Q&A: Sen. Shelley Moore Capito, incoming EPW chair

Sen. Shelley Moore Capito is planning to roll back elements of the Democrats' climate law as chair of the Environment and Public Works Committee next year, eliminating "frivolous" spending while pushing to keep the parts that have created new clean energy jobs.

In an interview with POLITICO, the West Virginia Republican laid out her priorities, including digging into a permitting rules overhaul and maintaining a focus on helping nuclear power grow — an area that's also drawn support from Democrats on the committee.

“I want to make sure we continue that bipartisan tradition that we've had,” said Capito, the current ranking member of the committee. “But having the reins of the committee is going to allow me to really flex my muscle in terms of oversight of the past four years in terms of some of the programs that have gone forward.”

Capito said she’s hoping to move legislation streamlining permitting reviews through the National Environmental Policy Act — including potentially including measures in a filibuster-proof reconciliation package Republicans are expected to pursue early next year to extend the 2017 Trump-era tax cuts.

But she acknowledged Republicans won’t be able to “claw back” grants the EPA has distributed to recipients through the Inflation Reduction Act, including $27 billion under the Greenhouse Gas Reduction Fund, a “green bank” to help fund clean energy projects in low-income areas that often struggle to attract private sector financing.

“Money that's already been obligated and out the door, that's a decision that's final. We're not gonna go claw back money. That's a ridiculous thought,” Capito said. “But … we're gonna shut the door on these frivolous ways to waste money in that bill.”

This interview has been edited for length and clarity.

This is a big moment for you given your long history on EPW. It was among the first committees you joined upon coming to the Senate from the House in 2015. What are some of your top priorities going to be under a GOP trifecta in a Trump administration?

I have served on the EPW since I first entered the Senate and have achieved some good bipartisan results in terms of things like nuclear and transportation and water. But having the reins of the committee is going to allow me to really flex my muscle in terms of oversight of the past four years in terms of some of the programs that have gone forward.

We'll also make sure that we move forward with the nuclear, the advanced nuclear that we were able to put into effect with the Advance Act. This is very important to me. If we're going to have these energy demands, we've got to find another base load energy to accompany natural gas and coal.

And then also, obviously we're going to work with the [Trump] administration on the over-regulation and the overly broad and poorly balanced regulations that the Biden administration has gone forward on.

So we're going to take advantage of the ability to set committee meetings where we could do a deep dive on these things. And that would be oversight of the IRA and others.

We're going to look at permitting reform, which has to be done to meet the energy demands. It's all about energy dominance, as President Trump says, and that's what we're looking at our committee to help achieve that.

And then the last thing, obviously, is swiftly confirming high-quality nominees from the administration.

Should Republicans hold out on permitting action until next year and not in the lame duck? Senate Energy Chair Joe Manchin told me he’s contemplating changes to his bill, including NEPA reform, to entice Republicans and that Majority Leader Chuck Schumer wants to pass a bill while Democrats still have Senate control.

We have to have NEPA reform so we can move projects along. That comes out of my committee. We're not skirting any environmental regulations, but we have issues of timeline and legal pushback. So [I want] some judicial reform for all projects, not just energy.

The ones that Manchin [put] in his permitting bill [are] only focused on energy projects.

We have transportation issues. We have manufacturing issues, broadband, siting, all of these different things that we're trying to permit have issues. We want to make sure that we can get rid of the delays and the expense that is preventing a lot of things from moving forward.

Do I think we can get something by the end of the year? I'm fully supportive of what Manchin and [Sen. John] Barrasso have done on the Energy Committee, but I do think we can go bigger after the first of the year, and we may be able to incorporate some of this into reconciliation, so that may be a better strategy.

So do you view it as an either-or proposition? Could you pass Manchin-Barrasso and do more next year too?

We could do it that way. But a lot of times, [with] Senate procedures and Senate focus, you don't get two and three strikes at the bat. You only get one good one. And if we're only going to get one, I would love to see it more comprehensive than what is coming out of the Energy Committee. But if it does make it into an end-of-year package, I will be supportive of it for sure.

House Natural Resources Chair Bruce Westerman last week told me he wants to include permitting reform measures in your anticipated reconciliation bill. Do you support that idea?

I definitely do, yes, and we'll be looking for openings like that when we do our reconciliation. And we're in the process now of doing a deep dive on it, to look at where we have budgetary impacts in EPW and how we can contribute to long-needed reforms through reconciliation.

Where do you see bipartisan opportunities? Are you operating under the assumption Sen. Sheldon Whitehouse will be ranking member? 

At this point we are. I do think that it will be Sen. Whitehouse.

I started on the committee when it was Sens. [James] Inhofe and Barbara Boxer, and we did highway bills and water bills and the Water Resource Development Act with all the [Army] Corps projects. So we want to continue that.

We're going to have a highway bill that expires in 2026, so that's always a large portion of energy that it takes to write that and make sure we're doing it right. We also have clean water and wastewater bills that are going to be coming up that we want to enact. We've worked on recycling — bipartisan. We'll continue to do that. We've looked at PFAS legislation. We didn't get there, but that's another topic of discussion that we need to keep active and hopefully find a resolution there.

So there's areas where we can work together, and I want to make sure we continue that bipartisan tradition that we've had.

Whitehouse is known as a vocal climate hawk but you’ve worked together on issues like nuclear and carbon capture. What do you anticipate that working relationship being like?

We worked on the Advance Act. We also worked on the 45Q tax credit to push the carbon capture, storage and utilization projects.

And so we're going to find the bipartisan areas that we can. I'm sure we're going to differ on some things, just like I differ with Chairman [Tom] Carper, but we have some must-do's.

On nuclear, do you want to move more legislation or will your focus be on implementing the Advance Act?

No, I think it's the implementation portion of the Advance Act. We want to make sure that small modular reactors can get licensed, that the protocols are in place by the Nuclear Regulatory Commission, who is, by the way, perennially the slowest commission I've ever seen in my life to make a decision.

Some [companies] like Microsoft and Amazon and Google are moving forward with data centers powered by nuclear and small modular nuclear reactors. Well, right now you can't build one because they aren't licensed. They don't know what the parameters are going to be. And that's what the Advanced Act is going to help with. And so we just need to push that through before we start considering other legislation.

You are also going to be No. 4 in GOP leadership so I wanted to turn to a broad question on how Republicans should handle repealing parts of the IRA as part of your anticipated reconciliation bill next year. You’ve been candid about investments IRA has spawned in West Virginia, including in coal dependent communities you care about. Are you prepared to oppose gutting the IRA that Trump seemed to pledge on the campaign trail? 

The area that just really rankles me … is the billions and billions of dollars that have gone out the door in grants and special interests. We're not going to be able to claw that back, but we've got to shut the door on it. And so as we follow the money, we're gonna shut the door on these frivolous ways to waste money in that bill.

In terms of some of the tax advantages for development of battery storage, or renewables or things of that nature, we have to look at those more individually. I don’t think it’s just a blanket shutdown of those particular economic opportunities.

Because in our state, we've taken advantage. Some people have taken advantage of this tax relief and are now employing 800 and 1,000 people, and that's what this should be all about, rather than just really giving money to your friends and your like-minded supporters in the form of what these grants have been doing.

Won’t that get complicated for Republicans trying to come to agreement on which credits to target? For example, some Republicans come from wind states, others are seeing carbon capture activity, or hydrogen, and have their own parochial interests.

I don't think that's gonna be easy. Any time [legislation] has some very good points to it, along with some dragging it down, it's always more difficult.

For instance, the administration has the 45V tax credit, which is supposed to be for future energy projects for hydrogen. Even though the legislation says these are for projects that would specifically utilize natural gas, [the] Treasury [Department] comes back and doesn't allow that to get full tax credit. There's other ways that we can reshape [it] to make this more advantageous for certainly my region of the country, and more fair.

EPA is expected to have obligated almost $40 billion in funding under the IRA, including $27 billion under the Greenhouse Gas Reduction Fund. Will you try to reclaim that money from the recipients?

No. But think about it, they're rapidly deploying this money, which tells me that's a total waste of energy. If you haven't figured it out yet in two years where the money should go, why do you rush it out the door in the last six weeks after you lose an election? That should tell you right there how worthy this green bank really is.

So you can’t really do anything about the Green Bank then? 

We really can't do anything. Money that's already been obligated and out the door, that's a decision that's final. We're not gonna go claw back money. That's a ridiculous thought.

You have said you want to repeal the IRA’s methane fee. What do you view as the preferred route to do that?

We're definitely looking at that for reconciliation because it does have a budgetary impact. They just finalized the rules so it does fall within the [Congressional Review Act]. We're trying to figure out the best strategy on that ... but we are definitely going to try to take that down.

I repeatedly warned my natural gas producers this was going to have a negative effect and be very expensive, and it's gonna be costly to everybody living in and around our state. And that's exactly what's gonna happen, and I'm hearing from a lot of them.

What about the money given to oil and gas companies to curb their emissions of methane as part of the IRA methane fee — would you try to take that back?

I don't think we're trying to take the money back. I would put that in the same bucket of the Green Bank. That money [has] gone out the door and if it's used properly and it reduces the methane, that's a good thing.

But this was sold as a way to help people who drill for natural gas to be able to have the tools available to handle the methane, measure the methane, and understand what's happening, and it's turned around to something else. It’s almost impossible for our small and medium producers [to comply].

Turning to Trump’s cabinet, you frequently questioned whether, under the Biden administration, EPA and other agencies were taking direction from unaccountable "climate czars" like Gina McCarthy and John Kerry. Trump just named North Dakota Gov. Doug Burgum to take on a “energy czar” type role chairing a new National Energy Council. Do you similarly oppose that position from being created? 

I see this as a coordinating, conscious effort by incoming President Trump. To achieve energy dominance, you got to have your secretary of Energy, your secretary of the Interior, your administrator [of EPA] at the table to be rowing with the same oar, and that's how I see it.

I don't know that the policies will emanate from that council. Overarching policies or themes can come and then each cabinet member takes it back to their individual cabinet. What was happening under Biden was all the decisions were being made in the White House, and they were just being foisted down to [EPA] Administrator [Michael] Regan. He was the implementer or the announcer of what was going on, but the real decisions are being made at the White House by folks that I can't reach for oversight.

But all of these people that I believe are going to be on this [energy] council, at least the ones I've seen so far, have accountability to the Senate and the House, because they're going to be called to testify in appropriations and other things.

I know you are very supportive of Trump’s nominee to lead EPA, former GOP Rep. Lee Zeldin of New York. Do you want to see Zeldin reissue the Affordable Clean Energy rule (from the first Trump administration), or take some other tack on regulating carbon from power plants?

First of all, the Clean Power Plan 2.0 is in litigation right now, and the first one fell because of constitutional issues [from] West Virginia vs. EPA. So, I don't know specifically if they would come back with what they put forward [in the Trump administration].

It’s been several years. Things have changed. I would imagine there'll be some changes, and that would be reflected in a new rule. So I expect changes to be made. But I expect the theme to be the same, and that is unleashing American energy.

What do you want to see the Trump administration do with the Biden administration's PFAS drinking water standards? 

I've learned a lot about PFAS over the last several years. I've learned that it's everywhere, and I've learned that all PFAS is not created equal. Some are different compounds and different chemical configurations. Some PFAS is used for one thing and some for another.

I want safe and clean drinking water, but I want a drinking water standard that's measurable.

Here's what didn't make any sense to me. They [Biden] put out a health standard that's one measurement, and then they put out a safe drinking level that's higher than that.

Can we make sense to the American public? They just want to know.

One of the issues that is just pervasive in this whole argument is, who's going to pay? And I'm strong on polluter pays, and I don't think that we should have third parties or passive receivers being the one that ends up holding the bill at the end of the day, or the federal government. So we got to work that out, and that was one of the big stumbling blocks, but we'll keep working on it.

So would you want to see the Trump administration repeal what Biden did and do their own? 

I'm going to leave that to them and see. I don't know what kind of priority it is. Certainly, Lee Zeldin is from New York. They've had significant issues in New York with PFAS, particularly around the [military] bases because of the firefighting foam. So I need to have a more extensive conversation with him on that matter.