For clean-energy advocates in the US, the past three months have been spectacular.
The Presidential transition from an outspoken critic of renewable energy to an ardent fan has been thrilling. Senator Chuck Schumer ascending to Majority Leader, Rich Glick becoming chair of the Federal Energy Regulatory Commission (FERC), and President Joe Biden appointing clean-energy leaders like Gina McCarthy, John Kerry and Janet Yellen to senior administration positions added further excitement.
President Biden’s early executive orders on rejoining the Paris Agreement and canceling the Keystone XL oil pipeline, and his signaling of an infrastructure proposal featuring clean energy provisions and a limitation on oil & gas development in Alaska’s Arctic National Wildlife Refuge demonstrated his commitment to aggressive clean-energy commitments.
On Wednesday, President Biden signed an additional series of executive orders all focused on climate change and environmental justice. This impressive list included setting a target of protecting 30% of America’s lands and waters by 2030, creating a new task force of 21 agencies and departments to co-ordinate a government-wide approach to climate change, and launching a series of efforts to assist disadvantage communities in responding to climate and environmental injustice, among other orders.
With these and other announcements, the US is now articulating a strong and appropriate clean-energy vision and has leaders that are experienced at getting the job done. Environmental groups and clean energy trade associations are writing glowing press releases welcoming the new President and Senate. This is the launch, as many said, of a new era. To buttress these words, American Clean Power Association released a report by Wood Mackenzie that showed a scenario that averaged 60GW per year of renewables deployed in the 2020s!
So, what could go wrong?
The reality is that public policy wheels move slowly, and the opponents of clean energy have not gone anywhere. In fact, all the tools that we used over the past four years to limit the damage by President Donald Trump and his supporters in Congress are going to be deftly deployed by those same opponents of clean energy.
Let’s start with the obvious: the November 2022 House and Senate elections are already underway. With close margins in both chambers of Congress — particularly in the Senate, where the 100 seats are split 50-50 between Democrats and Republicans, with Vice-President Kamala Harris able to cast the deciding vote — those that oppose clean energy are already making clear their opposition to a green agenda.
For example, while a few moderate Republicans like Senators Mitt Romney, Susan Collins and Lisa Murkowski might be willing to cross party lines, there are not the votes to overcome the 60-40 filibuster for a clean-energy infrastructure package.
While the budget reconciliation process can allow the Senate to move an infrastructure or clean-energy bill with only 51 votes, this is by no means guaranteed due to the presence of the independently minded moderate Democratic Senator Joe Manchin, a former coal broker who represents the otherwise very Republican coal-rich state of West Virginia.
Regarding regulations, there remain significant challenges in permitting interstate transmission, competitive barriers in the federally regulated regional transmission organization (RTO) markets, permit challenges for eagles, migratory birds and endangered species impacts, cumbersome National Environmental Policy Act (NEPA) reviews for siting renewable projects on public lands, and growing conflict with Federal Aviation Administration (FAA) radars that will limit onshore wind.
While the Biden administration and FERC have signaled their interest in addressing these challenges, such regulatory processes and improvements take years to implement and can be subject to significant subsequent litigation from, you guessed it, opponents of clean energy.
Fortunately, outside of government policy, the economic fundamentals of clean energy remain strong. Prices for wind, solar and storage are all declining and make clean energy the cheapest source of new energy in many parts of the US. As well, corporate demand for clean energy is growing, even if 2020 saw a minor dip in corporate power-purchase agreements (PPAs).
So, over the long term, clean energy remains a great business. However, the giddy enthusiasm of the past few months will be tempered with the cold reality of politics and the cumbersome, unpredictable transition of public policy.
We will make progress but think of it as incremental progress, rather than revolutionary progress. I am sorry to be the one to say this, but it’s time to wake up from a nice dream and rejoin political and policy reality.
Tom Kiernan was, until recently, the CEO of the American Wind Energy Association and was previously the President of the National Parks Conservation Association.