Congressional Update

The House and Senate returned to Washington, D.C. last week with eyes focused on reaching a deal on the debt limit. House Republicans released their debt limit proposal, which is designed to cut federal spending and repeal significant parts of the Inflation Reduction Act. The proposal comes as Speaker of the House Kevin McCarthy announced the framework during a speech Tuesday at the New York Stock Exchange. Debt limit discussions will intensify throughout the summer. The House Republican proposal forces Senate Democrats to the table to reach a deal before America defaults.

The framework also includes House Republicans’ energy plan (HR 1). As drafted, the bill would repeal the $7,500 tax for EVs but restore the per-manufacturer limit of 200k vehicles. The proposal would also repeal zero-emission nuclear power production, clean hydrogen, clean fuel production, and sustainable aviation fuel tax credits.

Congressional committees were active last week, with numerous Biden Administration officials testifying before relevant committees. Internal Revenue Commissioner Danny Werfel said he will provide extensive details on how the IRS intends to use the additional $80 billion recently provided by Congress. Commissioner Werfel’s comments come as the House Republican debt-limit plan aims to pull back the additional funding provided.

On Wednesday, Environmental Protection Agency (EPA) Administrator Michael Regan would not commit to issuing an emergency waiver allowing 15-percent ethanol blends at the pump. “All options are on the table and that waiver is available, but there must be certain conditions that are present,” Regan told lawmakers on the House Agriculture Committee. “And the reason I’m saying it this way is because previous administrations have used that waiver and the courts have immediately struck them down for not meeting that.” Regan said the agency is taking Midwestern governors’ requests for an emergency waiver “very seriously,” and conducting a “case-by-case analysis” of whether E15 will be needed in 2023. He declined to say when the agency would make a decision.