Kevin McCarthy, the Republican’s leader in the house announced the bill on Wednesday and claimed it would raise the US’s national debt ceiling by $1.5 trillion and slash federal spending by $4.5 trillion.
McCarthy said the bill aimed to kick start negotiations with the federal government over raising its $31.4 trillion federal debt ceiling before spending plans for 2024 are established.
The bill, which Republicans call the 'Limit, Save, Grow Act', would reportedly boost domestic oil and gas production in the US alongside cutting the IRA’s support for renewable energy.
Earlier this week, the American Clean Power Association said spending on clean energy projects including wind power in the US had exceeded $150 billion since August 2022 when the IRA was signed into law.
Reacting to the GOP bill, the ACP said in a statement: "In the last nine months, the clean energy industry has announced 46 major manufacturing facilities and scores of clean energy projects in communities across the country. If enacted, today’s actions would jeopardize these investments and thousands of good paying American jobs... Congress should not waste time or energy on political messaging bills that do not advance the national interest.”
Dead-on-arrival
The Republicans new bill is not likely to pass in its current form. The Democrats hold a slim majority in the Senate which is unlikely to approve the Republican proposals, while President Biden could also use a presidential veto on the bill if it passes through the legislature.
However it signals Republican hostility to the IRA's almost $400 billion spending boost to clean energy ahead of next year’s presidential election.
Biden’s Democratic administration has tabled its own budget which would reportedly save some $US3 trillion over 10 years. Where the Republican bill aims to reduce federal costs by cutting spending, the Democrat proposals would do so by raising taxes in various ways including higher tax rates for billionaires.
Commenting on the Republican proposals, US industry body the Business Network for Offshore Wind said repealing elements of the IRA would hurt communities likely to benefit from the new investment.
Sam Salustro, vice president at the group, told “uåX˜äŠÊ˜·³Ç: "The Inflation Reduction Act will prove to be a critical foundation to the offshore wind industry by supporting existing projects and accelerating future development, and will soon spur an avalanche of manufacturing, supply chain, and shipbuilding investment in the United States. Repealing elements of the IRA now would only deny communities economic opportunity, destroy new job creation, and drive-up electricity costs."
'Bi-partisan support for wind'
Despite McCarthy’s bill, offshore wind projects have bi-partisan support in some parts of the country including Maryland, where state lawmakers recently approved a large increase in the state’s offshore wind installation targets.
Salustro added that support stems in part from the benefits to development large infrastructure projects like wind farms can have: "Offshore wind enjoys strong bipartisan support because leaders understand how critical the energy source is to state energy plans and how much economic development comes with the industry,” he said.
“Just last week, a bipartisan group of legislators in Maryland quadruped the state’s offshore wind deployment goals and pointed to investments in new factories and facilities. This support will grow as investments come to life in places like Louisiana shipyards, Texas fabrication yards, and Midwestern factories."
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