Energy

# Summary of Proposed Clean Air Act Amendments This document proposes significant amendments to the Clean Air Act, creating a comprehensive framework for addressing greenhouse gas emissions while supporting affected workers and communities. ## Key Environmental Framework - Establishes a cap-and-trade system for greenhouse gas emissions through "emission allowances" (Title VII) - Creates "covered entities" required to comply with emissions limits - Implements an "International Reserve Allowance Program" for imported goods to prevent carbon leakage - Sets up a "Negative Emissions Activities Fund" to support carbon sequestration projects ## Major Funding Mechanisms 1. **Worker and Community Assistance Fund** (Section 103) - Supports transition assistance for workers and communities affected by the clean energy transition 2. **Cleaner Air Community Fund** (Section 104) - Funds community-based programs to improve air quality and support environmental justice 3. **Negative Emissions Activities Fund** (Section 105) - Supports programs that remove carbon from the atmosphere 4. **Energy Innovation Fund** (Section 106) - Funds research and development for clean energy technologies 5. **Clean Energy Rebate Program** (Section 102) - Provides direct rebates to eligible households for clean energy investments ## Worker and Community Assistance Programs - **Section 201-208** establishes a comprehensive program to support workers and communities affected by the transition to clean energy - **Adversely affected workers** (those partially or totally separated from employment at impacted employers) receive: - Wage adjustment assistance (up to 36 months) - Health insurance continuation (80% premium coverage for 36 months) - Educational benefits comparable to veterans' education programs - Employment services and training - **Adversely affected communities** (local governments facing significant tax revenue loss) receive: - Annual payments to replace lost local revenues (90% in first two years, decreasing to 25% in years seven and eight) - Grants for economic diversification planning - Community-Based Transition Hubs to coordinate local assistance efforts ## Key Features - **International Reserve Allowance Program** (Section 751-752) to ensure imported goods meet the same emissions standards as domestic products - **Conforming amendments** to the Clean Air Act to integrate these new programs - **Interagency coordination** through the Interagency Energy and Economic Transition Task Force - **Stakeholder Advisory Committee** to provide input from affected communities and workers - **Worker and Community Transition Report** to be submitted to Congress biennially This legislation represents a comprehensive approach to addressing climate change while simultaneously creating a safety net for workers and communities impacted by the transition to a clean energy economy.

This bill directs the Secretary of State to lead negotiations for at least 20 new nuclear cooperation agreements (commonly called "123 agreements") by 2029, while also seeking to renew or renegotiate expiring agreements. It directly affects U.S. nuclear suppliers, investors, and lenders seeking to compete globally for nuclear projects in foreign countries. Key provisions include creating a cross-agency program to remove regulatory barriers for U.S. nuclear exports, expedite international agreements, and promote adherence to global nuclear liability standards. The law mandates specific actions to enhance U.S. competitiveness in the international nuclear energy market, focusing on concrete policy changes like streamlining export processes.

This bill establishes a carbon tax on fossil fuel emissions starting at $35 per metric ton in 2027, with annual increases tied to inflation. It creates the Rebuilding Infrastructure and Solutions for the Environment (RISE) Trust Fund to distribute tax revenues toward infrastructure projects, climate adaptation, energy sector worker retraining, and carbon capture research. The bill also establishes a National Climate Commission to set emissions reduction goals and assess federal climate policies, while implementing border adjustments to prevent carbon leakage for imported goods. Additional sections address cancer research funding, PFAS contamination at defense sites, voting rights for unaffiliated voters, and restrictions on financial transactions for House members.

The Agricultural Environmental Stewardship Act of 2025 extends the deadline for a tax credit for qualified biogas property from December 31, 2024, to December 31, 2025. This change applies to biogas property construction beginning after December 31, 2024, as amended in the Internal Revenue Code. The bill directly affects agricultural businesses and producers building biogas systems that convert organic waste into energy, enabling them to claim the tax credit for a longer period. The key mechanism is a straightforward extension of an existing credit, without altering eligibility or creating new requirements.

This bill creates a tax credit for new vehicles with better fuel economy than the median for their model year, with a maximum credit of $5,000. It also imposes a fee on manufacturers of vehicles with fuel economy below the median for their model year. The credit amount is calculated based on how much a vehicle's fuel economy exceeds the median for its model year, using combined fuel-economy ratings expressed in miles per gallon of gasoline equivalent. Vehicle manufacturers must report fuel economy data annually, and the credit can be transferred to dealers who disclose the amount to customers. The bill applies to new passenger cars and light trucks starting with model year 2027.

The Energy and Water Development and Related Agencies Appropriations Act, 2026 (S 3293) allocates approximately $13.5 billion in federal funding for energy and water infrastructure programs for fiscal year 2026. The bill provides specific funding for Corps of Engineers civil works projects including flood control, river and harbor maintenance, and aquatic ecosystem restoration, as well as for Department of Energy programs focused on energy efficiency, nuclear energy, and grid infrastructure. It establishes the Water Infrastructure Finance and Innovation Program with $5 million allocated to support dam safety projects and levee maintenance for state and local entities. The bill includes detailed provisions governing how funds can be reprogrammed across different programs, with specific limits on reprogramming amounts for various categories. This funding bill directly affects federal agencies like the Army Corps of Engineers, Department of Energy, and Nuclear Regulatory Commission, as well as state and local governments that receive federal funding for water infrastructure projects.

This bill rescinds two presidential memoranda that banned oil and gas leasing in specific offshore areas. It directly affects oil and gas companies by removing restrictions on leasing in the Gulf of Mexico, Atlantic, Pacific, and Bering Sea regions of the outer continental shelf. The key mechanism is declaring the January 6, 2025, memoranda "have no force or effect," effectively restoring those areas to the federal leasing program. This would allow new oil and gas development permits in those previously restricted waters.

The HEATS Act eliminates the need for federal drilling permits for geothermal exploration and production on non-Federal surface land under specific conditions. It applies to operators who hold a state permit and where the U.S. owns less than 50% of the underlying geothermal rights. Key provisions include: no requirement for federal environmental reviews (NEPA), exemptions from the Endangered Species Act, and a 30-day start period after submitting the state permit. The bill maintains existing royalty payments for geothermal electricity production and explicitly excludes activities on Indian lands. It does not alter federal royalty rates or require additional federal oversight beyond state permitting.

This bill requires the EPA to adjust emissions calculations so that flexible fuel vehicles (FFVs) using E85 ethanol count as having 31% lower carbon emissions per mile compared to standard gasoline vehicles. It directly affects automakers who must meet fleet-wide CO2 emissions standards under current regulations. The change would allow manufacturers to use a reduced CO2 value for FFVs in their emissions calculations, based on EPA's assessment that E85 reduces emissions by 37% compared to gasoline. This adjustment applies to how the EPA determines compliance for FFVs under existing Clean Air Act standards.

The LIT Act of 2025 repeals energy efficiency standards for incandescent light bulbs by amending the Energy Policy and Conservation Act and terminating three specific Department of Energy rules established in 2022 and 2024. It removes requirements that manufacturers must meet for incandescent bulbs' energy efficiency, effectively allowing the sale of bulbs that previously did not comply with these standards. The bill directly affects manufacturers, retailers, and consumers of incandescent lighting products by eliminating these regulatory constraints. This change does not create new standards but eliminates existing ones governing general service lamps.