GOP megabill includes subsidy for coal used to make steel

As Republicans try to pare down tax subsidies for renewable energy in their massive reconciliation package, they’re also giving an incentive for another energy source: coal that’s used to make steel.

Democrats’ 2022 Inflation Reduction Act included tax credits for the mining of 50 “critical minerals.” The list included substances such as lithium, graphite and aluminum but not coal.

But new language released over the weekend includes “metallurgical coal” in the tax credit, allowing for claims of it until 2030.

Credits for “critical minerals other than metallurgical coal” are available until 2034.

The move comes as Republicans and the Trump administration are rallying around coal. In an April executive order, President Trump sought to define coal as a critical mineral as part of an effort to expedite its production.

The language, which was revealed over the weekend, also came as Republicans proposed a new tax on some solar and wind projects and slashed incentives for renewables.

Democrats subsidized solar and wind energy because they, unlike coal, are climate friendly, while coal is a major source of planet-warming emissions and other pollution.

Republicans say they support coal because it is dispatchable — meaning it can be used at any time, even if it’s not sunny or windy. Solar and wind are making some strides in this area with the use of battery storage.

The coal provision’s inclusion met criticism from the left.

“This bill gives up on the present and future of American manufacturing. It deprives the American people of high-paying jobs, and it kills investments in clean industries that have been driving domestic manufacturing growth. It does so just to give more tax breaks to the rich and tossing random unnecessary subsidies towards things like exporting coal to boost steelmaking in countries outside of the US,” said Mike Williams, senior fellow with the Center for American Progress, in a written statement.

—Updated at 9:10 p.m. EDT