Texans introduce bill in Congress to strike down Biden’s natural gas tax

Two Texas Republicans have introduced companion legislation in Congress to strike down a natural gas tax proposed by the Biden administration.

U.S. Sen. Ted Cruz introduced a bill to prevent a newly proposed tax and eliminate a new methane emissions fee created in the Inflation Reduction Act. U.S. Rep. August Pfluger introduced the bill in the U.S. House of Representatives, which already passed. Both bills have multiple cosponsors.

Both Cruz and Pfluger represent the oil and gas capital of the U.S. Cruz, from Houston, and Pfluger, from west Texas, have been pushing back against Biden administration policies attempting to stifle domestic production as Texas continues to lead the U.S. in oil and natural gas production.

Last year was a record year for domestic natural gas consumption, with Texas producing the equivalent of one-third of natural gas consumed in 2023 and Texas producers breaking multiple records, The Center Square reported.

Cruz’s bill repeals Section 136 of the Clean Air Act, which relates to a methane emissions and waste reduction incentive program for petroleum and natural gas systems.

While the Biden administration has blamed the U.S. oil and natural gas industry for skyrocketing energy costs, even blaming liquified natural gas (LNG) exports for them, U.S. Energy Information Agency data disproves the claim, The Center Square reported. A report by the Texas Oil & Gas Association pointing to EIA data shows that as LNG exports reached record highs, domestic natural gas prices decreased.

The real reason for increased energy costs, critics argue, are Biden administration policies, including over 200 actions taken against the U.S. oil and natural gas industry since January 2021, The Center Square reported.

“President Biden and Democrats have a plan for American energy: make it harder to produce and more expensive to purchase,” an Institute for Energy Research report states. “Since Mr. Biden took office, his administration and its allies have taken over 200 actions deliberately designed to make it harder to produce energy here in America.”

Earlier this year, 24 Senate Republicans blasted the administration’s proposed $110 billion tax on the oil, natural gas and coal industry, saying they will drive costs up even more and hurt low income Americans the most.

In 2023, natural gas was the top energy source powering homes and businesses, according to the EIA, “the most on record.” Since 2018, domestic natural gas consumption increased by an average of 4% annually, according to EIA’s analysis.

EIA also reported that last year, Texas’ oil, natural gas and natural gas liquids (NGLs) production reached new highs.

This is after the U.S. became the world’s largest LNG exporter in the first half of 2022, made possible by the Gulf states of Texas and Louisiana. Texas produced roughly a quarter of America’s natural gas supply at the time, according to the EIA. The U.S. has been able to meet increasing natural gas demand from European and Asian countries “largely thanks to Texas energy production and export infrastructure,” Texans for Natural Gas reports.

Nineteen state attorneys general have also highlighted how natural gas is an essential source of energy that Americans rely on and is vital to national security, The Center Square reported.

Despite the policies of the Biden administration, the Texas legislature, Gov. Greg Abbott and Texas producers have helped stabilize the energy market, Ed Longanecker, president of Texas Independent Producers and Royalty Owners Association (TIPRO), told The Center Square. The Texas legislature prioritized legislation to encourage domestic production and Texas producers in the Permian Basin, the powerhouse of U.S. production, have also made strides in technological advancements leading to emissions reductions, The Center Square has reported.

From 2011 to 2021, methane emissions intensity in the Permian Basin fell by more than 76% as production increased by over 345%, The Center Square first reported. According to TNG’s latest report, Permian Basin methane intensity fell by nearly 85% between 2011 and 2022, as new production records were also reached during the same time period.

“A strong supply of U.S. natural gas, largely supplied by Texas, has kept domestic energy markets stabilized as the power sector increases its natural gas demand and our LNG market grows,” Longanecker told The Center Square.

Recognizing the importance of the industry, nine Texas Democratic U.S. representatives earlier this year urged the president “to refocus on policies that support U.S. liquified natural gas (LNG) exports,” The Center Square reported. However, only a few voted for bills the U.S. House passed to expand and strengthen domestic production.

The bills were “an important step in pushing back against the anti-energy and anti-consumer Biden Administration and its war on U.S. domestic energy,” Karr Ingham, economist and president of Texas Alliance of Energy Producers, said. “It is critical for our industry, our nation, and the world to promote and expand abundant, affordable, and reliable petroleum energy production and support efforts to maintain our economy.”

The Democratic-led U.S. Senate has yet to consider them.