Congress Hasn’t Killed Biden’s Climate Agenda (Yet)

Much like a rude guest, Joe Biden arrived in Glasgow empty-handed. The US president was hoping to re-establish American climate credibility at the COP26 summit. He even delayed his departure from Washington D.C., hoping to conclude negotiations with the two sides of the Democratic aisle that would allow him to move forward with his climate plan. In his address to the Democratic caucus meeting, he asserted that the future of both his presidency and the party were at stake. "The rest of the world wonders whether we can function," he said, dramatically emphasizing that "this is not a joke". Yet, and not without a sense of déjà vu, this intensive presidential diplomacy failed to overcome Democratic divisions in time for the COP26.

Democrats were hoping for a happy ending to the negotiations on the simultaneous adoption of Joe Biden’s two flagship projects, the infrastructure bill (already approved in the Senate) and the Build Back Better budget bill, which includes the climate component. The BBB program has been largely watered down, however, as its amount has been cut in half (through the loss of much of its social and family component). It still contains a $555 billion check dedicated to fighting climate change, which could make it the most ambitious "green" investment project the US has ever adopted. In order to promote less carbon-intensive energy, this sum is made up of a series of subsidies and tax credits for the private sector and consumers. This is characteristic of the American approach to initiating change, which also meets the demands of Senator Joe Manchin (D-WV), who has repeatedly refused to sanction the use of fossil fuels. Yet, even if passed, the BBB plan would still be flawed. In particular, one section proposes massive investments in new technologies, such as hydrogen or carbon sequestration, the effectiveness of which remains uncertain today (unlike that of conventional renewable energies). Another limitation comes with a section of the bill which sacrifices environmental assessments for oil and gas pipelines built on federal land. Above all, the abandonment of the Clean Electricity Performance Program (CEPP), a result of Senator Manchin's fierce opposition, has largely reduced the ambition of the climate plan, along with the possibility for the United States to meet the nationally determined contributions (NDCs) submitted by the President last April.

The CEPP - the $150 billion backbone of the bill - was conceived as the main instrument for financing the transition of the US electricity sector. It was intended to support electricity providers whose share of clean energy in the mix increased by at least 4% per year, and to penalize those who did not meet that target. The program could have reduced the US energy sector greenhouse gas emissions by nearly 80% over the next decade. However, the careful unraveling initiated by Democratic Senators Joe Manchin and Kyrsten Sinema killed this ambitious part of the project. The alternative proposal of a national carbon tax brought forward by Senator Ron Wyden has so far been unsuccessful. 

While the fight against climate change was at the heart of Biden's plan, the slim Democratic majority in Congress caused a significant reduction in the administration's climate ambitions. Nevertheless, if approved, the BBB Act could cut US greenhouse gas emissions in half by 2030 compared to 2005 levels, which would send a strong climate signal from the United States on the international stage.

Regulatory action, another avenue of federal ambition 

Not all hope rests on Biden’s infrastructure bill. The federal imbroglio that has surrounded the issue of climate change in recent weeks has prompted Michael Regan, administrator of the Environmental Protection Agency (EPA), to assure that he would enact a "very aggressive" agenda, regardless of the outcome in Congress. The measures should target methane leaks from oil and gas wells, which are particularly important in the United States because of the rules and methods of operation. The extent of some of the leakages was revealed by satellite images last year, in April of 2020. In fact, the regulatory approach has already allowed the administration to limit the production and use of hydrofluorocarbons, components of air conditioners and refrigerators infamously known for their environmental impact. Similarly, Joe Biden signed an executive order to increase to 50% the share of electric and hybrid vehicles among new vehicle sales by 2030.