The SEC's new climate rule is on a collision course with Congress, Jael writes.

Why it matters: One of the year's most closely watched regulations is in the House GOP's sights. Expect fireworks accordingly via the Congressional Review Act.

Driving the news: SEC commissioners today approved a final rule requiring public companies to give investors information on various risks they face from climate change in regular disclosures.

• As part of that effort, the SEC is compelling certain firms to disclose carbon emissions resulting from their operations (known as Scope 1) and from their energy use (Scope 2).
• Some observers are calling it a watered-down rule because it no longer includes a wider supply chain emissions requirement (known as Scope 3) that the commission had previously proposed.

We were already expecting court challenges. But we've learned Congress is also likely to step into the fray.

• Rep. Andy Barr told Nick last night he expects a CRA resolution in response to this rulemaking. Today, Senate EPW ranking member Shelley Moore Capito told him the same.
• "I'd be happy to lead it, but I'm going to confer with my colleagues," said Barr, who named House Financial Services Chair Patrick McHenry and Reps. Bill Huizenga and Ann Wagner.

Between the lines: Some activists are bashing the SEC for ditching Scope 3. But it's unlikely that most congressional Democrats will join them.

• Sen. Brian Schatz told Jael yesterday that ditching Scope 3 could concern him "depending on how they do [it]" and that some have voiced "legitimate concerns" about how "that would be quantified."
• But overall, Schatz is still enthusiastic that the agency's stepping into the fray.
• "Risk is risk. Just because it's politically uncomfortable doesn't mean this particularly risk shouldn't be disclosed," he said, adding: "I'm not going to trash it before I read it."
• The House Sustainable Energy and Environment Coalition, a group of climate-hawk Dems, put out a statement praising the rule with zero mention of Scope 3.

Reality check: Supporters of SEC's action say it isn't intended to confront climate change at all but instead is purely for investors to know financial risks due to extreme weather and decarbonization plans.

• This is likely to be central to legal arguments against the rule, especially in light of recent Supreme Court rulings limiting agency authority to step beyond powers explicitly laid out in statute.
• "'How does this emissions disclosure rule save the planet?' That's kind of a different question than what the rule is trying to ask," said Laura Peterson of the Union of Concerned Scientists.

What we're watching: If/when lawmakers chafe over how frequently they're using the CRA to make policy.

• "It is a little tricky if you don't control all branches of government," Sen. Mike Braun told Nick. But if Donald Trump wins in November, he said, expect the GOP to focus on "the most egregious" regulations.

Rep. Mike Levin sees his transmission and permitting legislation as groundwork for the next big climate and energy bill, Nick writes.

Why it matters: The Clean Electricity and Transmission Acceleration Act, which he floated last year with Rep. Sean Casten, is House Democrats' answer in the permitting reform debate on the Hill.

Driving the news: Nick sat down with Levin this morning at an Axios event that also featured Energy Secretary Jennifer Granholm and top Biden climate official John Podesta. Here are some highlights.

🔮 CETA futures: Levin gave a telling quote on how Democrats view the permitting debate: "It shouldn't be easier to have a multi-state pipeline project than a multi-state transmission project."

• He likened CETA to the flurry of legislative proposals Democrats put on the table in the years before they passed the IRA.
• "My experience — I've been at this five years now — is that you have to be opportunistic," he said.
• "The things that we were able to do in the last Congress, whether the IRA or the infrastructure law, CHIPS, you name it, all was because we were prepared. In many cases … the foundation for those bills had already been written."
• FERC, he said, won't be able to act on its own to accelerate transmission deployment: "They need new authority to be able particularly to cite multi-state, multi-gigawatt projects."

🦺 IRA safety: Podesta, who's about to succeed John Kerry as top climate diplomat, doesn't think Republicans will successfully repeal the IRA because the projects funded by its tax credits are "sticky."

• "I think these tax credits are going to be very hard to rip out of the tax code. Once they're there, businesses are relying on them."
• As for the IRA's grant programs, he said, a lot of money will soon "be obligated and out the door." He pointed specifically to EPA's Greenhouse Gas Reduction Fund.

🗣️ Hydrogen balancing act: Podesta said he's "all about practicality" when it comes to the administration's guidance for the hydrogen tax credit.

• "We want to get this right.… We're going to make sure that this industry works and it's producing hydrogen in an environmentally friendly way."

♨️ Feeling the heat: Granholm said she wants to press oil companies to invest in next-generation geothermal technologies.

• "We have huge potential with advanced and enhanced geothermal in this nation, and they're in a perfect position to take advantage of that," she said.

Go deeper: Look for more, including Granholm's comments on the oil industry and AI, from our colleagues Ben Geman and Andrew Freedman in tomorrow's Generate.

📝 1. Hot letter: Dozens of Hill Democrats, including Chuck Schumer, signed on to a letter to the FTC expressing concern about oil industry mergers.

🗣️ 2. Confirmed envoy: Top Republicans think Podesta should receive Senate confirmation to replace Kerry.

• "This appointment is another example of your administration's practice of creating new offices that do not require Senate confirmation or that do not have explicit statutory missions and constraints," Shelley Moore Capito and Cathy McMorris Rodgers wrote to Biden.

♻️ 3. Recycling material: The DOE announced a new prize competition for companies recycling "critical materials" from electronic waste.

⛏️ 4. Caught in a Moshe: The Senate advanced Moshe Marvit's nomination to be on the Federal Mine Safety and Health Review Commission on a 50–49 vote.