President Biden announced on Thursday that the newest version of the budget reconciliation package includes a record-smashing $555 billion over 10 years to address climate change, by far the largest investment in mitigating the climate crisis to date.
The spending is designed to subsidize the transition from fossil fuels such as coal, oil and gas to clean energy sources such as wind and solar as well as to encourage related shifts like moving away from the internal combustion engine in favor of electric vehicles. Biden said this “framework” has the support needed to pass both houses of Congress.
While many Democratic domestic spending priorities got cut out of the compromise with moderates in the party, the climate change provisions ended up being only slightly smaller than the roughly $600 billion Biden initially requested for his Build Back Better agenda.
“The Build Back Better framework is the largest effort to combat the climate crisis in American history,” the White House said in a fact sheet distributed early Thursday morning ahead of the president’s remarks announcing that he and congressional Democrats had reached an agreement. “The framework will start cutting climate pollution now, and deliver well over one gigaton, or a billion metric tons, of greenhouse gas emissions reductions in 2030 — at least ten times larger than any legislation Congress has ever passed.”
Assuming the bill does indeed pass both houses of Congress, it will give a much-needed boost to Biden’s hopes of cajoling other countries to increase the ambition of their own pledges to reduce greenhouse gas emissions at the U.N. Climate Change Conference, set to begin next week in Glasgow, Scotland.
Environmental activists praised the bill as a major step forward in the gathering global effort to combat climate change.
“It’s a great day for climate, jobs, and justice!” wrote Tiernan Sittenfeld, senior vice president of government affairs at the League of Conservation Voters, in an email to Yahoo News. “Once passed this will be the largest investment in climate and environmental justice our nation has ever made by far, and it comes not a moment [too] soon as our nation reels from this summer’s deadly and devastating fires, heat, storms and floods, and the president leaves today for Glasgow.”
The biggest climate change component of the spending package will be $320 billion for expanded tax credits for clean energy production — for instance, a tax credit for buying a rooftop solar panel — transmission and storage, electric car adoption and clean energy manufacturing. There will also be $105 billion to deal with the effects of more extreme weather events, such as heat waves and floods, that are increasingly common because of climate change. Some of those measures, such as wetlands restoration, will also help to reduce climate change by bolstering what are known as natural “carbon sinks,” meaning areas where vegetation absorbs carbon dioxide from the atmosphere. Some of those programs would be carried out by a new “Civilian Climate Corps” of young Americans.
The federal government would also spend $110 billion on incentives to build up the domestic supply chain of clean energy technologies and reducing industrial emissions, and $20 billion for the purchase of new technologies, like longer-lasting solar batteries and small modular nuclear reactors that could transform the energy sector.
While the cost might seem staggering, Biden pointed out in remarks from the White House that climate-change-related extreme weather events cost the United States $99 billion last year alone. “And we’re not spending any money to deal with this?” he asked rhetorically. “It’s costing us.”
Biden did, however, give up two of the biggest components of his original climate plan: a program to incentivize utilities to switch to clean power sources such as solar and wind energy, and a fee on oil and gas producers that allow methane — an especially potent greenhouse gas — to leak out of their wells and pipelines.
The clean utility incentive program, which was scrapped at the insistence of Sen. Joe Manchin, D-W.Va., was replaced with a plan to reduce industrial emissions.
The U.S. is already on a trajectory toward lower emissions, thanks in part to the last major round of clean energy investment, which was included in the American Recovery and Reinvestment Act of 2009. The $90 billion in loans and tax credits for low-carbon technologies included in that law helped drive down the price of wind and solar energy in recent years, leading to their more widespread adoption.
This new bill would spend at least five times as much, but it still isn’t projected to get the country quite to halving its emissions without additional action from state and federal regulators. For example, the Environmental Protection Agency, using its Supreme Court-mandated obligation to regulate carbon dioxide as a pollutant under the Clean Air Act, could write rules requiring utilities to reduce their reliance on fossil fuels. Those rules could now potentially be more ambitious because the cost of compliance will be subsidized by these new spending programs.
That all depends on actions from agencies and courts that haven’t yet occurred. While the bill falls short of Biden’s original goals, the bigger fear among environmentalists was the possibility that no deal at all would be reached before the international climate negotiations begin. Now Biden can credibly claim that the United States is taking climate change seriously and call on other major climate polluters such as China to do the same.
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