Biden’s Climate Goals Get Greener Path as Democrats Take Senate

(Bloomberg) -- The slim edge Democrats won in the Senate renews hopes for limited legislation to combat climate change, such as measures to fulfill President-elect Joe Biden’s pledge to promote the use of electric vehicles and clean energy.

But the ambitious Green New Deal, as well as controversial proposals to phase out fossil fuels and ban fracking, are still on ice.

“Thin blue majorities in the House and Senate might not enable Biden’s party to enact a sweeping climate law,” said Kevin Book, managing director of research firm ClearView Energy Partners. Yet, he added, “a thin blue Senate could enable a bigger green stimulus, and carbon capture and EV credits could be part of it.”

Democrats holding control of both the House and the Senate following Tuesday’s Georgia runoffs can help fulfill Biden’s clean-energy ambitions by spending on renewable power programs and repealing tax incentives that bolster fossil fuels. They’ll be able to more quickly confirm Biden nominees to regulate energy and the environment and swiftly repeal some late-moving Trump rules that eased efficiency standards and pollution limits.

Still, with a narrow majority in the House -- and their hold on the Senate depending on tie-breaking from Vice President-elect Kamala Harris -- Democratic leaders will have to navigate around moderates in their own party and lure 60 votes to overcome a filibuster against major environmental legislation.

Senate control “will give the Democratic clean energy economic agenda a far stronger chance of passage, whether through tax incentives and spending measures in a budget bill or broader infrastructure legislation,” said Paul Bledsoe, a former White House aide under President Bill Clinton now with the Progressive Policy Institute.

But even making changes on simple majority votes in the evenly split Senate “is an exercise in herding cats, with each Democratic senator having effective veto power,” he added.

Democratic leaders will need the support of every member of their caucus to prevail in party-line votes, including conservative members such as Joe Manchin of coal-rich West Virginia and Kyrsten Sinema of Arizona. The dynamic gives individual senators clout to shape or block bills that damage home-state interests.

At the same time, Democrats will face competing pressure from progressives who campaigned on promises of bold climate action.

“Progressive environmentalists will not immediately concede to the conservative Democrats and moderate Republicans and support legislation that falls short of meeting aggressive climate goals,” said Benjamin Salisbury, managing director of research at Height Capital Markets. “They will need to be on the record for fulfilling the climate promise.”

Green Recovery

Environmentalists could see early wins with another coronavirus stimulus bill and infrastructure legislation that invests in a green recovery, unleashing spending on electric vehicle charging infrastructure and grid modernization.

A Covid stimulus package could dole out spending to power storage, upgrades to the nation’s grid and electric vehicle charging infrastructure, said Alden Meyer, a senior associate with the London-based research group E3G. “If you’re an advocate for strong climate and energy policies, last night was a very good night,” Meyer said Wednesday.

Senate Republicans, including their leader Mitch McConnell of Kentucky, have balked at the price tag of past stimulus packages and objected to House Democrats’ green spending plans. Now, incoming Senate Majority Leader Chuck Schumer, a Democrat of New York, will be able to shape stimulus relief bills, said Katie Bays, managing director of the policy consultancy FiscalNote Markets.

“The only way for the federal government to address climate change is to spend a lot of money, so to wrest control of spending from Mitch McConnell and give it to Chuck Schumer is a major achievement for environmental organizations,” Bays said.

Democratic leaders will have the power to set the legislative agenda and advance climate proposals alongside other priorities around taxes, health care and the pandemic.

“It’s a thrilling development because now we will have climate champions leading the House, leading the Senate and leading the White House,” said Gene Karpinski, president of the League of Conservation Voters. “That’s what we need for ambitious progress in the next few years.”

There’s little hope of realizing Biden’s original vision for a $2 trillion climate plan with such a narrow Senate edge. But some planks hold more promise, such as spurring electric vehicles and charging infrastructure, as they dovetail with blueprints advanced by Schumer and other congressional Democrats. That’s no accident, said James Lucier, managing director of Capital Alpha Partners.

“The reason you should take the Biden energy plan very very seriously is because for the first time we have clean energy legislation that is designed to be passable,” Lucier said. “There’s an agenda that is Teflon-coated and carefully crafted to blow right through the system as quickly as possible, with consequences that may not be visible for five or 10 years.”

Blow Right Through

Environmentalists have asked congressional Democrats to move quickly, warning that delays risk squandering an opportunity to aggressively confront the climate crisis and rebound from four years during which President Donald Trump denied the threat. They are wary of a repeat of what happened in 2009 under former President Barack Obama, when efforts to enact broad carbon cap-and-trade legislation named for then-Representatives Ed Markey and Henry Waxman stalled in the Senate.

“The Democratic energy agenda this time around is designed to have no rough edges and nothing that could snag in the Senate the way the Waxman-Markey bill did in 2009,” Lucier said.

Besides standalone environmental legislation, Democrats can use congressional procedure to bolster the Biden agenda. They can enact policy measures supporting carbon cutting with just a simple majority vote through the so-called budget reconciliation process that Republicans used to open oil leasing in the Arctic National Wildlife Refuge in 2017. And Democrats now can more easily overturn late-moving Trump administration rules on a simple majority vote using resolutions advanced under the Congressional Review Act.

Renewable energy advocates said they expect Democrats in charge of the House and the Senate to collaborate with Republicans on a green-themed infrastructure bill that contains encourages sustainable development, including investments in mass transit and charging stations for electric cars. Republicans and Democrats also could find common ground on efforts to support carbon capture and sequestration technology essential to pare emissions from power plants as well as heavy manufacturing.

The Democratic takeover of the Senate also could provide an easier path for Biden’s nominees to federal agencies that control energy and climate policy, including the Federal Electricity Regulatory Commission, where three Republicans are set to hold a majority until midyear.

“FERC will become a Democrat-majority body and there won’t have to be any horse trading with the Republicans to make that happen,” said Ari Peskoe, director of Harvard Law School’s Electricity Law Initiative. “McConnell was not shy about holding up Obama’s nominees, so there was precedent for sitting on the nominee forever.”