously been considered an entity that is owned, controlled by, or subject to the jurisdiction of a particular nation, such as China, Russia, or North Korea. Though FEOC requirements have been imposed in the past (such as through the Bipartisan Infrastructure Law), they have not typically interfered with tax incentives.

Summary of the Updated Senate Text

The Foreign Entity of Concern (FEOC) restrictions applied across clean energy and manufacturing tax credits are unworkable and, in some cases, extraordinarily punitive for industry. The bill establishes a material assistance cost ratio framework—modeled after the existing domestic content bonus—that sets credit-specific eligibility thresholds based on the share of inputs used across different technologies. It applies material assistance requirements to solar and wind projects that commence construction after June 2025. Projects must also pass new Prohibited Foreign Entity (PFE) tests tied to foreign ownership and influence. For solar and wind energy projects, as mentioned above, the Senate text also includes a new excise tax that functions as a supply chain penalty even after the underlying credits expire. The tax is equal to the percentage by which a facility fails the material assistance cost ratio times the facility’s manufactured component cost.

Changes from Previous Versions

The final Senate bill FEOC restrictions are more cumbersome, take effect more quickly, and are accompanied by new penalties. The text also includes some changes to address industry concerns about FEOC restrictions.

Key Impacts

FEOC restrictions will make the credits effectively repealed immediately for solar and wind projects—raising energy costs, killing jobs, and undermining U.S. investment and economic competitiveness. Some adjustments were made to the House bill to address industry concerns, but FEOC restrictions will also raise costs and hardship for energy and manufacturing projects.

Other IRA Programs Affected by Senate Finance Text

• Direct Pay (aka Elective Pay): These provisions in current law are not themselves amended, but they will be functionally unusable for the technologies for which energy tax credits are no longer applied.

• Clean Fuels Credits (45Z): This section of the bill adds a requirement that the fuel must be produced or grown in North America (U.S., Mexico, or Canada), which will be effective after December 31, 2025. It amends the credit such that the emissions rate cannot be less than zero; amends the credit to exclude any emissions attributed to indirect land use changes, and allows the Secretary to determine adjustments on regulations and methodologies; and amends the credit with respect to fuel derived from animal manure, by giving a specific emissions rate for each animal manure feedstock. All these changes will take effect in 2026. 45Z is extended through December 31, 2029.

• Carbon Capture Credits (45Q): FEOC requirements added. It increases the credit value and boosts the credit for carbon used for more oil production.

• Hydrogen Production Tax Credit (45V): Requires a facility to begin construction by January 1, 2028, instead of January 1, 2033, to be eligible for the credit.

• Nuclear Tax Credit (45U): Adds FEOC restrictions beginning at the date of enactment for specified foreign entities, and within two years of enactment for other prohibited foreign entities. Additional prohibition of credits to covered nations/entities, including restrictions on imported nuclear fuel that was produced in a covered nation/by a covered entity, with the exception of fuel acquired before January 1, 2023. Restrictions on foreign entities began in taxable years following enactment; restrictions on imported fuels begin after December 31, 2027.

Environment and Public Works (EPW) Committee

The Senate Committee on Environment and Public Works (EPW) covers, among other things, any elements of the reconciliation bill related to air and water pollution, environmental policy, and public buildings. This part of the reconciliation bill repeals many federal grant programs created by the IRA.

Summary of What the Senate EPW Committee Proposed

• The Senate EPW bill text largely mirrors the final House text, harming flagship climate programs.

• The bill repeals the $27 billion Greenhouse Gas Reduction Fund (GGRF). And it rescinds unobligated balances from key programs like Environmental Justice Block Grants and the Climate Pollution Reduction Grants (CPRG).

• The bill delays the imposition of a historic methane fee for ten years, rendering the effort to cut this climate super pollutant ineffective.

• The Senate bill proposes an “opt-in” fee for project sponsors to pay that expedites their project’s environmental review under NEPA.

Greenhouse Gas Reduction Fund

The $27 billion Greenhouse Gas Reduction Fund (GGRF) is the largest grant program within the IRA. This $27 billion is divided into three programs: the National Clean Investment Fund (NCIF), the Clean Communities Investment Accelerator (CCIA), and Solar for All. Not only does this program provide a significant investment in pollution-reducing clean energy technology and green banks, but it also benefits communities that have been historically overlooked and underserved, bringing greater equity to the clean energy transition. For months, the Trump administration has waged an unsubstantiated assault on this fund. At every turn, the administration has been unable to justify its attacks to undermine this program, failing to offer evidence to support its bogus claims of fraud, waste, or abuse.

Summary of the Updated Senate Text

The GOP’s bill repeals Section 134 of the Clean Air Act, in which the GGRF was created. Any unobligated balances are rescinded.

Changes from Previous Versions

There is no change to the House version.

Key Impacts

The GGRF is unlocking a historic wave of public and private investment, delivering local economic development opportunities that would not have materialized without this program, especially in disadvantaged communities. But the Trump administration has already been attacking the GGRF through an illegal funding freeze, and a court battle is currently raging with program awardees, in particular the NCIF and CCIA programs. The GGRF funding has technically been obligated, and only minimal GGRF funds remain unobligated and available for rescission. But this bill would harm program implementation and oversight at EPA. It may also represent an attempt by Congress and the administration to block or claw back funds that have been legally obligated.

Climate Pollution Reduction Grants

The Climate Pollution Reduction Grants (CPRG) are an EPA program established as part of a new Clean Air Act Section 137 created in the IRA, which provides grants to state, local, and Tribal governments to create and implement programs that reduce emissions and support jobs and communities. It was funded with $5 billion, including $250 million in planning grants, $4.6 billion for implementation grants, and the remaining balance for technical assistance and program implementation. These grants have been used to support state, local, and Tribal governments in nearly all 50 states.

Summary of the Updated Senate Text

The bill rescinds any unobligated funding under the Climate Pollution Reduction Grants (CPRG) for plans and implementation grants.

Changes from Previous Versions

Same as the previous version.

Key Impacts

The CPRG program is a primary vehicle for states to fund their pollution reduction programs. Rescinding unobligated funding for the CPRG program would dramatically harm program implementation at the agency. Many awarded states could have to stall or permanently halt their pollution reduction plans that were intended to create jobs, reduce energy and transportation costs, and mitigate pollution in impacted communities.

Environmental Justice Block Grants

This first-of-its-kind $3 billion federal program aims to empower disadvantaged communities to determine and design their own visions of pollution reduction and clean energy investment. The Environmental Justice (EJ) Block Grants, also known as the Community Change Grants, provide highly flexible funding that goes directly to nonprofit organizations serving these communities. This means projects are designed by and for communities to address their unique needs and build resilience to extreme weather events and environmental risks.

Summary of the Updated Senate Text

The Senate GOP’s bill rescinds all unobligated funding under Section 60201 of the IRA, which provided funding for highly flexible grants to nonprofit organizations serving disadvantaged communities.

Changes from Previous Versions

The Senate version closely mirrors the House version.

Key Impacts

Without EJ Block Grants, there will be less financial support for on-the-ground, community-led organizations that provide life-changing services to households based in disadvantaged communities or living near sacrifice zones. Examples of critical services include community-led pollution monitoring, prevention, and remediation; projects that reduce indoor air pollution; projects to counter health risks from urban heat islands, extreme heat, and wildfires; improved community engagement in public processes; and technical assistance. Much of these funds are unobligated.

Methane Emissions and Waste Reduction Incentive Program

Methane is a potent, planet-heating greenhouse gas that oil and gas operators often flare or leak into the atmosphere. That’s why Congress passed the Waste Emissions Charge (WEC) through the IRA in 2022, requiring oil and gas operators to pay a penalty fee if they exceed a certain level of methane pollution. Soon after, the Biden-led EPA introduced a rule implementing the WEC. But at the beginning of 2025, the Republican-controlled Congress voted to eliminate that rule. Now, Congress is trying to get rid of the fee outright via the budget reconciliation bill.

Summary of the Updated Senate Text

The bill rescinds all unobligated funding from Section 60113 of the IRA, which provided funding to the EPA for financial and technical assistance for methane monitoring and mitigation. Senate Republicans retain a fee on excessive methane waste, known as the Waste Emissions Charge (WEC), but the language is altered so that the collection of charges is postponed until 2034, as opposed to 2024 under current legislation. This renders the fee largely ineffective for the next decade.

Changes from Previous Versions

This is similar to previous versions of the text.

Key Impacts

By cutting methane pollution and other harmful pollutants, the WEC would have helped prevent asthma attacks and other health-harming impacts. The program would have reduced an extremely harmful greenhouse gas superpollutant. Altering the WEC will disproportionately impact communities of color and disadvantaged communities. The methane fee is also a revenue raiser, so its alteration increases the budget deficit and would necessitate even deeper cuts to other vital programs to comply with the GOP’s self-imposed spending cut targets.

Opt-In Fee Program under the National Environmental Policy Act (NEPA)

The National Environmental Policy Act (NEPA) is our nation’s bedrock environmental law. It requires federal agencies to assess the environmental impact of all major proposed government projects.

Summary of Updated Senate Text

Senate Republicans have created a new “opt-in fee” mechanism that would allow project sponsors to receive special treatment in the environmental review process. In exchange for a fee of 125 percent of the costs to prepare the environmental document, the project sponsor receives an expedited review.

Changes from previous versions

The previous Senate version had a provision that allowed project sponsors to skirt judicial review for a fee. The parliamentarian found the judicial portion violated the Byrd rule and was therefore struck.

Key impacts

This is a continuation of the “pay-to-play” politics we saw in the GOP’s House version, but this time, the bill is attacking the National Environmental Policy Act (NEPA), which provides for environmental reviews of all major government actions.

Other IRA Programs Affected by the Senate EPW Bil

Here’s a selection of programs that saw funding rescissions:

• Heavy-Duty Vehicles Program under Sec. 132 of the Clean Air Act

• Air quality monitoring in fenceline communities (Sec. 60105 of the IRA).

• Air quality monitoring in schools (Sec. 60106 of the IRA).

• Lots of embodied carbon programs, including the environmental product declaration assistance, low-embodied carbon labeling, GSA emerging and sustainable technologies program, and more.

What Didn’t Survive the “Byrd Bath” in the Senate EPW Text?

The Senate Parliamentarian advised that several provisions in the Senate’s former EPW bill text did not meet the requirements of the Byrd rule. This means that the following provisions have been struck from the bill:

• Republicans tried to repeal statutory authorizations for the Inflation Reduction Act and rescind funds. The parliamentarian ruled that the GOP’s megabill can rescind funding, but it cannot repeal their authorization. This means Congress could provide funding for them in the future.

• Republicans wanted to repeal the EPA’s tailpipe emissions rule, also known as the multipollutant emissions standards for model years 2027 and later light-duty and medium-duty vehicles. Fortunately, this provision has been struck from the text.

• Republicans wanted to enable project sponsors to speed up environmental reviews and skirt judicial review for a fee. The parliamentarian found the judicial portion violated the Byrd rule and was therefore struck.

Energy and Natural Resources (ENR) Committee

The Senate Committee on Energy and Natural Resources (ENR) covers policies related to energy resources and development, which include regulations and conservation efforts, nuclear energy, as well as Tribal affairs, public lands and their renewable resources, and federal leasing and related activities. This component of the reconciliation bill repeals critical IRA programs that were putting the nation on track to be energy dominant, while also cutting health-harming air and climate pollution.

Summary of What the Senate ENR Committee Proposed

• The GOP’s ENR bill will generate more climate disasters and harm to frontline communities by lowering fees required to lease land for oil and natural gas drilling and establishing a minimum number of required onshore and offshore oil and gas sales annually.

• The Senate bill will sell off public lands in eleven western states.

• Republicans will eliminate the majority of new funds and programs under the Department of Energy Loan Program Office, which will undermine American businesses and U.S. technology leadership.

• The GOP will repeal and rescind the remaining funds for the Advanced Industrial Facilities Deployment program, which will be a major blow to US economic competitiveness.

Oil, Gas, and Coal Leasing Handouts

America’s public lands and waters are precious—and coal, oil, and gas extraction that currently occurs there must end if we want to align with the latest climate science. But in this bill, the GOP has promised to further plunder lands currently managed by the Bureau of Land Management (BLM) and the Bureau of Ocean Energy Management (BOEM) — while slashing the royalty rates paid by oil and gas corporations to exploit America’s public lands.

Summary of the Updated Senate Text

Scientists and peer-reviewed academics have repeatedly found that there simply is no room for new coal, oil, and gas fields if we want to limit planetary warming to 1.5C. Flying in the face of climate science, the Republicans’ ENR bill recklessly accelerates oil and gas extraction on America’s public lands and waters. This bill sets a floor for the minimum number of onshore and offshore oil and gas sales annually and lowers the barriers to oil and gas leasing, including in the Arctic National Wildlife Refuge, the Gulf of Mexico, and Alaska’s Cook Inlet. This bill would reinstate onshore non-competitive leasing processes, lengthen drilling permit terms, and cut royalty rates. Each of these provisions lowers the barrier to access for Big Oil to exploit U.S. public lands and waters. The bill also proposes a massive expansion of coal leasing across federal lands, making at least 4 million acres of public land available for coal leasing. The bill text provides significant handouts to Big Coal by reducing the royalty rates for coal extracted on federal land.

Key Impacts

Leasing was made competitive so that government agencies could ensure the best and most efficient use of taxpayer dollars and reduce opportunities for corruption. This bill opens the door to backroom dealing through expanded non-competitive processes and reduced fees. This bill also encourages gas and oil drilling nationwide, which will increase air pollution, increase greenhouse gas emissions, and hold our national economy back by supporting reliance on non-renewable energy resources. Make no mistake: This is a cheap sell-out of our nation’s precious natural resources, an act of climate arson, and a poisoning of communities—all to facilitate a gargantuan handout to fossil fuel corporations.

Derailing Transmission Reforms

There are several IRA programs at DOE that support the expansion of electricity transmission infrastructure in the U.S. and are critical to providing affordable and reliable power for Americans. These include the Transmission Facility Financing program; the Offshore Wind Electricity Transmission Planning, Modeling, and Analysis program; and the Grants to Facilitate the Siting of Interstate Electricity Transmission Lines. These programs are especially important at a time of rising electricity demand, fueled by data centers to power artificial intelligence (AI), increasing electrification of vehicles and buildings, and an American manufacturing renaissance.

Summary of the Updated Senate Text

This version of the bill does not rescind unobligated funds for transmission facility financing.

Changes from Previous Versions

The previous version repealed and rescinded unobligated funds for transmission facility financing, grants to facilitate the siting of interstate electricity transmission lines, and interregional and offshore wind electricity planning, as well as modeling and analysis.

Key Impacts

It would seem that Republicans have finally come to terms with the fact that transmission reform and funding are necessary to deliver energy to Americans—even as the GOP aggressively eliminates opportunities to build clean energy. By eliminating clean energy programs that make our energy grid a secure and reliable source of affordable power, Republicans are pushing the nation farther away from energy dominance.

Department of Energy Loan Programs Office

The Department of Energy Loan Programs Office (LPO) was created with strong bipartisan support during the George W. Bush administration, and for the last two decades, it has provided critical financing for American energy, manufacturing, mining, and other industrial projects that reduce emissions and support American leadership in the fast-growing clean energy economy. To date, LPO has financed approximately $90 billion in innovative energy and manufacturing projects, including a $465 million loan to Elon Musk’s Tesla Motors in 2010. At the end of 2024, LPO had collected over $5 billion in interest payments from its loans, meaning that it has made a profit for American taxpayers.

Summary of the Updated Senate Text

Rescinds unobligated balances from LPO programs under Sections 1703 and 1706.

Changes from Previous Versions

In addition to rescinding unobligated balances, the previous Senate text also repealed LPO’s authorities under Sections 1703 and 1706. Only rescinding unobligated balances puts this bill in line with the House Energy and Commerce text, which also rescinded funding but did not repeal it altogether.

Key Impacts

Eliminating LPO’s new loan authority would be a devastating blow for the U.S., especially amidst rising energy demand and a competitive global race to build and manufacture the energy technologies that will power the 21st century. It would harm American businesses and U.S. technology leadership. Not only that, over the long term, shrinking LPO will cost American taxpayers money, as the successful program has already returned $5 billion in profit to the American taxpayer, via interest on its loans.

Advanced Industrial Facilities Deployment Program

The Advanced Industrial Facilities Deployment Program (AIFDP) was created in the IRA and funded with over $5.8 billion to advance industrial decarbonization and support American manufacturing’s global economic competitiveness. The program has provided funds for innovative low-carbon cement manufacturing projects in Indiana, Georgia, Texas, and Virginia, for next-generation aluminum manufacturing in Colorado, for low-carbon steel production in multiple states, and much more.

Summary of the Updated Senate Text

Rescinds unobligated balances.

Changes from Previous Versions

In addition to rescinding unobligated balances, the previous Senate text also repealed AIFDP. Only rescinding unobligated balances puts this bill in line with the House E&C text, which also rescinded funding but did not repeal it altogether.

Key Impacts

Rescinding unobligated balances and eliminating the AIFDP program would deal a major blow to U.S. global economic competitiveness as American businesses fight for market share in increasingly decarbonized steel, cement, aluminum, and other heavy industries.

What Didn’t Survive the “Byrd Bath” in the Senate ENR Text?

The Senate Parliamentarian advised that a handful of ENR provisions did not comply with the Byrd rule. That means those provisions would be subject to a 60-vote threshold, as opposed to a 50-vote threshold, and in turn, they have been struck from the megabill. Struck provisions include:

• The GOP wanted to introduce a “pay-to-play” approach to proposed liquefied natural gas (LNG) exports by allowing exporters to pay a $1 million fee to have their projects deemed in the “public interest,” effectively allowing them to buy out one of the approval stages from DOE.

• Republicans wanted to introduce a provision that would declare that offshore oil and gas projects are automatically compliant with the National Environmental Policy Act (NEPA).

• The GOP also wanted to require offshore oil and gas leases to be issued to successful bidders within 90 days of sale.

• Republicans wanted to mandate the sale of millions of Bureau of Land Management (BLM) and U.S. Forest Service lands.

• The GOP wanted to require the Secretary of the Interior to rubber-stamp the construction of Ambler Road, a proposed mining road in Alaska.

• Republicans wanted to remove the Secretary of the Interior’s discretion to lower fees for solar and wind projects on public land.

• The GOP wanted to require the Secretary of the Interior to hold annual geothermal lease sales and make changes to geothermal royalties.

Conclusion

Senate Republicans are taking money out of working people’s pockets to give tax breaks to billionaires. Throughout the entire reconciliation process, the GOP has taken a wrecking ball to programs that make energy affordable for households, reduce toxic pollution, combat the climate crisis, provide life-changing healthcare, and nourish families with food assistance.

Next, the GOP’s megabill will move toward a vote in the Senate, before being sent back to the House for a final vote. Allowing this one big, bad bill to pass would be disastrous for Americans today and in the future.

Find this memo online here.

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