House members clash over bill that would nix HVAC tax credits

U.S. House members are pushing back on their colleagues over proposed cuts to the Inflation Reduction Act included in Monday’s tax bill, which would sunset two consumer-facing HVAC tax credits. 

Why it matters: As it stands, consumers’ ability to claim a $3,200 tax credit for installing certain air conditioners, heat pumps, and furnaces will end on December 31. A 30 percent credit for installing geothermal heat pumps will expire on the same date. Catch up

What’s happening: Following the bill’s release, Florida Democrat Kathy Castor on Tuesday proposed an amendment that would delay the bill’s provisions from taking effect until the Energy Information Administration studies its impacts. 

• “You can’t rush a bill like this, with such a large impact, through without people understanding,” she said — although the amendment ultimately failed. 
• On Wednesday, more than a dozen House Republicans issued a statement saying that while some of the IRA’s phaseout schedules were “reasonable,” changes need to be made. 

Zoom out: The reactions echo previous Republican support for the IRA. In March, 21 House Republicans wrote a letter encouraging a “thoughtful” approach to any cuts, while Don Bacon, a Nebraska Republican, advocated for using a “scalpel,” not a sledgehammer. 

But, but, but: “We’re in the first quarter,” said Florida Republican Vern Buchanan, who’s hopeful that the Senate will act as a backstop when the bill moves forward. “We’re not done till we’re done,” he added.

• Case in point: Some Senate Republicans, including North Carolina’s Thom Tillis, already plan to ease some of the rollbacks. 
• “I don’t think there are any [IRA cuts], or I can’t think of many, that we would take just word-for-word, as is, but it’s a good foundation to build on,” Tillis said.

What’s next: While the Senate’s stance on reviving the HVAC tax credits remains unclear, the House plans to vote on the bill next week and pass it by Memorial Day, with Senate action to follow.

• “At a time when families and businesses are deeply concerned with energy prices, we should be doubling down on affordable, clean energy incentives, not gutting them,” wrote a consortium of eight environmental groups on Wednesday. 
• “We urge members to vote no on this bill,” they added.