A bill to help the United States meet its climate goals has cleared its final hurdle and is expected to be signed into law by President Joe Biden next week.
The Cut Inflation Act is a significantly scaled-down version of a previous Biden-backed bill that was blocked by dissenting Democratic senators, but will still deliver deep cuts in greenhouse gas emissions. greenhouse effect, according to experts.
After clearing the Senate on Monday — with Vice President Kamala Harris having to use her vote to pass it because the vote was split 50-50 — the bill passed the House of Representatives on Friday.
Tweeting a photo of himself smiling as he watched footage of the bill passing Congress, Mr Biden said on Twitter: “The choice we face as Americans is to protect those who are already powerful or finding the courage to build a future where everyone has a shot.
“Today I proudly watched as House Democrats choose families over special interests.”
He went on to say, “I want to thank the Democrats in Congress for supporting the Cut Inflation Act. It required many compromises. Doing important things almost always does. I can’t wait to sign her.”
The bill also aims to reduce medical costs for older Americans, but increases some corporate tax rates and introduces other measures to recover the money needed to pay for everything.
Republicans have attacked the bill, saying it’s a spending ‘wish list’ that would hurt an inflation-battered economy, kill jobs, drive up energy costs and undermine growth at a time when the economy is facing a potential recession.
But House Speaker Nancy Pelosi, the House’s top Democrat, said: “Today is truly a glorious day for us. We are sending a monumental bill to the president’s office that will truly be for the people.”
Economists say the legislation could help the Federal Reserve fight inflation, but do not expect a big impact on the economy in the coming months.
The bill plans to make $370 billion available for climate-focused spending, with incentives to encourage purchases of electric vehicles and energy-efficient appliances, and to motivate new investments in wind energy and solar.
The United States pledged to cut its greenhouse gas emissions to half their 2005 levels by 2030 last year Glasgow COP26 Climate Summit.
Modeling from Princeton University’s Project Repeat indicates that the bill will double the amount of new clean electricity generation capacity brought online by 2024.
This would help put the United States on the right path to fulfilling its promise.
Environmental groups broadly embraced the bill, but said rules that would allow the federal government to only allow new wind and solar power developments on federal lands when it also auctions drilling rights for oil and natural gas will prolong America’s use of fossil fuels. .
The provision was introduced by one of the Democratic senators who opposed Mr Biden’s original bill, Joe Manchin, who represents coal-producing West Virginia.
The legislation also allows the federal health plan Medicare to negotiate lower prices for prescription drugs, in the same way the NHS negotiates drug prices in the UK.
Juliette Cubanski, deputy director of the Medicare program at the Kaiser Family Foundation, said it would reduce drug costs for the government, employers and patients.
The nonpartisan Congressional Budget Office estimates that Medicare could save $101.8 billion over 10 years through negotiations.
The pharmaceutical industry says price negotiation will limit innovation.
It comes amid reports that the pharmaceutical industry spent more than any other sector last year lobbying Congress – at least $142 million.
Democrats also say the bill will reduce the budget deficit.
What’s in the bill?
£375 billion over 10 years to encourage industry and consumers to switch from carbon-emitting energies to cleaner forms of energy.
This includes $4 billion to deal with the drought in the western United States.
Expenditures, tax credits and loans will aim to promote the use of:
• Clean energy technology, such as solar panels, electric cars and energy efficient appliances
• Consumer efforts to improve home energy efficiency, such as retrofitting homes with heat pumps and electric water heaters
• Emission reduction equipment, such as carbon capture, for coal and gas-fired power plants
• Air pollution controls for ports and low income communities
• Soil enrichment programs and other efforts to promote climate-smart agriculture
Experts say that, combined with last year’s $1.2 trillion infrastructure bill, the Cut Inflation Act represents the biggest injection of public funds for energy programs since the Manhattan Project. .