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Infrastructure Bill Could Cut Carbon Emissions By Nearly a Gigaton

Provisions in the reconciliation package working its way through Congress would help meet Biden’s climate pledge

Chuck Schumer speaking at a news conference.

Senate Majority Leader Chuck Schumer.

The reconciliation bill working its way through Congress could cut U.S. greenhouse gas emissions by nearly a gigaton by 2030, according to a new report.

The analysis, released today by the Rhodium Group, an independent research firm, offers a first look at how the sprawling suite of climate policies Democrats are considering as part of their $3.5 trillion package could overhaul energy and contribute to President Biden’s Paris Agreement emissions-cutting pledge.

The bill could ultimately include dozens of different climate and energy provisions. But the report examined six of the biggest proposals currently in the mix: clean energy and electric vehicle tax credit expansions, a methane fee, funding for rural electric cooperatives, money for agriculture and forestry carbon capture programs, and the proposed Clean Electricity Performance Program (CEPP).


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Those policies alone would reduce greenhouse gas emissions by 830 million to 936 million tons by 2030 compared with current trajectories, the report found. The CEPP — which would pay power providers to deploy more clean energy, with the goal of hitting 80 percent clean energy by 2030 — would account for the bulk of those reductions.

That would amount to “easily the biggest thing to pass Congress when it comes to climate,” said John Larsen, a director at the Rhodium Group and one of the report’s authors. “It's highly likely that the total impact is bigger — potentially substantially bigger — than what we found simply because we didn't count everything,” he said.

Notably, the report, which used a version of the U.S. Energy Information Administration’s National Energy Modeling System, also found that the methane fee would increase consumer natural gas prices by just 2 to 3 percent, a relatively small change in fluctuating commodity markets. That finding contradicts frequently voiced arguments from Republicans that the policy would harm consumers and effectively raise taxes (E&E Daily, Sept. 14).

It’s not clear yet what, exactly, the reconciliation bill would mean for Biden’s pledge to reduce emissions 50 to 52 percent under 2005 levels by 2030.

“We estimate that there is a 1.7-2.3 billion ton gap between where emissions will be under current policy and where they need to be to meet the 2030 goal,” the report says. “The range reflects uncertainties around energy markets, technology costs, and natural carbon removal.”

The politics also remain tricky. The CEPP passed the House Energy and Commerce Committee yesterday, and Ways and Means is set to clear the clean energy and EV tax components of the bill soon.

But in the Senate, Energy and Natural Resources Chair Joe Manchin (D-W.Va.) has voiced opposition to both the CEPP and the reconciliation bill’s $3.5 trillion top line (E&E Daily, Sept. 13).

The expanded tax credits on their own could make for a major emissions reduction, but Congress or the executive branch would need some sort of other policy to get to 80 percent clean power if the CEPP were left out.

“The more Congress can do, especially this year, the better positioned the U.S. is generally to meeting the target,” Larsen said.

Reprinted from E&E News with permission from POLITICO, LLC. Copyright 2021. E&E News provides essential news for energy and environment professionals.