Clashes over electric vehicle policies are exacerbating tensions between the Biden administration and Sen. Joe Manchin (D-W.Va.), a key swing vote in the Senate.
For months, Manchin has fumed about the Treasury Department’s interpretation of electric vehicle (EV) tax credits in the Inflation Reduction Act (IRA) — the Democrats’ climate, tax and health care bill.
In recent weeks, the senator, who is facing reelection in conservative West Virginia, has stepped up his rhetoric on the issue amid a broader spate of criticism against the administration.
At one point he threatened to sue over electric vehicle guidance; at another, he opposed a nominee because of the dispute.
“Let me be clear,” he wrote in a scathing Houston Chronicle op-ed blasting the administration over its approach to the IRA last month. “If they choose to continue down this path there will be consequences now and in the future.”
The Inflation Reduction Act lifted a cap on how many cars can qualify for electric vehicle tax credits, but it added stipulations related to the batteries’ manufacturing and supply chains as well as how much they cost.
To qualify for the up to $7,500 credit, vehicles must not cost more than $55,000 unless they are sport utility vehicles (SUVs), pickup trucks or vans, for which the price limit is $80,000.
The credit is also divided into two parts: half for where the battery components are manufactured and half for where the battery’s minerals are refined or processed.
Manchin, who championed these stipulations during negotiations over the IRA, has raised concerns about the Biden administration’s treatment of them.
“They’re liberalizing the intent of what the bill was,” he said of the legislation during an event at the Chamber of Commerce this week.
The Treasury Department adopted guidance labeling “crossover” vehicles as SUVs, something Manchin criticized during his remarks at the Chamber — saying it allowed consumers buying “luxury” vehicles to get access to the credit.
During a Senate hearing on Thursday, he lamented that certain battery-related activities were categorized under processing rather than manufacturing.
Broadly, Manchin said that he didn’t want to provide credits for electric vehicles at all, but if they must be subsidized, the government should get supply chain wins in return.
“My personal belief is that we didn’t need any,” he said of electric vehicle tax credits during the hearing. “But with that being said, I said ‘if we’re going to do it, let’s get something for it.’”
Asked to comment on the EV issues, Treasury spokesperson Ashley Schapitl defended the guidance in an email to The Hill.
“Our guidance on the clean vehicle credit is centered on building a robust and resilient industrial base in the U.S. that will create more jobs, and strengthen the supply chains that are vital for energy security with like-minded partners,” Schapitl said.
“Treasury is laser-focused on unlocking the transformative benefits of the Inflation Reduction Act to lower energy costs for consumers, support workers, strengthen national security, increase American manufacturing capacity, and meet our climate goals,” she added.
In addition to his dispute over the guidance, Manchin also raised concerns this week about a separate electric vehicle policy from the administration: a new proposal from the EPA under which two-thirds of new car sales could be electric in 2032.
Manchin this week called for the rule, which has not yet been finalized, to be overturned. After a rule is finalized, Congress may decide to try to overturn it, but doing so would require either a two-thirds majority or the president’s signature.
During a press briefing this week, White House press secretary Karine Jean-Pierre defended the EPA’s proposal.
“The measures the EPA propose will, if implemented, do the following: Save American drivers and truck companies an average of $12,000 over the lifetime of their vehicle, which is incredibly important,” she said, according to an official transcript, “they’ll cut nearly 10 billion tons of CO2 emissions. That’s nearly twice annual U.S. emissions.” She added that the proposal would “deliver for the American people, as well as really fighting climate change.”
This week was not Manchin’s first time criticizing the Treasury Department’s guidance, which took effect this week. He has, in the past, threatened legal action over the issue.
He also cited his disagreement with the administration’s approach to electric vehicle tax credits as his reason for opposing a Biden nominee for a position at the Internal Revenue Service in the Houston Chronicle op-ed.
In that op-ed, titled, “The Biden Admin panders to climate activists. I won’t support their nominees,” Manchin went beyond the EV issue and raised concerns about another public-lands nominee.
“Going forward, each and every proposed nominee I will review will be judged through one prism: Are they political partisans first or Americans first?” he wrote last month.
The spat over electric vehicles is a microcosm of broader tensions between Manchin and the administration; the swing-vote senator has, in recent weeks, blocked several Biden nominees, voted with Republicans to nix Biden rules and applauded GOP efforts on the debt limit issue.
While he said he did not agree with every piece of the Republicans’ proposal, he slammed what he described as a “deficiency of leadership” from President Biden.
This is not the first time Manchin has feuded with the administration, but the recent flare up comes as next year’s elections inch closer.
Manchin, if he runs, may benefit from distancing himself from Biden in deep-red West Virginia next year.