Democrats Near Deal on $500 Billion to Fight Climate Change
(Bloomberg) -- More than $500 billion of an emerging Democratic spending plan is targeted to fight climate change, making it one of the biggest portions of a bill likely to top $1.5 trillion, according to people familiar with the discussions.
While details are still being worked out, the framework is expected to include expanded tax credits for renewable power, advanced energy manufacturing and electric vehicles, as well as incentives to support investments in electric transmission, energy storage and sustainable aviation fuel.
The effort to develop a blueprint for the environmental portion of the reconciliation bill comes just days before President Joe Biden arrives in Glasgow, Scotland for a United Nations conference on climate change.
“We are going to send the president to Glasgow with a strong provision,” said Senator Ron Wyden, an Oregon Democrat who chairs the Senate’s tax-writing committee. “We are going to send the president there with a strong case.”
The tentative agreement on the bill’s cost was described by three people who asked not to be identified discussing closed-door negotiations. The figure was previously reported by Axios.
Even without congressional passage of the climate-and-social-spending bill, the developing deal could provide Biden evidence the U.S. will make investments necessary to meet its Paris agreement commitment to slash the country’s greenhouse gas emissions at least 50% by 2030.
White House officials discussed expanding grants and loans in the agriculture and industrial sectors to help them shift to clean energy providers with fewer emissions during a meeting with environmental and justice groups Monday, according to a senior Biden administration official who requested anonymity to share the plans.
The framework is set to include grants and loans to drive emissions reductions in the industrial sector that is harder to decarbonize as well as funding to drive land conservation, according to two of the people.
A methane fee remained under discussion and was undergoing changes, Democratic senators who emerged from a closed-door caucus meeting Tuesday said. One possible change under discussion is to phase in the fee, which could be as much as $1,500 per ton of methane, said one of the people.
“It’s in, it’s under discussion, we’re working hard to make sure that that stays,” Senator Chris Van Hollen, of Maryland, told reporters.
A plan to impose tariffs on carbon-intensive imports, known as a border adjustment tax, won’t be included in Democrats’ spending bill, Democratic Senator Sheldon Whitehouse said.
The developing climate plan would complement tens of billions in separate spending on clean energy and sustainable mass transit in an infrastructure bill also pending in Congress. That measure would steer as much as $2.5 billion to low-emission buses, as well as $6 billion for nuclear power plants and $7.5 billion for electric vehicle chargers.
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