Inflation Reduction Act passes the Senate with historic climate investments, permanent black lung excise tax extension, rural energy infrastructure and more

CONTACT: Molly Moore, Director of Program Communications, (847) 401-3633, [email protected]

WASHINGTON, D.C. — Today, the U.S. Senate passed the Inflation Reduction Act, which contains many of the climate and energy investments that President Biden pushed for in his Build Back Better agenda, as well as spending to support rural communities with energy efficiency and electrical infrastructure improvements and a permanent extension of a tax on coal to support the Black Lung Disability Trust Fund.

The bill, passed under the budget reconciliation process in the Senate, also contains measures aimed at lowering prescription drug prices and some tax reform, as well as provisions Appalachian Voices opposes that promote continued fossil fuel use.

“The Inflation Reduction Act is a major achievement in the effort to reduce our nation’s greenhouse gas emissions and other harmful pollutants,” said Appalachian Voices Executive Director Tom Cormons. “The bill includes big victories for Appalachian communities such as clean energy development and manufacturing tax credits directed at communities transitioning away from fossil fuel economies, incentives for rural electric cooperatives switching to clean energy, and a permanent extension of the black lung excise tax to help shore up benefits and healthcare for coal miners with black lung.”

“Miners with black lung disease and their widows, families and supporters have pushed for solvency for the federal black lung benefits fund for years,” said Central Appalachian Field Coordinator Willie Dodson. “Permanent restoration of the black lung excise tax is significant, and miners and advocates are committed to improving the black lung benefits program and increasing protections for miners going forward.”

The bill includes:

• $9.7 billion for grants and loans to rural electric cooperatives and their subsidiaries to purchase renewable energy, renewable energy systems, and energy efficiency improvements on generation and transmission systems.
• $1 billion for forgivable loans for renewable energy resources for resale to residents. This includes solar, wind, hydropower, biomass or geothermal energy. Eligible entities include for-profits entities, government entities, electric cooperatives and non-profit organizations.
• $27 billion to establish a new Greenhouse Gas Reduction Fund to accelerate deployment of low-carbon technologies. At least 40% of the benefits of these investments must go to disadvantaged communities.
• $3 billion for Environmental and Climate Justice Block Grants, which will provide support for community-led priorities to reduce pollution and improve public health and climate readiness.
• A permanent extension of the black lung excise tax at the higher historic rate. This tax on domestic coal sales funds the Black Lung Disability Trust Fund for miners with black lung, who have been fighting for more than three years for a 10-year extension of the higher tax rate.
• An increase of the federal investment tax credit for renewable energy to 30% and a 10-year extension of the credit; the bill adds a new 10% bonus incentive for projects in low-income communities and a 10% bonus tax credit for communities experiencing the loss of fossil fuel jobs or mine and power plant closures. The tax credits are also expanded to allow for a “direct pay” grant option for nonprofits, government entities and rural electric cooperatives, which were previously not able to take advantage of the tax credits, as well as a “transferability” option that will expand access to the tax incentives.
• Incentives for domestic clean energy manufacturing, including dedicated funding and incentives for projects in communities moving away from fossil fuels, which will help create new clean energy jobs in coal-impacted communities.

“These provisions will create more clean energy jobs in coal-impacted communities and greatly expand the reach of the Appalachian Solar Finance Fund. Investments in clean energy will allow Central Appalachia to remain an energy leader while adapting to the new low-carbon future,” said Regional Director of Community and Economic Development Adam Wells.

However, the bill also contains provisions, which Appalachian Voices opposes, that would ensure continued fossil fuel production over the next decade, as well as incentives for problematic technologies such as biofuels and fossil-fuel based hydrogen that industry will inevitably attempt to construct in disadvantaged communities.

“We stand together with communities across the country in opposing these investments and remain steadfast in our continued fight to move our region away from fossil fuels,” said Deputy Executive Director Kate Boyle.

“Appalachian Voices is dedicated to protecting communities from harmful fossil fuel projects, including the Mountain Valley Pipeline, and we will continue to use every tool available to us to fight for clean air, clean water and sustainable futures,” said Virginia Policy Director Peter Anderson.

Though passage of the Inflation Reduction Act is momentous, the fight for clean air and clean water is far from over. Appalachian Voices is deeply concerned about Sen. Joe Manchin and Majority Leader Chuck Schumer’s reported agreement to force a vote on a separate “permitting reform” bill that, among other provisions, would attempt to pave the way for the harmful and unnecessary Mountain Valley Pipeline. Appalachian Voices will continue to oppose expansion of new, unnecessary fossil fuel infrastructure, particularly in low-income and Black, Brown and Indigenous communities.

Protecting the Central and Southern Appalachian Mountain Region