Yesterday House Republicans approved the “Lower Energy Costs Act,” a bill that is aimed at increased production of fossil fuels in the U.S. The package would lift a variety of restrictions, fees and red tape for oil, natural gas and coal projects.
The bill has several key components with the main focus on making pipeline and refinery projects simpler to approve and oversee. A limit on environmental reviews of projects to two years (vs the average of seven currently) would be one of the mechanisms to achieve this. In statement after the vote Republicans claimed the bill will have a direct impact on prices at the pump and in grocery stores.
A new tax on methane emissions, introduced last year, would also be scrapped, reducing maintenance costs for fossil fuel producers. Methane is one of the gases contributing to global warming according to the IPCC.
Increased production of minerals that have become crucial for the energy transition like lithium, cobalt and nickel would also get a boost from the act. This might initially seem counterintuitive but it appears the thinking behind the legislation is focused on bringing the production of EV’s, smartphones and computers in the U.S., as opposed to relying solely on foreign imports and exposing supply chains to risk.
House Speaker Kevin McCarthy, R-Calif., commented on the bill by saying it “restores American energy leadership by repealing unnecessary taxes and overregulation on American energy producers,” and “makes it easier to build things in America.”
Relevant: Will Oil Companies Actually Profit From Biden’s Climate Bill?
The vote was won with a 225-204 vote but Senate Majority Leader Chuck Schumer, D-N.Y., was quick to describe it as “dead on arrival.” President Biden has also made clear that he would veto the bill.
The Clean Air Task Force, a non-profit environmental organization, voiced its opposition against the bill with their U.S. Federal Policy Director Evan Chapman saying: “…this bill is a step in the wrong direction and would put our climate goals further from reach. Of particular concern, this bill would repeal the Methane Emissions Reduction Program, which incentivizes operators to reduce emissions and decrease waste, improving the air quality for the millions of Americans living near oil and gas sites. It would also dismantle the Greenhouse Gas Reduction Fund, which was created to support rapid deployment of low- and zero-emissions technologies…”
Read more: Inflation Reduction Act May Cut US Emissions By 40%