BURSTThe Treasury Department’s rule for implementing the Inflation Reduction Act’s (IRA) renewable energy tax credits will incorporate new language that will provide greater benefits for operations that refine natural gas from organic waste.
The announcement comes following lobbying by Rep. Hillary Scholten (D-Mich.), who joined three other congressional Democrats in August asking the Treasury Department to go with broader language, as well as a push by groups like American Biogas Council and the Coalition for Renewable Natural Gas.
Under the initial proposed rule, the machinery used to refine the raw organically-derived gas into the final natural gas product that travels through pipelines was not considered “integral” equipment. But it will be considered as such under the final language.
Under the earlier language, “the cost of the upgrading equipment addition must generally be at least four times the value of the collection system,” the members wrote.
“I wanted to make sure anyone who is willing to make renewable natural gas a priority can reap the benefits,” Scholten told The Hill.
The rule comes after a group of House Republicans, ahead of the presidential election, asked Speaker Mike Johnson (R-La.) to consider leaving some of the IRA’s renewable energy tax credits in place in the event of a Republican trifecta rather than moving to repeal the law wholesale.
Scholten told The Hill that push from Republican colleagues suggests opportunities for broader bipartisan cooperation on energy issues in the next Congress, particularly given the tax credits’ particular implications for rural districts.
Scholten told The Hill she was “in active conversations” with Republican colleagues to extend the credit, which can only be claimed for projects if building begins by the end of the calendar year.
“We’re in the fourth quarter… the people who are really intended to benefit from it are going to have very limited time,” she said.
The new language, which Scholten said would particularly benefit farmers, comes amid an internal debate about the Democratic party’s appeal to rural voters following losses in the 2024 election.
Reps. Angie Craig (D-Minn.) and Jim Costa (D-Calif.) have both announced leadership challenges to House Agriculture Committee Ranking Member David Scott (D-Ga.), with both citing their potential to reach rural voters, drawing an unspoken but clear contrast with Scott’s own predominantly urban district.