For Climate Progressives, Biden’s $2.25 Trillion Isn’t Enough
(Bloomberg) -- As a candidate, Joe Biden garnered nearly unanimous support from environmentalists, progressives, and clean energy advocates for his promise to reconfigure the U.S. economy for the fight against climate change.
But as president, his $2.25 trillion jobs-and-infrastructure blueprint—released Wednesday and meant to fulfill much of that campaign pledge—received a much less harmonious welcome.
“Today I find myself caught between two truths,” said Varshini Prakash, executive director of the youth climate activist group the Sunrise Movement. “This infrastructure plan is a historic step forward that would not have been possible without us,” she said, referring to fellow young protesters and advocates of the Green New Deal. And yet, “so much more is needed to reach the scale of what is necessary to truly transform this country to stop the climate crisis.”
Renewables industries, for the most part, stand to have many of their wishes fulfilled. “It feels like a unique moment in history,” said Abigail Ross Hopper, chief executive officer of the Solar Energy Industries Association, in an interview with Bloomberg Green. “It feels like a generational opportunity.”
But the dissonance with the climate left is just one sign of the challenges Biden will face getting his bill passed.
Even before details became public, it was clear the American Jobs Plan would have a difficult road ahead in Congress, not least because it accommodates so many of the left’s long-held priorities. The bill includes money for mass transportation, for green housing development and redevelopment, for electric vehicle charging infrastructure, and—perhaps crucially—proposes to raise the top corporate tax rate from 21% to 28% to cover the cost. Enforcement will be key, the White House said in its notes on the bill, a possible nod to one of progressive Senator Elizabeth Warren’s favorite themes.
Those who came out swinging against the proposal took issue primarily with its size. In a tweet soon after details were made public, Representative Alexandria Ocasio-Cortez, a sponsor of the Green New Deal, drew an unflattering contrast between the infrastructure plan and the recently passed stimulus bill, which provided nearly as much funding for 2021 alone. “I am encouraged by the vision laid down by the Biden infrastructure plan,” she said at a town hall, “but I'm concerned that the numbers that they've allocated won't get us to that vision that they themselves have agreed to.”
Representative Pramila Jayapal, chair of the Congressional Progressive Caucus, was quick to express her disappointment, as well. “While President Biden’s proposal is a welcome first step,” she said in a public statement, “more must be done to improve on this initial framework to meet the challenges we face.”
Others were more circumspect in their criticisms, even if they employed some of the same language. Senator Sheldon Whitehouse, a Rhode Island Democrat and member of the Senate Environment and Public Works Committee, for instance, called Biden's plan a “fine starting point” for Congress to begin work on infrastructure. “I like that it’s focused on upgrading infrastructure—something we need to do more of in Rhode Island,” he said.
But for the solar industry, the plan "actually beats expectations," said Michael Weinstein, an analyst at Credit Suisse Group AG. “It’s a big day. It's clear that a lot of the infrastructure bill will focus on renewable energy.”
Federal tax credits have helped make solar and wind power more affordable in the U.S., and the plan proposes extending those tax credits for another decade—longer, even, than many companies had expected. “That’s a pleasant surprise,” said John Berger, CEO of residential-solar company Sunnova Energy International Inc. A potential decade-long extension would give solar companies greater certainty, especially as Biden looks to the sector to help green the country's grids. Clean-power stocks such as Sunnova’s surged Wednesday after details were released.
Some renewable fuel sources did less well than solar, however. Biden's blueprint, for example, disappointed biofuel advocates, since a rapid shift to electric vehicles poses a threat to the market for corn-based ethanol. Biden wooed voters in Iowa and other top corn- and ethanol-producing states with promises to use “every tool at his disposal” to promote biofuels. But his infrastructure plan “assuredly missed an opportunity to meet these promises” and “overlooks the urgent need to expand access to low-carbon biofuels,” said Emily Skor, chief executive of the pro-ethanol group Growth Energy.
But to many hard-core climate activists, the dividing of the spoils among the renewable energy sectors missed a greater point: that the bill wasn’t radical enough on climate change and other urgent environmental issues. The fact that the bill contained extensions of a tax credit for carbon capture—a priority for fossil fuel-producing states like West Virginia, home of Senator Joe Manchin, a crucial Democratic swing vote on just about any legislation—stood out as proof that the administration was addressing climate change only superficially.
“The carbon capture people are really happy,” said Brett Hartl, government affairs director at the nonprofit Center for Biological Diversity. “They are getting even more boondoggles and tax credits for things that don’t work in the real world.”
Jayapal also reminded Biden that during the campaign he’d committed to $2 trillion over four years to address climate change, not the decade he’s now proposing.
Many of the criticisms were summed up in a statement from Greenpeace USA. “The president’s ambition in this moment does not meet the scale of the interlocking crises facing our country,” the group said. “It is not enough to go back to normal.”
©2021 Bloomberg L.P.