Hi Folks,
You may have seen this headline from the New York Times. “Key to Biden’s Climate Agenda Likely to Be Cut Because of Manchin Opposition” Article pasted below.
While this is a big set back for those who have been advocating for a CEPP, I wanted to let folks know that we are still optimistic that carbon pricing can be included in the budget bill. Obviously Senator Manchin is still a potential obstacle but the Senate Finance committee is still pushing hard to including pricing.
In terms of our advocacy, we should see how the dust settles on this (one article does not mean the negotiations are over). We should continue to advocate strongly that reconciliation needs to include policies that get us to 50% emissions reductions by 2030, and advocating for a carbon price being a key part of that package.
This is a difficult time for our friends in the climate movement who have been working hard to advocate for the CEPP. Please be supportive of them. This is not an appropriate time to urge them to support a carbon price.
For now, let's keep our focus on what we are for - reducing emissions by 50% by 2030 and getting a carbon fee and dividend in place.
Tony
Key to Biden’s Climate Agenda Likely to Be Cut Because of Manchin Opposition
The West Virginia Democrat told the White House he is firmly against a clean electricity program that is the muscle behind the president’s plan to battle climate change.
WASHINGTON — The most powerful part of President Biden’s climate agenda — a program to rapidly replace the nation’s coal and gas-fired power plants with wind, solar and nuclear energy — will likely be dropped from the massive budget bill pending in Congress, according to congressional staffers and lobbyists familiar with the matter.
Senator Joe Manchin III, the Democrat from coal-rich West Virginia whose vote is crucial to passage of the bill, has told the White House that he strongly opposes the clean electricity program, according to three of those people. As a result, White House staffers are now rewriting the legislation without that climate provision, and are trying to cobble together a mix of other policies that could also cut emissions.
A spokesman for the Biden administration declined to comment, and a spokeswoman for Mr. Manchin did not respond to an emailed request for comment.
The $150 billion clean electricity program was the muscle behind Mr. Biden’s ambitious climate agenda. It would reward utilities that switched from burning fossil fuels to renewable energy sources, and penalize those that do not.
Experts have said that the policy over the next decade would dramatically reduce the greenhouse gases that are heating the planet and that it would be the strongest climate change policy ever enacted by the United States.
“This is absolutely the most important climate policy in the package,” said Leah Stokes, an expert on climate policy, who has been advising Senate Democrats on how to craft the program. “We fundamentally need it to meet our climate goals. That’s just the reality. And now we can’t. So this is pretty sad.”
The setback also means President Biden will have a weakened hand when he travels to Glasgow in two weeks for a major United Nations climate change summit. He had hoped to point to the clean electricity program as evidence that the United States, the world’s largest historic emitter of planet-warming pollution, was serious about changing course and leading a global effort to fight climate change. Mr. Biden has vowed that the United States, will cut its emissions 50 percent from 2005 levels by 2030.
The rest of the world remains deeply wary of the United States’ commitment to tackling global warming after four years in which former President Donald J. Trump openly mocked the science of climate change and enacted policies that encouraged more drilling and burning of fossil fuels.
“This will create a huge problem for the White House in Glasgow,” said David G. Victor, co-director of the Deep Decarbonization Initiative at the University of California, San Diego. “If you see the president coming in and saying all the right things with all the right aspirations, and then one of the earliest tests of whether he can deliver falls apart, it creates the question of whether you can believe him.”
Democrats had hoped to include the clean electricity program in their sweeping budget bill that would also expand the social safety net, which they plan to muscle through under a fast-track process known as reconciliation that would allow them to pass it without any Republican votes. The party is still trying to figure out how to pass that budget bill, along with a bipartisan $1 trillion infrastructure bill.
For weeks, Democrat leaders have vowed that the clean electricity program was a nonnegotiable part of the legislation. Progressive Democrats held rallies chanting “No climate, no deal!”
Mr. Biden had hoped that enactment of legislation would clean up the energy sector, which produces about a quarter of the country’s greenhouse gases. He wanted a program with impacts that would last well after he leaves office, regardless of who occupies the White House.
House Speaker Nancy Pelosi said at an event in San Francisco Friday morning that she is continuing to push for the strongest possible climate change provisions in the bill.
“What we’re here today about is specifically about the climate piece,” said the California Democrat. “This is our moment. We cannot — we don’t have any more time to wait.”
Democratic presidents have tried but failed to enact climate change legislation since the Clinton administration. During a year of record and deadly droughts, wildfires, storms and floods that scientists say are worsened by climate change, Democrats had hoped to finally garner enough political support to enact a strong climate law, even as scientific reports say that the window is rapidly closing to avoid the most devastating impacts of a warming planet.
A major scientific report released in August concluded that countries must rapidly and immediately shift away from burning fossil fuels in order to avoid a future of severe drought, intense heat waves, water shortages, devastating storms, rising seas and ecosystem collapse. To avert catastrophe, scientists say nations must keep the average global temperature from increasing 1.5 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.
Even as Ms. Pelosi vowed in San Francisco to protect those climate provisions, at least four people in Washington close to the negotiations called the clean electricity program “dead.”
Senator Tina Smith, Democrat of Minnesota, the chief author of the program, said that while dropping it might win Mr. Manchin’s vote on the budget bill, it could cost hers — and those of other environmentally-minded Democrats.
“We must have strong climate action in the Build Back Better budget. I’m open to all approaches, but as I’ve said, I will not support a budget deal that does not get us where we need to go on climate action,” she said. “There are 50 Democratic senators and it’s going to take every one of our votes to get this budget passed.”
Mr. Manchin, who has personal financial ties to the coal industry, had initially intended to write the details of the program as the chairman of the Senate committee on energy and natural resources. Mr. Manchin was considering a clean electricity program that would reward utilities for switching from coal to natural gas, which is less polluting but still emits carbon dioxide and can leak methane, another greenhouse gas. Mr. Manchin’s home state, West Virginia, is one of the nation’s top producers of coal and gas.
But in recent days, Mr. Manchin indicated to the administration that he was now completely opposed to a clean energy program, people familiar with the discussions said.
As a result, White House staffers are scrambling to calculate the impact on emissions from other climate measures in the bill, including tax incentives for renewable energy producers and tax credits for consumers who purchase electric vehicles. Unlike a clean energy program, tax incentives tend to expire after a set period of time, and do not have the market-shifting power of a more durable strategy.
Those other programs include about $300 billion to extend existing tax credits for utilities, commercial businesses and homeowners that use or generate electricity from zero-carbon sources such as wind and solar and $32 billion in tax credits for individuals who purchase electric vehicles. It could also include $13.5 billion for electric car charging stations and $9 billion to update the electric grid, making it more conducive to transmitting wind and solar power, and $17.5 billion to reduce carbon dioxide emissions from federal buildings and vehicles.
But, analysts say, while those spending program will help make it easier and cheaper for the U.S. economy to transition to a lower-emissions future, they are unlikely to lead to the same kind of rapid reduction in emissions that the clean electricity program would have.
It is also possible that Democrats may try to push through the clean electricity program as a stand-alone bill — but the timeline for doing so is narrowing, with the 2022 midterm elections approaching.
Another NYT article:
Democrats Weigh Carbon Tax After Manchin Rejects Key Climate Provision
By Coral Davenport and Luke Broadwater
Oct. 16, 2021Updated 7:21 p.m. ET
WASHINGTON — Some House and Senate Democrats, smarting from a move by Senator Joe Manchin III, Democrat of West Virginia, to kill a major element of President Biden’s climate plan, are switching to Plan B: a tax on carbon dioxide pollution.
A carbon tax, in which polluting industries would pay a fee for every ton of carbon dioxide they emit, is seen by economists as the most effective way to cut the fossil fuel emissions that are heating the planet.
The almost certain demise of the clean electricity program at the heart of Mr. Biden’s agenda — which comes as scientists say forceful policies are needed to avert climate change’s most devastating impacts — has prompted outrage among many Democrats and has led several to say now is the moment for a carbon tax.
“I’ve had a carbon pricing bill in my desk for the last three years just waiting for the time,” said Senator Ron Wyden, Democrat of Oregon, chairman of the Senate Finance Committee.
“What has been striking is the number of senators who’ve come to me about this since early fall — after Louisiana got clobbered with storms, the East Coast flooding, the Bootleg wildfires here in my own state,” said Mr. Wyden, speaking by telephone on Saturday from Oregon. “Now there are a number of senators, key moderate senators, who’ve said they’re open to this. And a lot of House folks who have said they would support it if the Senate sends it over.”
Senator Ron Wyden, Democrat of Oregon, whose staff is said to be considering a domestic carbon tax that could start at $15 to $18 per ton.Credit...Erin Schaff/The New York Times
But a carbon tax can be politically explosive. Industries could pass along their higher costs, leaving President Biden and fellow Democrats vulnerable to claims that they are raising taxes on the middle class, at a moment when inflation and energy prices are rising. Environmental justice advocates say a carbon tax permits companies to continue polluting, albeit at a higher cost, which disproportionately harms low-income communities. And it is unclear if Mr. Manchin, whose vote is crucial to Mr. Biden’s legislative agenda, would support a carbon tax.
As a result, the White House is scrambling to come up with alternatives to replace the $150 billion clean electricity program that had been the centerpiece of Mr. Biden’s climate agenda until just days ago, when Mr. Manchin indicated he strongly opposed it. That program would have rewarded utilities that stopped burning fossil fuels in favor of wind, solar and nuclear energy, and penalized those that did not. It was intended to push the nation’s electricity sector to generate 80 percent of its power from clean energy sources by 2030, from 40 percent now.
As they seek alternatives, White House officials are also weighing a voluntary version of a cap-and-trade program, which would create a market for polluters to buy and sell allowances for a certain amount of emissions. They are also considering adding to the $300 billion in clean energy tax incentives and credits that remain in the bill, while looking for ways to salvage some parts of the clean electricity program.
A White House official said on Saturday that staff members were still engaging with members of Congress and had not yet agreed to a final version of climate provisions.
The cut to the climate change program could be among the first consequential decisions in what will very likely be a painful process for Democrats as they pare their ambitious $3.5 trillion domestic policy package. Mr. Manchin and another Democrat, Senator Kyrsten Sinema of Arizona, have said they cannot support that spending level. Over the next two weeks, the White House will negotiate with Democrats over cuts to dozens of programs, as lawmakers try to whittle the original bill to about $2 trillion.
Mr. Biden suggested on Friday that one of his agenda’s signature items — two years of free community college — was also on the chopping block, and progressive lawmakers worried about whether plans to provide paid family leave and expand Medicare to include vision, dental and hearing benefits could survive.
Mr. Biden and Democratic leaders on Capitol Hill have set a deadline of Oct. 31 for a deal that would enable Democrats to pass the bill with their razor-thin majorities in both chambers of Congress.
In recent days, as White House officials were trying to forge a deal, Mr. Manchin told them he would not support any legislation that includes a clean electricity program. Mr. Manchin, whose state is a major coal producer and who has financial ties to the coal industry, has said that abandoning fossil fuels will harm the country’s energy independence and would make climate change worse.
Once his opposition to the clean electricity program became public on Friday, several fellow Democrats expressed outrage.
“We have a moral obligation and a governing mandate to pass policy that addresses climate change,” the 96-member Congressional Progressive Caucus wrote on Twitter. “Inaction is not an option.” For weeks, progressive Democrats have been holding rallies chanting, “No climate, no deal!” to pressure the White House to include strong climate provisions. Several of those rallies focused on the importance of the clean electricity program.
Congress “cannot afford to gut” the climate provisions in the bill, Representative Alexandria Ocasio-Cortez, Democrat of New York, wrote on Twitter. “This issue is bigger than ideology. It is a moral imperative for humanity and our planet’s future to reduce and eventually eliminate emissions,” she wrote. “There are many ways to do it, but we can’t afford to give up.”
Senator Jeff Merkley, Democrat of Oregon, has been involved with the “No climate, no deal” rallies. “Listen, my state is burning up. We’re losing our snowpack, the ocean’s acidifying, affecting our shellfish,” he said on Saturday. “This is a code red.”
Mr. Merkley said he would not vote for a reconciliation package that did not have “significant climate provisions,” but he said he was open to any option that cut carbon dioxide emissions in half by 2030 and produced carbon-free electricity by 2035.
He suggested additional wind and solar subsidies or proposals to speed up the transition to clean energy vehicles.
“The Biden team is going to have to lay out how they’re going to meet those two goals,” he said, “because that’s the way we stay on track.”
The clean electricity program opposed by Mr. Manchin was notable because it would include both incentives and penalties. Payment to electric utilities to switch to clean energy was the carrot; a penalty for companies that did not replace fossil fuels with clean energy was the stick. A carbon tax might provide a similar inducement, when paired with tax incentives, analysts said.
“If you were to replace the clean electricity program with a price on carbon, I think that would go a long way. It would put back a lot of the stick elements that were removed,” said Zeke Hausfather, a climate scientist and policy analyst at the Breakthrough Institute, an energy and climate research organization.
Mr. Wyden’s staff, which is drafting the carbon tax language, is considering a domestic carbon tax that could start at $15 to $18 per ton, and that would increase over time, according to two people familiar with the matter who were not authorized to speak on the record.
The tax would be applied directly to coal mining companies, large natural gas processing plants and oil refiners, based on the emissions associated with their products, with one exception: Oil refiners would very likely be charged for producing diesel fuel and petrochemicals, but not gasoline — a way to shield most American drivers at the pump.
An important part of the policy, Mr. Wyden said, will be to use the revenue for tax rebates or checks for poor and working-class Americans — particularly those employed in the fossil fuel industry. “You’ve got to show workers and families, when there’s an economy in transition, that they will get their money back,” he said. “They will be made whole.”
“I’ve had a carbon pricing bill in my desk for the last three years just waiting for the time,” said Senator Ron Wyden, Democrat of Oregon, chairman of the Senate Finance Committee.
“What has been striking is the number of senators who’ve come to me about this since early fall — after Louisiana got clobbered with storms, the East Coast flooding, the Bootleg wildfires here in my own state,” said Mr. Wyden, speaking by telephone on Saturday from Oregon. “Now there are a number of senators, key moderate senators, who’ve said they’re open to this. And a lot of House folks who have said they would support it if the Senate sends it over.”
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