Republicans plan an energy agenda designed to keep Democrats on their heels

Republicans are preparing to advance an ambitious energy agenda if they win control of the House in next week’s elections — including faster approvals of fossil fuel projects and probes of how the Biden administration is spending its hundreds of billions in climate dollars.

The plan, described by a dozen current and former House lawmakers, aides and outside allies, seeks to build on the political momentum that the GOP claimed on energy policy this year, as jumps in fuel and electricity prices battered President Joe Biden’s popularity and complicated his climate agenda.

The GOP effort would include components of a strategy„,“link“:{„target“:“NEW“,“attributes“:[],“url“:“https://subscriber.politicopro.com/article/2022/06/house-republicans-climate-change-midterms-00036481″,“_id“:“00000184-3475-df7a-a7cf-b6f740170000″,“_type“:“33ac701a-72c1-316a-a3a5-13918cf384df“},“_id“:“00000184-3475-df7a-a7cf-b6f740170001″,“_type“:“02ec1f82-5e56-3b8c-af6e-6fc7c8772266″}“>components of a strategy that top House Republican Kevin McCarthy released in June that called for measures to stimulate oil and gas production, ease permitting regulations and seek to reduce reliance on China and Russia for critical materials. It also would propose actions that lawmakers of both parties may be able to agree on, such as faster approvals for low-carbon energy sources like renewable power, small nuclear reactors and hydrogen.

In interviews, the people familiar with the Republican priorities say it will keep a focus on voters‘ frustrations with gasoline prices, which surged in the past year amid the Russian invasion of Ukraine and the global economy’s rebound from the pandemic.

“Whatever big initiatives they have, it’s going to be focused on addressing inflation and energy costs,” said George David Banks, an outside energy adviser to Republicans who was former President Donald Trump’s top international energy adviser. “That’s the smart political move if you are trying to build momentum, and more of a majority the next election and trying to get the White House back.”

Biden and Democratic lawmakers such as West Virginia Sen. Joe Manchin are still hoping to pass permitting legislation this year that would ease approvals of oil and gas infrastructure along with clean energy sources like wind and solar power. Republicans have panned the Democratic plan as too modest, and their own expected legislative push will center on measures to reduce environmental reviews for all types of energy projects, speed approvals for oil pipelines and natural gas export terminals, as well as mines to produce critical minerals used in electric vehicles and uranium fuel that powers nuclear reactors.

Democrats‘ long-shot end-of-year permitting push and Republicans‘ appetite for updating those rules when they are likely to take control of the gavels could help the two sides strike a deal in the next Congress, according to one former Republican legislative aide.

“The exercise sets the table for compromise for early next year,” said Alex Herrgott, president and CEO of the Permitting Institute, a nonprofit, who was a senior staffer for Sen. Jim Inhofe (R-Okla.) and who has been giving technical advice to congressional staffers working on permitting.

Republicans say the Manchin proposal, or any similar compromise that might emerge in the waning months of this year, doesn’t go far enough to change the National Environmental Policy Act, the bedrock environmental law first adopted in 1970, which they see as a barrier to building energy infrastructure.

A senior House GOP policy adviser acknowledged that Republicans‘ permitting legislation — modeled after a broad NEPA overhaul bill introduced in 2020 by Rep. Garret Graves (R-La.) — would be a starting point of negotiations with congressional Democrats and Biden.

“You want to negotiate from a position of strength, not weakness,” the senior GOP House aide said in an interview. “We are going to introduce our best stuff. With that said, we are realistic of what the Senate looks like.”

House Republicans are also planning to scrutinize how the Biden administration deploys the $370 billion in clean energy measures that Congress approved in Democrats‘ Inflation Reduction Act„,“link“:{„target“:“NEW“,“attributes“:[],“url“:“https://legislation.politicopro.com/bill/US_117_HR_5376″,“_id“:“00000184-3475-df7a-a7cf-b6f740180000″,“_type“:“33ac701a-72c1-316a-a3a5-13918cf384df“},“_id“:“00000184-3475-df7a-a7cf-b6f740180001″,“_type“:“02ec1f82-5e56-3b8c-af6e-6fc7c8772266″}“>Inflation Reduction Act — though that GOP effort could risk undermining investments in energy improvements that would benefit red states.

Republicans have contended that Democrats‘ climate policies have stoked inflation by slowing oil and gas production — even though production of both has climbed under Biden.

But despite being heavily favored to take the House in the November election, Republicans may struggle to move legislation, even in a scenario where they also win control of the Senate. Any GOP majority in the Senate would likely fall well short of the 60 votes needed to overcome Democratic opposition, and Biden would be ready to veto anything that detracts from his agenda.

That means Republicans are unlikely to pursue more far-reaching ideas, such as repealing the sprawling set of tax credits for clean energy development and manufacturing that forms the centerpiece of the Democrats’ climate law. Any bill that makes it through Congress is likely to be limited to smaller measures that have bipartisan support.

„There is a very narrow window for moving anything. It’s going to be must-pass or significantly bipartisan,” said Christopher Guith, senior vice president of the U.S. Chamber of Commerce’s Global Energy Institute.

The senior Republican House policy adviser pinpointed measures to bolster nuclear energy and critical minerals mining as potential areas of compromise with Democrats. The person added that House Republicans’ initial energy package focused on permitting won’t be their only attempt at advancing policy.

Democrats, though, worry that even if Republicans seize control of only one chamber of Congress, they can still inflict significant damage on the gains that Biden’s party has made in advancing the president’s climate agenda. Biden is seeking to cut U.S. greenhouse gas emissions in half by 2030 and put the country on a path toward net-zero emissions by mid-century.

“My concern is that a lot of resources are going to be used to fend off [GOP] political attacks as opposed to resources and focus to implement these historic pieces of legislation,” said Rep. Ro Khanna (D-Calif.) in an interview.

Republicans acknowledge they don’t have the appetite to unwind the climate bill’s major clean energy tax credits. Industry advocates say these credits provide long-term certainty for both renewable energy sources and emerging carbon-free technologies that have gained traction„,“link“:{„target“:“NEW“,“attributes“:[],“url“:“https://subscriber.politicopro.com/article/2022/08/16/biden-climate-bill-gop-governors-00051374″,“_id“:“00000184-3475-df7a-a7cf-b6f740190000″,“_type“:“33ac701a-72c1-316a-a3a5-13918cf384df“},“_id“:“00000184-3475-df7a-a7cf-b6f740190001″,“_type“:“02ec1f82-5e56-3b8c-af6e-6fc7c8772266″}“>that have gained traction in GOP-led states.

“Once these things are done, authorized and being built in Republican states and districts, the enthusiasm for repealing becomes very difficult,” Sen. Kevin Cramer (R-N.D.) said in an interview.

Instead, Republicans are expected to home in on oversight of spending stemming from the climate and infrastructure laws. Already, GOP lawmakers have released statements raising concerns with the implementation of the loan guarantee program under the Energy Department, which received billions in new funding and authority, and questioning the supply chain of renewable energy sources, which also will be boosted under the law.

Washington Rep. Cathy McMorris Rodgers, who is in line to chair the House Energy and Commerce Committee if the GOP wins the majority, has called the influx of loan authority into the DOE loan guarantee program “Solyndra on steroids.”

She was referring to the solar company that collapsed in 2011 after it received more than $500 million in federal loan guarantees, drawing years of Republican attacks on the Obama administration’s clean energy programs. Democrats have countered that despite its demise, Solyndra was just a small part of the $90 billion in clean energy initiatives that spurred a huge expansion of wind, solar and other renewable power across the U.S.

Former GOP Rep. Greg Walden of Oregon, who was the top Energy and Commerce Republican before retiring last year, said his party has an obligation to vet the enormous spending in the Inflation Reduction Act.

“Is it going out in a timely manner and in the right places? You look for overbuild and waste. You basically hold agencies and programs accountable to the law,” he said.

But Republicans will face a tricky balancing act, as government funding increasingly supports new types of energy projects in their own home states. The Biden administration’s loan program office, for example, has provided a conditional loan guarantee„,“link“:{„target“:“NEW“,“attributes“:[],“url“:“https://subscriber.politicopro.com/article/2021/12/doe-kicks-off-restart-of-loan-guarantee-program-with-up-to-1b-deal-3993096″,“_id“:“00000184-3475-df7a-a7cf-b6f740190002″,“_type“:“33ac701a-72c1-316a-a3a5-13918cf384df“},“_id“:“00000184-3475-df7a-a7cf-b6f740190003″,“_type“:“02ec1f82-5e56-3b8c-af6e-6fc7c8772266″}“>provided a conditional loan guarantee for a project in Nebraska that promises to convert natural gas into hydrogen, which companies are eyeing to help reduce fossil fuel use.

“It will be super interesting to see how Republicans balance the desire to conduct investigations and find ‘the next Solyndra’ against the fact that Republican states and districts will disproportionately benefit from the investment, construction and job creation that flows from what Democrats just did via reconciliation,” said Colin Hayes, a founding partner at lobbying shop Lot Sixteen and former Republican staff director of the Senate Energy and Natural Resources Committee.

Forthcoming guidance from the Treasury Department„,“link“:{„target“:“NEW“,“attributes“:[],“url“:“https://subscriber.politicopro.com/article/article/2022/10/treasury-gets-to-work-on-implementing-clean-energy-tax-credits-00060462″,“_id“:“00000184-3475-df7a-a7cf-b6f740190004″,“_type“:“33ac701a-72c1-316a-a3a5-13918cf384df“},“_id“:“00000184-3475-df7a-a7cf-b6f740190005″,“_type“:“02ec1f82-5e56-3b8c-af6e-6fc7c8772266″}“>Forthcoming guidance from the Treasury Department on how to implement the climate law’s provisions for tax credits is also likely to put the Internal Revenue Service under further Republican scrutiny.

Republicans, with the control of committee gavels, are also expected to investigate the Biden administration’s interactions with OPEC, which rejected U.S. pleas and voted to cut output by 2 million barrels per day. Recently, House Oversight and Reform ranking member James Comer (R-Ky.) led a letter with fellow Republicans on the oversight panel„,“link“:{„target“:“NEW“,“attributes“:[],“url“:“https://republicans-oversight.house.gov/wp-content/uploads/2022/10/Oil-and-Gas-Embargo-Letter-to-Sec.-Granholm-19.pdf“,“_id“:“00000184-3475-df7a-a7cf-b6f7401a0000″,“_type“:“33ac701a-72c1-316a-a3a5-13918cf384df“},“_id“:“00000184-3475-df7a-a7cf-b6f7401a0001″,“_type“:“02ec1f82-5e56-3b8c-af6e-6fc7c8772266″}“>led a letter with fellow Republicans on the oversight panel requesting documents and information related to the administration’s potential plans to ban oil and gas exports, as well as the Energy Department’s role in recent releases from the Strategic Petroleum Reserve.

Republicans say they plan to spotlight how the supply chain for batteries and other critical components for green energy technologies relies on nations with poor human rights and environmental records, including China. And committees would also dig into the administration’s approach to domestic energy production, as well as examine corporations‘ adoption of so-called environmental, social and governance goals in their investment decisions, the people who spoke to POLITICO said.

Comer said in a statement to POLITICO that Republicans would use their majority to conduct “robust oversight” of Biden administration policies. Those include the “canceling” of the Keystone XL pipeline and efforts to restrict oil and gas leasing on federal lands, as well as ways in which the Securities and Exchange Commission “is pushing President Biden’s radical climate agenda through regulation that could drive up the costs of goods and services for Americans.” The SEC is looking to impose rules requiring public companies to disclose their risks from climate change.