Democrats’ colossal spending package dubiously named the “Inflation Reduction Act” includes plans to spike energy prices with nearly $20 billion in new taxes.
According to an analysis by the conservative fiscal group Americans for Tax Reform, the $750 billion-dollar bill imposes $19.7 billion in tax hikes on American energy. Senate Democrats advanced the legislation on Sunday 51-50 when Vice President Kamala Harris cast the tie-breaking vote.
West Virginia Democrat Sen. Joe Manchin, who shocked Senate Republicans when he announced a compromise with Majority Leader Chuck Schumer on a revamped “Build Back Better” package, celebrated the new version of the previously doomed bill as a win for domestic energy.
“For years, I have worked across the aisle to determine the most effective way to increase domestic energy production, lower energy and healthcare costs, and pay down our national debt without raising costs for working Americans,” Manchin said in a press release. “By investing in American energy production and innovative technologies the U.S. is on a path toward energy security, lower gas and home energy prices and we are leading the fight on global climate.”
The bill’s litany of tax hikes targeting conventional sources of energy from fossil fuels, however, will raise American utility bills and jeopardize the reliability of the power grid. The legislation more than doubles the excise tax on coal for $1.2 billion, adds a more than 16 cent-per-barrel tax on crude for $12 billion, and imposes a major tax on oil and gas development for another $6.5 billion to complement the Interior Department’s doubling of oil and gas royalties on public lands this spring.
In a letter to lawmakers from the American Gas Association, the industry warned consumers will face a 17 percent increase in their gas bills if the Democrats move forward with their plans to introduce a new methane emissions tax on natural gas.
“We also estimate that the proposal could put more than 100,000 American jobs at risk,” the trade group wrote to Congress.
Americans are already paying elevated energy prices courtesy of the president who pledged not to raise taxes on those who earn less than $400,000.
In June, gas prices reached an all-time peak of $5.01 per gallon of regular unleaded and remain an average of more than $1.50 per gallon above what they were when Biden took office. According to the Energy Information Administration (EIA), prices for electricity rose at their fastest pace last year since 2008. In the agency’s latest report on inflation last month, the Bureau of Labor Statistics revealed energy prices are up nearly 42 percent from a year ago.
“Sadly, with once-in-a-generation inflation, our families have been suffering under a green tax for well over a year,” Larry Behrens, the communications director for the energy non-profit Power the Future told The Federalist. “Make no mistake, this is what happens when you turn the economy over to the architect of the Solyndra fiasco.”
In 2011, the start-up solar power company went bankrupt two years after capturing a $535 million-dollar loan from the federal government under the Obama-Biden administration. Biden’s new spending package with nearly $400 billion dedicated to climate makes similar expenditures to promote wind and solar, including $30 billion worth of tax credits to expedite production of panels and turbines and $10 billion to build manufacturing capacity for panels and electric vehicles.
Alex Epstein, an energy expert and author of “Fossil Future,” wrote in a Substack post “worst of all” the legislation gives “the Biden EPA essentially unlimited power to restrict fossil fuel projects” but gutting a key provision of the Clean Air Act.
The nation’s accelerated transition to intermittent sun and wind has already triggered blackouts in California and Texas while Americans cope with sticker shock in their utility bills and at the gas pump.
“The Manchin [Green New Deal] gives govt limitless, corruption-inducing power,” Epstein wrote. “The deal itself has $10s of billions that bureaucrats can allocate arbitrarily. And Manchin’s requested permitting policies would give new, illegitimate powers that are guaranteed to be exercised corruptly.”