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SMITH PLANS WORK WITH MANCHIN: Sen. Tina Smith of Minnesota, the leader of Democrats’ push to increase the use of clean electricity, is betting she can find common cause with her colleague Joe Manchin, who has threatened to oppose policies that are overly prescriptive on curbing fossil fuel use.
Smith will need Manchin’s cooperation if Democrats are to pass the centerpiece of their $3.5 trillion reconciliation package — a “clean electricity payment” program that would pay utilities to generate a growing percentage of power from carbon-free sources with the end goal of having 80% clean power by 2030.
The budget blueprint Democrats released yesterday directs the Energy Committee that Manchin chairs to create the program, a not-so-easy ask for a centrist from West Virginia who has historically opposed climate policies that resemble a mandate requiring more use of renewables and less of coal and natural gas.
“I listen hard to what Sen. Manchin says and I am grateful he remains open to this idea,” Smith told me in an interview yesterday, noting Manchin has not ruled out supporting Democrats’ clean power plan. “I listen to Sen. Manchin, and when I hear him talk about the importance of energy independence, I think about how renewable and clean energy is rural energy we create here at home, and see a lot of common ground.”
Smith’s pitch: Smith used Manchin buzzwords in making her well-honed pitch to him. She said spending massive amounts on renewables will help the U.S. “compete” with China, which she said is “leading us” on wind and solar investment.
Smith said that natural gas power plants equipped with carbon capture should be credited under the clean electricity payment program, along with nuclear power, energy sources that are “important for reliability of the system.”
The program envisioned by Smith also differs from a typical clean electricity standard (CES) as imposed in several states.
To distinguish it from a CES — a policy Manchin has expressed doubts about — Democrats are pitching their plan as not being a binding regulatory mandate.
Democrats hope structuring the plan as an investment program involving federal expenditures will allow it to pass muster with the Senate parliamentarian, who rules on whether policies fit the strict budget rules of reconciliation.
The program would assess a fee on utilities that underperform, but Smith said electric companies should be assigned different targets based on their starting level for clean power, enabling utilities in carbon-intensive states to have more time to wean off fossil fuels.
Democrats are also betting that paying utilities to use clean energy will mean that any higher costs are burdened by the federal government, rather than being passed through to electricity rates, a key consideration for a state like West Virginia, which has been slow to shift its generation mix.
“That’s why the investment approach makes sense,” Smith said. “That helps to keep utilities’ rates stable.”
IPCC report raises the stakes: Smith raised the specter of this week’s dramatic report from the U.N. Intergovernmental Panel on Climate Change, which stated global warming from the use of fossil fuels is aggravating extreme weather across the world and the problem will become significantly worse without dramatic emissions cuts.
“The work we have ahead of us in reconciliation is exactly the kind of action we need to take so we can have a real impact,” Smith said. “We know just market forces left to their own devices will trend toward clean energy, but not nearly fast enough.”
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HOUSE DEMOCRATS PUSH FOR MORE: House Democrats are pushing for more funding for their priorities in response to the Senate’s budget resolution.
A group of several dozen Democrats, led by Reps. Debbie Dingell of Michigan and Yvette Clarke of New York, in a letter advocated for a $85 billion investment in EV infrastructure, calling the $7.5 billion earmarked for charging in the bipartisan bill insufficient.
Rep. Raul Grijalva of Arizona, chairman of the Natural Resources Committee, said Senate Democrats’ budget blueprint doesn’t offer the Interior Department enough money to “meet some of our critical climate goals” including for drought mitigation throughout the West.
“Investments in electric vehicles and renewable energy technologies are critical to a cleaner future, but millions of Americans are facing drought, wildfire, erosion and habitat destruction today,” Grijalva said in a statement.
Rep. Jared Huffman of California, in an interview with me yesterday, suggested he would oppose the bipartisan infrastructure bill unless the reconciliation package proves to aggressively address climate change, although he didn’t lay down any “categorical red lines.”
“I would say this is the proverbial talking with your grandkids moment and I am not going to tell my grandkids we had a chance back in 2021 to change the trajectory of this climate crisis but we caved in because Republicans wanted to build new fossil fuel infrastructure,” said Huffman, a member of the House Climate Crisis Committee.
BREAKING…SENATE PASSES BIPARTISAN INFRASTRUCTURE BILL: The Senate this morning passed a $1.2 trillion infrastructure package after months of negotiations and days of floor debate, sending the bill to the House, where Democrats say they’ll consider it in September alongside a much larger bill that would pay for a broad array of social and climate mitigation programs.
The vote was 69-30, winning the backing of more than a dozen GOP lawmakers, many of them negotiators who worked with Democrats and the White House to finalize the deal, as the Washington Examiner’s Susan Ferrechio reports
The measure provides $550 billion in new spending, including $7.5 billion on new electric vehicle charging stations as well as billions on mass transit, rail, climate resilience, grid upgrades, and more..
The Senate will begin immediate consideration of a $3.5 trillion budget resolution following passage of the infrastructure bill.
SCOOP…REPUBLICANS CALL ON BIDEN TO OPPOSE EUROPEAN UNION CARBON TARIFFS: A group of 19 Senate Republicans is calling on President Joe Biden to “safeguard” U.S. commercial interests and oppose the European Union’s plan to impose “carbon tariffs” against countries that lack aggressive emissions-reduction policies.
The EU last month unveiled a carbon border adjustment proposal as a way to prevent domestic industries from moving overseas in order to escape the bloc’s aggressive plans to raise the price of using fossil fuels.
The long-anticipated move inaugurated a new form of protectionist trade policy linked to addressing climate change.
Senate Republicans led by Sen. Kevin Cramer of North Dakota wrote a letter to Biden, exclusively shared with me, warning the EU’s plan is “unfair to the U.S.” and would harm small manufacturers of products targeted by the scheme, such as steel, aluminum, cement, electricity, and fertilizer.
They called it a “guise to promote green protectionism.”
“Instead of punishing U.S. imports, our European allies should work with us to advance a common approach in curbing overseas emissions, particularly those from China,” wrote the Republicans, who also include Dan Sullivan of Alaska, Marco Rubio of Florida, John Barrasso of Wyoming, Tim Scott of South Carolina, John Cornyn of Texas, and more.
Yeah, but: The Senate Republicans did not comment in the letter on a similar proposal by Senate Democrats as part of a sprawling $3.5 trillion infrastructure and climate spending package to impose a “polluter import fee” on exporters of carbon-intensive goods, though it is far less detailed than the EU’s plan.
GOP RESPONSE TO IPCC REPORT: Republicans in Congress were pretty radio silent, though, about the U.N. IPCC report, with a few exceptions.
Rep. Garret Graves of Louisiana, top Republican of the House Climate Crisis Committee, did offer comment, saying the report “highlights the urgency of climate change.” But he said policymakers “must approach this issue the right way” and underscored his opposition to Democratic climate plans, which he derided as “flawed policies that only shift higher emissions, economic activity, and jobs from the U.S. to China.”
He also said that “American innovation” is the “only way to address this global issue.”
GOP Rep. Bruce Westerman of Arkansas, the ranking member of the House Natural Resources Committee, told me today the U.N. report “tells us what we already know” and “only reinforces the need for real, implementable solutions.”
As examples, he listed policies like planting more trees to absorb carbon, boosting domestic production of critical minerals used in clean energy technologies, and improving forest management techniques to curb wildfires.
BIDEN’S ELECTRIC VEHICLE PLAN WON’T SPUR BREAKTHROUGH, STUDY SAYS: Electric vehicle sales will only rise modestly under Biden’s proposed stricter auto emissions standards released last week.
An analysis published yesterday by the Rhodium Group finds that under the model year 2023-2026 proposed standards, zero-emission vehicle sales would rise from just over 3% of total new sales today to 18-37% by 2030, depending on the cost of EV batteries.
That is a small increase from the current trajectory of 17-35% zero-emission vehicle sales by 2030.
But sales could grow further if Congress passes new policies to make EV adoption more attractive to buyers, such as reducing the cost of the cars through subsidies and rebates, providing grants to states and localities to build charging stations, and incentives for manufacturers to retool factories to make batteries and EVs.
Those investments, combined with state-level zero-emission vehicle policies and voluntary EV spending by automakers, has the potential to push EV and carbon-free vehicle deployment beyond Biden’s goal of 50% sales by 2030, Rhodium said.
ENERGY DEPARTMENT GETS TOP ATTORNEY: The Senate last night confirmed Sam Walsh by voice vote to be general counsel of the Energy Department.
Walsh is a former deputy general counsel for energy policy at DOE in the Obama administration.
“Sam is one of the world’s foremost experts on clean energy law, which will be essential as he helps us meet President Biden’s climate goals,” said Energy Secretary Jennifer Granholm.
The Rundown
New York Times Electric cars for everyone? Not unless they get cheaper.
Reuters Geoengineering marks scientific gains in UN report on dire climate future
New York Times Climate change is a ‘hammer hitting us on the head,’ developing nations say
Bloomberg Refiner boosts battery bet as it sees US gasoline peaking
Bloomberg China’s new oil giants flourish in Xi’s clean energy wave
Wall Street Journal As the Dixie Fire and others burn, the US struggles to find enough firefighters
Calendar
WEDNESDAY | AUG. 11
12 p.m. CRES Forum will hold a virtual event titled, “Resiliency & Clean Energy: Keeping the Lights on While Reducing Emissions.” FERC Commissioner Neil Chatterjee will deliver a keynote address.
2 p.m. League of Conservation Voters will hold a virtual conversation with Energy Secretary Jennifer Granholm on “building the clean energy future.”
TUESDAY | AUG. 17
10 a.m. ConservAmerica will hold a webinar exploring a federal Clean Energy Standard.
