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Photo: Samuel Corum/Getty Images

Congress is nearing passage of legislation that phases down a powerful planet-warming gas used in air conditioning and refrigeration, while also extending tax credits for renewable power and carbon capture projects.

Driving the news: Those provisions are part of the bipartisan year-end spending and COVID-19 relief deal moving through Capitol Hill this week, after a compromise on a $900 billion package was finally reached Sunday night.

Why it matters: Phasing down use of hydrofluorocarbons (HFCs), a highly potent greenhouse gas, is a big and rare bipartisan agreement on global warming.

  • It sets up the U.S. contribution to a major 2016 global deal to cut HFCs under the 1987 Montreal Protocol, even though the U.S. has not formally ratified the amendment.
  • The bill also aims to improve Energy Department R&D and demonstration programs for a suite of clean energy technologies, authorizing $35.2 billion over a decade, per E&E News.

How it works: The Montreal Protocol successfully curbed the use of substances that deplete the ozone layer, but one side effect was to boost deployment of HFCs.

  • The New York Times notes that the legislation on Capitol Hill "effectively puts the United States in compliance with the terms of the [2016] deal."
  • It "requires companies to phase down production and consumption of HFCs to about 15 percent of 2012 levels by 2036," the Times reports.

Where it stands: The various pieces of the energy tax section, per sources familiar with the text and published reports, include ...

  • A two-year extension of the investment tax credit for solar projects before phasing down.
  • Making projects that transform wasted heat into electricity at industrial plants eligible for investment tax credit.
  • A one-year extension of the production tax credit for wind projects that was about to expire, as well as incentives for offshore wind through 2025.
  • A two-year extension of credits for carbon sequestration projects.

What they're saying: "The agreement includes sweeping clean energy reforms, R&D enhancements, efficiency incentives, and extends clean energy tax credits to create hundreds of thousands of jobs across the clean economy," House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer said in a joint statement.

  • "The package also phases out superpollutant HFCs, positioning the U.S. to lead the world in avoiding up to 0.5 degree Celsius of global warming," they said.

Go deeper

Dan Primack, author of Pro Rata
Jan 22, 2021 - Politics & Policy

Private equity bets on delayed tax reform in Biden administration

Illustration: Brendan Lynch/Axios

In normal times, private equity would be nervous about Democratic Party control of both the White House and Congress. But in pandemic-consumed 2021, the industry seems sanguine.

Driving the news: Industry executives and lobbyists paid very close attention to Treasury Secretary nominee Janet Yellen's confirmation hearings this week, and came away convinced that tax reform isn't on the near-term agenda.

14 mins ago - Politics & Policy
Scoop

White House plots "full-court press" for $1.9 trillion relief plan

National Economic Council Director Brian Deese speaks during a White House news briefing. Photo: Alex Wong/Getty Images

The Biden White House is deploying top officials to get a wide ideological spectrum of lawmakers, governors and mayors on board with the president’s $1.9 trillion COVID relief proposal, according to people familiar with the matter.

Why it matters: The broad, choreographed effort shows just how crucially Biden views the stimulus to the nation's recovery and his own political success.

14 mins ago - World

Scoop: Sudan wants to seal Israel normalization deal at White House

Burhan. Photo: Mazen Mahdi/AFP via Getty

Three months after Sudan agreed to normalize relations with Israel, it still hasn't signed an agreement to formally do so. Israeli officials tell me one reason has now emerged: Sudan wants to sign the deal at the White House.

Driving the news: Israel sent Sudan a draft agreement for establishing diplomatic relations several weeks ago, but the Sudanese didn’t reply, the officials say. On Tuesday, Israeli Minister of Intelligence Eli Cohen raised that issue in Khartoum during the first-ever visit of an Israeli minister to Sudan.