You are using an outdated browser.
Please upgrade your browser
and improve your visit to our site.
Skip Navigation

Why the Republicans’ “Lower Energy Costs Act” Won’t Lower Energy Costs

It will, however, please the oil and gas industry.

Steve Scalise speaks in front of an American flag.
Kevin Dietsch/Getty Images
U.S. House Majority Leader Steve Scalise at a press conference following a House Republicans’ meeting to discuss their new energy plan on March 28.

Without being a fly on the wall in congressional offices or overpriced D.C. steakhouses, one can only imagine the precise wish list the oil and gas industry has been circulating among the politicians it funds on Capitol Hill. Based on what these corporate execs have been saying in public recently, though, Republicans’ giant new energy package, H.R. 1, would seem to check off lots of items: What the GOP has titled the “Lower Energy Costs Act” is, in fact, a giveaway to the companies profiting the most off the higher energy prices this bill claims to be combating.

GOP messaging around this bill, which is expected to come to a vote in the House on Thursday, emphasizes that government interference is what’s keeping energy prices high. “For the last two years, President Biden and his extremist friends in Washington have waged a war on American energy, and hard-working families across the country are paying the price,” Louisiana Congressman Steve Scalise, the bill’s lead sponsor, wrote in a statement about the bill.

But that narrative doesn’t reflect what the energy industry itself says is going on. Fewer than 10 percent of 140 oil and gas companies surveyed by the Dallas Fed this month reported believing that government regulations would have the greatest influence on their profitability, per a report released Wednesday. Back in December, the same quarterly energy survey found that a similarly small percentage of firms cited “uncertainty about government regulations” as “the biggest drag on crude oil and natural gas production growth” for their firms. Instead, a plurality simply cited banal factors like cost inflation, the “health of the global economy,” and the “cyclical nature of the industry” as the primary factors affecting profitability and worker shortages. Since 1999, Scalise has accepted $2.1 million in campaign contributions from the oil and gas industry.

Presumably, in a bid to throw lots of things at a wall and see what sticks, congressional Republicans have also argued that H.R. 1 is essential for combating the climate crisis—a thing they are allegedly now concerned about after decades of denial and obstructionism. The centerpiece of this dubious argument is part of the GOP’s energy platform known as permitting reform, which they claim will make it easier to bring new energy installations online.

Conservative Climate Caucus Chairs John Curtis and Mariannette Miller-Meeks co-authored a recent Washington Examiner op-ed that presented H.R. 1 as a must-have for environmentalists, casting existing regulations as a core barrier to reducing emissions. “A clean energy future,” they write, “is impossible without permitting reform,” seemingly to imply that renewable energy plans—rather than, say, pipelines and drilling projects—would be first in line to reap the rewards of a streamlined approval process. Even the argument that statutes like the National Environmental Protection Act are to blame for slow-rolling clean energy deployment, experts say, deserves a closer look. It becomes particularly hard to swallow when you consider Curtis’s and Miller-Meeks’s material interests: This cycle alone, Miller-Meeks has gotten $35,000 from oil and gas industry PACs. Curtis has raked in $97,500, and the industry is his fourth-biggest donor over the course of his congressional career.

In fact, portraying H.R. 1 as “permitting reform” at all is inaccurate: Changing the regulatory processes that energy developers say slow their projects is just one part of a much broader suite of pro-industry changes. Most of H.R. 1’s provisions are intended to supercharge oil and gas development by repealing certain Biden-era policies and mandating the administration green-light new drilling. The bill would require the Department of the Interior to conduct additional lease sales for drilling on federal lands, prohibit the president from banning fracking, and reverse Biden’s decision to halt the Keystone XL pipeline. It’d also prevent the president from doing things that might actually lower energy prices by, for example, axing parts in the Inflation Reduction Act that incentivize cost-saving energy-efficiency measures and might erode demand for fossil fuels.

Democratic leadership doesn’t seem to have fallen for the trick. Senate Majority Leader Chuck Schumer has said H.R. 1 will be dead on arrival in the Senate, and Biden has vowed to veto the package should it make it to his desk. The Office of Management and Budget put out a strongly worded Statement of Administration Policy. H.R. 1 “would raise costs for American families by repealing household energy rebates and rolling back historic investments to increase access to cost-lowering clean energy technologies,” the statement reads. “Instead of protecting American consumers, it would pad oil and gas company profits—already at record levels—and undercut our public health and environment.”

Republicans seem to know H.R. 1 will fail. Party insiders speculated to The Washington Post this week that they want to be able to point to Democrats killing a bill called the “Lower Energy Prices Act” so that Democrats look bad when gas prices more than likely go up this summer, as they tend to every summer. H.R. 1 may also be the blueprint for a package they hope might court more bipartisan support. “Dems may come to the table because they need [permitting overhaul] for their renewable energy, they need it for their transmission,” Congressman Garret Graves, author of the bill that provided the inspiration for much of H.R. 1’s permitting language, said this week. “Republicans may come to the table because they need it for their [pipelines] or whatever else.” Some anonymous Democratic lawmakers told Politico they could be interested in a different version of the package, making peace with it being the pound of flesh they exchange for House Speaker Kevin McCarthy agreeing to raise the debt ceiling.

Calling something “permitting reform” is a useful way of rallying support for a few reasons. For one, there are wind and solar developers, in addition to fossil fuel companies, frustrated by the processes they need to go through to get approval to build stuff. A number of clean energy trade associations—including the American Clean Power Association, the Solar Energy Industries Association, and the American Council on Renewable Energy—have thrown their weight behind the Chamber of Commerce’s call for permitting reform, joining the likes of the American Petroleum Institute.

That seemingly odd-bedfellows coalition might confuse even well-meaning politicians. Most congressional offices take their cues from overworked and underpaid 25-year-olds who spend—generously speaking—20 percent of their week thinking about energy and climate policy. In that context, the fact that policies promised by H.R. 1 have support from organizations with the words “solar” or “clean” in their names can mislead elected officials or their staff into thinking that a bill will be a good thing for the planet. Campaign contributions from groups supporting H.R. 1 (or whatever future version of it might crop up soon) go a long way too.

Not all bills that are good for renewable energy companies are good for the planet, of course. As for-profit firms interested almost exclusively in their own profits, wind and solar companies and their trade associations may see little contradiction between growth in their business and in oil and gas drilling, even if the overall effect of something called permitting reform might be to increase fossil fuel emissions.

But to fully appreciate the perversity of calling H.R. 1 “permitting reform” and presenting it as a fix for high energy prices, consider the alternative approach to curbing energy prices California has taken. This week, the state legislature passed a bill that, when first conceived, was supposed to be a tax on oil companies’ windfall profits—and potentially even a cap on profits. Since its inception, of course, the bill has been watered down via lobbying to an information-gathering exercise. It creates a “dedicated, 24/7 independent watchdog to root out price gouging by oil companies,” housed under the California Energy Commission. Refiners will be required to submit information on how their prices are determined, albeit with modest penalties for those found to be charging more than the “maximum allowable margin.”

The very fact that a state could need an independent watchdog to figure out when gas companies are price gouging points to the reality behind Republican bluster this week: The relationship between domestic fossil fuel production and prices at the pump is a thorny one and hardly as straightforward as the GOP routinely makes it out to be—including in its advocacy for H.R. 1.

Politicians truly concerned with Americans’ energy bills probably wouldn’t be axing commonsense measures like the Greenhouse Gas Reduction Fund, which provides grants to deploy cost-saving green energy technologies. Bringing prices down and reducing costs was never the point of this legislative push, though. Making their donors happy may not be the only reason why many Republicans are putting their energies behind H.R. 1, but it’s a more likely explanation than their having developed a newfound interest in the plights of working-class people and the planet.