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Biden’s All-of-Government Climate Pledge Begins to Take Shape

March 1, 2021, 11:01 AM

The Biden Administration’s decision to throw out the Trump White House’s method for calculating the social cost of carbon was one of the first tangible actions on the president’s lengthy climate change to-do list as he works to convince the world that the White House is once again serious about a global response to warming temperatures.

The approach, announced Friday, pegs the social cost of carbon at $51 a ton for 2021 after adjusting for inflation at a 3% discount rate. The Biden plan, which replaces a Trump-era method that was as low as $1, will be used on an interim basis. A higher dollar figure makes it harder for agencies to issue new regulations that are more permissive to industry because it more starkly shows the benefits of tough rules outweigh the costs.

Several earlier executive orders signed by the president so far also address climate change, many incorporating dozens of separate directives. One of those orders, signed on Jan. 27, directs agencies across the government to complete at least 60 separate actions, according to an examination by Bloomberg Law. It sets April and May deadlines for a few of the tasks.

Administration officials have already ticked off a few of the most straightforward items, such as naming climate envoy John Kerry and proposing the new price on the harm caused by carbon dioxide. But they have yet to meaningfully tackle the more daunting components of the directive that will require collaboration across agencies, such as developing a federal green buying plan or analyzing security implications of climate change.

They’ve also stumbled: the U.S. Postal Service announced plans last week to buy as many as 165,000 new mail trucks that would be powered mainly by internal combustion engines, outraging some environmental activists and members of Congress who said the award violates Biden’s day-one executive order calling on the government to prioritize clean energy in vehicle purchases.

Initial Test

Progress on additional executive orders in the coming months will be the first test of whether Biden can deliver on his promise to prioritize climate change. Though the administration’s early actions signal climate change will be a priority, the U.S. will have to tackle emissions at home to win back the trust of other nations.

The administration has promised to unveil its proposed contribution to global emissions reduction efforts at the White House’s global climate summit in April, convened to lay the groundwork for broader negotiations on an international agreement in Glasgow later this year.

The administration also will need to attract support from Congress to make any climate commitments permanent—President Barack Obama declined to submit the Paris Agreement to the Senate for consent, making it easier for his successor Donald Trump to withdraw the U.S. formally a few years later.

“If we’re going to go down this path of governing through executive order, through one branch of the three branches of our government, then all you are going to end up seeing is this instability and these wildly changing policies as you go from a Bush to an Obama to a Trump to a Biden,” said Garret Graves (R-La.), the top Republican on the Select Committee on the Climate Crisis.

World Stage

The credibility of the U.S. rests on whether the Biden administration’s April announcement on emissions reduction commitment is seen as aggressive enough on the world stage.

England, the host of the international climate negotiations later this year, is trying to encourage other countries to offer bold contributions—and the U.S. can help lure them toward that goal, said Rachel Kyte, dean of the Fletcher School at Tufts University, who previously led climate change-related efforts at the World Bank.

“The U.S. is the big jigsaw puzzle piece outstanding at the moment,” Kyte said.

To help shore up support, Kerry has hit the event circuit in recent weeks to make the case to world leaders that the U.S. is serious about climate change.

He’s touted the Biden administration’s approach to climate change at the Munich Security Conference, published a TED Talk with former Vice President and environmentalist Al Gore, and participated in a climate change panel at the Italian Embassy.

The State Department is also starting to engage with a few international clean energy groups, such as the International Energy Agency, Mission Innovation, and the Clean Energy Ministerial, a Kerry spokesperson said.

The administration hopes to generate goodwill among world leaders by also pushing the Senate to ratify a 2016 international agreement to lower use of hydrofluorocarbons, a group of greenhouse gases used for cooling. President Donald Trump never submitted the agreement to the Senate for consideration, and State Department leaders are crafting legislation for it to finally happen.

Trump officials previously defended holding back the ratification. They said components of it overlapped with legislation Trump signed in December directing the Environmental Protection Agency to decrease consumption and production of the hydrofluorocarbons by 85% over the next 15 years.

At the Department of Homeland Security, officials are integrating climate considerations into department-wide planning, programming, and budgeting, a spokesperson for the agency said without providing specifics. A Biden executive order directed the agency to report annually on its progress addressing how climate change threatens the Arctic and the nation’s borders.

Efforts at Home

One area where Capitol Hill Republicans could help the White House reach its goals: the need for the government to boost investment in clean energy research and technology.

In his Jan. 27 executive order, Biden directed federal agencies to use federal funding to spur clean energy technology and infrastructure.

Since then, the Transportation Department revamped its popular infrastructure grant program, launched during the Obama administration and continued under Trump, to prioritize projects that address climate change and racial equity. The Energy Department announced it is making $100 million in funding available for clean energy technology research and development.

Republicans could support a bill that would provide funding and coordinate efforts across government to research climate change solutions, Graves said. He would also be open to increasing tax incentives for companies that capture and store carbon dioxide, a component of the 2017 tax law (Public Law 115–97).

In the executive branch, Kerry and Treasury Secretary Janet Yellen have held their first meeting on writing a climate finance plan, one of the tasks on Treasury and State’s to-do list. Biden’s directive gives them until late April to finish the plan, though the directive lacks instructions on when to execute it.

Separately, the U.S. Securities and Exchange Commission announced Wednesday that it is boosting scrutiny of how well companies disclose risks that climate change poses to their business.

Making that path permanent would require direction from Congress, said Steven Rothstein, managing director of the Ceres Accelerator for Sustainable Capital Markets. The House Financial Services Committee held a hearing Feb. 25 on whether public companies should be required to disclose climate risks and the greenhouse gas emissions in their operations and supply chains, drawing ire from the committee Republicans.

“Politically-motivated disclosure requirements only increases costs and add another hurdle for companies who look to go public,” said Rep. Bill Huizenga (R-Mich.), who chairs the subcommittee that held the hearing.

Agencies are also revamping existing programs to meet Biden’s asks.

The Agriculture Department is working to expand its Conservation Corps, an environmental stewardship program that includes 10,000 young people and veterans annually, to include “climate-smart agricultural programming,” a spokesperson said by email.

“Here at home, we have to do our part or we will not be able to make the kind of worldwide change that climate change demands,” domestic climate chief Gina McCarthy told reporters at a news conference in late January.

—With assistance from Megan U. Boyanton, Shaun Courtney, Dean Scott, Shira Stein, Stephen Lee and Ellen M. Gilmer.

To contact the reporters on this story: Courtney Rozen in Washington at crozen@bgov.com; Aaron Kessler in Washington at akessler@bloombergindustry.com

To contact the editors responsible for this story: Bernie Kohn at csaenz@bloombergindustry.com; Cheryl Saenz at csaenz@bloombergindustry.com

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