The debate over repealing President Biden’s Inflation Reduction Act, despite the high degree of political polarization in Washington, does not break neatly across partisan lines.
With the current degree of political polarization in Washington, the debate over climate change often descends into reciprocal partisan blather. Some Democrats have promised to “keep it in the ground” when it comes to fossil fuels, and President Trump told attendees at Davos three days after he came back into office that he was ending the “Green New Scam,” without even precisely defining what that meant.
But one specific action promised during last year’s campaign was the rollback of President Biden’s signature legislation, the Inflation Reduction Act (IRA), which authorized $370 billion to promote a range of commercial developments related to renewable energy, electric vehicles, and the production of critical minerals related to those sectors. Much of this was in the form of subsidized loans, as well as tax credits. Trump promised to “rescind all unspent funds” from the IRA.
But the politics surrounding the specifics of IRA loans does not break down on purely partisan or ideological lines, especially now that many of those projects have specific locations attached to them and local communities who are hoping for the creation of good jobs in manufacturing.
While Trump’s new Secretary of Energy Chris Wright has, of course, halted new awards under the IRA, a full repeal is much more difficult than it sounds, despite Republicans’ trifecta of winning the White House and both houses of Congress. At this point, it does not appear that Republicans who are supporting a full repeal would have anywhere near the votes to accomplish it as part of this year’s budget cycle.
Why Some Republicans Support the Inflation Reduction Act
Much of this has to do with where the investments under the IRA are going. Per an analysis from the Rhodium Group, the two largest states for investment related to the IRA for the period from September 2023 to September 2024 as a proportion of their entire economies were Nevada and Wyoming, Wyoming being a state that’s more often associated with being America’s top coal producer. The potential presidential election swing states of Michigan, Arizona, Georgia, and North Carolina also come out toward the top of the distribution. Kentucky and South Carolina also were at the high end, with Tennessee and Texas above the median point.
Even before Trump won the 2024 election, there already was a group of Republican House members who had made clear that they would not want to see a full repeal. A letter organized by Rep. Andrew Garbarino (R-NY) in August 2024, with support from eighteen House Republicans, urged Speaker of the House Mike Johnson to prioritize “business and market certainty” when making any adjustments to the IRA, avoiding creating disruptions to decisions that had already been made by private sector actors based on the law.
A second letter by Rep. Garbarino in March 2025 urging Speaker Johnson not to use rollbacks of the IRA credits to pay for extending tax cuts garnered twenty-one House Republican supporters.
Meanwhile, on the Senate side, four Republican senators, including Lisa Murkowski (R-AK), a moderate leader on energy issues, and Sen Thom Tillis, who serves on the Finance Committee, wrote to Senate Republican leader John Thune in April opposing a repeal of the tax credits.
All of this probably leaves any measure for a broad repeal short of the votes it would need to pass, given the Republicans’ narrow majority in the House of Representatives. That is probably a good thing.
Why Repealing the Inflation Reduction Act is Bad For Business
If there is one thing worse than alleged “green corporate welfare,” it is businesses getting jerked around endlessly by having the government move the goalposts, regardless of how that happens to come about. Decisions have been made and resources have already been committed based on the existence of these loans and tax credits, and rolling them back in an indiscriminate manner would inevitably lead to wasted capital.
The fact that a bipartisan majority in both houses of Congress appreciates this, judging from the number of signatories on these letters, is an optimistic sign that our constitutional process for making decisions after careful deliberation is still functioning, even in this era of such sharp partisanship.
About the Author: Greg Priddy
Greg Priddy is a Senior Fellow at the Center for the National Interest and does consulting work related to political risk for the energy sector and financial clients. Previously, he was director of global oil at Eurasia Group and worked at the U.S. Department of Energy.
Image: Shutterstock/Vitalii Vodolazskyi
