The agreement, which includes generous tax credits to stimulate the development of clean energy and the purchase of electric vehicles – could put the United States on track to cut its greenhouse gas emissions 40 percent below 2005 levels by 2030, according to the Rhodium Group, a research firm. President Biden has pledged to cut emissions by at least half by the end of the decade.
A combination of executive action from Biden and state-led efforts to address climate change “may help close the rest of the gap,” said Ben King, associate director of Rhodium.
Without new legislation, Rhodium projects that the United States would likely reduce its carbon output by only 24 to 35 percent by 2030.
The Earth has already warmed more than 1.1 degrees Celsius (1.98 Fahrenheit) above pre-industrial levels, mainly due to the burning of fossil fuels. Scientists say that each additional fraction of warming will increase the severity of hurricanes, floods, wildfires and Heat waves in the next years. The United States would have to cut its emissions by at least half to give world leaders a chance to keep warming to 1.5 degrees Celsius (2.7 Fahrenheit).
The new deal includes some major concessions on fossil fuels that would likely increase carbon pollution by requiring the federal government to auction off more public land and water for oil drilling. Manchin, whose home state of West Virginia is a major coal and gas producer, advocated for these provisions during the negotiations. But many climate advocates said those trade-offs, which Senate Democrats agreed to win Manchin’s support, were worth it.
The bill would require new lease sales in the Gulf of Mexico, which climate advocates had opposed but the Biden administration was leaning forward no matter.
It would also make the construction of renewable energy projects on federal lands dependent on more oil drilling. For the Interior Department to issue a right of way for wind and solar projects, an approval needed to connect to the power grid, the department would have to auction off at least 2 million acres for drilling during the previous year. Similarly, Interior would not be able to sell offshore wind leases until it had offered for sale at least 60 million acres of offshore wind.
Brett Hartl, director of government affairs at the Center for Biological Diversity, called the pro-fossil fuel provisions “super cynical.”
“If you look at the details, it’s a terrible deal,” Hartl said. “Frankly, I don’t see how the math works, because the amount of lease that we would be securing through 2032 would just be game over for the climate.”
But Princeton University professor Jesse Jenkins, an energy policy expert and modeller, said the bill’s climate calculation is erased.
“The measures in this bill require the administration to ensure that the lease continues,” he wrote in an email. But Jenkins said any additional federal lease emissions are “dwarfed by the emissions reductions driven by the bill.” A new tariff on methane emissions from the oil and gas industry and an Environmental Protection Agency regulation curbing emissions of the potent greenhouse gas are also expected to reduce carbon pollution.
“While it is unfortunate that the bill includes some support for continued fossil fuel production on public lands and waters,” said Sam Ricketts, co-founder and adviser to Evergreen Action, an environmental group, “we recognize that it is the result of a long and laborious process necessary to obtain the support of the 50 Democratic senators in this Congress”.
The climate and tax package would boost US energy production and combat climate change through tax incentives for the renewable energy sector, increasing wind, solar, battery and geothermal construction. Tens of millions of drivers would qualify for new tax credits to buy electric vehicles. Homeowners across the country would receive financial help to pay for heat pumps and insulate their properties.
“What is going to happen with this bill is a wave of investment in renewable energy,” said Lachlan Carey, a senior associate at RMI, a clean energy think tank.
An analysis by the group found that such new investments would lower the cost of electricity by shifting the country away from more expensive fossil fuels, such as coal, and toward cheaper renewable energy. Although the effects of this transition will likely take a few years to reach people, it could save US taxpayers $5 billion annually by 2024, the group found.
“This couldn’t come at a better time,” Carey said. “Gasoline prices are hurting American consumers, the Russian invasion of Ukraine has highlighted the risks of relying on fossil fuels, and of course China continues to dominate industries like solar, batteries and wind. This bill truly unlocks the power and ingenuity of the American private sector to compete in the industries that are going to define this century.”