House GOP lawmakers on two separate panels May 14 delivered on their promise to pass legislation that would gut many programs established by the 2022 Inflation Reduction Act that were intended to reduce climate emissions and expedite construction of renewable and other lower-carbon-emitting energy infrastructure projects. 

The bills are part of the 2025 budget reconciliation package that would set in motion many Trump administration priorities, but they collectively face opposition from a mix of Democrats, moderate Republicans and budget deficit hawks who say the bills don’t go far enough to reduce the deficit. 

The bills, grouped together in a large package—the “one big beautiful bill” requested by Trump—will be considered by the Budget Committee the week of May 19 before the package is able to move to the floor, but House Speaker Mike Johnson (R-La.) said May 15 that the legislation will likely go through more changes to gain enough support to pass the full chamber. 

Construction groups support provisions that would make permanent tax reductions in the 2017 Tax Cuts and Jobs Act, which are set to expire at the end of the year unless they are extended.

Gutting of Climate Law Programs 

The House Energy and Commerce Committee voted 30-24 along party lines to approve legislation that would amend the Natural Gas Act to expedite permitting for natural gas facilities—and for hydrogen, natural gas and carbon dioxide pipelines.

It also makes steep cuts to Medicaid programs and would return $6.5 billion in unspent funds from the Inflation Reduction Act to national coffers. 

Among programs or unobligated funding under that law that would be cut are: community and block grants for environmental justice communities; EPA’s Greenhouse Gas Reduction Fund program for clean energy and projects to reduce greenhouse gas emissions; the U.S. Dept. of Energy’s Loan Programs Office; and the Tribal loan guarantee program. 

The bill also would pull back funding for transmission facilities and grants for siting interstate transmission lines; as well as funding for interregional and offshore wind electricity transmission planning, modeling and analysis. The package also would rescind the incentive program for reducing petroleum and natural gas methane emissions. 

The Congressional Budget Office May 12 told the panel’s chair, Brett Guthrie (R-Ky.), that the bill would likely cut the deficit by more than $880 billion, but Democratic lawmakers charged that deficit reduction would come at the cost of loss of Medicaid services for more than 13 million Americans. 

The same day, lawmakers on the House Committee on Ways and Means also voted along party lines to advance Republicans’ tax break plan, which could add trillions to the deficit. It also would accelerate the phaseout of production tax credits for nuclear, hydrogen and renewable energy projects. 

Environmental groups expressed frustration at the rollbacks. 

“At a moment when energy demand is skyrocketing, the last thing we should be doing is rolling back investments that will make electricity more abundant, reliable and affordable,” said Nathaniel Keohane, president of the Center for Climate and Energy Solutions.

Push to Extend 2017 Tax Cuts

The bill’s provisions extend cuts from 2017, including one benefiting many contractors, which are otherwise due to expire. 

Overall, the Joint Committee on Taxation estimates the bill would reduce federal revenue by about $3.7 trillion over 10 years and add $5.3 trillion to the national deficit if cuts are made permanent. But if lawmakers don’t extend the 2017 cuts due to expire this year, Americans could face an average 22% tax increase, said Rep. Jason Smith (R-Mo.), chair of the ways and means committee. 

“This cornerstone of President Trump’s economic agenda will put the interests and needs of working families and small businesses ahead of Washington, bring jobs and manufacturing back to America and usher in a new golden era of prosperity,” he said in a statement after the vote. 

A key inclusion for some contractors is permanent extension of 199A deductions for pass-through businesses, which account for more than 70% of construction firms, says the Associated General Contractors of America. Industry largely supported the provision for creating a 20% deduction available to qualifying businesses when lawmakers first passed it in 2017, but it was due to expire this year. As newly approved by the Ways and Means committee, the deduction would be made permanent and be increased to 23%. 

Committee Democrats raised concerns about how much the 199A deduction actually helps small businesses, and how much it supports billionaires. 

As of 2022, more than $216 billion in deductions were claimed under the provision—but half of them were claimed by the top 1% of taxpayers, including about 800 taxpayers with incomes exceeding $100 million, according to the Joint Committee on Taxation. 

Rep. Gwen Moore (D-Wis.) said 84% of businesses that claimed the deduction have no employees. “So they didn’t create jobs,” she added. 

The package would also make permanent alternative minimum tax relief for high-income taxpayers from the 2017 cuts, increase the estate tax exemption to $15 million from $10 million and eliminate taxes on overtime pay for most workers through 2028. 

The Senate will also need to sign off on the package, and it may face obstacles over some provisions, although the reconciliation process being used by lawmakers reduces the margin needed by Republicans to pass it.