Concerns mount over energy provisions in Democrats’ spending bill
President Biden’s $ 1.7 trillion Build Back Better Act is expected to receive little to no GOP support in Congress, and Republicans are increasingly concerned about how the spending program might affect prices at the pump.
Gas prices peaked in seven years after shortages in the post-pandemic market spiked demand and pushed up inflation.
The latest move to move the United States away from oil dependency and cut greenhouse gas emissions in the president’s social spending program has raised fears that prices will continue to inflate for consumers.
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“In their tax spending and binge plan, they want to penalize our oil and gas industry by tackling damaging fees and handcuffing domestic production,” Republican representative from Texas, Michael McCaul, told Fox Business.
The Build Back Better plan would set aside $ 775 million for Environmental Protection Agency (EPA) grants, rebates, contracts and loans to help reduce emissions from oil and gas systems.
Although the EPA is also required to establish a plan that charges fees for excessive waste emissions from oil and natural gas facilities, the congressman explained.
From 2023, waste emissions exceeding a set threshold would be charged $ 900 per tonne of methane, and by 2025 the fine would rise to $ 1,500 per tonne – costs lawmakers fear will be passed on to the consumer American.
âAt a time when Americans are struggling to buy gasoline for their cars, Democrats are pushing for policies that will only drive prices up,â McCaul said. “These policies, combined with the administration’s reliance on OPEC +, will make us more dependent on foreign oil as gas prices for Americans soar.”
Global demand for oil fell in April 2020 when economies closed, cruise ships docked, planes stayed ashore, and people stopped coming to the office due to the deadly coronavirus pandemic.
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Led by Saudi Arabia, the Organization of the Petroleum Exporting Countries (OPEC) has cut production to avoid the inevitable crisis followed by a drop in demand.
But as economies around the world have reopened, demands for oil and gas have been renewed, causing a shortage of supply and soaring prices.
On Thursday, OPEC and its allies said they would not increase production to ease global shortages – instead preferring to keep gas prices artificially inflated.
Russian Minister of Energy Alexander Novak asserted that this was an attempt to keep the market in balance and avoid potential changes in demand.
The White House condemned the move, but the administration’s changes to U.S. oil production, such as the suspension of new federal oil leases and the exposure of oil drilling leases in the Arctic National Wildlife Refuge, prompted Republicans screaming scandal.
When Energy Secretary Jennifer Granholm was asked on Friday what the administration was planning to do to boost oil production, she laughed and said the United States did not have a “magic wand. “to force OPEC to embrace global concerns.
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âWhat is the American solution? Bloomberg asked, pushing aside Granholm’s dismissal. “If they’re the bad guys, Russia and OPECâ¦ what’s Biden’s plan to jumpstart energy production across America?”
“The Biden plan is to diversify, to make sure that we are moving towards clean energy where we are not dependent on cartels and we are not dependent on geopolitical adversaries who can create choke points,” he said. she said, adding that it is a “longer term strategy”.