US House reconciliation bill stalls amid push for swift end to energy tax credits

The House Republicans' sweeping budget reconciliation package hit a major procedural snag May 21 as deficit hawks threatened to vote against the measure unless the Inflation Reduction Act's clean energy subsidies are phased out sooner, among other policy changes.

Three members of the conservative House Freedom Caucus – Chip Roy of Texas, Andy Harris of Maryland and Clay Higgins of Louisiana -- said the lower chamber's reconciliation bill must eliminate the 2022 climate law's green energy tax credits faster than phaseout schedules proposed under a House Ways and Means Committee bill.

"When [President Donald Trump] called for an end to the 'Green New Scam,' he didn't mean leave 40% to 45% of the subsidies ongoing," Roy said during an impromptu press conference held alongside an ongoing House Rules Committee bill markup for the combined Republican reconciliation package. "That's something we're going to continue to scale back on."

The comments came as the House Rules Committee continued a marathon debate, which began at 1 am ET May 21, late into the afternoon as the panel awaited a manager's amendment from leadership reflecting negotiated legislative changes. The committee is the final procedural stop for the reconciliation bill before a full House floor vote.

Speaker Mike Johnson told reporters the House may still vote later May 21 on the party's so-called "One Big, Beautiful Bill" despite continued internal divisions on state and local tax deductions and reservations among moderate Republicans about harming IRA-funded projects in their districts.

The White House separately released a May 21 statement of administration policy urging House Republicans to "immediately pass this bill." Failure to do so "would be the ultimate betrayal," it said.

The holdouts, alongside Johnson, were invited to the White House May 21 as Trump and leadership attempted to convince them to vote for the package. Timing for a House Rules Committee vote and subsequent full House floor vote was still unclear.

Trump visited with Republican House members May 20 to convince them to back the legislation as written. During a press appearance with Johnson, Trump criticized Republican deficit hawk Thomas Massie, who has also opposed the bill.

The three House Freedom Caucus members said May 21 they were now primarily concerned with the size and scale of cuts to Medicaid – arguing that the cuts didn't go far enough to reduce deficit spending or alleged "waste" – and with the speed of energy tax credit phaseouts.

"We demand that waste, fraud and abuse be addressed in Medicaid, because it's inadequately addressed in the current bill," Harris said at the press conference. "And we believe that as much of the Green New Scam should be eliminated as is possible."

Energy tax fight

The text passed out of the Ways and Means Committee May 14 would phase down 45Y and 48E technology-neutral clean electricity production and investment tax credits, as well as the 48E nuclear production credit, from 2029 through 2032. The bill would repeal credit transferability for the 45Y and 48E credits two years after enactment and establish strict new prohibitions for projects whose physical components or intellectual property are tied to foreign entities of concern.

The committee bill would also all but end consumer subsidies for electric vehicles after 2025, while retaining and easing some eligibility requirements for the 45Z clean fuels production credit, earning praise from US biofuels producers. The 45Q credit for carbon capture and sequestration was also maintained.

Harris, Roy and Higgins did not detail the energy tax credits they would prefer to phase out more quickly. In 2024, 38 House Republicans wrote a letter to Johnson asking for targeted modifications to the IRA's clean energy tax credits, though public objections from those members have yet to derail the reconciliation process to date.

On May 13, Senator Kevin Cramer, Republican-North Dakota and an influential Senate energy policy voice in the upcoming Senate reconciliation deliberations, publicly disagreed with the Ways and Means Committee's phaseout approach. Republicans should support advanced nuclear energy and geothermal research projects while ending subsidies for more mature industries like wind and solar, Cramer told Politico.

Senator Shelly Moore Capito, Republican-West Virginia, agreed, noting "there has been job creation around these tax credits."

Permitting provisions

Still in question is which measures to speed energy project permitting and limit judicial review will remain in the sprawling legislation as Johnson struggles to meet a self-imposed Memorial Day deadline for a House floor vote.

"A lot's still in motion," a House aide said May 21, with more details to come in the House Rules Committee's manager's amendment.

A version of the legislation posted by the House Rules Committee ahead of its May 21 markup had struck provisions to fast-track the permitting path for cross-border pipelines. The updated bill text also stripped out a new federal siting regime for CO2, hydrogen and petroleum pipelines that have faced opposition from Great Plains state lawmakers with concerns about CO2 pipelines.

Trump reportedly urged lawmakers to revive the pipeline permitting provisions during a meeting with Republican House members early May 20.

Meanwhile, the Rules Committee version kept in place other hotly debated permitting changes backed by Republicans, including one allowing applicants who pay a fee to get faster, near-guaranteed approval of natural gas projects.

Also maintained was a House Natural Resources Committee measure allowing applicants to pay a fee for environmental reports and then enjoy protection from lawsuits under the National Environmental Policy Act.

Democrats have assailed the permitting approach as creating a pay-to-play scheme that would allow the Trump administration to ignore environmental laws, while Republicans said the steps would streamline siting and permitting of pipelines around the country, helping to meet energy demands and win the AI battle with China.

"The proposed amendments before us would open up the door for industry to strip the [Natural Gas Act] of these most essential foundational public interest principles and replace it with a pay-to play-regime that guts effectively any meaningful regulatory oversight, preempts state input, and effectively locks the courthouse doors to those most harmed," Megan Gibson, senior attorney with the Southern Environmental Law Center said in a briefing for reporters May 20.