Biden’s difficult (but possible) path to 100% clean electricity by 2035

How Biden could clean up the U.S. electricity sector -- using the federal budget.

In 1999, Texas Governor George W. Bush, a Republican, signed a law restructuring the state’s energy market that included a provision calling for 2,000 megawatts of renewable energy capacity — about enough to power 328,000 homes — by 2009. The state was among the first in the nation to put a so-called renewable portfolio standard in place — a statutory mandate to reach a renewable electricity generation target by a certain date. It reached its goal four years early.

Dozens of other states followed suit, particularly in the last few years, with states ambitiously targeting 100 percent clean energy by midcentury — or even 2030. All told, 30 states and three U.S. territories have implemented such standards since the early 1980s. They require electric utilities to make renewables a progressively larger fraction of their energy mix over time, but the producers are allowed to buy and sell renewable energy credits to meet the requirement.

The lingo has changed since the 1980s. “Renewable portfolio standard” is now “clean energy standard,” or CES. And so has the political landscape. Republicans had few qualms with renewable portfolio standards a couple of decades ago, when they looked small and harmless and were often tacked on to other measures. Like so much else in climate politics, the issue has grown divisive.

“The fossil fuel industry and electric utilities started to understand that this policy, which looked pretty small at the beginning — they started to realize we weren’t going to stop there,” Leah Stokes, assistant professor of political science at the University of California, Santa Barbara, told climate journalist David Roberts on his podcast in January this year. “We were going to go 100 percent clean, and that started to threaten their bottom line.”

On Thursday, Stokes and some other climate wonks joined forces with Evergreen Action, a climate think tank formed by former staffers for Washington Governor Jay Inslee, and Data for Progress, a progressive think tank, to publish a report that outlines a roadmap to a federal clean energy standard — one that would transition the nation’s electricity grid off of fossil fuels and onto clean energy sources by 2035. It’s a massive, federal version of the efforts all those states have undertaken. It’s also something President Joe Biden promised to accomplish when he was on the campaign trail.

Decarbonizing the electricity sector is relatively low-hanging fruit. The way that the U.S. has made the most progress on cutting carbon so far has been through the electricity sector, with steps like retiring coal-fired plants, putting emissions controls on natural gas power plants, and, of course, adding wind and solar to the grid. Even so, power is the second-largest source of greenhouse gas emissions in the U.S. by sector, right behind transportation.

The magic of a clean energy standard is that electricity can be used for more than just keeping the lights on. Other slices of our economy, like vehicles, building heating systems, and even some kinds of heavy industry, can be plugged into the clean energy hose. In this way, clean electricity generation can help decarbonize the entire economy, moving the nation toward a greener future. “Achieving carbon-free electricity throughout the economy can help to catalyze upwards of a 70-80 percent reduction in U.S. carbon pollution,” the report estimates.

There’s just one problem. In a Senate that’s split 50-50, finding enough votes to pass a CES will be difficult. The filibuster, an arcane tactic that allows the minority party to require 60 votes to pass virtually any bill, stands in the way of climate legislation. Thanks to the filibuster, if 41 Republicans in the Senate oppose a clean energy standard, the measure is dead. Democrats could vote to abolish the filibuster with a simple majority, but moderate members of the party, namely Senators Joe Manchin of West Virginia and Kyrsten Sinema of Arizona, have signaled that that course of action is a no-go. If even one Democrat falters, a vote to reform or abolish the filibuster would fail.

“My sense is that a federal clean energy standard is something that even moderate Democrats like Joe Manchin are open to, but in my conversations with Republicans there’s still fairly strong opposition to the idea,” said Alex Trembath, who is the deputy director of the Breakthrough Institute, an environmental research and policy center, and was not involved in the report. “That’s a contrast to things like federal funding for R&D and support for demonstration and deployment of novel clean-energy technologies, which continue to gain bipartisan support. A clean energy standard would be a much higher-profile policy, and it’s unclear to me if Democrats are going to want to push for that in the coming Congress.”

If Democrats do decide to push for it, there’s a way around the filibuster. It’s called budget reconciliation. Each year, the House and Senate pass budget resolutions that establish the dollar amounts that different areas of government, like defense and commerce, can spend. They’re not binding, but they do set the course of debate for the entire year in both chambers, and Congress is theoretically supposed to pass legislation that matches those budget resolutions. Budget reconciliation is a process within that process (thrilling, I know) that increases or reduces spending and revenue, or modifies the federal debt ceiling — how much money the U.S. government is allowed to borrow. And reconciliation is immune to the filibuster — it only takes 51 votes to pass it in the Senate.

The problem is that measures passed via reconciliation have to concern the budget, and a clean energy standard doesn’t — at least not on its face. “I don’t think you can reasonably argue that regulations that limit emissions or change car standards or anything like that are budget germaine,” Marc Goldwin, head of policy at a nonprofit called the Committee for a Responsible Federal Budget, told Grist. Goldwin was also not involved in the Evergreen and Data for Progress report.

But there are ways to tailor a clean energy standard to make it budget-relevant and fit the reconciliation mold. One option that the report highlights is to create a carbon trading program within the federal government. Remember those renewable energy credit exchanges that are a part of most states’ clean energy standards? The report’s authors suggest creating a federal zero-emissions electricity credit system — a universal currency that companies could tap into to reach zero-emissions by 2035. The government would create a stockpile of these credits that energy companies could claim by either delivering one megawatt-hour of carbon-free electricity to customers per credit or by buying credits from the federal stockpile with regular money at a price set by the region in which the utility operates.

It’s a bit like Monopoly — except in this case, the money the federal government gets from companies buying up its zero-emissions electricity credits would go right back into green energy programs. The report recommends that those programs benefit disadvantaged communities.

A promising and even more reconciliation-friendly alternative to the credit system would be to incorporate the clean electricity standard into the tax system. Starting in 2025, for instance, a utility might see 25 percent of its carbon-emitting generation taxed by the federal government. That percentage would rise over time until 100 percent of a given company’s carbon-emitting generation is taxed. Sounds punitive, right? The report suggests coupling this tax with a “complementary performance tax credit” to incentivize companies to incorporate more clean electricity into their portfolios. Bad cop, good cop.

“You could probably use tax policy to basically have similar results to regulation,” Goldwin said, but he noted that advocates of this approach will have to walk a fine line in order for such a tax to fit the parameters of the budget reconciliation process. If the price on emissions is too high, power companies might not pay it, opting to pay fines instead, in which case the federal government won’t see revenue from the initiative and it won’t count as a tax. “There’s a gray area, but there’s certainly a path,” Goldwin said.

What these proposals, if adopted by Democrats, come down to — and indeed what much of the Evergreen and Data for Progress report hinges on — is whether House and Senate parliamentarians agree that a federal CES, in whatever form it’s proposed, fits the mold of the budgetary process. Parliamentarians are basically the referees of Congress, always poised to blow the whistle if someone isn’t following the rules.

One of the parliamentarians could say that a measure that creates a carbon trading program within the government is outside the bounds of budget reconciliation. If that happens, members of Congress can vote to overrule the decision with a simple majority, but the same senators who get faint of heart when contemplating abolishing the filibuster aren’t likely to turn around and vote to override the person in charge of interpreting Congress’ rules.

And, zooming out, it’s worth considering whether 100 percent clean energy by 2035 is even feasible from an emissions standpoint. “I’m surprised that they’re so gung ho about pushing for 100 percent carbon-free electricity by 2035,” Destenie Knock, assistant professor in the civil and environmental engineering division at Carnegie Mellon university, told Grist, referring to the authors of the report. “While it would be great to have that by 2035, to me it seems like it’s going to be a bit of a challenge.” The electric grid as it stands today is severely limited. We’re going to need way more transmission lines, way more long-term energy storage, better energy infrastructure, and better jobs training programs, among other things, if we want to achieve 100 percent clean energy by 2035, Knock said. She suggested a different target: make the deadline 2050.

“Even if we could do all this deployment right away, if we do a quick flip and people feel left out or feel even more marginalized, then we could see a lot of strong backlash,” Knock said. “That’s one of the reasons I’m in favor of a slower turnover. It gives time for people to renavigate this energy landscape that we have.”

This story was originally published by Grist with the headline Biden’s difficult (but possible) path to 100% clean electricity by 2035 on Feb 4, 2021.