Policy and Legal

The Treasury Department and the IRS can help the U.S. meet its climate goals—if both agencies “can leverage private sector ingenuity, expertise and capital” both transparently and inclusively, the NAM told Treasury late last week.

What’s going on: This year’s reconciliation legislation contains advanced manufacturing, clean energy and climate incentives to invest $369 billion in actions that will address climate change, including $270 billion via direct tax incentives.

• These measures can be successful if “Treasury and the IRS quickly address the critical details of how each of these incentives will work in tandem with clean energy and advanced manufacturing projects that have already begun and those that have yet to be conceived,” NAM Vice President of Energy and Resources Policy Rachel Jones told the agencies.
• Treasury must also work to ensure the incentives are used “in a way that quickly brings new private capital to bear” while keeping projects on schedule.

Manufacturers’ input needed: Engagement with manufacturers should help the agencies develop their rulemaking, Jones said.

• “To meet our shared goals, including achieving meaningful emissions reductions, Treasury and the IRS should maintain an open line of communication with the NAM’s members of all sizes and sectors,” she said.
• “Without thoughtful engagement with manufacturers, the clean energy and climate incentives could have the opposite of intended results, and in some cases projects could stall, communities will face further disappointment, energy security will be jeopardized and climate goals will go unmet.”

What’s not needed: “It would be shortsighted to implement guidance and rules that exclude or indirectly penalize manufacturers that are already making significant capital investments in clean energy projects,” Jones said.

Teamwork—and plain language: The NAM also urged Treasury and the IRS to make clear their definitions and qualifications when it comes to clean energy and climate tax credits.

• Jones recommended cooperation across the “entire federal family” to combat climate change—from the Nuclear Regulatory Commission to the Department of Defense to the Federal Energy Regulatory Commission and many more.

NAM about town … The NAM participated in a Treasury roundtable yesterday where it shared the specific concerns and constructive input from manufacturers more directly.