Odds have soared that a key piece of President Joe Biden’s climate agenda — a program meant to speed up replacing coal- and natural gas-fired power plants with wind, solar and nuclear energy — won’t make the final cut in the sweeping budget bill pending in Congress.
The setback risks some embarrassment for the U.S. on the global stage as it heads to Glasgow in under two weeks for what are expected to be the most ambitious United Nations talks on climate change in some time, top administration officials and congressional Democrats argued.
U.S. Climate Envoy John Kerry told the Associated Press that any Glasgow setback would carry reputational risk matching that of former U.S. President “Donald Trump pulling out of the Paris agreement, again.”
The $150 billion Clean Electricity Performance Program (CEPP) has been a focal point of Biden’s proposed climate-change legislation and a vital part of his whole-of-government approach to catching the U.S. up to other world powers in slowing global warming.
But it’s become increasingly clear that the CEPP has met an unwavering foe in the form of Sen. Joe Manchin, the West Virginia Democrat whose vote on the Build Back Better bill is crucial in the tightly split chamber.
CEPP would reward electric utility companies that switch from fossil fuels
to renewable or cleaner energy sources and fine those that don’t.
A Manchin spokesperson told the New York Times last week that the coal- and oil-state senator has concerns about using taxpayer spending to pay private companies that are already taking their own steps toward combating climate change. Private companies, and Manchin, are also keen to preserve U.S. energy independence and a full portfolio of energy options.
Democrats in favor of the CEPP have said these incentives are needed to speed up private-sector participation if the U.S., the largest global polluter behind China, can hit a proposed 50% cut in greenhouse gas emissions from 2005 levels by the end of the decade. Combined with clean energy tax credits, the CEPP could account for 42% of Biden’s 2030 emissions reduction targets, the administration has said.
Some oil companies, BPBP and ShellRDS.B among them, signed onto a 17-company letter to congressional leadership that said they prefer a Build Back Better plan that promotes government spending alongside company spending in the push toward renewables.
Manchin has also said he’s not interested in promoting a tax on carbon emissions. “We’re not — the carbon tax is not on the board at all right now,” the senator told reporters this week.
Bigger picture, Democrats are trying to figure out how to pass the budget bill, along with a bipartisan $1 trillion infrastructure bill. Accordingly, reductions have cropped up in spending areas beyond climate change.
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Biden on Tuesday described a more limited vision to Democratic lawmakers of a $2 trillion government-overhaul package with at least $500 billion to tackle climate change.
Still, any major reduction for climate change for the administration comes at an inopportune time, with only two weeks until the highly anticipated U.N. Convention on Climate Change (COP26) meeting in Scotland for a check-in about progress toward net-zero emissions targets and pressure to spend more to help developing nations combat global warming, rising seas and other concerns.
“With only two weeks to the COP26 meeting in Scotland, this is a tough blow. Already, it was going to be a difficult slog to meet the arbitrary [emissions] target that President Biden announced earlier this year; this only steepens the climb,” said Frank Maisano, senior principal at the energy-focused Policy Resolution Group.
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The prospect of the world’s leading economic power arriving in Glasgow with limited domestic policy to cut emissions will make it harder to convince other major polluters, primarily China, to do more, observers say. The U.S. “will look ridiculous if they show up with nothing,” Sen. Sheldon Whitehouse, a Democrat, told the Guardian. “It would be bad for U.S. leadership, bad for the talks and disastrous for the climate. Just disastrous.”
Whitehouse said inclusion of a methane and carbon pollution fee takes on greater importance in the proposed bill.
A major scientific report released by the U.N. in August argued that countries must immediately shift away from burning fossil fuels or risk an ever-hotter future that packs intense heat waves, water shortages, damaging storms, rising seas and biodiversity loss that could bring more frequent pandemics. The U.S. and Europe suffered under the wrath of major storms, believed made more intense and frequent by climate change, throughout 2020 and 2021.
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Meanwhile, an energy industry report from earlier in the year pushed cutting funding for new oil and gas development.
Scientists have long said that the average global temperature must not increase beyond 2 degrees Celsius, and ideally, no more than 1.5 degrees Celsius, above preindustrial levels. But as countries continue to pump carbon dioxide into the atmosphere, the average global temperature has already risen by about 1.1 degrees Celsius.