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GOP’s House Majority Complicates Podesta’s Climate Spending Role

Nov. 18, 2022, 10:30 AM

Clean energy czar John Podesta’s task in overseeing $369 billion under the climate and tax law got several degrees tougher now that Republicans have won control of the House—and the power to closely scrutinize his office.

A lack of trust from Republicans could throw sand in the gears of the Biden agenda, which seeks to cut emissions by 40% over the next eight years through a combination of tax credits and investments in solar panels, batteries, and other green technologies.

Making the road ahead potentially trickier for Podesta, senior adviser to the president for clean energy innovation and implementation, is that he’s already a divisive figure. Opponents see him as the ultimate Washington insider, having served in high-ranking roles for the last three Democratic presidents, and as the tip of the spear for Hillary Clinton’s 2016 presidential bid against Donald Trump.

“John’s going to have to bend over backward to show that clean energy has value to the entire country, including red states,” said Paul Bledsoe, who worked closely with Podesta as director of communications for the White House climate change task force under President Bill Clinton. “He’s got his work cut out for him.”

A White House spokesman declined multiple requests for details on Podesta’s role beyond those in President Joe Biden’s September directive. But in a November 2021 podcast hosted by the Center for American Progress—the left-leaning think tank he founded—Podesta pushed back on his critics.

“Always, in the past, the skeptics have said, ‘When you try to address the environment, when you try to clean up pollution, you’re going to cost jobs, you’re going to burden the economy, et cetera,’” Podesta said. “That’s always been a big lie.”

GOP Scrutiny

Several House Republicans now in line for leadership positions have already signaled their intent to investigate the spending under the climate and tax law known as the Inflation Reduction Act (Public Law 117-169).

Rep. Cathy McMorris Rodgers (R-Wash.), who will likely become the new chair of the House Energy and Commerce Committee, said in announcing the hiring of a new chief counsel last month, “We have a full agenda to hold President Biden and his administration officials accountable for how they’ve shut down American energy.”

To Sean Moulton, senior policy analyst at the Project on Government Oversight, GOP threats underscore how critical it is for Podesta to ensure the money is spent wisely.

“Their biggest goal is to make sure, despite whatever political accusations are made, that there is no scandal,” he said. “There almost certainly will be some fraud that goes on, some waste that happens. To some extent, it’s unavoidable. But it’s about minimizing it.”

No Playing Favorites

There’s little evidence so far that Republican states don’t want government climate funding, according to Ali Zaidi, Biden’s new national climate adviser. He noted that all 50 states have submitted plans to the Biden administration to build electric vehicle charging under the infrastructure law.

Another tranche of climate funding went out earlier this month, when the White House announced $53 million for 132 community air pollution monitoring projects across the country, funded by both the climate bill and the Covid-19 stimulus package.

But only 29.9% of that funding went to states that voted Republican in the 2020 presidential election, not counting a small number of joint awards that went to both red and blue states.

The discrepancy is almost certainly a function of either the number of grant applications EPA received from different states, or the quality of the applications—not political calculations, according to Kevin Minoli, former EPA acting general counsel and principal deputy general counsel and now a partner at Alston & Bird LLP.

Bledsoe said he doesn’t envision Podesta playing favorites with the funding—if only because doing so would undermine Democrats’ long-term argument that clean energy is a reliable technology that can create jobs across the nation.

“It’s incumbent on the administration to show that this legislation will be administered in a bipartisan manner,” said Bledsoe, now a professorial lecturer at American University’s Center for Environmental Policy.

Minoli agreed, saying that, if anything, the incentive for Podesta would be to send resources to states that are less welcoming to the administration.

Getting projects funded quickly and delivering benefits to voters will be an important part of Podesta’s job for galvanizing support in future elections, too, said Trevor Higgins, acting head of the energy and environment group at the Center for American Progress, a left-leaning think tank that Podesta founded.

One place where Podesta could be most effective would be to act as a central clearinghouse for the climate law’s many tax credit provisions, coordinating policy in categories like hydrogen, carbon capture, and wind and solar component manufacturing, said Hunter Johnston, a partner at Steptoe & Johnson LLP who specializes in energy and tax policy.

‘Eyebrow-Raising Choice’

Even some of Podesta’s allies said they were surprised the White House picked him, given his political background.

“It was an eyebrow-raising choice,” Bledsoe said.

But outside of tough congressional oversight, Podesta may not encounter excessive friction on a day-to-day basis because most of his job will involve working with Democratic-led federal agencies, Moulton said.

Both Bledsoe and Moulton agreed that Podesta’s hiring gives the White House a highly experienced manager with countless connections across the nation.

“When you bring in someone with the visibility, clout, and experience of someone like Podesta, you’re making it clear to the agencies that this is someone who the president wants you to listen to,” Moulton said. “Putting someone of this stature in charge means he’ll be able to cut through the red tape and get these agencies to understand that there are expectations.”

—With assistance from Courtney Rozen.

To contact the reporter on this story: Stephen Lee in Washington at stephenlee@bloombergindustry.com

To contact the editor responsible for this story: Chuck McCutcheon at cmccutcheon@bloombergindustry.com