White House says renewables still pivotal to budget reconciliation despite rumours of ITC changes

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The US$3.5 trillion budget reconciliation has been pending in the US Senate amid opposition from two key Democrat lawmakers. Image: Obi Onyeador via unsplash.

The White House has said renewables are still key to its budget reconciliation bill despite rumours of the investment tax credit (ITC) being modified, as opposition to the bill by senators Manchin and Sinema continues.

Speaking at a White House press conference, White House communications director Jen Psaki said it was “absolutely pivotal” that the legislation contained “climate components”, holding up parts of the bill such as “offshore wind and solar”.

The US$3.5 trillion budget reconciliation package currently includes an extension to the solar ITC for 10 years at 30% for projects that meet certain labour conditions, but there have been reports in international media outlets that the ITCs could get cut from the bill.

There have been recent suggestions in international media outlets that Democrats are discussing changes to the ITC to bring Manchin onside. This could be a cut to the length of the ITC to five years or a devaluation in its support to 20%.

Due to the even split within the US Senate, President Joe Biden needs all of his 50 senators to vote in favour of the bill, but West Virginia senator Manchin and Arizona senator Krysten Sinema have delayed its passing so far.

When asked at the briefing about Manchin’s opposition to the bill in its current form and whether President Biden will be able to meet his climate goals without the senator’s support, Psaki said:

“It is absolutely pivotal that these pieces of legislation have climate components — and they will — to address the climate crisis.

“President Biden has been clear about what he supports. A hundred percent clean power by 2035 is a goal he committed to over a year ago […] and he remains committed to it.”

Yesterday (18 October), Reuters reported that Biden was speaking with Manchin, who thinks the bill is far too costly, about what was required for his support.

When asked about the difficulties during an appearance in Hartford, Connecticut, local media reported that Biden said: “To be honest with you, we’re probably not going to get US$3.5 trillion this year. We’re going to get something less than that. But I’m going to negotiate, I’m going to get it done.”

Meanwhile, Manchin has entered into a very public war of words with Vermont senator Bernie Sanders over the budget reconciliation. Sanders wrote an op-ed on Friday (15 October) in Manchin’s home-state paper, the Charleston Gazette-Mail, lambasting the moderate lawmaker for obstructing the bill.

Manchin fired back shortly after. He said: “This isn’t the first time an out-of-stater has tried to tell West Virginians what is best for them despite having no relationship to our state.

“Senator Sanders’ answer is to throw more money on an already overheated economy while 52 other Senators have grave concerns about this approach. To be clear, again, Congress should proceed with caution on any additional spending and I will not vote for a reckless expansion of government programs.” 

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