When Barack Obama pumped $ 90 billion into wind turbines, solar panels and batteries as part of his efforts to revive the US economy after the 2008 crash, his administration boasted the “biggest clean energy investment in history”.
Joe Biden, then vice president, wants to eclipse the legacy of his former boss. The president on Wednesday announced a proposal to inject nearly ten times that figure into clean energy because it uses a $ 2 billion infrastructure drive to keep its promise to put America on the path to a greener future.
“The US Jobs Plan will lead to transformational progress in our efforts to tackle climate change,” Biden said. “This is not a plan to tinker with the edges.”
The package would provide unprecedented government support for everything from electric vehicles to renewables, as well as national targets to wean utilities from carbon-emitting energy sources. Analysts said it would give investors the long-term confidence needed to attract much more private capital to the sector.
“This now puts the whole clean energy transition on hyper-propulsion,” said Paul Bledsoe, strategic advisor at the Progressive Policy Institute and former climate advisor at the Clinton White House. “What it does, I think for the first time really, is provide absolute certainty for business investment in clean energy.”
Biden’s plan would see more than $ 350 billion infusion directly into clean energy – driving electric vehicle infrastructure, reinvigorating the network, and spurring research and development – plus an estimated $ 400 billion extending and expanding tax credits for the production and storage of clean energy. It would also set a “clean energy standard” requiring utilities to produce carbon-free electricity by 2035.
The tax credit proposals, in particular, have garnered enthusiastic support from the industry. The package would extend the production and investment credits demanded by renewable energy producers by 10 years.
Congress has repeatedly extended solar and wind credits over the past two decades, often at the eleventh hour or even after they expire. The latest extension came in a year-end expense and the Covid-19 relief package went into it December.
“Predictability is going to make it much easier to get the investment we will need to deliver the growth necessary to be up to the challenge of tackling climate change,” said Gregory Wetstone, chief executive officer of the American Council. on Renewable Energy.
New tax credits would be available for energy storage technologies, such as grid-connected batteries, and for at least 20 gigawatts of high-voltage power lines that could link remote solar and wind farms. to more populated areas.
Larry Gasteiger, executive director of Wires, a transportation group, said the tax credits would reduce costs for electricity consumers, although accepting utilities – which earn regulated returns on the amount of money they invest in their infrastructure – was less certain. “Each public service will carry out this evaluation itself,” he said.
Biden has chosen climate change as one of his administration’s top priorities and has already issued a number of executive orders, join the Paris agreement, the disposal of Keystone XL pipeline and suspend new oil and gas leases on public lands.
With these latest plans, he hopes to implement election pledges to drive the United States towards full decarbonisation of its electricity sector by 2035 and net zero emissions across the economy by. 2050.
Some analysts have questioned whether integrating key climate proposals into a larger infrastructure plan is the best way to pursue the president’s lofty green goals. But the White House is reluctant to rely too much on regulation that could be blocked in the courts, as a stand-alone climate bill would struggle to muster the ten Republican votes needed to clear the obstruction to the government. Senate.
“So if you can’t do it through specific climate legislation and you can’t do it through regulation, then trying to do it through something like an infrastructure bill can have a lot of meaning, ”said Robert Stavins, head of energy and Harvard. professor of economics.
“The advantage is that infrastructure can be bipartisan partly because there is a broad concern about infrastructure, but also because an infrastructure bill, by its very nature, will distribute benefits. “, he added. “And politicians, whatever their party. . . love to give benefits. “
But many in the progressive wing of the Democratic Party believe the proposals are too modest. “It is not enough”, tweeted Alexandria Ocasio-Cortez, a supporter of the Green New Deal, as details of the plan emerged. “Must be much taller.”
Ben Beachy, manager of the Sierra Club, agreed. He advocated tripling Biden’s proposed spending levels to $ 1 billion a year over the next decade, in line with proposals unveiled by Progressive Democrats earlier this week. “It’s a very welcome start, but Congress must now step it up,” he said.
On the other hand, Republicans criticized Biden’s proposals as being too spendthrift. John Barrasso, the longest-serving Republican on the Senate Energy and Natural Resources Committee, dismissed them as “an out of control socialist spending spree.”
The president has indicated a preference for working with Republicans to gain bipartisan support for the package. But Democrats are expected to be able to go it alone by using the reconciliation mechanism to force him through the Senate with a simple majority.
“We will have these conversations,” said Gina McCarthy, Biden’s climate czar. “But rest assured, the president released a figure that he felt was not only defensible, but necessary to respond at this precise moment. We don’t just want to manage the future, we want to win it. “
Additional reporting by Gregory Meyer in New York