Experts React: Biden’s First 100 Days

Focus on Energy Communities in Transition

Ben Cahill
Senior Fellow
Energy Security and Climate Change Program

The Biden administration, mindful that its climate policies could hasten the already steep decline of the coal industry, aims to revitalize coal-dependent communities. President Biden’s climate-focused executive order signed on January 27 established an interagency working group to support vulnerable communities.

The group’s first report highlights 25 energy communities that are potentially at risk and identifies $38 billion in available federal funding to invest in infrastructure, broadband, small businesses, and local financial institutions. Environmental remediation will be a priority, building on President Biden’s plan to invest up to $16 billion in plugging orphaned oil and gas wells and reclaiming abandoned mines. The Biden administration plans to hold a series of town hall discussions in these communities, in an important step toward engaging local voices to find solutions rooted in each region’s particular needs.

The scale of this effort and the focus on social equity are admirable and probably long overdue. Still, planning for a just transition is a complex task. It is important to fund a wide range of initiatives that emerge organically in these regions, but this will not necessarily support an overarching economic development vision. Effective, place-based investment depends on comprehensive efforts to map out an economic future, usually enlisting a wide range of local, regional, and national actors. The most successful coal transitions have taken decades rather than years, typically in countries with stronger social safety nets and better vertical and horizontal policy coordination than the United States. The Biden administration is aware of these challenges. The interagency group suggests that sustained engagement with local communities is the best way to deliver short-term aid but also design realistic long-term strategies for these communities.


The United States Should Lead a Values-Centered Clean Energy Transition

Frank Fannon
Senior Adviser (Non-resident)
Office of the President

President Biden firmly established climate change as his government’s central foreign policy principle in contrast to the prior administration’s focus on security. This dramatic shift was expected; however, the government must reconcile how to achieve its climate ambitions in a way that aligns with traditional, liberal, and democratic values.

Clean energy technologies require significant volumes of several key minerals. The World Bank projected a demand increase of 500 percent or more for many critical clean energy metals. By increasing the United States’ climate targets, the administration is accelerating the demand for these energy transition minerals.

Today, China dominates the clean energy technology supply chain from mining to manufacturing. The United States concluded that the Chinese Communist Party (CCP) achieved its top spot through state financing of mines across the developing world, aggressive intellectual property theft of Western technologies, and manufacturing that violates environmental protection and human rights.

The Biden administration was right to call out China’s human rights abuses. The administration has repeatedly stated that it would not weaken those positions in exchange for cooperation on climate change. However, the CCP rejected this idea of compartmentalizing issues and countered that all issues are interrelated.

The Biden administration is building on the prior administration’s focus on clean energy supply chains. For example, the president committed to strengthening the multinational Energy Resource Governance Initiative, which advances global best practices for responsible clean energy mineral development. The administration also commissioned a 100-day supply chain review and bolstered research and development funding. Yet, challenges remain.

The Biden administration should recognize that the United States cannot “compete” with China as if both countries were playing the same game. Rather, the administration should leverage the United States’ comparative advantages. We have the minerals, the capital, and the world’s most dynamic private sector. The administration could empower the United States’ values-based private sector to build tomorrow’s clean energy supply chain today.


Biden’s Indo-Pacific Energy Engagement

Jane Nakano
Senior Fellow
Energy Security and Climate Change Program

The centrality of climate change as well as a pronounced preference for international partnerships have shaped the Biden administration’s energy engagement in the Indo-Pacific region—one of the most dynamic centers of the global energy system. The first 100 days saw the Biden administration forge climate partnerships with key regional economies, including the launch of U.S.-Japan Climate Partnership and the U.S.-India Climate and Clean Energy Agenda 2030 Partnership, while Special Presidential Climate Envoy John Kerry struck a joint statement on the climate crisis with China. Moreover, the Biden administration announced a Climate Finance Plan to scale up U.S. public climate finance and mobilize private finance internationally. These measures could alter fuel choices as well as energy trade and investment patterns in the region.

Several other priorities also shape the U.S. energy engagement in the region. A key administration goal is to end international financing of “carbon-intensive fossil fuel-based energy.” This priority has a particular resonance to the Indo-Pacific region, which is home to leading coal producers (e.g., Australia, China, and India) and financiers (e.g., China, Japan, and South Korea) in the world. The Climate Finance Plan instructs federal agencies to begin concrete work on this front. Whether and how the Biden administration may leverage Seoul’s recent coal finance ban and Tokyo’s more categorical ban to urge Beijing to follow suit warrants attention. Biden’s Washington will not shy away from pressuring allies—such as Australia—and rivals—such as China—alike to reduce coal production and combustion. Moreover, growing domestic scrutiny of methane emissions has rendered a limited role to natural gas in the U.S. energy engagement with the region, which under the Trump administration prioritized U.S. gas exports. Last, in the words of Secretary of State Antony Blinken, managing relationships with China is the “biggest geopolitical test of the twenty-first century.” U.S.-China rivalry in such areas as clean energy technology innovation and manufacturing will affect the pace, scope, and substance of energy infrastructure development in the region, particularly in Southeast Asia and the Pacific Islands.


New Deal for National Security

Kartikeya Singh
Senior Associate (Non-resident)
Energy Security and Climate Change Program and Wadhwani Chair in U.S.-India Policy Studies

Perhaps the biggest threats to U.S. national security now are not driven by forces that come from beyond our borders, but rather a constellation of factors driving social instability and deep divisions within the country. To right these wrongs and chart a new deal for all American people, the Biden administration has indicated through its actions in the first 100 days that it has every intention to reestablish a social contract between the people and their government. If implemented well, this renewed social contract, with an emphasis on climate action and environmental justice, would be the best guarantor of U.S. national security.

Guiding this new focus on environmental justice as the vehicle to deliver a new social contract is a whole-of-government approach that was activated when Biden signed the executive order on securing environmental justice and equitable economic opportunity. The extent of the reorganization in federal agencies, from the EPA to the Department of Justice and the Department of Health and Human Services, is unprecedented. Furthermore, the American Rescue Plan includes several provisions that aim to deliver on this social contract by strengthening energy, water, and health infrastructure for low-income communities. For some perspective, the EPA will be releasing more environmental justice–focused grants in the next year than it has since its inception.

More promising is the prospect of what is on the horizon: the American Jobs Plan could provide major investments in infrastructure and at the same time ensure environmental justice is delivered. Should Congress have the courage to deliver on this vision, it would be allocating funds that could create jobs focused on ecological restoration in communities dependent on the declining fossil fuel value chain or restore communities of color fractured by large-scale infrastructure. “Trickle-down economics has never worked. It’s time to grow the economy from the bottom up and middle out,” stated the president in a recent tweet. Indeed, this is the best down payment toward U.S. national security.


Capital Case

Kevin Book
Senior Associate (Non-resident)
Energy Security and Climate Change Program

Literally on day one, President Biden signed an executive order revoking the Keystone XL oil pipeline’s cross-border permit. His motive seemed clear: fossil energy systems are designed to flow, which means interrupting throughput—at the wellhead, at the wastewater injection site, or somewhere in between—can keep oil and gas “in the ground.” The cancellation drew widespread notice, but it may have been more symbolic than substantive. Without new pipes, refiners can still transport barrels via other modes (albeit at higher cost and/or greater risk).

But fossil energy extraction is capital-intensive—it takes money going into the ground to get molecules out—which means regulations that raise operators’ costs of equity and debt (or cut access to capital entirely) have potential to curtail upstream development more broadly than a single pipeline cancellation. Less-noticed steps by federal financial regulators and independent agencies over the course of Biden’s next 99 days in office could do precisely that.

The Federal Reserve unveiled two climate risk bodies: a micro-focused Supervision Climate Committee on January 25 and a macro-focused Financial Stability Climate Committee on March 24. On January 28, the Office of the Comptroller of the Currency paused a Trump-era rule that would have barred lenders from withholding services for fossil energy. On March 10, the Labor Department’s pension overseer announced it would not enforce two Trump-era rules aimed at limiting environmental, social, and governance-themed investments. On March 15, the Securities and Exchange Commission requested comment on climate risk disclosure. Two days later, the Commodity Futures Trading Commission announced a Climate Risk Unit.

Domestic and international coordination could tighten the capital squeeze, too. On March 31, Financial Services Oversight Council chair (and Treasury Secretary) Janet Yellen convened a climate risk discussion at the pan-governmental financial forum’s very first Biden-era meeting. The April 22 White House International Climate Finance Plan tasked the Treasury with synchronizing international climate risk protocols. Watch this space: these “indirect financializations” of climate risk could accelerate Biden’s green transition.


Economics, the End of Austerity, and Biden’s Big Climate Ambitions

Lachlan Carey
Associate Fellow
Energy Security and Climate Change Program

Over $6 trillion. That is the combined sum of President Biden’s proposed rescue and recovery agenda. Including the $400 billion in clean energy tax credits, the American Jobs Plan contains as much as $1.6 trillion in climate-related spending over eight years, or about 7 percent of today’s GDP. It is not so long ago that such figures would have been seen as absurd politically, and outright dangerous economically. But Biden’s first 100 days have shown we are entering a new era of “Bidenomics,” where climate spending is relatively unconstrained by deficit hawks and inflation alarmists, and even endorsed by macroeconomic theories and evidence.

What appears to be a sudden embrace of debt and deficits has been building for some time. More than a decade of sluggish growth after the Great Recession displayed the shortcomings of fiscal austerity for all to see. Low labor force participation and median wage stagnation forced economists to resurrect Keynesian ideas of activist fiscal policy and full employment. Research into the positive externalities of public investment has identified clear opportunities for innovation and industrial policy—indeed, the first report of Biden’s Council of Economic Advisers is an unequivocal endorsement of green industrial policy. Advances in clean energy technologies have thrown Nordhaus-esque cost-benefit models of climate change into disrepute.

In other words, economics is no longer the intellectual or rhetorical obstacle to climate action it once was. Rather, a new crop of economists is embedding the lessons of the last decade into a different breed of climate policy that focuses on public investment, job creation, and innovation policy. These are not just views held by a left-wing fringe, but rather are firmly embedded in Biden’s thinking and that of his key advisers. The implications will be far-reaching, wide ranging, and, hopefully, planet-saving.


President Biden Likely Needs More Than a ‘Pen and a Phone’

Michael Catanzaro
Senior Associate (Non-resident)
Energy Security and Climate Change Program

President Biden recently announced the Nationally Determined Contribution (NDC) for the United States under the Paris Agreement. He proposed economy-wide emissions reductions of 50-52 percent below 2005 levels by 2030. With Congress nearly equally divided, can the Biden administration meet this goal on its own without comprehensive climate legislation?

As President Obama famously said, “I’ve got a pen, and I’ve got a phone,” meaning executive power alone was sufficient to enact his agenda. To be sure, he tried, but without new legislation he got mixed results at best. Consider the Clean Power Plan, which was blocked by the Supreme Court.

It is true that, over the last few decades, policymaking through regulation has become the norm, especially with respect to energy and environmental policy. With some exceptions, Congress has refused (or been unable politically) to address the major issues of the day.

Without congressional action, say, to require a zero-emissions power grid or new authority to address greenhouse gas emissions from the industrial and transportation sectors, the Environmental Protection Agency and other agencies will have to slog it out rule by rule. Administrative rulemaking is a laborious process often slowed by litigation. And the fate and contours of rules can be shaped (not always to one’s liking) by courts.

This is not to say that President Biden is operating without any help from Congress. Consider that last year’s omnibus budget compromise included the American Innovation and Manufacturing (AIM) Act, addressing non-carbon dioxide greenhouse gases, and the Energy Act, which includes, among other things, federal support for research and development into low- and zero-carbon energy technologies, such as advanced nuclear.

Moreover, President Biden’s American Jobs Plan proposes billions in new spending on clean energy. Yet the Senate’s procedural hurdles stand in the way, even under the budget reconciliation process. And without a new framework with binding emissions limits, making the NDC’s 2030 goal a reality will remain a challenge.


Even with Federal Leadership, States Still Matter

Morgan Higman
Energy Security and Climate Change Program

While the federal government steps up its game, states will continue to be a driving force on issues of climate and energy. Policies to limit emissions and expand energy efficiency and renewable energy are well established in the majority of states, but ambitions are still growing. In the last few months, nearly half of all states have committed to net-zero emissions by 2050. To reach this goal, states are increasingly eyeing phaseouts of coal power, combustion vehicle sales, and super-polluting hydrofluorocarbons. There is also growing state interest in capturing methane, developing carbon pricing schemes, and setting targets for energy storage. These emerging commitments are especially important because they represent a degree of stringency that may not be politically viable at the federal level given the divisiveness of climate policy across party lines.

State capacity and experience with climate policies is likely to influence the rate and impact of new federal initiatives. Lessons from the American Recovery and Reinvestment Act (ARRA) illustrate this point. As ‘‘pass-through’’ entities, states exercised considerable discretion in how and when ARRA funds for clean energy were dispersed to local governments, nonprofits, and private contractors. Studies indicate that states with longer-standing and more stringent renewable energy portfolio standards disbursed funding more efficiently. Likewise, state engagement with investors, community action groups, and regional counterparts may increase the number of “shovel-ready” investments that can benefit from new federal programs or policies.

State energy strategies vary significantly across the country, and states are limited in what they can accomplish alone. President Biden’s leadership can play an important role in ensuring that all states prioritize decarbonization and in addressing interstate challenges, such as electricity transmission and pipelines. Nonetheless, state climate initiatives will continue to be a critical source of policy innovation and durability, a failsafe against federal gridlock or backsliding in the future.


Biden Has Changed How We Talk about Energy and Climate

Nikos Tsafos
Interim Director and Senior Fellow
Energy Security and Climate Change Program

In just a few months, President Biden has reshaped the energy and climate conversation in Washington. There was always a rhythm to how this town talked about energy—focused on the price of gasoline, foreign oil, trade deficits, entanglements in the Middle East, pipelines in Europe, and so on. Or, more recently, on leveraging cheap energy for economic growth or exporting oil and gas to support jobs and help allies. President Biden has changed all this. His focus is competitiveness—winning the race for clean energy. The keywords that resonate are jobs, infrastructure, manufacturing, supply chains, and opportunity. Also, resilience, equity, and justice.

In this shift, the Biden administration has quietly retired the notion of an “all of the above” strategy, a (largely rhetorical) commitment to favor all fuels. The administration wants to support some energy sources and shrink others—there is no other way to succeed. It has also brought back industrial policy. The term is rarely used, but the administration sees the federal government as a primary engine for change, as a way to channel the creative dynamism of private markets. The energy transition needs this.

But can the government achieve this audacious target, to halve greenhouse gas emissions by 2030 relative to 2005? It is not only a divided Congress that hinders durable policy. It is also an administrative apparatus that has atrophied, a government that has not governed much. There is too much reliance on tax breaks and credits, on tweaking arcane rules, and on “innovation.” Other levers are rarely used—stricter rules and mandates, taxes on energy, public institutions to steer and to coordinate. To succeed, in other words, the government will need to do more governing, not just spend money and write rules. That challenge stands above all others.


Supporting Developing Country Confidence in U.S. Climate Leadership

Sandeep Pai
Senior Research Lead
Just Transition Initiative, Energy Security and Climate Change Program

President Biden recently hosted a global climate summit of 40 world leaders to reestablish U.S. leadership in the global climate arena. During the summit, the administration announced an ambitious domestic target of reducing emissions by 50-52 percent by 2030 compared to 2005 levels. Showcasing this ambitious domestic commitment, it launched a Global Climate Ambition Initiative that aims to “support developing countries in establishing net-zero strategies.” Yet developing countries remain skeptical of U.S. climate leadership. Aside from domestic sociopolitical reasons, some developing countries are hesitant to declare more ambitious targets without greater certainty about short- and long-term support from high-income countries such as the United States.

There are two main reasons for this. First, the United States lacks credibility in this space as it has consistently changed its stance on climate. In 1997, the U.S. Senate refused to approve the Kyoto Protocol, and two decades later President Trump withdrew from the Paris Agreement. Therefore, there is understandable fear that a new administration in the future may yet again change its stance on climate. Second, more specifically, if developing countries are to declare more ambitious targets, this would require technology transfer and finance from developed countries. Here again, the United States’ record falls short. For example, in 2014, the administration had pledged $3 billion to the Global Climate Fund, but so far it has only transferred $1 billion.

Recognizing these issues, the Biden administration recently pledged that by 2024, it will double its annual climate finance to developing countries relative to the average level during the second half of the Obama administration. It also promised to triple its adaptation finance by 2024. These promises and other global initiatives on climate are encouraging. However, 2024 is still in the future. To build trust in the short term, the Biden administration should commit to and deliver on short-term climate financing or initiatives for clean energy deployment in developing countries like India or Indonesia. This, coupled with consistent and concrete long-term policy action, will help increase developing country support for U.S. climate leadership and bolster their domestic ambition.


Biden Needs Federal Regulators to Step Up to Meet Ambitious Goals

Stephen Naimoli
Associate Fellow
Energy Security and Climate Change Program

The Biden administration has brought a significant focus on climate into the government. His Cabinet, from Transportation Secretary Pete Buttigieg to Treasury Secretary Janet Yellen, has emphasized climate and environmental justice in ways we have not seen before. This has come with a lot of laudable goals from the administration for 2030: a 52 percent reduction in greenhouse gas emissions from 2005 levels, deploying 30 gigawatts (GW) of offshore wind, $174 billion for electric vehicles, and an 80 percent low-carbon power sector, just to name a few.

However, for the country to meet these goals, President Biden needs a lot to go right. Consider the offshore wind goal, for example. President Biden has committed the Bureau of Offshore Energy Management (BOEM) to approving 16 offshore wind farms by 2025. This means making two big changes: First, speeding up the approval process, as meeting the 2025 goal would require approving an average of three to four projects per year. But Vineyard Wind, the project currently farthest along in the process, has been waiting three years for a final decision. The industry has to hope that a decision on Vineyard Wind will start a cascade of approvals. The second big change would be building up the project queue. There are currently 14 projects in the permitting process, adding up to about 12 GW. There seems to be no shortage of interest from developers, so the constraint will be how quickly BOEM can lease new areas as the current plots fill up.

Commentary is produced by the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. Its research is nonpartisan and nonproprietary. CSIS does not take specific policy positions. Accordingly, all views, positions, and conclusions expressed in this publication should be understood to be solely those of the author(s).

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