April 08, 2022

Will the Senate Take Bold Action on Climate Change?

Posted on April 8, 2022 by Leslie Carothers

The brutal Russian assault on Ukraine has commanded center stage on big issues affecting the United States and the world. Certainly this attention is deserved.  But the war has also diverted needed focus on the national climate protection agenda still languishing in the U.S. Congress.  And time is running out.  Scientists warn of a brief and closing window for action to prevent deadly heat and damage.  Widespread weather disasters worsened by climate change are already causing severe human hardship and billions of dollars in damage in our country.  

Action by the new Administration and the Congress has been slow.  To be sure, Congress deserves credit for a partial response to the climate crisis by enacting the Infrastructure Investment and Jobs Act in December, 2021, with 19 Republican votes in the Senate. The bipartisan infrastructure law funds clean energy demonstration projects to improve energy storage, advanced nuclear technology, carbon capture from fuel burning as well as direct carbon capture from the atmosphere.  Funding is provided to expand transmission lines to deliver wind and solar energy and pipelines for captured carbon dioxide, together with substantial investments in public transportation, electric vehicle charging stations, and even school buses.  For a more complete summary, see Christiansen, Auslander, and Pilchen, The Bipartisan Infrastructure Package – What it Means for Energy and Climate. These projects and programs, though valuable, will take considerable time to implement and will not deliver significant carbon emission reductions this decade.  That’s why the bipartisan legislation provides only an estimated 9% of the carbon emission reductions needed to meet the President’s announced goals for 2030 according to the analysis of Princeton University’s REPEAT scenario modeling program in its Summary Report: The Climate Impact of Congressional Infrastructure and Budget Bills.

President Biden’s ambitious proposals to invest more federal funds in immediate incentives to expand renewable energy were part of the Build Back Better reconciliation package stalled in the Senate.  There, the Democratic cohort includes the mercurial Senator Manchin who has heretofore been reluctant to support many funding provisions of the package, including portions of the climate program.  What are the major climate investments in the reconciliation bill, and what are the prospects for enactment of an aggressive climate protection program with or without Republican support?

  • The most potent element in the pending reconciliation proposals is providing direct incentives of $320 billion, the biggest share of the $550 billion climate package, by increasing and extending tax credits for commercial and residential installers of clean energy systems, including wind turbines and solar systems.  Availability of credits would also be expanded for energy storage technologies, upgrading existing nuclear power plants, and production of clean hydrogen fuel.
  • Tax credits for sequestration of carbon dioxide emissions would be extended and added for wildfire hazard mitigation projects.
  • Tax credits for electric vehicles and heat pumps are provided to speed the transition to lower carbon emissions from transportation and buildings.
  • Funding of $20 billion would support conservation investments in agriculture as well as  technical  assistance and funds to Rural Electric Cooperatives to enable them to pursue funding and development of renewable energy and increase energy efficiency.
  • Federal procurement of building materials like steel and cement made with lower carbon emissions would receive funding, and federal authority to define standards for declaring the embodied carbon in building materials is included.

None of these provisions sets a price on carbon or requires energy users to increase the use of renewable energy. (Earlier versions of the Biden proposals included a national clean energy standard that was cut because it could not be passed under the Senate rules for the budget reconciliation process not subject to the filibuster, nor was Senator Manchin likely to support it.) The remaining programs in the package are financial and not regulatory tools but are considered sufficiently powerful incentives to the private sector to significantly advance achievement of the Biden Administration’s ambitious goal of achieving a 50-52% reduction in greenhouse gas emissions from 2005 levels by 2030.  These proposals have garnered  extensive support from the business community. For a summary of the provisions and examples of company and business organizations’ statements supporting action, see the website of the Center for Climate and Energy Solutions.

As this is written, Senator Manchin is reportedly open to resuming negotiations over the climate provisions.   Senator Jon Tester of Montana, a centrist Democrat from a red state, has emphasized his support for tax credits for renewable energy installation and favors the using the regular appropriation process for research and development investments in vehicle electrification. On the Republican side, there are many Republican Senators who recognize the climate threat the country faces.  Some support carbon taxes as the best and only approach; others may also favor financial incentives to accelerate renewable energy projects favored by business interests. Senator Sheldon Whitehouse believes almost all Senate Democrats would support a carbon tax as part of a mix of incentives. It is time for senators from both parties to roll up their sleeves and reach agreement on a creative combination of the financial levers available to move the country faster toward an economy achieving net zero greenhouse gas emissions.  Their legacies and the futures of their children depend on it.