Hawley talks to reporters last month. Photo: Chip Somodevilla/Getty Images
The Senate GOP's plan for multiple reconciliation bills complicates the IRA picture for next year amid a furious lobbying effort to save the climate law.
Why it matters: Republicans spent the week strategizing on reconciliation, but the IRA's future remains far from certain.
Here's what we're hearing …
GOP uncertainty: Senate Republicans want to do at least two reconciliation bills, with one addressing energy and the border and another on taxes.
- The top IRA targets remain EV credits and EPA's methane fee, but senators emerged from their policy meeting this week with vague ideas on other specifics.
- "That's gonna need time to take shape," Sen. Josh Hawley told Axios. "There's no shortage of things there to go after, particularly the climate-related stuff."
- Another discussion among aides and GOP lawmakers: making changes to federal leasing policy to encourage fossil fuel production and raise revenue as a payfor, following Democrats' inclusion of leasing provisions in the IRA.
… And clashes: House Republicans, meanwhile, want to consolidate everything into one reconciliation bill.
- Ways and Means Chair Jason Smith told CNBC tha the two-bill strategy "breeds failure," since the GOP will have such tight margins (217 to 215 at the outset) in the House.
- "We have more work to do to try to align," Sen. John Cornyn told Axios when asked about Smith's comments. "We all want to do the same thing, more or less."
Dems on defense: Sen. Ron Wyden told Axios he's trying to get companies to "buttonhole" individual Republican lawmakers to ask them to protect the IRA's tax incentives.
- "I've been talking to a lot of business groups lately, and I'm trying to make a full-court press to describe this as something they're going to have to work for," he said.
Cascading impacts: Even without wholesale repeal, Republicans could have a big impact on how the IRA functions.
- Repealing demand-juicing incentives the GOP dislikes (like the EV credit) could upend supply-inducing provisions they support (like the advanced manufacturing credit).
- "Those two things do work in partnership, and if you lose one, the policy itself becomes less effective" at expanding EV deployment, said Jeff Navin, a founder of Boundary Stone Partners.
- Still, the IRA is a hodgepodge law, constructed based on what could pass rather than as a perfect piece of manufacturing policy.
- The debate is now about how "they're going to rip pieces of it apart," Rep. Sean Casten told Axios. "There are a thousand ways to break things."
