Republicans seeking to roll back the Biden climate legacy are actually looking to preserve one IRA incentive: the 45Z clean transportation fuels tax credit, Daniel writes.

Why it matters: A powerful and diverse coalition that includes airlines, farmers, labor unions and biofuel blenders already has secured backing for the credit from some GOP lawmakers.

• Expanding an IRA credit would be a novelty as the party searches for trillions to pay for an extension of the Trump tax cuts.

Context: The credit, which took effect this year, provides a per-gallon tax break for producing transportation fuels — including ethanol-made sustainable aviation fuel — that emit fewer greenhouse gases.

• Short-term 45Z guidance released in the Biden administration's final days left questions up to President Trump and Republicans.

Between the lines: The industry's argument — outlined in a letter to Congress last month — is that 45Z's three-year lifespan can't stimulate enough investment for projects that take longer to permit and build.

• "It's going to be part of the reconciliation debate — that conversation's already beginning," said Geoff Cooper, president and CEO of the Renewable Fuels Association.
• An airline industry source who spoke on condition of anonymity added: "We're getting positive responses from Republican audiences. We're talking, certainly, to the tax-writing committees. We're talking to leadership."
• The source said an extension to 10 years is the priority, followed by an increase in the credit value.

What they're saying: "45Z can be a very productive provision, and so I'm interested in that," Adrian Smith of Nebraska, a top Republican on Ways and Means, told Daniel.

• He said strengthening 45Z could be achieved in reconciliation: "I think 45Z can deliver positive results."
• Sustainable aviation fuel is "a huge economic opportunity" and "an area that we should continue to support," Rep. Julie Fedorchak of North Dakota agreed.

Zoom in: A Ways and Means hearing in January featured Republican testimony in support of the tax credit.

• Iowa's Mariannette Miller-Meeks, chair of the House Conservative Climate Caucus, backed 45Z as a credit that reflects "our state's priorities," she told reporters after the hearing.

Yes, but: Even with such support, a tax-credit extension goes against where Republicans ultimately want to be.

• "We're going to have a rigorous debate here going forward.… There are going to be a lot of priorities," Smith said.

Ford CEO Jim Farley met with lawmakers on the Hill yesterday after he warned publicly about Trump's tariff regime and possible layoffs if Republicans repeal IRA incentives, Nick and Daniel write.

Why it matters: U.S. automakers have made big bets on EVs, but the consumer tax credit is one of the most attractive GOP repeal targets in reconciliation.

Driving the news: At the Wolfe Research Auto, Auto Tech and Semiconductor Conference, Farley said IRA repeal would put jobs at risk at "battery production and assembly plants all through Ohio and Michigan, Kentucky and Tennessee."

• But he struck a more conciliatory tone coming out of meetings on the House side.
• He told Nick that his company is "really excited about what the Trump administration is committed to in terms of making a stronger U.S. auto industry."

Between the lines: One of those battery plants in which Ford has invested big money — a joint venture with South Korea's SK On — sits in the district of Energy and Commerce Chair Brett Guthrie, a leading Hill opponent of EV subsidies and tailpipe regs.

• Guthrie told Daniel yesterday he hadn't met with Farley — but that the Ford plant wouldn't sway his thinking on the 30D EV credit.
• "I'm concerned about the growth of that plant, but I'm not going to vote to mandate people buy a car that comes out of that," he said. "Just because something's in my district, I shouldn't mandate that people have to buy it."

📊 1. Budget resolve: The House Budget Committee is marking up a fiscal framework for a package of energy and border security priorities.

• The Senate Budget Committee voted along party lines yesterday to advance its blueprint.

⛏️ 2. Mining fix: Bipartisan bills were reintroduced in the House and Senate to address the Rosemont court ruling that limited the scope of mining activities on public land.

• The Mining Regulatory Clarity Act, led by Sen. Catherine Cortez Masto, was praised by mining, clean energy, and zero-emission transportation advocates.

🌎 3. Heating up: Rep. Celeste Maloy sees a path to passage for her bipartisan geothermal permitting bill with Rep. Susie Lee.

• Last session, "it just didn't make it to the top of the pile, so we'll work on getting it to the top of the pile this time," Maloy said. "There are a lot of people with the right interests aligned to push it this time."

"I believe we can outperform that.… The unknown is how CBO is going to score. From things we looked at in the past, we don't have a lot of confidence in their ability to do that."