How the House cut off new solar and wind subsidies in the "Big Beautiful Bill"

My Power Hour discussion with Representatives Chip Roy and Josh Brecheen

I invited Representatives Chip Roy and Josh Brecheen for a discussion about how they defeated a hoard of subsidy-seeking lobbyists to cut off new solar and wind subsidies in the “Big Beautiful Bill.” I had the opportunity to help out with this effort, and I think there are a lot of great lessons here.

We also discussed why it's crucial for the Senate to preserve and build on this victory—and ideas for how to do that.

I hope you enjoy (full video and transcript below).

---

Rep. Alex Epstein:

Welcome to Power Hour. I'm Alex Epstein. Well, as longtime listeners know, I don't do the show regularly. I think we've done it twice in the last two years, once with Senator Cotton, and once with Peter Thiel, and we had some interesting arguments to have.

So, the reason I'm bringing it back today is we have a very exciting development that I wanted to talk about with two of the main people responsible for the development. I'd say the two people most responsible for the development.

And they are Representative Josh Brecheen, and Representative Chip Roy, and, in my view, there was this huge victory that didn't have to happen in terms of the IRA subsidies. It's also a victory that is not yet final at all, because we had a much improved House bill, but we haven't yet had a successful Senate bill and passage. There's still a lot of work to do. So, I thought I'd talk to these guys to understand what happened, how it happened, what we can learn, how we can actually improve it going forward.

So, welcome both of you.

Rep. Chip Roy:

Great to be on, Alex.

Rep. Josh Brecheen:

Thank you, Alex.

Alex Epstein:

So, maybe, Chip, let's start with you. Just give your sense of how bad and flawed the Ways and Means proposal, I think it came out two Tuesdays ago now, we're recording on May 26th, Happy Memorial Day, by the way, everyone. And then the difference between what was put out, and then what the final bill was, and then we'll go into the mechanics behind it.

Rep. Chip Roy:

Yeah. Happy to do it, and thanks for doing this, Alex. And thanks for all of your efforts to get this issue front and center for the American people, and to help us lead on this, and thanks to Josh for all of his leadership.

Look, you and I go way back. We get what's important here. There's a moral imperative. There's also a national security imperative that we undo the damage, and prevent future damage of the so-called Inflation Reduction Act, which is, obviously, weakening our grid, and all of your listeners know this, or they wouldn't be listening to your podcast.

But weakening our grid, undermining the markets, undermining our ability to have reliable energy. And so, that imperative means that we need to act. Well, now enter where we are on this reconciliation process. Right? Which is a tax and spend bill that has to do with deficits and budgets, and so forth.

But we all know there's policies attached to those things. And the Ways and Means Committee, they've got to deal with the tax implications, which necessarily includes the lion's share, the bulk of the impact of the so-called Inflation Reduction Act, because those are predominantly subsidies. Right?

So, the Ways and Means Committee produced a product to try to extend the President's tax cuts under the Tax Cuts and Jobs Act, the TCJA, but also to deal with the Inflation Reduction Act, because, A, the president campaigned upon it, B, we all campaigned upon fully repealing it. Okay? "Terminating it," to use the president's terms. And then importantly, we know we needed to do it. So, that's the good news.

The bad news is is that what Ways and Means produced was heavily, in my view, K Street-driven, and SWOP-driven. Right? It was built around, "Well, this is what's possible, and here's what we need to do. We need to preserve these options."

And so, in basic terms, what it did was it had no cutoff at the beginning to say that no projects that start after a certain date will be allowed. Right? As a basic premise. That was missing from the whole structure.

And the second thing it did was had a very late requirement that new projects, or projects that were already under construction, a late date for being in service, and then a long-term phaseout of those dates. We're talking about well into the 2030s, even having projects that could extend into the 2040s. It was nowhere near where it needed to be.

Now this is all... The last one I want to filibuster. This is all putting into context here, we're not talking about right now the roughly 40%, the $400 billion of the trillion ish that's available here, the $400 billion that is projects already in service and connected to the grid. Those weren't even being touched. Of the remaining projects, the ones that were either in process, or could be new ones, we didn't believe the language was sufficient. In fact, we thought it could be massively exploited, and would allow for future projects to continue, which means the IRA would continue and the grid would be weak.

So, we then set out to change that.

Alex Epstein:

Yeah. Any thoughts from you, Josh, in terms of just how the Ways and Means bill struck you compared to what was remotely right?

Rep. Josh Brecheen:

Yeah. Look, I think what's important to know, the One Big Beautiful Bill, Chip and I, Ralph Norm, Andrew Clyde were involved, Chip, specifically, in helping design the balance the budget neutrality element months ago to say, "The budget committee sets the instructions." Then all these other committees go out there to make this One Big Beautiful Bill that as much as deficit-neutral, and in addition to a growth element that we prescribed at 2.6 year-over-year.

Then, Chip, Ralph, Andrew, and I, along with the budget committee last week had a vote, "Did you meet your instructions?" My great consternation over this was... And to you, Alex, I'm grateful to you and others that have pointed this out, since 1999, think wind, think solar, every time the production tax credit's been pointed to and said, "Hey. Five years from now," or, "Two years from now, we, as Congress, will end this."

Since it started in 1992, there's been, at least, 10 different times where Congress said, "Some date in the future, we'll end it." That was enacted, and then years later, Congress would come back, and change its mind.

And so, to evaluate the score, "Did we meet budget neutrality in repealing the IRA?" Which has a significant cost. Those tax subsidies go into wind and solar. So, they stay with us on the thought of wind and solar specific to this. We knew the likelihood of starting this process years in the future, the way Ways and Means had prescribed it, that it wouldn't happen.

And so, the four of us had a no vote, worked all weekend with you and others trying to get leadership, the White House, to engage with us, correct that date, to move the date up to 60 days after enactment, we're going to cut this stuff off, specific to wind and solar. Now under Trump's term of office with him shepherding riding herd over this to make sure the lobbyists that are now headed to the Senate to try to change the great product we came up with.

Our hope is that your podcast gets out, and people understand the pressure now is on the Senate, and the lobbyists for wind and solar will be trying to undo what we did, because we have a true repeal of the wind and solar tax credits that are the greatest threat to undermining reliable, affordable energy on our electric grid, and outsourcing jobs overseas.

Alex Epstein:

I'll just give a little bit of my reaction too, because I've been for a while getting the opportunity to talk to different groups, including Republican groups about this issue, and, most notably, a friend August Pfluger allowed me to come speak to the Republican Study Committee, which is the biggest group of Republicans. And I think there were probably 60 people, or so, in attendance there.

And I was making the case for full termination, and what I felt would happen is, well, the people with all these existing projects would manage to quell most of them, and then that would be the debate. Like, this $400 billion.

But then it turned out that... And I blame myself for not anticipating this, the $400 billion wasn't even questioned. That was the starting point that Ways and Means had operated with, and which I later confirmed. It was just the question is how much new subsidy are we going to allow to happen?

And then with the most dangerous subsidies, the solar and wind subsidies, there was literally this phaseout where they're literally giving out new 10 year subsidies in 2031. But on Donald Trump's 95th birthday, he can celebrate with wind subsidies still existing, and yet people had the gall to call it like, "We're terminating them. We're getting rid of it."

So, it was really this thing where it was not doing the job, and, in particular, it was offloading the job on future Congresses. And it's, basically, saying, "Hey. Well, after Trump is President, we are trusting that you guys are going to actually phase this out" versus what I was arguing for very strongly is, "At minimum you have to get rid of the new subsidies, and you absolutely have to have them all expire and stop under Trump's term."

And so, by this final agreement where you have to be in construction 60 days after the bill is enacted, or you have to be in service by 2028. People are acknowledging that's a real restriction. So, this was a huge thing. Basically, we went from solar and wind subsidies continue indefinitely, and we keep getting the grid spammed with this unreliable electricity that undermines our whole grid, and is really an existential threat to the grid, or actually cutting it off. Given the options, it was a really big victory.

The other thing I would say to highlight this is if you look at when the Ways and Means bill came out, of course, all the lobbyists, particularly, the solar and wind people, what they said is not, "Oh my gosh. We got a huge victory. Can you believe it?" They said, "This is criminal. You're phasing out our subsidies in 2031? That's so soon. How can you possibly do that?" And they're always confusing their existing subsidies and new subsidies deliberately.

But they were hoping, and if you look at some of their lobbyists talking, they thought, "Oh, the Ways and Means would be the starting point, and would become even more generous." So, we'd get even more of an extension of the subsidies. And they got a very rude awakening when, in fact, the subsidies got massively scaled back. And I give you guys, as well as Andrew Clyde and Ralph Norm, and a lot of credit.

So, before we go into what succeeded, I'm curious what you guys think about how the Ways and Means got to where it was, both what went wrong, but also maybe what went right in terms of maybe it wasn't as bad... Maybe it could have even been worse, because I know a lot of us were working... So, I was disappointed by it, but maybe it could have been even worse. But, particularly, what went wrong, but if there's anything that went right before that, I'm interested in that too. Chip, you want to start?

Rep. Chip Roy:

Yeah. Sure. Look, I want to give credit to Jason Smith and his staff for taking a giant step into this mix. Right? He didn't walk away from it. What they would say is that the CBO had soared $515 billion, with a B, out of "$607 billion possible" in their scoring.

Now we can nuance that, and you can better than I, but for your listeners, look, what that means is that $93 billion was left on the table, and you had to assume that their $515 billion would actually materialize out of the CBO's score.

Why do I bring that up? Because they were proud of that. Right? To be clear, and to be fair, there was a serious political move. For all the people out there who have been pushing this for a long time, encouraged the President to campaign on it, the President put it out there. The President was explicit about this through these negotiations that he meant terminate the Green New Scam as he calls it.

So, we had made progress leading into this moment, but then what happens is staffers and the people around town, the lobby community, they all have their influencers. Right? "Hey, guys. We got to make sure these contracts stay in place." "Well, hey, dude, the grid is already relying on these things." "Oh, we're Republicans. We honor contracts. So, we got to keep these going." "Oh, but, oh, these guys have some projects that were already invested," or, "They already bought some land," or, "They already leased some land. We got to keep that going." And then, "We got to make sure we don't disrupt." Right? There's always a reason.

So, they try to build it to be nebulous enough that you could ultimately drive a truck through it. I think there was a mix going on here, to answer your question. I think there were some staffers at Ways and Means and Jason Smith and others who wanted to constrain. I think there were political forces to say, "Nah, don't strain it too much," so you've got a typical Washington kind of product. And then we used our efforts in the budget committee to force the conversation that needed to be had, which is the President said terminate. So we wanted to get it close to termination, at least with respect to the projects that are started and in process, not yet constructed or barely constructed. And then the ones that would be new projects. I'd love to be able to touch the existing ones, but let's kind of put that to aside for a minute.

We did a great job, I think of constraining that, to your point, of getting to a place where they all have to be implemented by December 31st, 2028, and they have to have construction, 5% IRS rule within 60 days of enactment. And I can tell you that the powers that be in town, the lobby community, the people that have a lot of interest in this space are freaking out, that they think that is way too tight. They are absolutely losing their mind, that that is going to actually be affected. And so for everybody out there, we need to keep our foot on the gas and at least get what we got out of the House through the Senate and hopefully try to push them to go even further with respect to ongoing projects.

Alex Epstein:

Gotcha. I have some thoughts on this, but Josh, any thoughts on sort of what went wrong or right heading up to the Ways and Means thing and then after that?

Rep. Josh Brecheen:

Yeah. Look, Chip, Paul Winfrey, it's well known to ratchet up, ratchet down the historic use in 2001, that Chip and Paul Winfrey were able to, in communication with the speaker and with Jodey Arrington, our budget committee chairman, Wood Smucker, others, I was in the room getting to watch this all play out months ago. That was set and Chip would I know want to see a better outcome, but I would tell you it was, from my viewpoint, it was probably the best thing going in that drove people to a higher level of cuts than what we would've had. And so I congratulate them for doing that, for what I would say is providential and the way it just came about hours before we had to take that vote. This is months ago, established what you may be hearing about, that dollar for dollar for every amount of spend, we had to have savings.

And so that was a Chip, Paul Winfrey product and there to be congratulated for that. And then the leadership to see the wisdom of that, knowing that you've got such a tight margin that you have to broker those of us that would be deficit hawks in relative balance to those in our conference who don't really care as much about the deficit. Now, Chip was talking about ways and means and the staff, and I believe it was genuine, but Chip is right. You have K Street, and again, since 1992, the production tax credit has always been reanalyzed. And the promise to end it at some point in the future has always been changed because do not think that that lobbyist crowd, when I fought the wind solar or the wind subsidies in Oklahoma, there were 50 lobbyists working against me on state level. And Oklahoma's one of the top three among almost 50 states.

But I can't imagine if there were 50 lobbyists working against me in Oklahoma trying to repeal these in 2018. I cannot imagine how many hundreds of lobbyists, and we're not just talking about United States, we're talking about other countries, wind as European investors who benefit, European people that are heavily involved in making sure that production tax credit, tax subsidies are going to them to get the return on their investment. And then for solar, of course, all the components that are directly tied to China.

So you have a lobbyist credit that is really smart, that will use a narrative that will mix facts and try to go to not chairmans, but you could keep in mind, you got to get this thing out of committee, right? So you had members of the committee who were getting information from lobbyists that may seem right in their mind, but at the end of the day, as Chip said, they're all having a gnashing of teeth right now because they know this product, thankful to the sword that was driven in the ground, saying this isn't going to pass like this. We have to make a change to get a real repeal. We've achieved that.

Now the work is for everyone in America who cares about a reliable, affordable grid, reaching out to United States senators and saying, "Don't change it. What the House put in there, relative to the changes of 60 days after this bill is signed into law, hopefully 2025, early. If you don't have 5% commenced construction, and if you don't, by 2028 are producing power, then I'm sorry, the game is up." Let the free market decide what energy is to be chosen, not those who have preferential treatment from government.

Alex Epstein:

Next thing I want to cover is, is how you both individually thought of drawing a line because it's a hard thing. I mean, I was told by people that I like and trust who said, "Look, I know you don't like the Ways and Means thing very much, but it's so hard to get things to work. There's a lot of things we have to get to work at the same time." If this doesn't pass, then the IRA is just going to be totally preserved, which you agree is worse than what Ways and Means had. And sometimes people say, "Well, it's the President's bill now. It's the President's bill. You have to be careful about talking about it."

And for me, look, I'm just an independent commentator. I say what I think, it's relatively low downside for me to just keep saying what I think. But for you guys, I'm sure you are under enormous pressure to acquiesce way earlier. So how do you decide, hey, we're going to... I mean, I remember someone who's advising us was basically saying, "It is not a good idea to hold this up in budget. They should not do that. They should do it when rules are coming, et cetera." So starting with Chip, how do you make this decision like, "I'm going to stop this here and everyone's going to be mad at me and I might get primaried, but that's okay"?

Rep. Chip Roy:

Well look, for some of us, we're a little used to it more than others. Josh and others that he mentioned, Andrew Clyde, Ralph Norman, others friends of mine in the House Freedom Caucus and generally willing to take a stand, we're kind of used to taking those arrows. But it doesn't make it easy, especially when it's such a complex topic. I had great unease even when I voted for the bill, ultimately on the early hours of Thursday morning. I still have unease. I'm still not sure exactly how this plays out going through the Senate, but everything we do is a balancing act. And you have to humbly and prayerfully try to figure out how to walk the line, if you will.

It is very much the President's bill in the sense that most of these are core issues on which he campaigned. We're trying to honor that commitment and also remind everybody that in Article One, Congress exists in the Constitution to work with the President. We send the bill up, we've got to get it through both houses and then get it to the White House. So I'll just say it this way. There are a lot of moving parts. There's overall spending levels, there's overall taxation questions. There are questions about Medicaid that this podcast is not for. There's lots of variables in this mix.

But one of the core issues was this issue, and we had to make a determination that we were going to go fight for something we could be proud of so that I could look at the people that I represent in central Texas. Josh could look at the people in Oklahoma, he represents and say, "You know what? We stopped another one of those solar farms that was being produced literally by just paper shuffling around with these subsidies that nobody would've ever done. It was based on the market. And we stopped one of those battery plants that a bunch of my constituents are mad about, because they're right to be mad about them. They're right to be mad about a weakening grid."

So we have an obligation to do it. And this is a little bit art, not science. You know it when you see it. Josh and I and Ralph and Andrew and others, we leaned into it because it was so important. And look, I will tell you, this is still a critical component of whatever gets through the Senate. I'm going to be a little careful here about drawing red lines. In fact, the Freedom Caucus, Josh and I, we expressly avoided drawing hardcore red lines to try to make this move forward. And I'll stop filibustering here and I'll just say, look, I will say this. This bill cannot get watered down or it's not going to be successful coming back to the House.

So hopefully we will work with our Senate counterparts, maintain what we did accomplish, soothe everybody's concerns. Hey, this is a good thing. And the last point here, people talk about jobs. That's what I keep hearing, and I've heard the White House, I've heard people on K Street, "Chip, you're going to hurt jobs, future jobs. You're going to hurt jobs if you hurt the already existing projects." Guys, what about the jobs in natural gas? What about the jobs in nuclear? What about the jobs in pipelines? What about the fact that you don't want to have jobs being subsidized to produce something that makes your country weaker? Right? People don't tell me that if I go out and try to stop an illicit drug industry—

Alex Epstein:

Fentanyl jobs.

Rep. Chip Roy:

Right? It's like, "Oh, well, I'm a hurting job." It's like, look, I want to have a grid that's stable, so I'll yield back to Josh and you, but that's my perspective.

Alex Epstein:

I like how you keep using filibuster, which is appropriate since that's what we avoid in reconciliation. I'll get to you, Josh in a second, but I was just doing some thinking yesterday about the jobs issue and the fairness issue, and we're talking about the existing projects, which I'll bring up when we talk about the Senate because think it's really important to hit on the idea that the existing projects absolutely do not deserve their subsidies and their subsidies are immensely harmful. But people talk about, "Oh, what's the harm that you're going to do to these subsidized projects that are harming the grid?" But what they don't talk about is, what is the harm that the subsidized projects did to the existing projects?

Because the existing projects were set up. If you think about coal plants and natural gas plants, they were set up with certain economic expectations. People invested in those plants based on the idea that we had a grid that valued reliability and they could get a certain income stream by selling to the electricity markets. Then the electricity markets were totally spammed by unreliable solar and wind, that always when they're on there, once they're subsidized, they're the lowest marginal cost producer, even without subsidies, but certainly with them because they have no fuel cost. So every time they're available, they take away revenue, operating time and revenue, from the reliable plants. They also suppress the temporary prices of the auctions, so the reliable plants operate less time and get paid less money per time.

Now we end up paying all that money in subsidies and in capacity payments and all sorts of stuff, but nobody cares about the people who had totally legitimate investments in reliable power, who got their investments stolen and destroyed by the subsidized movement. So that's the cancer we have to get rid of. If you want to have empathy for anyone, it's all those coal plants and those workers who were doing perfectly good things and could have provided low cost, reliable electricity for decades more, and they just got driven out of business by this cancer.

But I still wanted to ask Josh, to go back to you. We talked this a little bit at the time, but tell listeners what was your calculation in terms of saying, "Hey, I'm going to draw the line here and it needs to reach a certain level of improvement, otherwise I can't give my support to it"?

Rep. Josh Brecheen:

Yeah, it was plain. It was truth. It had to be what we said the budget blueprint was going to be early in the year in February, and that we said that we had to meet certain conditions, and as some of us were even the night of the time we voted present to give it a chance to move along while we finalize some of these issues that were still left hanging with SALT and other considerations to look at leadership and say this is about truth. And this is not just an exercise where we're stapling the committee products back together. The question before the budget committee was, did you meet the instructions? And again, the greatest predictor of the future is the past.

And when Congress has done this 10 different times, said, "Oh, some day in the future that production tax credit's going to end," 10 different times, history shows you it never does because the lobby power is tremendous. Then under President Trump's term of office is when this had to end so that he would be the one who had the pen that if they tried to change it, go back on their word, he had the veto ability. And so putting this under President Trump's term mattered. It was a matter of being able to go out to the American people and say, "We did what we said, and it's about truth."

Alex Epstein:

Speaking of truth, there's a couple of things that impressed me working with you guys through this process. We've been in one way or another working on it for a while. Chip and I have been in one way working with one another since 2017 or something like that before he was in Congress. And I've always appreciated, Chip, that you're focused on these issues even though they're not your committee issue. And you've had really good people on your team like Hal Duncan, really good on energy. But I didn't know Josh as well.

And one thing that impressed me about you, Josh, I'm going to leave the specifics anonymous, but we were at a certain meeting and you were talking to a certain wealthy person who was advocating subsidies. And often when I see people in that situation, they'll nod and you were just questioning that person just like you would question somebody who wasn't a billionaire who made $20,000 a year and you're saying, "This doesn't make sense to me." And you kept arguing. And I thought, "Wow, he is really interested in the truth on this issue."

And then also when I had the honor of helping during some of these negotiations and advising, and one thing I noticed is I'm not somebody who stands for any industry. I'm advocating killing the carbon capture stuff for the oil and gas people. And at least in the discussion that I was on, I was the only outside person on and I was being only asked what I thought was true. There were no lobbyists, there's nobody who's... You guys were only interested in, "Hey, tell me the truth about what you think." So I don't know if you have any comments on that, but that was very notable to me as clearly not what happens often in these situations.

Rep. Josh Brecheen:

Alex, if you want me to respond. Look, what I can tell you what earned Chip respect and hopefully others of us is people expect you to pretend. And when you start being a person of truth, people go, "Oh, you're different." You're not a pretender. You're not an actor. And that's not why I got involved in politics is to become an actor. I got involved because the truth matters.

And having someone that's an honest broker, represents you, that is what made America great initially. And that's probably the thing that's undermining, that's eroding our structure, our people who are self-interested, self-motivated, ambition. And ambition, as Joan Adams said, where you find ambition, revenge, and average, which means greed, that undermines the constitution as if a whale goes through a net. That's John Adams. And so truth matters, man.

Rep. Chip Roy:

So if I could add to that, Alex. I'm a University of Virginia grad and there there's a famous Jefferson quote that, "For here we are not afraid to seek truth wherever it may lead nor tolerate error as long as reason is left to combat it." And it was one of the founding concepts at Virginia, but I think it has been lost a lot over the years. And I want just give a shout-out to Josh for his integrity and for wanting to seek truth and righteousness in all of this and trying to do the right thing and to honor commitments along the way. And it's a tough line to walk.

Right now, I mean, I ended up voting for the bill as I had said somewhat reluctantly for a variety of reasons. One, I wish we would've gone further on the Inflation Reduction Act existing projects and I wish we'd have gone further on Medicaid. And so I've got a lot of people on my right flank who are mad because we put out the truth, which is guys, 40% of the dollars are still going to flow. And that means you're going enrage some people who are going to go, "Why didn't you repeal it all?" And I'm going to say, "Good question."

But part of that is level setting the truth. And then I have to go back and say, if I'm comfortable with the bill, say, "Well, I voted for the bill because it moved the needle significantly. It was what I truly believe was the best we could get in that moment." Now I'm still hopeful we'll get more in the Senate and we got to factor in a lot of things. My point of bringing this up to your point is, we have to be truthful with the American people. We have to lay it all out there. And then we have to be willing in a republic, a Republican form of government to take the arrows of leadership.

That means making the tough call of voting for something that isn't perfect. That means taking the tough arrows of voting against something that may be politically expedient to vote for or you may have a lot of pressure to vote for. That's what a Republican form of government requires of us under our constitution, to put the truth out there and to go try to navigate it. I think we've done that, but I still think we got a lot of work to do to get through the Senate and finish this job.

Rep. Josh Brecheen:

Alex, can I add one more thing just so we understand—

Alex Epstein:

Yeah, of course.

Rep. Josh Brecheen:

—what we're talking about. The 400 billion that Chip keeps talking about the IRA, so anyone who would talk about, well, you're going to catch people in the middle of these projects and you're going to pull the rug out when they started with this promise. The 400 billion he's talking about is the change we made was any prospective decision to try to get into this tax subsidy is going to end.

60 days after this bill is signed into law you have to have 5% commenced construction. What Chip's talking about is all the projects that were promised 10 years on the production tax credit, those are going to get paid out. And what he's saying and what many of us are saying is there's many things in government that people sign up and you have a change of administration. Think the Keystone Pipeline.

Alex Epstein:

Yeah, no kidding. That's quite a policy change to abolish it.

Rep. Josh Brecheen:

Just so everyone understands we did as much as we could on the House side and then I'm hopeful, like Chip is, that we can have a real conversation about that 400 billion is still hanging out there without making sure we keep our foot on defense, making sure that the changes, the right changes, no new projects starting in the Trump administration, that they're going to be allowed in if they don't meet a certain threshold.

Rep. Chip Roy:

And it's important to stay on offense. Sorry Alex, it's your podcast.

Alex Epstein:

No, no, you guys are are here. I want you to talk.

Rep. Chip Roy:

It's important for us to stay on offense. Okay. We did a good thing, but there's more we could do. And I want to stay on offense to remind people that hey, make them play on our field, which is, you go justify why we're going to continue to subsidize unreliable energy. I want them to have to justify that. You go justify why Texas is getting $3 billion a year, $3 billion a year of federal borrowed money, adding up to the debt, adding more to the deficits and taking that three billion and putting it into the pockets of billion-dollar corporations usually run by leftists to go fund a lot of profiteering for Chinese companies and to make our grid less reliable.

Somebody explain to me why I am obligated to do that for the next 10 years. I do not believe I am. So I'm going to remain on offense that we should go after those projects as well, they should be phased out because we want our grid to be reliable, we want more gas, we want more nuclear. We want to have a abundance of reliable energy so that our economy can grow and prosper and our national security can be strong. We should be on offense on that. Proud of what we've done, maintain it and go on offense in the Senate.

Alex Epstein:

Getting to the Senate, without giving away any secrets that could be destructive, I'm curious if you guys have any additional insights into what made these negotiations effective? And the point you just made is one that as I was trying to help really picked up on was just realizing, wait a second, everyone's leaving this 400 billion on the table, let's attack that. So any chance I got and people got annoyed with me. I'm like, "You should not have let this 400 billion on the table. This is a huge gift which you do not deserve. How could you possibly demand one cent more?"

And I felt like that as the starting point. That is the truth. That's the logical starting point. But by starting it with termination, termination is the ideal. You don't deserve $1 of this. And then you should have to argue for every one of those $400 billion versus those being table stakes. I felt like even though we introduced that a little bit late, that was effective. And that definitely needs to be the framing of the Senate. So curious what you guys think about that, but also any other negotiating things, again, that don't give away future effectiveness.

Rep. Chip Roy:

Yeah. I mean, I'll throw it out there, Josh, and just say I agree. And I just said it or repeated that going on offense matters strategically because it's an indefensible position. I mean, I understand there will be a honorable position that is, well, we have to honor the agreements. Well, I take issue with that because tax policy changes with the change of administration, tariff policy changes, regulatory policy changes, executive actions change, circumstances change, and frankly truths or truth, we need a reliable grid.

So if somebody made a bad bet in saying they wanted to go take these massive subsidies, which were effectively "free money," they're not free, economics 101, but "free money" to then make our grid less reliable. I'm going to take issue with that. And I think we need to be on offense on that point. But the broader perspective is we need to be really positive about what we accomplished. We need to be clear about the things that we were able to do and why we're able to do them in the House to inform the Senate and put that all in context while being on offense.

I think those are going to be the critical negotiating techniques because what we were able to accomplish is actually good and righteous because you can't say that you're going to save $500 billion if you don't believe it. If you think, "Well guys, look, I don't think that's going to be true," when you're relying on backdoor regulating, backdoor limiting, which is what the original Ways and Means bill was doing, which we didn't talk about very much, but we talked about the out years, the 2031 and the four-year phase outs and the long runway for projects and no immediate construction date.

What we didn't talk about is that they were heavily relying on restrictions on Chinese minerals and where the minerals come from to say that, well, that'll stop most of the flow for at least solar and maybe batteries. Well, we tend to be a little suspicious of that, that there will be ways to game that and then run it. And if your goal is ultimately to turn off the future projects, turn them off. Stop playing games. So I think that's important. Josh, I'll turn to you.

Rep. Josh Brecheen:

I want to back up what you guys said relative to every year they stay in place, every year that there's more payout, that we know since 2022, I believe last three years, the Energy Information Administration says that 61% of all new electricity generation on our grid is coming from solar, about the same timeframe 11% all new generation coming from wind. So what is that displacing? In our congressional districts, the coal plants we know have been shutting down for five and 10 years, that is displacing natural gas.

And so it almost, I would say at a one-to-one ratio, if you look at where natural gas was relative to these other technologies a few years ago, we're displacing the liquid gold that is within the United States national security, ease of access, US jobs, and we're outsourcing to China because we know some of these components that make up solar, 97% coming directly from China, others 80%. And so absolutely gaming, moving the solar components that are having to come out of China to another country, rebrand it, repackage it, send it in. All these timeline changes were very important, plus not just going after the residential side, but the commercial side, thanks to the expertise on this call that you all were able to pull off.

And so our national security, when we are dependent on these other countries, think of what's just happened in the last several years with the European Union countries. Here they have been buying $20 billion worth of fossil fuels because their electricity generation, their own energy consumption was in jeopardy. And they're paying more now to Russia, 20 billion more than what they've given to Ukraine. Think national security of when you become so relied on other countries and you can't self-contain your own energy production.

Alex Epstein:

Yeah. And for me, I would just stress, yeah, the solar and wind thing with all the existing subsidies has been so massively damaging and the idea of continuing it is so abhorrent.

Let's talk about the Senate. So I've shared with this a little bit publicly, and I'll talk about it a little bit more now. My approach to the Senate is totally go on offense. So just keep telling the truth. But I'll give you what the other side is saying because I think I've identified their position comes down to three core myths and everything else they say. I mean, the amount of false arguments that I'm getting from these lobbyists is just even astonishing to me. And I've dealt with a lot of crazy people, but it's just so many disingenuous and misleading arguments.

But I think they basically have three arguments. One is that subsidizing solar and wind has led to great economic results. That's one. Number two is the House bill cuts all solar and wind subsidies. And then three is by cutting all solar and wind subsidies, the House bill will cause great economic destruction. So these subsidies have been amazing. We're cutting them all. And so the world is going to end. And the truth is subsidizing solar and wind has led to catastrophic results. The House bill only cuts those subsidies for new projects, not existing ones unfortunately. And by cutting new solar and wind subsidies, the House bill does a lot of good, but the Senate can do far more good if it cuts all of them. As I've organized every imaginable argument by sharing this with any Congressman who wants to know and I'll post it publicly, every argument they have is one of these three fallacies. And it's so important right now to get out that truth and to make clear, the House bill did not go far enough.

The other thing that I've been focused on is the nuclear issue, because I think nuclear is... What happens is nuclear is entangled with solar and wind through what are called the PTC and ITC, which under the IRA became "tech neutral." And they still are overwhelmingly for wind and solar, but because nuclear derived some benefit from them, all these "pro-progress" people, even the pro-solar and wind people are being like, oh my gosh, we're going to destroy nuclear if we get rid of the PTC and ITC. But the issue is if nuclear is improperly entangled with solar and wind, let's disentangle it because nuclear is not very expensive compared to these things. And nuclear actually has some argument for support given how victimized it is by bad regulation and how you have a lot of new potentially promising dispatchable technology.

So what I've been advocating is, hey, here's what you should do with nuclear, make any of the tax credits only apply to dispatchable sources. So they actually need to be on demand both for new projects and existing projects. Guess what? We then can save about $200 billion in existing solar and wind subsidies because some of the other 400 billion are for other things like carbon capture and stuff like that, which I also want to kill. But in terms of the easiest stuff to kill, we can get rid of those. And then you can easily finance nuclear. So what I've been drafting and helping people with is, hey, here's a way nuclear can be even better off and we can kill more of the solar and wind stuff that's destructive and unjustified, the subsidies I should say. And thus we can have a better budgetary outcome and a better nuclear outcome and thus a much better grid outcome. But all of this depends on recognizing the solar and wind subsidies have been an absolute disaster and none of them are justified. So curious if you guys have any thoughts or additions to that?

Rep. Chip Roy:

Yeah, Alex, I just wanted to say one thing, and I know we're probably getting towards the tail end of the podcast. I would just say one, and you won't want to do this, but I'm going to do it. You deserve enormous praise for being engaged in this and being a voice that helped us enormously with logic and reason, both your previous work and your work through this process and being a part of the conversations. Josh worked very hard to encourage that you would be a part of conversations on the Hill, as did I. Josh was a big champion of making sure that you had a voice there. And I want to make sure that everybody listening to this knows how important it was and how important it is and how important it will be through the Senate process. And look, I think what you just said is really important for the entire world to level set and understand about what we're facing and that putting that out there logically and with truth has level set the field.

And on the nuclear point, I would just close by saying, yeah, I couldn't agree with you more. And in fact, we had some jaws drop. I don't remember if this Josh, when they were talking about the subsidies, right? Because we're fiscal hawks and we're trying to save every dollar, they sometimes get wrapped around the axle that we want to cut every single thing. I said, "Now look, just take the nuclear out. Don't make them be a part of the deal." If the subsidies need to flow for them, let them flow for the nuclear because we need to offset all of the last 50 years of stupid under the Nuclear Regulatory Commission and all of the ridiculous regulations that have limited our ability to have that reliable power at our fingertips. I'm a pro gas guy, Texan, but I'm pro nuclear and you've been one of the leading voices on nuclear. So it was critically important that we make that point. And thanks for your help through this whole process.

Alex Epstein:

Thank you. And I'll just say that I've been surprised. I want to give other people this as an example. I've been surprised in working with politicians just how much it helps to be, of course useful, that we can provide good information and ideas very quickly and at high quality. But the other thing is trusted, just that the fact that I've been saying the same things for 18 years, and I say the same thing, no matter who you are, that really matters to politicians. And I just want to highlight that because people don't think that's true. They think that, oh, the way to get to politicians is to give them a lot of money.

You guys know... I mean, Chip and I go way back. I never endorsed anybody. I don't endorse parties. I don't give money. We've never talked about money. And people are always like, "Oh, you have to do that to play the game." And I'm like, "I'm not playing that game. I'm playing the game of if you want to fight for energy freedom, I will tell you the truth and give you all the help I can." And that's it. And that's worked amazingly well strategically. And I just want to tell that to other people. So maybe they can do the same instead of treating politicians as corrupt.

Rep. Chip Roy:

And Alex, Josh mentioned earlier, Paul Winfrey and Matt Dickerson and Brian Blaze, they were really important on this issue, predominantly heavily Medicaid, but this issue too, because they were helping us level set and be honest about the budget. They do something similar as you do, right? They've got organizations that are donor funded that they go out and go advocate for good budget policy, good healthcare policy. And so they were reliable assets for us during this fight, both heavily on healthcare and Medicaid, but the overall spending levels and how to deal with the budget fight, including the Inflation Reduction Act. So we need people like that who are committed to the cause. And for all the people out there who support Alex and support other organizations like that, we need them. And sorry Josh, I didn't mean to jump in front of you.

Alex Epstein:

All right. Let me just say one thing about the support though. One thing I've always set up, I mean, I have the benefit of being an author and speaker so I can make my money on the free market. So I don't need donor support for stuff, but I do ask for a lot of it because it amplifies my ability to have an impact. But I'd say one other lesson I've found is if you can set up your donor situation so that they have zero editorial control over anything you say. And so everyone knows you represent yourself, you don't represent anyone, you don't represent any interests, that's going to help with your credibility.

Rep. Chip Roy:

100%.

Alex Epstein:

And we should wrap with this, but Josh, I'll give you the final word on what we should be doing and what the American people should know with regard to the Senate. Because again, this is far from over. I think the lobbyists for solar and wind got surprised, but they're going nuts right now and their enthusiasm to keep them is only matched by my enthusiasm to destroy them.

Rep. Josh Brecheen:

I would say, Alex, I know you're going to be putting out information. Make sure that people that are going to be talking to their United States Senator are armed with the truth, not the misinformation that the wind and solar lobby is going to be communicating with them. They're going to be amplifying perspective jobs and perspective projects that will not be based 100% truth. It will be based in projections of what they might have done. And so I would say follow sources like you that are trusted and then advocate to your United States Senator and to the White House to make sure that truth wins out in this and that we have relative to the mandate, and we end the Green New Scam that is putting our national security and US jobs at risk.

Alex Epstein:

Thanks guys. Well, that's a great place to end the podcast. We're actually going to do a little Q&A with some local people right after this, but I'll wrap up the podcast. So hi everyone. This has been Power Hour. Thanks so much to my guests, Josh Brecheen and Chip Roy. Thanks for what you did in this process and let's fight going forward.

Questions about this article? Ask AlexAI:

---

Popular links

• EnergyTalkingPoints.com: Hundreds of concise, powerful, well-referenced talking points on energy, environmental, and climate issues.

• My new book Fossil Future: Why Global Human Flourishing Requires More Oil, Coal, and Natural Gas—Not Less.

• Speaking and media inquiries

---

“Energy Talking Points by Alex Epstein” is my free Substack newsletter designed to give as many people as possible access to concise, powerful, well-referenced talking points on the latest energy, environmental, and climate issues from a pro-human, pro-energy perspective.