WV senators backing megabill predicted to gut thousands of jobs, raise energy costs

Sens. Shelley Moore Capito and Jim Justice, both R-W.Va., had indicated support for the Senate version of far-reaching budget reconciliation bill that surprised pundits by including deeper cuts to renewable energy incentives that have driven a rise in energy manufacturing and deployment than the House of Representatives’ version of the bill passed last month.

Backed by President Donald Trump, the bill is designed to extend tax cuts first created under Trump in 2017 that benefit the wealthy, aided by savings expected from proposals poised to sever access to Medicaid and the Supplemental Nutrition Assistance Program for thousands of West Virginians.

Upon Senate approval, the bill would go before the House for it to consider concurring with changes made to it in the Senate. The Senate was debating the bill as of press time Monday.

Business and renewable energy advocates fear the bill will increase energy costs, block hundreds of billions of dollars in manufacturing and energy investments, and hobble the U.S. in a race to dominance in artificial intelligence, or AI.

“At a time when we should be investing in energy independence at home, this bill forces our economy to rely on foreign adversaries while dramatically increasing energy bills for every household and draining local communities of the jobs they rely on,� the International Brotherhood of Electrical Workers said in a statement Sunday night.

Gas turbine supply constraints, demand growth driven by power-hungry data centers and increasingly extreme weather patterns threaten power grid capacity and reliability as the budget reconciliation bill aims to crush renewable energy support.

The bill has been expected to exacerbate that extreme weather by curtailing support for renewable energy deployment and other environmentally conscious moves designed to reduce harmful greenhouse gas emissions.

Coal has proven to be increasingly uneconomic, gas-fired turbine wait times have slowed gas power generation buildout, and advanced nuclear and carbon capture technologies aren’t ready for commercial scale, leaving renewables as a key energy choice to meet rising power demand.

But the legislation favors coal over renewables, creating a new advanced manufacturing tax credit for metallurgical coal — regardless of whether the production occurs in the U.S.

“This bill kills the industries of the future while subsidizing the industries of the 19th century,� Jesse Jenkins, a mechanical and aerospace engineering associate professor at Princeton University and leader of a Princeton energy research group, wrote in a X post Saturday. “It’s insanity!�

West Virginia Coal Association president Chris Hamilton, though, hailed the legislation Monday, telling the Gazette-Mail the inclusion of metallurgical coal as a critical mineral eligible for advanced energy manufacturing production tax credit is a “game changer for West Virginia.�

The value of coal exports from West Virginia to China and India — most of which is likely metallurgical coal because those two countries are major steelmakers — was about $1.2 billion in 2021, per a 2023 analysis published by West Virginia University’s Bureau of Business and Economic Research. Employment from mining metallurgical coal in West Virginia exceeded 6,800 in 2019, per that analysis, which cited U.S. Mine Safety and Health Administration and West Virginia Coal Association data.

Capito and Justice arguments don't fit with modeling 

Capito, who chairs the Senate Environment and Public Works Committee, defended the bill on X over the weekend in part by saying it would “Mak[e] American energy dominate� and sharing a post from the committee’s Republicans calling the bill a “return to fiscal responsibility� after an increase in energy costs.

But the legislation would add more than $3.2 trillion to the national debt through 2034, according to an estimate released Sunday by the independent, nonpartisan Congressional Budget Office.

Justice’s and Capito’s X accounts both shared Saturday posts from the Senate Republicans’ account claiming they were supporting a bill that would save every West Virginia family $1,423 in 2026, citing the Tax Foundation, an international tax policy think tank.

But that $1,423 figure comes from a May 2024 Tax Foundation study that predicted the average tax increase of per West Virginia taxpayer if the 2017 tax cuts were allowed to expire, without accounting for the sweeping Medicaid, SNAP and energy tax credit cuts in the budget reconciliation legislation still a year away from being introduced.

Power bill increases in West Virginia in recent years have been driven largely by increases in fuel prices raising the cost of coal, which accounts for a nation-highest 90% of the state’s electricity.

San Francisco-based climate policy firm Energy Innovation LLC has projected that changes in the House-passed budget reconciliation bill, which was less aggressive in renewable energy cuts, would result in:

• The loss of 2,000 jobs in West Virginia by 2030 and nearly 3,300 jobs by 2035, due to a drop in new domestic energy and manufacturing investments
• Increase household energy spending in West Virginia by an average of nearly $160 per year in 2030 and more than $410 per year in 2035 due to increased capital, fuel and operating expenses, with households paying $1.5 billion in increased energy bills through 2035

Higher energy costs across West Virginia households totaling $310 million by 2035 would result from more dependence on fossil fuels and higher fossil fuel prices, Energy Innovation predicted.

West Virginia had a greater number of operational jobs — 1,697 — created by clean energy projects completed since the Inflation Reduction Act through 2025’s first quarter than any bordering state, according to a study by the Rhodium Group, an independent research provider, and the Massachusetts Institute of Technology Center for Energy and Environmental Policy Research.

The Inflation Reduction Act is a landmark 2022 climate spending law passed by a then-Democratic Congress that the budget reconciliation bill nearing completion would significantly roll back.

“I don’t want windmills destroying our place,� Trump said in a Fox News Channel interview that aired Sunday. “I don’t want, you know, these solar things where they go on for miles and they cover up a half a mountain that are ugly as hell.�

How the bill would curtail energy tax credits 

The Senate reconciliation bill would end clean electricity and investment tax credits for solar and wind placed into service after 2027, a much tighter window than a previous Senate Finance Committee proposal that would have linked eligibility to when a project starts construction.

That deadline is expected to be virtually impossible for most projects due to global supply barriers and permitting delays, with subsequent failures to meet the bill’s deadline for coming online resulting in less financing and more projects folding.

The bill would move up the end date for electric vehicle tax credits to Sept. 30 this year, compared with six months after enactment in the earlier Senate Finance Committee text.

It would require a facility to begin construction by the end of 2027 instead of the end of 2032 to be eligible for a hydrogen production tax credit viewed as key for the Appalachian Regional Clean Hydrogen Hub.

The hub, known as ARCH2, is a proposed hydrogen production, storage and delivery network with sites planned in West Virginia, Ohio and Pennsylvania that has been supported by West Virginia’s congressional delegation since it was selected by the Department of Energy for up to $925 million in funding in 2023 through the Infrastructure Investment and Jobs Act approved by Congress in 2022 under then-President Joe Biden.

The Senate bill would fast-track the phaseout of advanced energy manufacturing production and investment tax credits viewed as key for battery storage innovation firms like Form Energy, which plans to commercialize a battery that can economically store electricity for 100 hours at its first commercial-scale battery-making facility in Weirton.

Ex-W.Va. economic leader defends tax credits  

Former West Virginia Senate Majority Leader Mitch Carmichael, R-Jackson, who served as Department of Economic Development secretary under Justice when Justice was governor, told the Gazette-Mail Monday the Senate bill as constituted then would hurt West Virginia’s energy landscape.

“Those tax credits yielded great benefits for the state of West Virginia,� Carmichael said.

Carmichael has been pushing for the preservation of energy tax credits as executive director of Built for America, a recently launched advocacy group whose website says the credits “give us the edge in batteries, semiconductors, nuclear, and geothermal — critical industries we can’t afford to lose.�

Carmichael led the Department of Economic Development when it struck the economic package deal that helped secure Form Energy’s Weirton operation and required the creation of 750 jobs within five years.

Form Energy cofounder and CEO Mateo Jaramillo told the Gazette-Mail in May the company opposed rollbacks proposed in the budget reconciliation package, calling energy tax credits “essential to rebuilding American manufacturing, enhancing our energy reliability and security, and ensuring the United States remains competitive in the global economy."

The Senate bill would also restrict production tax credit access for battery and other advanced manufacturing components that get “material assistance� from prohibited foreign entities. China would be a prohibited foreign entity, a designation effectively blocking the tax credit for a wide array of projects since China is the chief importer of many material components to the U.S., which nonetheless needs to grow its renewable energy production to localize its supply chain away from China.

Sen. Thom Tillis, R-N.C., blasted his party’s reconciliation bill in a spirited Senate floor speech Sunday, calling its production and investment tax credit treatment “another classic example where think tanks and people that haven’t worked a day in business are setting policy in the White House without a clue about what they’re potentially doing to our grid.�

Tillis announced earlier in the day he won’t seeking reelection next year after Trump criticized him on social media for voting against advancing the bill, saying in a statement, “In Washington over the last few years, it's become increasingly evident that leaders who are willing to embrace bipartisanship, compromise, and demonstrate independent thinking are becoming an endangered species.�

An amendment offered by Sens. Joni Ernst, R-Iowa, Chuck Grassley, R-Iowa, and Lisa Murkowski, R-Alaska, Monday pending at press time backed by the Solar Energy Industries Association was designed to reestablish the “commence construction� standard rather than the “placed into service� standard for energy tax credits.

“Slashing energy tax credits and layering on harmful restrictions is no way to power America’s future, economically or in terms of national energy security,� McGarvey said. “Critical infrastructure projects essential to that future are being sacrificed at the altar of ideology.�

But Rep. Riley Moore, R-W.Va., whose district includes Form Energy’s Weirton plant, praised the Senate bill in a roundtable discussion that aired on CNN Sunday for being what he called “more aggressive� on green energy tax credits.

“If it’s not in operation, it’s over,� Moore said of the tax credit cutoff applying to solar and wind projects that don’t come online by 2027 instead of merely projects that hadn’t begun construction. “And that is great for my state of West Virginia. We’re an energy state. We’re a traditional fossil-fuel energy state.�