House-Passed ‘Build Back Better’ Plan Aims To Curb Methane Emissions by Hiking Heating Prices
Buried inside the “Build Back Better” plan that cleared the House of Representatives on Friday morning is a new tax on natural gas production that will likely translate into higher heating bills for American households.
The new tax is aimed at curbing methane emissions and will apply fees to companies that produce, process, transmit or store oil and natural gas starting in 2023. The specific fees will depend on where the natural gas is produced and will vary depending on how much methane is released into the atmosphere during the process. Overall, the Congressional Budget Office estimates that the new “methane fee” will generate about $8 billion over the next 10 years.
The natural gas industry says that money will end up coming directly out of consumers’ wallets.
“New fees or taxes on energy companies will raise costs for customers, creating a burden that will fall most heavily on lower-income Americans,” a coalition of energy industries wrote in a letter to congressional leaders in September. “These major new costs most likely will result in higher bills for natural gas customers, including families, small businesses, and power generators.”
Those industry groups claim that the new fee will translate into a 17 percent increase in household energy prices for homes that rely on natural gas heat. Meanwhile, Americans for Tax Reform, a conservative nobnprofit that advocates for lower taxes, says the natural gas fee is “a clear violation” of President Joe Biden’s promise that the “Build Back Better” plan would not increase taxes on American families earning less than $400,000 annually.
The proposed methane fee is based on legislation introduced earlier this year by Sen. Sheldon Whitehouse (D–R.I.). In a statement when the bill was introduced, Whitehouse said the new fees would slow climate change and improve air quality.
But the tax is unlikely to have a serious impact on global methane emissions. The United States accounted for about 622,000 metric tons
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