On July 27, 2022, with Senator Joe Manchin's (D-WV) support, Senate Democrats unveiled a budget reconciliation bill that includes $369 billion in climate and clean energy policies.[1] The proposed bill, called the Inflation Reduction Act of 2022, follows months of negotiations between Democratic leadership and Senator Manchin, who had opposed the Build Back Better bill passed by the House last fall. It would be the country's largest climate change bill if it makes it through the Senate and House. According to Senate Majority Leader Chuck Schumer's (D-NY) office, the legislation would reduce greenhouse gas emissions by roughly 40% by 2030.

Under the bill, existing renewable tax credits would be extended, and after 2025, they would become technology neutral and based on greenhouse gas emissions reductions. Existing nuclear power plants would be eligible for a production tax credit. In addition, the 45Q credit for carbon capture and storage (CCS) would be expanded and extended. The bill will offer a $4,000 credit for used clean vehicles and up to $7,500 for new clean vehicles. The deal includes the Methane Emissions Reduction Program, which would put a fee on excess methane emissions and offer up to $850 million in grants to industry to monitor and reduce methane. It also contains $60 billion for environmental justice, $60 billion for clean energy manufacturing, and $27 billion for a new federal green bank.

[1] https://www.democrats.senate.gov/imo/media/doc/inflation_reduction_act_of_2022.pdf