Republican US lawmakers support IRA energy tax credit

Republican U.S. legislators sent a letter on Thursday to the chair of the House Ways and Means Committee expressing their support for the tax credits that were boosted by former president Joe Biden's Inflation Reduction Act. This legislation was not voted for by Republicans.

Why it's important

The letter was signed by a dozen Republican U.S. The letter from a dozen Republican U.S. Representatives highlights the importance of incentives known as Investment Tax Credits, or ITC, as well as Production Tax Credits, or PTC for Republican states that have large clean electricity projects such as wind, nuclear, and solar power and battery storage.

The letter was signed by representatives Mariannette Miller Meeks from Iowa, Jen Kiggans of Virginia and Jeff Hurd from Colorado, among others. It emphasized the importance of the credits, as the United States is experiencing a surge in power demand not seen for 40 years.

In the budget reconciliation process, Republicans led by Donald Trump are seeking to reduce spending, such as tax credits, in previous legislation.

KEY QUOTES

In a letter sent to the chairman of the committee, Representative Jason Smith by the legislators, they said that "these credits will strengthen American supply chains, industrial capacities, grid reliability, and resilience" and create countless jobs.

They said that "China aggressively expanding its energy capabilities in order to fuel its geopolitical aspirations, the ITC and PTC is vital to keep the U.S. on the front lines of an intensifying global race for energy,"

It is "not unreasonable", according to the lawmakers, to include a gradual phase-out of credits in the reform of the tax code. However, they did not provide any further details.

RESPONSE

"They are trying to be reasonable, but they seem to be losing ground by opening up the possibility of phase-outs while dozens remain in the camp for full repeal," said Chris Moyer. He is a former Democratic staffer in Congress, and now the head of Echo Communications Advisors. (Reporting and editing by Edward Tobin; reporting by Timothy Gardner)

(source: Reuters)