Congressional Update

With Congress wrapping up its Easter recess, much of the activity took place within the Administration. The biggest news was the Environmental Protection Agency’s (EPA) release of two rules that it says would “accelerate the ongoing transition to a clean vehicles future and tackle the climate crisis” and would lead to two-thirds of new cars and trucks being electric by 2032. Interestingly, however, the EPA did not abide by the Obama Administration practice of meeting with industry groups before announcing this rule, instead just making the announcement. This has rubbed some opposition groups the wrong way and so it remains to be seen what the rules will ultimately look like when or if they become final. Accompanying this, the Department of Energy and EPA have proposed changes to how EV fuel economies are calculated, which would make it that much harder for gas-powered cars to compete. The Administration believes the changes would require automakers to increase the efficiency of their fuel-powered vehicles to maintain their current emissions outputs.

In that same vein, Rep. Troy Nehls (R-TX) introduced a joint resolution that, if enacted, would roll back a different EPA rule. The rule in question, which became final in January, would impose far stricter emissions requirement on new trucks beginning with the 2027 model year. This is a similar measure to the one Sen. Deb Fischer (R-NE) introduced in February. Also, two environmental groups – the Clean Air Task Force and the Natural Resources Defense Council – sent a letter to the U.S. Department of the Treasury arguing that the Inflation Reduction Act’s clean hydrogen tax credit should account for “additionality,” or additional clean energy generation. That it must be truly new, rather than providing flexibility for existing industries. This is at odds with energy industry stakeholders who argue that the whole clean hydrogen industry is too new to have such strict guidance, and that any extra red tape will curtail investment in the sector.

Congress returns to Washington, D.C. on April 17 with focus on addressing the debt ceiling. Meanwhile, House Republicans will continue their oversight of Biden Administration actions including the use of funds under the Inflation Reduction Act and Infrastructure Investment and Jobs Act.