Robinson Meyer | The Atlantic

The World Could Be Entering a New Era of Climate War

2022-11-23T11:18:00-05:00

Back in 2015, when I started covering climate change, climate war meant one thing. At the time, if someone said that climate change posed a threat to the world order, you would assume they were talking about the direct impacts of warming, or its second-order consequences. Analysts and scholars worried over scenarios in which unprecedented droughts or city-destroying floods would prompt mass migrations, destabilizing the rich world or giving rise to far-right nationalism. Or they worried that a global famine could send food prices surging, triggering old-fashioned resource wars. Or they fretted over social science showing that weather fluctuations could lead to revolutions and civil wars.

The world of 2015 is not the world of 2022. Countries have made remarkable progress averting worst-case climate scenarios since then: Canada taxes carbon pollution, Europe has its Green Deal, and the United States somehow passed the Inflation Reduction Act. What’s more, elected leaders have run on these policies and won. Thanks to a global turn away from coal power, the world will likely not warm 9 degrees Fahrenheit by the end of the century, as had once seemed possible.

The success of the past seven years was driven home for me when I saw a German public service announcement last month that added decarbonization to the old Enlightenment trinity: “Demokratie, Vielfalt & Klimaschutz. Du Bist Europa,” it read: “Democracy, diversity, and climate protection. You are Europe.” What a victory. And what a complicated one. Since 2015, the risks of climate war have not entirely decreased. Instead the risks have shifted. As more countries have integrated the energy transition into their economies, a chance now exists that efforts to address climate change could encourage conflict in their own right.

This shift has not happened intentionally, to be clear. It’s the result of a process that climate advocates, to their credit, were among the first to note: that batteries, renewables, and zero-carbon energy are the next rung on the technological ladder. Climate hawks have rightly celebrated the news of Ukrainians using ebikes and electric drones for recon or to raid Russian tanks. But that only drives home that these innovations are “dual use”—they can be deployed in civilian and in military contexts, and thus are non-optional for countries pursuing their security.

Conflict over dual-use technologies is already at the center of U.S.-Chinese trade spats. Last month, the Biden administration effectively banned the sale of any modern semiconductor-manufacturing equipment to China. It also forbade “U.S. persons”—a group that comprises American citizens and green-card holders—from working in the Chinese semiconductor industry. As Eric Levitz writes in New York magazine, the policy amounts to a type of economic war, because “it is now official U.S. policy to prevent China from achieving its development goals.”

This is a dangerous logic when you consider that semiconductors are crucial for decarbonization: The shift to electricity all but necessitates greater use of semiconductors. Computer chips govern nearly every part of how electric cars, scooters, water heaters, induction stoves, and more use energy or preserve it. One of the major ways that electric-vehicle makers secure a competitive advantage is by eking out tiny improvements from the computer chips and software that govern a car’s battery pack. Now, the type of semiconductors affected by Biden’s policies is far more advanced than the cheaper kind needed for decarbonization. But you can see how trying to prevent the other country’s development can cascade from an economic disagreement into a military one.

Part of what makes this dynamic tricky to manage is that the U.S. and China are productively using climate policy as a venue for their own diplomatic competition. Perhaps the most important international climate announcement of the past few years was President Xi Jinping’s pledge that China would aim to reach net zero by 2060. He announced the goal less than 2 months before the 2020 U.S. presidential election, and it was widely understood as a “pointed message” for—if not a rebuke of—the United States and the Trump administration. “It demonstrates Xi’s consistent interest in leveraging the climate agenda for geopolitical purposes,” Li Shuo, a Greenpeace analyst, told The New York Times then.

Competition has improved American policy, too. Thanks to the Inflation Reduction Act—a law that passed in part because American legislators did not want to cede the clean-tech industry to China—the United States is about to subsidize domestic solar-panel manufacturing at a massive scale. It’s possible that a decade from now we will have more cheap solar panels than we know what to do with. And while that may cause substantial economic deadweight loss, it’s probably good, on net, for the climate. If geopolitical competition leads America to subsidize a solar industry, then competition is probably helping climate action, not hindering it. Flooding the world with cheap solar power will not only speed up decarbonization, but also push companies to find new and creative ways to use solar panels.

The most likely trigger—possibly the only trigger—of a full-blown war between China and the United States remains Taiwan, but we should be attentive to how conflict over trade, even when it emerges from politicians’ virtuous desire to have a domestic clean-tech industry, can degrade relations between countries and push them toward zero-sum thinking. And the greatest risk from mitigation-fueled violence is not, we should be clear, to citizens of America or China or Europe. Over the past month, the Democratic Republic of Congo has seen its heaviest rebel fighting in a decade as groups allegedly backed by Rwanda try to lay claim to the country’s minerals, The Wall Street Journal recently reported. Congo produces two-thirds of the world’s cobalt and has the largest reserves of tantalum, a metallic element used in capacitors.

At the same time, the old idea of a climate war has not vanished either. The past year has shown how much climate impacts, such as drought, can drive up the price of key commodities, fueling inflation in the rich world and food shortages elsewhere. Conventional energy sources, such as fossil fuels, are far more likely than renewables or climate technology to trigger such a conflict, Dan Wang, a technology analyst at the China-based economic-research firm Gavekal Dragonomics, told me. China remains dependent on oil and natural gas from abroad; the U.S. has become a large and growing exporter of natural gas to the country. Were the U.S. to cut off those exports—as it did with oil to Japan in the run-up to World War II—then the risks of a bigger conflict could be far graver.

For years, climate advocates argued that their issue deserved to be at the center of economic and social policy making. Climate is everything, they said. Well, to a degree, they won: Decarbonization is now at the center of how the U.S., China, and Europe conceive of the future of their economies. Climate advocates have won a seat at the table where the life-and-death matters of state and society are decided. What progress the world has made; what a long way we still have to go.

Wait, Why Wasn’t There a Climate Backlash?

2022-11-16T10:59:00-05:00

There should have been a climate backlash.

A week out, that’s what’s most astonishing about the midterm elections. During previous administrations, voters penalized congressional Democrats for even trying to pass a climate bill. That’s what happened in 1993 and 2009. This time, Democrats actually did it with the Inflation Reduction Act, and then it turned into the best midterm performance for a party in power in a generation.

As I wrote last week, that Democrats stopped a red wave is excellent news for climate policy itself. With control of the Senate, President Joe Biden will be able to appoint and confirm nominees and judges, allowing him to implement the IRA as planned. He will also have a stronger hand in budget negotiations. But I’m still wondering: Why was there no backlash?

Let’s set aside what might be the most likely explanation—that voters were focused on other issues this year, or that Republicans nominated such extreme candidates for the Senate that voters overlooked the IRA and voted for Democrats anyway. The GOP barely made an issue of the IRA, almost never mentioning it in attack ads, preferring instead to focus on inflation and crime. Still, that suggests something worked about the IRA that didn’t work about earlier climate proposals. What was it? I’ve come to think that three aspects of the law—and the campaign to pass it—helped differentiate it.

First, Democrats need to thank Joe Manchin. For most of Biden’s presidency, Manchin was the archvillain of the climate process: He killed the Build Back Better Act, which fused the president’s original climate goals to a messy set of new domestic programs, not once, but twice. In July, I wrote that Manchin’s fickleness at the negotiating table was setting America up for catastrophe. Yet when he finally settled on a deal, he defended it, and his long opposition to climate policy bestowed an aura of moderation on the IRA. The public never thought the IRA was radical in part because it was Manchin’s bill.

But second, Manchin should thank Democrats, too. If Manchin provided political cover for the party, then the party returned the favor and gave policy cover for Manchin. The idea underpinning the IRA—that climate policy should aim to lower the cost of clean energy and create new, pro-decarbonization coalitions within the United States—proved politically far less harmful than the older idea that climate policy should aim to make fossil fuels more expensive.

The third and perhaps most important reason the IRA did not face a backlash is that the other half of Biden’s energy policy has given the law cover. Biden has made enterprising use of the Strategic Petroleum Reserve, or SPR, the U.S. government’s strategic stockpile of oil that it can distribute in an emergency or if supplies are interrupted. Starting in April, after gas prices surged during the Ukraine war, the government released an average of about 1 million barrels a day from the reserve, the largest and fastest sale of supplies from the stockpile ever.

In June, gas prices hit an all-time high, and then they steadily declined throughout the summer. Although these releases are not solely responsible for the decline, they have helped accelerate the downward slide. Last month, the White House announced the second and more important aspect of this policy, which is that the government will refill the reserve at a price guaranteed to generate a small profit for U.S. oil companies. Until the government runs out of space in the SPR, this will help place a floor under global oil prices, giving drillers the confidence to expand production.

Although Republicans have tried to attack Biden over these releases, they haven’t hit the mark. That’s in part because … what would they criticize? If Americans are upset about gas prices being so high, shouldn’t Biden go out of his way to bring them down? Some moderate Republicans even called for Biden to adopt a similar strategy in March.

In the simplest sense, Biden’s use of the SPR allowed moderate Democrats to say that they support expanding oil and gas drilling or lowering costs while still backing Biden’s far more important climate policy. Using the SPR as an insurance policy is one of the policies that Representative Jared Golden of Maine, for instance, called for after Russia invaded Ukraine. Golden later voted for the IRA, but framed it as one more policy among many to lower energy costs—all kinds of energy costs. He was just reelected in a district that leans 10 points toward Republicans.

It turned out that addressing energy costs now allowed Democrats to take the most ambitious steps ever proposed to cut long-term fossil-fuel demand. It’s notable what an act of defiance Biden’s energy policy is. That the president could even try managing gas prices reflects a shift away from political wisdom. In 2012, the University of Chicago Booth School of Business surveyed 41 economists about whether federal policy affected gasoline prices more than market forces did. (This was seen as a proxy for: Can the president do anything about gas prices?) Not one said yes.

Yet here is Biden, doing it, and it may have helped save him. What’s more, voters vindicated those efforts at the polls. To the degree that politics is what you can get away with, Biden has managed to successfully nudge down gas prices while preserving power to pass more aggressive climate policy.

This is perhaps the most reassuring lesson of the midterms. Managing the energy transition is going to be really hard. Here’s one example: Global oil demand is set to plateau in the 2030s, according to the International Energy Agency. During that time, the world’s transportation sector will still depend on oil, but for the first time in the roughly 160-year-old history of the oil industry, nobody will want to risk producing too much of it. Oil companies have no experience running a business when global liquid-fuel demand is plateauing, much less falling—but they will have to learn.

And that is only one challenge. New factories will have to open; demand for certain minerals will explode. These are going to be unprecedented changes, and they will likely cause some volatility and backlash, both in politics and the economy. What Biden’s energy balancing act suggests is that these bumps in the road can be managed as long as politicians understand what the economy needs—to fight climate change in the long term and to manage costs in the near term—and deliver.

The country isn’t doomed to endless thermostatic backlashes: When policy is designed cannily and attentively, it can avoid political blowback. That’s maybe the most hopeful takeaway of them all.

America Just Shrugged Off Biden’s Big Climate Law

2022-11-11T13:57:00-05:00

Probably the best day for climate action in American political history was August 7, 2022, when the Senate overcame 30 years of sclerosis and passed the Inflation Reduction Act, the country’s first comprehensive climate bill. After that day, the bill’s adoption into law was all but assured, and it sailed through the House and reached the president’s desk.

But perhaps the second most important day for American climate policy was this past Tuesday. Democrats’ surprisingly strong showing in the midterm elections will prove to be a landmark in the history of how the country has handled global warming. It will help ensure that the IRA can transform American industry and boost renewables, electric vehicles, and other sources of zero-carbon energy. There will still be bumps on the road to implementing the law, of course. And Biden’s policy may yet prove insufficient to the task of reducing carbon pollution. But the game has changed nonetheless. American climate policy will never be the same.

Why is that? Well, first, because Democrats bucked the cardinal rule of American politics—that the president’s party almost always hemorrhages seats in the House in its first midterm election: Republicans lost 41 seats in the 2018 midterms, for instance, and Democrats lost 63 seats in 2010. Although control of the House is still being decided, the most likely outcome as of this writing is that Republicans will win a tiny majority, perhaps as small as one seat. That majority will be wobbly, and the new speaker of the House will have very little margin for error.

Democrats, meanwhile, seem likely to retain control of the Senate, perhaps even growing their majority by a seat. There’s more precedent for that in the midterms: The GOP successfully defended its Senate majority in 2018 as well.

The significance of these two results—the first a spiritual victory for Democrats, the second a literal one—becomes clear once you fit it into the broader sweep of American environmental history. Since global warming became a national issue in the late 1980s, Democrats have struggled to fight it without facing electoral blowback. In 1993, President Bill Clinton tried and failed to pass a “BTU tax,” a surcharge on energy production that would have boosted renewables and resembled a carbon tax in some ways. That proposal never became law—it passed the House and died in the Senate—but many lawmakers who voted for it got tossed in the 1994 midterms anyway. In 2009, a Democratic House majority again considered the pro-climate cap-and-trade bill. That proposal, too, passed the House, died in the Senate, and then cost some House members their seats anyway.

The IRA had already defied the examples here, of course, because it passed into law. But its passage also appears to have not cost Democrats in the midterms. That sets the IRA apart not only from previous climate proposals but from previous laws of all sorts. The 2010 and 2018 midterms were powered in part by public revolt at the incumbent president’s major piece of legislation: the Affordable Care Act in the first case and President Donald Trump’s tax-reform bill in the second. Yet voters did not rise up in the same way against the IRA, even though it is at least as central to Biden’s legacy as tax reform is to Trump’s. As E&E News noted last week, relatively few GOP ads even mentioned the IRA in the run-up to the election.

The climate law did not appear to hurt Democrats even in particularly rural or fossil-fuel-dependent areas. Look at New Mexico, for instance, which recently supplanted North Dakota as the country’s No. 2 oil-producing state. Going into the election, the state was represented in the House by two Democrats and one Republican, Representative Yvette Herrell, who came from the state’s oil-rich southeast. Voters not only reelected the two Democrats (both of whom had backed the IRA) but replaced Herrell with a Democrat (who got some help from a friendly gerrymander). Or look at Colorado’s Eighth District, comprising Denver’s north suburbs and much of the state’s oil country, where the Democrat Yadira Caraveo eked out a win against the Republican Barbara Kirkmeyer.

The party also likely held on in Maine’s rural Second District, one of only eight Democratic-held districts nationwide that backed Trump in 2020. The incumbent Democrat there, Representative Jared Golden—who rejected earlier climate proposals but voted for the IRA—seems to have won reelection.

The IRA’s lack of electoral penalty is only part of the good news for Biden. The fruits of the election—likely a fractious Republican House and a narrowly Democratic Senate—will significantly boost the president’s ability to implement climate and energy policy in his second term.

Over the next two years, the Biden administration will implement the IRA, translating its tax credits into policy and instituting new programs in the Department of Energy and the Environmental Protection Agency. His party retaining control of the Senate means that Biden will be able to staff and run the government as normal, submitting judges and executive-branch nominees for confirmation for the duration of his term. And if the slim Republican majority in the House is especially ungovernable, that will give Biden even more clout in budget negotiations to push for more climate funding.

He will also be better able to defend the IRA itself. By 2024, the IRA will be harder to undo—it will already have led to the construction of more hard infrastructure and even subsidized new factories across red states, getting “steel in the ground,” as Ali Zaidi, Biden’s domestic climate czar, says.

A few weeks ago, the investment bank Credit Suisse published a report saying that if the IRA was implemented successfully, it could unleash more than $800 billion in spending and turn the U.S. into the world’s “leading energy provider.” The midterm election was the great threat to that outcome. Now the threat has passed.

The Paris Agreement Is Working … For Now

2022-11-09T12:07:00-05:00

This week, tens of thousands of diplomats, activists, and world leaders are gathering in Sharm el-Sheikh, Egypt, for the annual United Nations climate summit, known as COP27. They’re meeting to discuss the ongoing implementation of the Paris Agreement, the global climate treaty that was finalized in 2015. The key issue is likely to be the pact’s “loss and damage” provisions—diplomatic shorthand for whether rich countries, which have emitted the bulk of carbon pollution into the atmosphere, should reimburse poor countries facing climate-change-intensified disasters. It’s one of the most controversial issues at the climate talks, and negotiators have kicked it down the road at each of the past handful of UN negotiations.

But the talks will also refocus attention on the Paris Agreement more broadly, and the international process that it jump-started seven years ago. The treaty, which is voluntary and nonbinding, has never been particularly revered: Many climate activists believe it doesn’t go far enough—its text doesn’t even mention fossil fuels, which cause climate change, by name—while climate-change-doubting politicians have demonized it. Yet its apparent mediocrity has hidden an important story that has played out slowly over the past few years. The Paris Agreement process seems to be working … at least for now.

Let’s refresh how the main process of the Paris Agreement is supposed to work. Every few years, each country makes a new pledge about how much it will cut emissions. A few years after making their pledges, negotiators gather at COP for a “global stocktaking” of how they did. There’s no penalty for not hitting your target; the only punishment is getting “named and shamed” by other attendees, nonprofits, and the press. Then the cycle restarts, and countries make new, more ambitious pledges. This current conference is taking place in an “off” year for this cycle, when negotiators hash out other parts of the Paris Agreement or revisit other climate commitments.

There’s no particular reason to think that the process should work. The Paris Agreement is little more than a global procedural requirement—a voluntary commitment by every country in the world to do the same homework assignment. And it is not how earlier international environmental treaties worked. The Montreal Protocol, for instance, which successfully phased out the use of ozone-depleting pollutants, worked by imposing a de facto command-and-control scheme across the global economy, limiting how much of certain chemicals could be made and how they could be traded.

But the world has made more progress on climate change over the past few years than it did in the 25 years prior. As David Wallace-Wells recently noted in The New York Times, the world has significantly reduced the possibility of some of the most catastrophic climate outcomes. That’s partially because of technological improvements in wind, solar, and batteries. But it’s also because of a new urgency in how climate change has been discussed since 2015, and since 2018 in particular. You can see the urgency nearly everywhere you look: Since 2020, China has committed to its first net-zero target, the United States has passed the first substantive climate legislation in its history, and the European Union has committed at least 1 trillion euros to a new vision of its economy that it calls the “European Green Deal.”

Why is that? This is going to sound weird, but so far the Paris process is managing climate change because it has created a space to manage climate change. It has made a zone of peaceful competition, collaboration, and one-upmanship that stands apart from the rest of international politics. Consider that when the U.S. announced it would withdraw from the Paris Agreement at the beginning of the Trump administration, climate advocates worried that the treaty process would fall apart and other countries would pull out. Yet it did not, and they did not.

If anything, the process was stronger when the U.S. rejoined last year. That’s partially because mayors, blue-state governors, and some of the country’s largest companies went into overdrive to hold up the spirit of the pact, but it’s also because the rest of the world used Trump’s departure as an opportunity to show up Trump. And as the political scientists Michaël Aklin and Matto Mildenberger have observed, it’s also because the Paris process—and the COPs themselves—allow pro-climate-action groups in each country to coordinate with pro-climate-action groups in other countries. (This often happens through the trade or finance-related talks that happen off to the side of the conference.)

Watching the Paris talks play out, I’ve started to wonder if they meet the philosopher and polymath Nicholas Nassim Taleb’s definition of antifragility—systems that get stronger as they are subjected to shocks and volatility. And yet, it’s possible that for all that the Paris Agreement has done, we’ve now reached the high point for the treaty. Countries, after all, are starting to tackle the trickiest issue at COP—the issue of loss and damage, or as former U.K. Prime Minister Boris Johnson derisively called it on Monday, climate “reparations.” The treaty process is only antifragile as long as countries have something to collaborate on; if parties or movements in several large countries decide they want nothing to do with climate action, then it could wither.

That possibility got likelier after last night’s midterm elections in the U.S. The red wave did not materialize, but the GOP could still win a robust trifecta, giving it control of the White House and both chambers of Congress, as soon as 2024. Even another American withdrawal—or a U.S. attempt to defund certain UN agencies—might not be enough to disturb the Paris process. But combined with an anti-climate or far-right turn elsewhere in the world—in China, perhaps, or Europe—then it might be enough.

Climate-related pledges work only when some plurality of the world’s largest polluters get together to make them. The U.S., as Republican politicians continually remind us, emits only a fraction of the world’s annual carbon pollution. But were it to depart Paris along with China and several European countries, then it could do real damage. Earlier this year, I said we might be in a golden age of climate action. But Eden only seemed like Eden after the Fall.

A Republican Congress Is Coming for Biden’s Climate Wins

2022-11-02T11:04:00-04:00

Let’s get right to it: Come January, Republicans are likely to control both houses of Congress. The signs are lining up. After a summer when Democrats saw glimmers of hope—and when they seemed likely to retain the Senate—the light has faded. GOP control of the House of Representatives seems all but assured, and as of yesterday, prediction models suggest that the Senate will tip as well.

If history is any indication, a Republican Congress could spell doom for climate policy. Since the early 1990s, when the GOP took a turn toward climate-change denialism, the party has been one of the world’s top enemies of climate policy. For years, it was one of the few major political parties in a developed country that rejected the reality of human-caused climate change. When Republicans won the House in 2010, two years into Barack Obama’s presidency, it set back American climate politics for years, putting a generation of open climate-science doubters in Congress. They tried to fire White House climate advisers, hectored environmental officials, shut down the House’s global-warming committee, and doomed what had been a bipartisan effort to tax carbon pollution.

Of course, plenty of congressional Republicans—more than 130, by one count—still deny the reality of human-caused climate change. But some members of the party claim that they’ve evolved since then. This year, House Republicans unveiled a new Conservative Climate Caucus that, in a fascinating circumlocution, sort of recognizes that fossil fuels are causing the planet to warm. (“The climate is changing, and decades of a global industrial era that has brought prosperity to the world has also contributed to that change,” the group has said.) The caucus now has 74 members, including Representative Frank Lucas of Oklahoma, who is likely to lead the House Science, Space, and Technology Committee next year. Lucas has called “the need to address global climate change” one of that committee’s “two most immediate challenges.” (Not that he’s a dyed-in-the-fleece environmentalist: He also has a 5 percent lifetime score from the League of Conservation Voters.)

So what will this new Republican Congress actually mean for climate policy? Three factors will help determine what could happen next.

First, and most crucial, the party will want to own Joe Biden—to defeat him, humiliate him, smash his presidency into bits. As my colleague Barton Gellman has reported, the House might impeach Biden at some point in the next year, simply because its rhetorical groundwork will leave it no other choice.

These same dynamics seem likely to all but force the party to target the president’s climate policy as well, because climate policy has been so central to Biden’s presidency. The president’s three big bills—the bipartisan infrastructure law, the CHIPS and Science Act, and especially the Inflation Reduction Act—cement emissions reduction as a core goal of American economic policy. On the face of it, you would expect Republicans to attack these policies and the officials implementing them. Many Republicans will want to turn the IRA, which got zero Republican votes, into Biden’s Obamacare: a legislative boondoggle that stands for the broader problems of his presidency. The IRA funds two public-financing agencies to help create more green industry in the U.S. Both will be natural targets of aggressive, and even destructive, Republican oversight in the coming Congress.

[Read: It wasn’t just oil companies spreading climate denial]

But that will be tricky because the public doesn’t seem to hate the IRA like it disliked the Affordable Care Act. Republicans will also have to navigate that the IRA isn’t so far from the climate policies that they have recently mooted; certainly, it’s much closer to their views than Obama’s 2009-era climate policies were. In 2011 and 2012, for instance, conservatives hammered the Obama administration for making a high-profile $535 million loan to the solar-panel manufacturer Solyndra, which later went bankrupt. The episode represented all the failures of liberal economic planning, Mitt Romney said on the presidential-campaign trail: Democrats used taxpayer money to pick winners and losers in the economy, and those winners didn’t even succeed.

But since then, Republicans have warmed to similar industrial policies because they will, at least in theory, help the American economy better compete with China’s. “We need capitalism,” Senator Marco Rubio of Florida said last year. But “in those instances in which the market’s most efficient outcome is one that’s bad for our people, for our national security, for our national interest, bad for America—in those instances, what we need is targeted industrial policy to further the common good and to protect our people, our country, and our future.” It’s also clear now that Solyndra failed in part because China’s policies enabled its own factories to spit out solar panels far more cheaply than U.S. factories could.

The second factor is that economic incentives will pull the party in two directions. The GOP has historically been close to the fossil-fuel industry: Since 1990, more than two-thirds of the oil-and-gas industry’s donations to candidates and party committees have flowed to Republicans, according to the watchdog group OpenSecrets. There’s no reason to expect that trend to slow.

But the green transition is also a windfall for rural areas, and that means—given the country’s increasing urban-rural polarization—it’s a windfall for Republican districts. As the analysts Liam Denning and Jeff Davies have shown, most of the country’s new zero-carbon energy infrastructure is getting built in securely GOP districts. For instance, Kevin McCarthy, who in all likelihood will be the next speaker of the House, actually lives in the country’s No. 1 district for planned and operating grid-scale battery projects. Nine of the 10 congressional districts with the most planned or operating renewable capacity, in fact, are held by Republicans. This concentration will only intensify as the IRA pumps more money into zero-carbon infrastructure. Ford’s four new electric-vehicle and battery factories, for instance, are being built in deep-red Kentucky and Tennessee.

For this reason, Credit Suisse analysts concluded in a recent report that the GOP is unlikely to repeal the IRA even if it clinches a trifecta in 2024. The question in the short term is whether that political concern changes the party’s oversight agenda.

[Read: The climate economy is about to explode]

Finally, the party has long-term electoral concerns to consider. Combatting climate change is far more popular than it was in 2010. “Obviously McCarthy wants to win the midterms and become the speaker of the House, but he also understands that if he wants a longer-term majority for Republicans, then climate change and environmental issues broadly have to feature as a part of the party platform,” Christopher Barnard, the policy director of the American Conservation Coalition, told me. That group has helped establish new pro-climate GOP efforts, framing its work as crucial to reaching the voters of the future, including women, independents, and younger voters.

Perhaps the most catastrophic outcome for the climate is not that the GOP targets Biden’s climate policy, specifically, but that it takes aim at his whole administration through budgetary showdowns or by letting the government lapse into endless shutdowns. That would sap some of Biden’s power, and some of his precious days in office, to implement the IRA’s important tax provisions.

There are lots of good reasons—economic, political, and electoral—that it might be unwise for Republicans to try to smash Biden’s climate policy. But they may pale in comparison with what’s virtually certain to be the supreme goal of any Republican majority: opposing Biden by any means possible.

The Climate Art Vandals Are Embarrassing

2022-10-27T13:29:44-04:00

Earlier this month, two young people visiting room 43 of the National Gallery in London shed overcoats to reveal T-shirts printed with the name of their activist group, JUST STOP OIL. Then they poured tomato soup across one of Vincent Van Gogh’s sunflower paintings, turned around, and glued their hands to the wall. “What is worth more: art or life?” one of the activists asked. “Are you more concerned about the protection of a painting or the protection of our planet and people?”

Then it happened again, and again. Last weekend, two activists associated with Letzte Generation, a German climate-activist group, splattered mashed potatoes across a Claude Monet painting of haystacks on display in the Museum Barberini in Potsdam, and glued their hands to the wall. This morning in The Hague, another pair of Just Stop Oil protesters mixed it up: One activist appeared to glue his own head to Vermeer’s Girl With a Pearl Earring, and the other poured tomato soup over him.

If these protests outrage or upset you, well, that’s the point. As one of the German activists put it: “We are in a climate catastrophe, and all you are afraid of is tomato soup or mashed potatoes on a painting.” The protesters want to piss you off, because, hey, why aren’t you just as pissed off about the climate crisis? Climate activism has entered its shock—or is it schlock?—era.

But set aside that somewhat sociopathic logic for a moment. There’s something poignant and undeniably resonant about the first two incidents in particular, in which activists raised in the 21st century attacked some of the most famous cultural heritage of the 19th century. Climate change, after all, implicates a particular vision of middle-class prosperity—a vision of paved roads, bustling factories, and coal-fired power plants—that took shape in the late 19th and early 20th centuries. And the impressionists, who stood in sunlit fields and on Parisian balconies and captured the feeling of industrial modernity breaking into the world like a yolk from a shell, are as linked to that vision as the automobile. No wonder climate activists, the rebels of this century, are targeting them.

That doesn’t justify the vandalism. Nor does it resemble how the activists themselves have talked about their actions. The aim of Just Stop Oil and Letzte Generation has been to wheedle people for not caring more about the climate crisis. Yet even if one were inclined to defend their tactics—and argue, for example, that the activists showed admirable restraint by choosing to defile paintings that were protected by a pane of glass—the protests still fail on their own terms.

James Ozden, a researcher who runs the Social Change Lab, in London, is one of the most prominent early supporters of the protests. In a widely shared Substack post, he has argued that empirical evidence supports the approach—or at least does not suggest that it is harmful to the broader fight against climate change. Just Stop Oil epitomizes what he calls the “radical flank effect,” “where more radical factions of a social movement can increase support for more moderate factions.” He cites a handful of studies showing that radical flanks may increase donations, mobilization, and political support for the moderate arm of a movement.

But when I looked closely at these studies, they didn’t seem to have much bearing on the soup protests. In an experiment from one of the studies that Ozden mentions, researchers asked online respondents about their views on animal cruelty, had them read accounts of a “radical” and a “moderate” activist group’s views and protest tactics, and then polled them on their views again. The moderate-group account described a campaign of peaceful mass protests against factory farming, and the radical-group account described something far more disruptive: Vegans had blocked traffic and “doused streets and meat-delivery trucks with the blood and entrails of animals slaughtered in factory farms … and in some cases advocated violence against animal farmers.” The online respondents said they thought better of the moderate factions after reading about the radicals. (This is, I should note, not exactly an enthusiastic endorsement of radical tactics.)

Ozden also refers to a study from last year, which included an experiment comparing the effects of two different protests against racist policing. In the first, Black activists held peaceful marches and sit-ins; in the second, “a large portion of the African American community” refused to pay tickets and fines to the police. The study found that white people who identified strongly with being white were more likely to endorse concessions to the movement after reading about the latter protest. The lesson of both studies, according to Ozden, is that a mix of disruptive and conventional protest tactics can work better—in the sense of increasing support for the broader cause—than the standard activist repertoire of demonstrations, sit-ins, and marches can alone.

But even if we stipulate that finicky social-science experiments have something to tell us about politics, Ozden isn’t making the point that he thinks he is. In the experiments described above (and in almost all of the others cited in his blog post), the “radical” activists directed their aggressive and even violent tactics toward the group causing their grievance. The animal-rights radicals targeted meat and leather producers, for instance, not elementary schools. The Black activists went on a ticketing strike against police departments, not the IRS. And the radical climate activists in another experiment advocated for violence and vandalism against fossil-fuel companies, as opposed to impressionist painters, museum curators, or members of the art-viewing public. (Even before the mashed-potatoes-on-Monet incident, Ozden wrote a follow-up post recognizing that the first protest may have lacked an “action logic”—a harmony of tactics and target that would help onlookers understand its nature and purpose. “I’m quite unsure if it was overall good or bad for the climate movement,” he wrote.)

This lack of connective logic has irked many otherwise sympathetic climate advocates. “Regardless of whether you think protests like this are effective or not—and as a climate scientist, I’ve spent 30 years on this issue, so my sympathies are with the protesters, of course—I find it weird to target museums and nonprofits that help all of us,” Jonathan Foley, the executive director of the climate nonprofit Project Drawdown, told me. Foley is an influential environmental scientist who has studied the planet’s ecological boundaries and deforestation, but he also knows something about museums: From 2014 to 2018, he led the California Academy of Sciences, in San Francisco, one of the largest science museums in the world. And the protests worry him.

It’s true that the targeted paintings were protected by glass panes—but those panes aren’t designed to protect against seeping liquids (or whatever mashed potatoes are), Foley said. They keep out ultraviolet light and dust. Nor are museum-security staff prepared for the challenge of patting down every potential visitor for wayward appetizers, which is what insurance companies will now likely demand, he said. Furthermore, because staging protests at art museums has now happened a few times, he said, every art museum could see its insurance and security costs increase by hundreds of thousands of dollars. Museums may also put paintings—and even sculptures—behind the kind of boxlike cases that today protect only a few world-famous works, such as the Mona Lisa.

“You’re hurting organizations that are often in debt, that are often struggling financially,” he said. And he rejected the connection that some academics have made between the art world and the wealth inequality that fuels climate change: “People say, ‘It’s fancy art for billionaires.’ But no, the billionaires keep their art in their homes, and it’s insured. You’re not hurting them by doing this. You’re hurting the public.” Climate activists and museum workers are “on the same team,” he insisted: They’re both trying to preserve a priceless intergenerational gift for the public. “I don’t understand, in the name of preserving something we cherish, damaging something we also cherish.”

[Read: Just how safe is great art?]

So we don’t know that the protests are effective, and we do know that they’re likely to cause financial problems for many museums. Here I will add my own concern: The activists look so silly. Food-throwers at the targeted museums attached their body to the wall under a painting, or to the painting itself. This required some anatomical logistics: Each activist had to remove a hidden tube of superglue from their pocket or bra, grasp it with one hand and twist off the lid with the other, then carefully squirt out the adhesive. It is awkward to describe; it is even more awkward to behold. There is no dignified way to squeeze a tiny bottle of superglue. Aesthetics matter in politics: Think of Che’s upward-and-to-the-left gaze on a T-shirt; a civil-rights protester’s head held high against police dogs in a black-and-white photo; or even the arc of a Molotov cocktail through the air. The soup-and-superglue movement fails an important test of youthful, radical politics: It does not look cool.

The activists’ stated rationale—that they are calling out the public for caring more about art than the climate—is just as awkward. If you and I were standing next to, say, a tranquilized horse, and you punched the horse, I would probably say, “Stop punching that horse!” I might even try to get you to stop. It would be highly irregular for you to respond, “Why do you care about this horse more than climate change?” The answer is, I do care about climate change, but right now you are punching the horse. Leftists sometimes resent mainstream economists for imagining trade-offs where none actually exist. But that’s exactly what they have done here.

And yet, the kids mean well, right? When you’re thinking about a problem as consequential as climate change, it’s tempting to grade for effort. Well, these activists really care about climate change, and it’s such an important issue … shouldn’t we listen to them? But the story of the past 40 years, the thing that the activists say they resent, is that politicians have claimed to fight climate change for decades and have met only occasional success. Getting angry about climate change is the easy part; actually finding ways to cut carbon emissions, to disrupt the fossil-fuel-powered economy that has dominated since Monet, is something else. The soup protests don’t make sense, aren’t obviously justified by bank-shot social science, and—worst of all—they look bad. Humanity is already doing enough to tarnish its precious inheritance. We don’t need extra help.

China Accidentally Made Our Gas Much Cheaper

2022-10-19T10:57:00-04:00

You’d be forgiven, at this point, for believing in what the MSNBC host Chris Hayes calls the “gas prices monocausal theory” of American politics. Every major political dynamic, every twist and turn in approval polling and legislative possibility, seems driven by whether gas prices are going up or down.

Consider Joe Biden’s presidency. When Biden took office, he was broadly popular, helping the narrow Democratic majority in Congress pass a COVID-19 relief bill and send out $1,400 checks. And in Biden’s honeymoon phase, gas prices were comfortably below $3 a gallon, until May 2021.

You know what happened next: The United States pulled out from Afghanistan as gas prices were already climbing, and Biden’s popularity tanked. When Russia invaded Ukraine earlier this year, oil prices soared. In June, a gallon of gas cost more than $5 in the U.S., higher than ever before in history, and Biden’s approval rating reached a nadir.

But then gas prices began to fall the following month—and the president started ticking items off his to-do list. Congress passed the Inflation Reduction Act, and Dark Brandon became a meme. By late August, gas prices had fallen below $4 a gallon, and according to Gallup, Biden’s approval rating climbed to its highest level in a year. (More recently, gas prices have risen, and Biden’s party looks to be in a worsening position with the midterm elections looming.)

Even if some of this is a coincidence, the power of gasoline prices is hard to overlook. When the numbers on gas-station signs tick up or down, it leads to downstream effects that trickle out across the rest of American society. Naturally, why gas prices have fallen over the past year has garnered a lot of attention—including from me. But one of the biggest reasons for the dip that has corresponded with the best few months of Biden’s presidency has gone underappreciated: China’s policies helped crash global oil prices.

Since March, President Xi Jinping’s aggressive zero-COVID policy has imposed intermittent lockdowns and travel restrictions throughout China, essentially subjecting hundreds of millions of people to house arrest across the country. Those restrictions—plus China’s preexisting economic slowdown—have drastically reduced the country’s apparent demand for oil, easing up the global market in the process. Yesterday, China indefinitely delayed the release of its third-quarter GDP data, an ominous sign that its economy may have deteriorated even more than anticipated.

For many oil-industry specialists, China’s COVID policy “is the boogeyman that encompasses everything,” Rory Johnston, an oil analyst and the author of the Commodity Context newsletter, told me. Although China has aimed to prevent any COVID cases since the pandemic began, its policies became more draconian and widespread in the spring after the more infectious Omicron variant became dominant. At a moment when widespread shortages imperiled the world economy, Xi’s pandemic policies took “a huge amount of pressure out of the global commodity system” by massively crimping domestic demand, he said.

The reason for this crash in demand is quite simple. During the first half of the pandemic, China’s zero-COVID approach was able to keep cases to a minimum through widespread testing and by heavily restricting travel in and out of the country. By August 2020, thousands of people were able to attend a crowded music festival in Wuhan, the Chinese city where the pandemic began, while much of the West was still dealing with the daily threat of COVID.

But even as the rest of the world has gotten vaccinated and effectively moved on from the pandemic, China has doubled down on zero COVID—even after the Omicron variants made it all the more difficult to stop transmission. Hundreds of millions of people—including almost the entire population of Shanghai, China’s most populous city—spent some of the spring locked down. As of last week, nearly 200 million people remained under some form of lockdown in China, according to The New York Times.

The policy has obliterated China’s gasoline use. “If you lock down one-quarter of the country and don’t let them drive anywhere, they will consume less fuel,” Johnston said. One nice thing about the oil market is that it’s really easy to think about. The world consumes about 100 million barrels of oil a day, give or take. Since April, lockdowns have reduced the country’s oil demand by about 2 million barrels a day, or about 2 percent of global oil demand, Johnston said. Earlier this year, before the lockdowns began in earnest, China consumed about 15 million barrels a day, an all-time high, he said. (For reference, the U.S. is the world’s largest oil consumer and uses about 20 million barrels of oil a day.)

The oil market has undergone a global switcheroo: Back in the spring, Johnston expected that about 3 million barrels of oil production would vanish during the war, nearly all of it from Russia. Instead, Russia’s supply remained online, and 2 million barrels a day of Chinese demand vanished. “That was a net swing of 5 million barrels a day, in terms of what we expected and what we got,” Johnston said. “This year was supposed to be Armageddon for oil, and it ended up being Lucy and the football.”

And the lockdowns are unlikely to end soon. Some onlookers had hoped that the Communist Party might loosen the policy after the party congress this year, where Xi Jinping will almost certainly be named to an unprecedented third term as the country’s president. But those hopes appear dashed.

At this point, news of a fresh lockdown or outbreak in China can shift the oil market more than an announcement from OPEC, the cartel of oil-producing countries. Earlier this month, a group including the OPEC countries and Russia announced that it would cut production by about 2 million barrels a day. The move was widely understood as a bid to raise oil prices and a rebuke to the Biden administration. Yet since then, the U.S. benchmark crude price has slightly fallen, in part because of a new COVID flare-up in China. (Gasoline, which is made from refined petroleum, is still getting more expensive, although prices have fallen in the past week.)

What do low oil prices have to do with climate change? Quite a lot. Just on a mechanical level, when oil is cheap, more people can afford to burn it, so more carbon pollution streams into the atmosphere.

But oil prices also shape the rest of the political environment in which climate policy—and all policy, for that matter—is made. Again, when gasoline spiked earlier this year, President Joe Biden’s popularity collapsed; when prices receded, it rose. You could argue that Biden’s two biggest legislative accomplishments—the IRA and the CHIPS and Science Act—were possible only because gas got so inexpensive over the summer. (Senator Joe Manchin finalized a deal only days after gas prices had clearly started to fall.) One of the great ironies of this year is that both of those laws targeted China’s industrial economy: The IRA is meant to re-create a renewable-energy industry in the U.S., cutting into China’s advantage on solar panels and batteries, while the CHIPS and Science Act is meant to boost American semiconductor manufacturing. But both may have only happened because of Chinese policy in the first place.

There’s a broader lesson here, too, for climate hawks. The United States has now passed climate policy at the scale of the full economy; climate policy has, for better or worse, merged with industrial policy. Yet fossil fuels remain the economy’s principal energy source. Given oil’s continued importance—even just on a raw political level—policy makers can’t ignore the old energy system even as they build a new one.

Frankenstein’s Hummer

2022-10-12T11:21:00-04:00

The GMC Hummer EV was always going to be divisive. Even its name, which ported one of the most famous gas-guzzling brands of all time to the world of zero-emissions vehicles, was a kind of taunt. But this month, a viral video gave a sense of what a flash point the $110,000 car may be.

Edmond Barseghian, a Los Angeles–based influencer and entrepreneur who drives exotic cars, has one hand on the wheel of the new Hummer pickup. He accelerates out of a stop as the words “12,000 lbs truck out accelerates most super cars” flash across the screen.

The Hummer gets up to 66 miles per hour in a few seconds. Barseghian moans in pleasure. Then he realizes that his vehicle is hurtling—at highway speed—toward three lanes of cars idling at a stoplight. “Oh shit,” he says, as he seems to slam on the brakes. “I forgot how heavy this car is.” Barseghian comes within a car’s length or two of a collision before fully stopping. “It did not want to slow down,” he says, cursing. “Whew! Knocked the air out of me.”

The video, which got hundreds of thousands of likes on Instagram but has now trickled to other major platforms, provoked a divided reaction among viewers. For Barseghian and many of his followers, the Hummer seemed to validate EVs as legitimate road machines. “My new Hummer made me a believer in electric cars,” Barseghian wrote in the video’s caption on TikTok. But other people did not find themselves as revved up. “The EV Hummer is here and we should all be concerned,” tweeted one self-described car enthusiast. “These should not be street legal, unless obliterating people with cars is the goal,” posted Michael Eliason, an architect who specializes in sustainable construction.

[Read: Big cars are killing Americans]

The Hummer EV haters and lovers had discovered one of the most important facts about electric “super trucks”: They are very heavy, and they go very fast. If you imagine an ambulance that can accelerate as fast as a Formula 1 car, you’re imagining a vehicle only slightly more unwieldy than the new Hummer. I am not exaggerating: F1 cars can go zero to 60 in 2.6 seconds; the EV Hummer pickup can get there in three seconds flat. The Tesla Model X Plaid, an SUV that weighs a comparatively svelte 5,390 pounds, can get up to 60 miles per hour in 2.5 seconds.

Mikhael Farah, a spokesperson for General Motors, told me in a statement that the Hummer in the video was able to accelerate so rapidly because the driver was using a feature called “Watts to Freedom,” a “launch-control mode” designed to propel the car forward from a stop. The Hummer’s owners manual warns drivers that “Watts to Freedom is intended for use only on a closed course and should not be used on public roads,” Farah said.

Of course, the fact alone that Watts to Freedom is shipped with street-legal cars reveals the unusually lax regulatory environment that cars face. Ebikes, for instance, are physically restricted by federal law from exceeding a maximum speed by motor alone; cars, meanwhile, can include a dangerous acceleration mode as long as the owners manual warns drivers to “make sure there are no people or objects around” before you activate it. Watts and freedom aside, the weight of EVs is a safety issue that drivers—and cyclists and pedestrians—will only have to keep worrying about as these cars go mainstream.

Why are electric trucks so heavy? Lithium-ion batteries, the main type of energy storage used in modern EVs, are significantly less energy-dense than gasoline or diesel fuels. That means that, all else being equal, a battery pack that can propel an EV for 100 miles of driving will weigh more than the gasoline that will power a car the same distance.

Of course, all else isn’t equal. EVs use their stored energy far more efficiently than gas cars do, according to Anthony Schiavo, a research director at Lux Research, a global advisory firm. “It turns out that combusting fuels is not that effective a way to generate energy,” he told me. Although batteries are heavier than gasoline, electric motors are much lighter than internal-combustion engines. Still, nearly all EVs are, for now, heavier than their gas-powered equivalents.

The physical limitations of batteries mean that cars like my own, a decade-old Volkswagen that weighs 2,900 pounds and has about 400 miles of range on a full tank, would be tough to re-create as an EV using today’s technology, Schiavo said: Even if you could accomplish it on an engineering basis, the raw materials would probably cost more than the car’s original purchase price. (The Hummer EV’s battery pack alone, meanwhile, weighs nearly as much as my car.)

Yet physics by itself isn’t to blame for the Hummer’s paunch. There’s no technical requirement forcing the Hummer to weigh 9,000 pounds, and in fact, the battery pack in the Hummer takes up only about a third of the car’s overall weight. “It’s absolutely a design choice and a marketing choice,” Schiavo said. “People like larger vehicles, and the reason why those larger vehicles are getting made is because they sell.” Since the Ford Explorer was first introduced in 1990, more and more Americans have bought big, truck-like cars—SUVs, crossovers, pickups.

These big vehicles are dangerous. American vehicle deaths jumped to a 20-year high in the first part of this year; the U.S. leads the developed world in traffic deaths. These statistics, which have deteriorated since the pandemic began, seem to be even worse for pedestrians: Last year, pedestrian deaths reached their highest level in 40 years, according to the Governors Highway Safety Association.

Suffice it to say that cars as huge as the Hummer EV need to face some kind of regulation, especially in cities and towns, where they pose a distinct threat to the public. The federal government, specifically the National Highway Traffic Safety Administration, must make good on enforcing the pedestrian-safety standards that it has said are coming. Perhaps the most innovative work being done is happening here in Washington, D.C., which is asking drivers of especially heavy vehicles to pay a higher registration fee to accommodate the greater road wear and tear that they will cause.

“The customer’s safety is a top priority regardless of the type of propulsion or mass of the vehicle,” Farah, the GM spokesman, said in a statement. He shared a report suggesting that the rise in traffic deaths is “likely” caused not by heavier cars per se, but by a pandemic-era spike in speeding, drunk driving, and distracted driving. But the same report also said that infrastructure that has “prioritized the movement of motor vehicles over walking and bicycling” has worsened the traffic-death epidemic. And addressing that problem—by making cities and suburbs more bike- and pedestrian-friendly—is entirely in line with America’s climate goals. According to a recent report from the Rocky Mountain Institute, an energy think tank, Americans must collectively reduce their passenger “vehicle miles traveled” by 20 percent in order to keep the planet from warming more than 1.5 degrees Celsius. Electrification cannot be an excuse for needless traffic deaths; nor can it let us cede our streets to cars alone for another half century.

But if the Hummer EV’s weight can be brought under control—and if it still develops a reputation as so reckless that liberals resent it, or seek to ban it from their cities … I’m not sure that’s actually bad for the energy transition per se.

[Read: Stop worrying and love the F-150 Lightning]

One of the greatest remaining obstacles that EVs face in America is cultural opposition. People identify deeply with their cars; they expect them to say something about themselves, and right now, driving an EV sometimes but not always marks you as a liberal. Because political identity is often influenced by doing what the other side hates, it’s not unimaginable that tagging the Hummer EV as the Anti-Democrat EV could help the industry more broadly. But it’s also possible to imagine a world where Democrats and Republicans each find their own reasons to hate the Hummer, or where a few high-profile crashes lead conservatives to join liberals in balking at super-heavyweight EVs generally.

Whatever happens, the drama around the Hummer EV is a reminder that the energy transition will not play out with the aesthetics that climate change has had so far. Last week, I wrote that people who have worked in climate change for a long time should prepare themselves to feel like old fogeys—and to welcome the deluge of insight from people just joining the field. The same is true for aesthetics. (And cars, for all their dangers, remain at least partially aesthetic objects.) For the kind of liberal communitarians who have cared a lot about climate change for decades—who have thought about their carbon footprint, bought conventional hybrids, and worried about flying or their meat consumption—sometimes winning on the politics of climate change is going to feel a lot like losing on the aesthetics.

The Climate Economy Is About to Explode

2022-10-05T10:30:00-04:00

Sign up for The Weekly Planet, Robinson Meyer’s newsletter about living through climate change, here.

Late last month, analysts at the investment bank Credit Suisse published a research note about America’s new climate law that went nearly unnoticed. The Inflation Reduction Act, the bank argued, is even more important than has been recognized so far: The IRA will “will have a profound effect across industries in the next decade and beyond” and could ultimately shape the direction of the American economy, the bank said. The report shows how even after the bonanza of climate-bill coverage earlier this year, we’re still only beginning to understand how the law works and what it might mean for the economy.

The report made a few broad points in particular that are worth attending to: First, the IRA might spend twice as much as Congress thinks. Many of the IRA’s most important provisions, such as its incentives for electric vehicles and zero-carbon electricity, are “uncapped” tax credits. That means that as long as you meet their terms, the government will award them: There’s no budget or limit written into the law that restricts how much the government can spend. The widely cited figure for how much the IRA will spend to fight climate change—$374 billion—is in large part determined by the Congressional Budget Office’s estimate of how much those tax credits will get used.

But that estimate is wrong, the bank claims. In fact, so many people and businesses will use those tax credits that the IRA’s total spending is likely to be more than $800 billion, double what the CBO projects. And because federal spending tends to catalyze private investment, that could send total climate spending across the economy to roughly $1.7 trillion over the next 10 years. That’s significantly more money flowing into green-energy industries than the CBO projected, though it’s unclear if that additional money will lead to more carbon reductions than earlier analyses have projected.

Second, the U.S. is “poised to become the world’s leading energy provider,” according to the bank. America is already the world’s largest producer of oil and natural gas. The IRA could further enhance its advantage in all forms of energy production, giving it a “competitive advantage in low-cost clean electricity and hydrogen production, infrastructure, geologic storage, and human capital,” the report states. By 2029, U.S. solar and wind could be the cheapest in the world at less than $5 per megawatt-hour, the bank projects; it will also become competitive in hydrogen, carbon capture and storage, and wind turbines. (The law will help America’s battery industry, but the bank doesn’t see the U.S. becoming the world’s biggest battery producer, given that China already has such a dominant advantage.)

Perhaps rosiest of all was the bank’s view of major risks to the IRA. The bill passed with not even a single Republican vote, but the bank concludes that the GOP is relatively unlikely to repeal the law, even if they take the White House in 2024. That’s because it would hurt their own voters most: “Republican-leaning states are likely to see the most investment, job, and economic benefits from the IRA,” the report claims. Instead, the IRA is most likely to stumble because America still struggles with building out its energy infrastructure: The country might not be able to get government approval to permit enough power lines, green infrastructure, and carbon-injection wells for the law to matter, the bank said. This risk is all the more heightened now that Senator Joe Manchin’s permitting-reform bill—which, for all its flaws, would have clearly allowed for more renewable transmission construction—has failed. Powerful business groups are also lobbying to revise the most transmission-friendly sections from that bill if Congress revisits it.

The Credit Suisse report is truly remarkable. What stuck with me most was this declaration: For big corporations, the IRA “definitively changes the narrative from risk mitigation to opportunity capture.” In other words, companies should no longer worry that they might be unprepared for future climate regulation, such as a carbon tax. They should be scared of missing out on the economic growth that the energy transition (and the IRA) will bring about.

If the bill’s passage wasn’t signal enough, the report shows that climate change as a political issue—and frankly environmental protection more broadly—has arrived to a wholly new place. For decades, the country’s biggest climate advocates have tried to reduce the harm that the economy causes to the environment. Now they find themselves tasked with the biggest story in the economy itself.

Perhaps most strange, even if the United States slips into recession in the next year, the IRA will only become more important. Historically, economists and businesses have treated helping the environment as a product of prosperity—if the economy is good, then companies can afford to do the right thing. But the IRA’s programs and incentives will keep flowing no matter the macro environment, which makes betting on clean energy one of the most certain economic trends of the next few years. Clean energy is now the safe, smart, government-backed bet for conservative investors. It’s really a shocking reversal of the past 40 years. It is such a change that it hasn’t yet been metabolized by the world of people involved in the issue.

So inspired by the vigor of Credit Suisse’s forecast, let me venture a few predictions of my own. The number of Americans working in a climate-relevant industry is going to explode. It is going to undergo what you might call a techification. I was a nerd and a dreamer in high school in the late aughts, which meant I paid attention to the start-ups of that era—such as Twitter, Facebook, and Flickr—in their early years. I remember that fateful moment around 2010 when the valence of the industry switched—it was right around when The Social Network came out—and working in tech went from being a career choice for dorky optimists to the default career track for many ambitious college students. A similar switch is coming for companies working on climate change: The opportunity will be too large, the money too persuasive, the problems too intriguing.

Finally, those of us who have long worked in climate change—and here I include myself, who started covering this topic in 2015—should have some excitement and even humility about this deluge of new talent. Even setting its arduous politics aside, managing climate change is a legitimately difficult technical and cultural problem—it’s going to require as many attentive and enthusiastic brains as possible, and the path to decarbonizing always required an infusion of new workers, investment, and good will. If you don’t yet work in the industry, but have always cared about climate change as an issue, well, this is your moment to get involved. These companies are going to need engineers, yes, but also programmers, accountants, marketers, HR staff, general counsels—there is space for everyone now.

The fight against climate change is going to change more in the next four years than it has in the past 40. The great story of our lives is just beginning. Welcome aboard.

Honestly? The Link Between Climate Change and Hurricanes Is Complicated.

2022-09-29T17:02:00-04:00

Hurricane Ian is one of the most destructive hurricanes ever to hit Florida. A day after the storm made landfall, hundreds of people have been rescued and, as of this morning, millions were without power. President Joe Biden has indicated that early reports suggest “substantial loss of life,” but no firm numbers have been confirmed. With such a catastrophic storm coming after the string of disasters this summer, some commentators have tried to link Hurricane Ian to climate change.

But while climate change is clearly fueling some disasters, such as heat waves and wildfires, it has a more complicated effect on hurricanes. The most recent report from the Intergovernmental Panel on Climate Change, the United Nations–led panel of hundreds of climate scientists from around the world, has said that it’s an “established fact” that industrial carbon pollution has led to an increase in “frequency” or “intensity” of extreme weather. But the report uses more circumspect language such as “likely” to talk about tropical cyclones. (Tropical cyclones are only called hurricanes when they’re above a certain wind speed and in the Atlantic or North Pacific Ocean.)

Climate change is changing hurricanes in a few ways. “First of all, you can have more intense hurricanes in a warmer climate. That finding goes back well over 30 years now,” Kerry Emanuel, an MIT meteorologist and an expert on how climate change affects hurricanes, told me. “For that reason we expect to see more of the highest-category storms—the Cat 3s, Cat 4s, Cat 5s, more of the Ian-style storms.”

[Read: How Hurricane Irma is sucking Florida’s beaches dry]

In effect, climate change raises the speed limit on storms, he said, allowing hurricanes to attain a higher wind speed than they would otherwise. Why does this happen? It arises from the brute-force physics of a hurricane colliding with the inescapable presence of greenhouse gases. “A hurricane is a heat engine,” Emanuel told me, turning heat from the ocean into wind energy. This transformation happens because as water evaporates from the sea surface, it transfers heat from the ocean to the atmosphere, essentially speeding the storm. (The underlying phenomenon here is also why “if you’re wet, you feel cold, all else being equal,” Emanuel said.)

So how does the ocean get hot in the first place? There is really only one way for heat to enter the ocean and only two ways for it to leave, he said. Heat always arrives in the ocean as sunlight; it always leaves as infrared radiation, which is emitted back into space, or as evaporation from the sea surface. But carbon dioxide and other climate pollutants prevent infrared radiation from escaping the ocean—that’s the “greenhouse effect” that gives greenhouse gases their name. Because heat has nowhere else to go, the rate of sea-surface evaporation has to speed up, which means more heat energy can pass into the storm.

In other words, climate change “creates the conditions for water to evaporate faster,” Emanuel said, which means more heat can enter a given storm—and it can get windier.

Second, researchers agree that hurricanes can now strengthen far faster than they could in the old climate. The number of tropical cyclones that have undergone “rapid intensification”—a term of art meaning a storm’s top wind speed has increased by at least 35 miles per hour over a 24-hour period—has “likely” risen over the past 40 years, the IPCC has found.

“The forecaster’s nightmare is going to bed with a tropical storm in the Gulf of Mexico and waking up to a Cat 4 bearing down on a city” that has no time to evacuate, he told me. Even when meteorologists can safely predict that a storm will rapidly intensify, they can struggle to communicate its risks to the public.

Hurricane Ian looks like a textbook case of rapid intensification: On Monday morning, its top wind speeds were 75 miles per hour, barely qualifying the storm as a hurricane; just 48 hours later, its winds howled at up to 155 miles per hour—just shy of Category 5 status—as it made landfall in Cayo Costa, Florida. Indeed, people may feel like every hurricane to hit the United States recently has undergone a similar metamorphosis. Last year, Hurricane Ida made landfall in Louisiana as a powerful Category 4 storm only 74 hours after it became a tropical depression; the storm formed and came ashore faster than New Orleans could evacuate. In 2018, Hurricane Michael rapidly exploded into Category 4 status before it walloped the Florida Panhandle; a year earlier, Hurricanes Harvey and Irma also experienced rapid intensification before they made landfall.

Finally, climate change is making hurricanes rainier, Emanuel said. That’s actually true of most storms, tropical or not, but it’s especially important for hurricanes, because rain from a given hurricane can combine with other impacts to increase a storm’s overall danger.

[Read: Did climate change intensify Hurricane Harvey?]

“If you have a more intense storm and an elevated sea level, you’re going to be more susceptible to surge flooding,” when the storm pushes the ocean ashore, he told me. Then, surge flooding and “freshwater flooding” from all that extra rain “can gang up,” he said, creating a brackish flooding disaster. “It looks like that’s what happened in Fort Myers,” which has seen some of the worst damage, he told me.

So that’s what scientists do know about climate change and hurricanes. But much remains unclear or unknown about how the two interact. There’s essentially no agreement on what a warming climate will do to smaller hurricanes in the Category 1 or 2 range, Emanuel said. Historically, these less intense storms form far more often than major storms, and they dominate the raw numbers of hurricanes that form each year (although major hurricanes still cause by far the most damage). But “we just don’t know if the number of those smaller storms will be more or fewer or stay the same.”

Climatologists also don’t know what will happen to the diameter of hurricanes. The size of hurricanes is an overlooked but important aspect of a storm’s danger, Emanuel said. For instance, Hurricane Ian made landfall in almost the same place that Hurricane Charley did in 2004, but Ian is a much wider—and thus a much more destructive—storm. Charley, in fact, could almost fit entirely within Ian’s eye. Idealized computer models show that climate change will likely make these monster storms more common, Emanuel said, but so far “nobody wants to carry that over to the real world,” which is far more complex than a simulation.

So what can we say about climate change’s effect on Ian? Stepping back, it seems safe to say that it showed some symptoms of climate change. It rapidly intensified. It dumped huge amounts of rain. You could even argue that it showed evidence of that “higher speed limit.” But asking questions beyond that is folly, Emanuel said.

“I don’t like the question ‘How did climate change affect this storm?’” he told me. “If you had a grandparent who died of lung cancer and who smoked two packs a day, you wouldn’t ask, ‘How much did smoking contribute to his lung cancer?’ Because sometimes people get lung cancer without smoking at all. You just can’t answer that question.”

What Did Axios Do?

2022-09-28T10:42:00-04:00

The men who summarized the news at the bullet-point-loving start-up Axios—Mike Allen, Roy Schwartz, and Jim VandeHei—may now be driving it. They may have tried to tamper with their book’s position on the New York Times best-seller list, Defector reports.

The three men recently published Smart Brevity, a book that champions the direct, abrupt style of the Virginia-based centrist tabloid. But the men have now adopted a new and innovative practice that has media insiders raising their eyebrows.

The intrigue: An internal Axios memo encouraged each employee to buy six copies of the trio’s new book. Workers could then get those purchases expensed by the company—a practice that could cost Axios more than $70,000, according to Defector.

📈 If employees followed through, such a practice could send Smart Brevity soaring up the New York Times best-seller list. But it’s not entirely fair play, publishing insiders say.

Why it matters: Becoming a New York Times best seller can bring fame and notoriety—not to mention five-figure speaking gigs at big companies and conferences. It’s no wonder that Axios’s co-founders are chasing that kind of clout.

But: The Times is wise to these kinds of ploys. The paper has long attached a typographical mark called a dagger (†) to titles that may have been bought in bulk by authors hoping to worm their way onto the list.

🔪 The paper also reserves the right to kick anyone off its list—for any reason.

📚 “Institutional, special interest, group or bulk purchases, if and when they are included, are at the discretion of The New York Times Best-Seller List Desk editors,” says the paper’s website.

But, but: A few best-selling-book insiders told me that they thought Axios’s method was deliberately designed to evade these controls. “It sounds to me like they’re trying to dodge the dagger,” one deeply connected columnist said.

Axios has more than 500 employees. If each employee buys six copies of the book, that may not show up as a single bulk purchase, evading the Times’ filters, algorithm experts told me.

The numbers: Every Axios employee could buy six books.

Count it up: One. Two. Three. Four. Five. Six. That’s six books.

No matter how you look at it, that’s more than five—but less than seven.

Driving the news: This is a weighty time for Allen, Schwartz, and VandeHei.

Axios was recently acquired by Cox Enterprises for $525 million, one of the largest media start-up acquisitions of the past few years. Only the Times’s own acquisition of sports-news giant The Athletic—and Axel Springer’s recent purchase of Politico—were bigger.

But online-media insiders say that the company’s most promising product remains the software that it uses to send its emails—and the distinctive style that it uses to write them. Axios hoped to license that product—and its trademark approach—to companies communicating with their own employees.

But, but, but, but—but: That core technology wasn’t actually included in the sale to Cox. It was spun off as a separate B2B company, dubbed Axios HQ.

💸 Axios HQ plans to raise its Series A next year. Axios’s board—on which Allen, Schwartz, and VandeHei all have seats—controls the board of Axios HQ, according to the company.

Corporate-governance and bullet-point insiders told me that Axios HQ’s success is riding on HR departments wanting to use the company’s distinctive style. If Smart Brevity looks like a best seller, that may make Axios HQ’s sales pitch easier.

Go deeper: Even if Allen, Schwartz, and VandeHei did try to shortcut their way onto the list, they wouldn’t be the first. They may have learned from one of Washington’s most famous recent residents: President Donald Trump.

President Trump’s 1987 The Art of the Deal only climbed the list because his company bought “tens of thousands of copies,” according to a later tell-all.

That didn’t stop the future president. The cover of every subsequent edition of the book has said No. 1 Best-Seller at the top.

Go deeper-er: “Smart brevity” is a literary tradition of its own. William Strunk and E. B. White’s classic book about writing, The Elements of Style, commands writers to “Omit needless words.”

Maybe that’s just what Allen, Schwartz, and VandeHei are doing. After all, Strunk and White didn’t say anything about skipping needless book orders.

Be smart: Six may seem like a lot—it’s more fingers than most people have on one hand—but it’s not the biggest number, according to numerological insiders.

Eighty-four, 3 bajillion, and seven are all bigger numbers than six, The Atlantic has confirmed.

But be careful. If a number has a negative sign in front of it, then it’s not bigger than six. “-9” is smaller than six, insiders cautioned. Let’s hope Axios employees kept that in mind.

The Senate Just Quietly Passed a Major Climate Treaty

2022-09-28T10:26:00-04:00

What if the Senate passed an international climate treaty—a pact so powerful that it could avert nearly 1 degree Fahrenheit of global warming—and nobody noticed?

That’s more or less what happened a week ago. Last Wednesday, the Senate ratified the Kigali Amendment, a treaty that will phase out the world’s use of hydrofluorocarbons, or HFCs, a climate pollutant used as an industrial refrigerant and in sprayable consumer products. Because HFCs are hundreds of thousands of times more potent at capturing heat in the atmosphere than carbon dioxide, the Kigali Amendment, which has already been adopted by 137 countries, is the most significant environmental treaty that the United States has joined in at least a decade.

But just as striking as the fact that the United States joined the treaty was how it did it. The vote to ratify Kigali was bipartisan, with 21 Republicans and 48 Democrats voting in support. Yet the move didn’t break through to the extent that other recent climate news has. “It’s very important, and nobody’s picked it up,” Michael Oppenheimer, a geosciences and international-affairs professor at Princeton, told me. In fact, even he didn’t know the treaty had actually been ratified until I told him.

It deserves more attention. The Kigali Amendment was finalized by negotiators in Kigali, Rwanda, six years ago, updating the Montreal Protocol, a three-decade-old treaty. That pact was first adopted to eliminate chlorofluorocarbons, or CFCs, a class of chemicals that were found to be destroying the ozone layer. It has proved to be one of the biggest environmental victories of the past decades: CFCs have since been successfully phased out—and the gap in the ozone layer that those chemicals opened has begun to close.

[Read: ‘The biggest thing to happen in international climate diplomacy in decades]

The Montreal Protocol was updated four times before the Kigali Amendment, but this tweak is different. Instead of helping protect the ozone, this tweak was designed to specifically reduce greenhouse gases.

Regardless, the muted response after the Senate’s move might be in part because the United States had already essentially decided to comply with the treaty, even if it declined to ratify it. In December 2020, Congress passed stringent targets for eliminating HFCs from the economy as part of its lame-duck COVID stimulus bill. (The same piece of legislation sent $600 checks to every American.) That bill is projected to eliminate the equivalent of roughly 900 million metric tons of carbon-dioxide pollution by 2036, more emissions than Germany produces in a year. But America’s full ratification and participation in the treaty will keep the legal regime that underpins the agreement strong.

The Montreal Protocol and its successive amendments are binding treaties with an enforcement mechanism: While the affected chemicals get phased out, only countries that are party to the treaty can trade the chemicals or goods that include them with other countries. This creates a form of lock-in for American companies exporting their products, Nina Kelsey, a political scientist at George Washington University, told me. American industries have tended to support the Montreal Protocol because they benefit from it. That has been true since the 1980s, when DuPont, the sole company that made a replacement chemical for CFCs, argued that the Reagan administration should join talks over the deal that became the pact.

That’s one big reason the U.S. has remained so engaged in the Montreal process even as it has taken a far less active approach in other international treaties. It’s also why Republicans have historically remained friendlier to the Montreal approach relative to other climate policy.

Even so, it wasn’t a sure thing that the United States would join this treaty, even if it had already agreed to abide by it. That the Senate got it done caps an unprecedented year for American climate policy. “Ratifying the Kigali Amendment, along with passing the Inflation Reduction Act, is the strongest one-two punch against climate change any Congress has ever taken,” Senate Majority Leader Chuck Schumer, a Democrat from New York, said before the vote. Normally, such partisan triumphalism is worth ignoring. But in this case … I think he’s actually right?

In fact, after so many years of doing next to nothing on the climate, America seems like it’s in the middle of a mini–golden age for climate policy making. Apart from the IRA, Congress has also passed smaller bills, including the bipartisan infrastructure bill and the CHIPS and Science Act, that implement a dramatic new industrial policy and could increase federal spending on energy R&D.

[Read: Congress just passed a big climate bill. No, not that one.]

At the same time, California has vowed to ban new sales of gas-powered cars by 2035, and American automakers have made multibillion-dollar investments in a future where they mostly build and sell electric vehicles. The issue isn’t solved, of course: More legislation and executive action is needed, and the IRA could still fail as a policy experiment. But Congress is doing more now than it’s ever done.

And it’s taking action through alternate channels, too. The success of the Montreal Protocol “shows that even if the major international focus on dealing with greenhouse gases under the Paris Agreement has been less effective, there are other ways to take a bite at the climate problem,” Oppenheimer said. “In this case, quite a big bite. There is a lot more activity around [addressing climate change] than the stultifying lack of progress in international negotiations sometimes makes it look.”

Manchin’s New Bill Could Lead to One Big Climate Win

2022-09-21T10:20:00-04:00

Sign up for The Weekly Planet, Robinson Meyer’s newsletter about living through climate change, here.

About a year ago, one of the worst things that can happen to any climate journalist happened to me: I started to care about power lines.

I began to care, specifically, about transmission lines, the subset of power lines that traverse great distances and carry electricity from one region of the country to another. You’ve definitely seen transmission lines—they run along those steel structures you sometimes notice on the highway, unlike distribution lines, which hang from telephone poles and connect to your house. (Thankfully, I do not care about distribution lines.) In the world of climate policy, caring about electricity transmission is roughly like developing a sincere rooting interest in the New York Jets: You have chosen to suffer.

Transmission lines are the circulatory system of America’s power grid. Lately, that grid has been very sick. The U.S. experienced 64 percent more power outages in the last decade than it did during the decade prior, according to a new study from Climate Central, a nonprofit research group. That’s in part because the grid is getting old. Most of the country’s roughly 437,000 miles of transmission lines were built in the 1950s or 1960s and designed to last 50 years; those lines are now reaching the end of their life in a hotter, stormier, and more extreme climate than they were built for.

Even if the grid was holding up fine, though, we would still need more lines. We need to electrify most of the economy in order to eliminate carbon pollution; by 2050, the country must build new transmission lines at twice the pace it does today, according to Princeton’s Net-Zero America report.

But we aren’t doing that. Not even close. America has somehow slowed down its rate of new transmission construction over the past decade; last year, the U.S. built only 386 miles of new transmission capacity.

[Read: A very California lesson on just how weird electricity is]

There’s a way to fix this sorry state of affairs. Senator Joe Manchin’s so-called permitting-reform bill, which is due to be released today, will likely make it easier, faster, and cheaper for the country to build the kind of major new transmission lines that climate change requires. Yet these measures will come at a cost for environmentalists: The bill may authorize some fossil-fuel projects, and it may make it harder for green groups to block new infrastructure projects in court. The trade-offs may be dicey for climate advocates to accept, but its transmission components, considered alone, could very well amount to a win for the climate.

One of the oddities of America’s economy is that there is no national electricity market. This is weirder than it might seem at first. After all, you can find iPhones, pickup trucks, or a loaf of bread at roughly the same price anywhere in the country. Even the price of natural gas is set at just one place—the Henry Hub pipeline nexus, in Louisiana—and it trades within a few cents of that price everywhere, Michael Skelly, a renewable developer and the CEO of Grid United, told me.

But the cost of electricity varies enormously by where you live. It costs about 11 cents to run a dishwasher in Oregon, 12 cents in Florida, 18 cents in New York, and 22 cents in California. The problem is that the U.S. has three independent grids—an eastern region, a western region, and Texas—that divide into 22 subregions and thousands of utilities. Unifying those grids into one, which is possible by building new lines that go from region to region, would remedy one of the economy’s most glaring inefficiencies.

Fixing the grid is also essential to encouraging the growth of renewables. Although the sun doesn’t shine and the wind doesn’t blow all the time, one of the two is usually happening somewhere in the country. The U.S. has unusually well-balanced renewable potential, in fact: In the West, wind and solar generate huge amounts of electricity during the summer, while midwestern wind goes gangbusters in the winter, Skelly said. The only way to tap into America’s renewable potential is by moving electricity across large parts of the country.

But it’s much harder to build transmission than it is to build other types of energy infrastructure. If you want to build a new natural-gas pipeline, for instance, then you only need to go to one place: the Federal Energy Regulatory Commission, or FERC, an independent agency. But if you want to build new transmission, then you need to win the approval of every state, county, city, and in some cases, landowner along the proposed route.

These players tend to block new lines either by withholding their permission or by raising endless objections during the environmental-review process, a move that is possible even when a new line is in the obvious best interests of the environment. In 2009, Skelly set out to connect the wind farms of the Oklahoma panhandle with transmission lines in Tennessee. Because the Tennessee Valley Authority hooks into the East Coast’s transmission network, the project would have effectively supplied cheap, zero-carbon energy to Philadelphia, Atlanta, and Washington, D.C. But as Russell Gold describes in his excellent book Superpower, that effort failed—after eight years of wrangling over permitting.

The onerous permitting process can even hamper the government itself. In 2009, the Bonneville Power Administration, a federally owned public utility, set out to build the I-5 Corridor Reinforcement Project, a transmission line that would have connected Seattle and Portland, Oregon, to untapped but plentiful wind resources east of the Cascades. The agency prepared an 883-page environmental-impact assessment justifying the project … but after seven years, it could not get the permits to continue.

That’s where permitting reform comes in. This summer, when Manchin agreed to support the Inflation Reduction Act, he forced Chuck Schumer to swear that he would introduce a separate bill later in the year to reform the onerous environmental-review process. Permitting touches many aspects of American infrastructure, and Manchin wasn’t necessarily thinking of transmission lines: He wants to expedite the construction of the Mountain Valley Pipeline, which will bring natural gas out of West Virginia to the East Coast. Since then, we haven’t learned a lot about the actual content of the bill, save a one-page bullet-point list and a brief draft reportedly watermarked with the initials of the American Petroleum Institute. (The lobbying group has denied writing or editing the legislation.)

It’s possible to make a wholly conceptual case for permitting reform: In order to decarbonize, the country really does need to build more infrastructure than it’s built in a generation, and the nation’s environmental-review laws should accelerate that process as much as possible. But it’s also possible to build a conceptual case against it. Even without details on the text of the bill, Democrats such as Senator Bernie Sanders have called it a “huge giveaway to the fossil-fuel industry.” And Republicans have already demonstrated a desire to roll back environmental-review laws in ways that no Democrat would agree with.

We don’t yet know permitting reform’s net effect on emissions, or even if the bill will become law, but upgrading America’s approach to transmission is poised to be the best part of the bill. Everything we know about the permitting bill so far suggests that it would significantly improve the country’s ability to build the transmission infrastructure that we need.

Read: Not even a single Republican voted for the climate bill

Based on what we do know, the permitting bill will likely make three big changes to existing law to accelerate the sort of infrastructure we need to build more transmission lines. First, it would let the government declare that a transmission project is “in the national interest,” which would let FERC, the same agency that approves interstate pipelines, run a streamlined permitting process and issue a construction permit. Second, it would let the government set permitting-review deadlines for major transmission projects, so that projects could not get buried under an avalanche of procedural concerns. Finally, it would let FERC say who will pay for a transmission project.

The most important of the three changes might be the final one, the question of who pays for a new line, Rob Gramlich, the founder and president of Grid Strategies and one of the country’s foremost transmission lobbyists, told me. Most transmission projects are not made by the federal government or by developers such as Skelly, but by utilities, who then must divide up the cost of construction among their ratepayers.

“Transmission is a classic ‘public good problem,” Gramlich said, in that it brings lots of small benefits to many people, but nobody wants to pay for them. The bill instructs FERC to allocate the costs of transmission to the customers who will benefit from it the most.

These changes to transmission would reduce U.S. carbon pollution by “hundreds of millions of tons a year by 2030,” according to a memo circulated by Gramlich’s group. That estimate might be a little high, John Larsen, the head of U.S. climate research at the Rhodium Group, an independent energy-research firm, told me. But “more transmission is very good for the country,” he said, “making it easier and faster and cheaper to get a cleaner grid.”

For instance, if you don’t have an easy way to transport electricity across long distances, you might build three mediocre wind plants instead of one stupendous facility. Over the entire electricity grid, those costs start to add up; a recent National Renewable Energy Laboratory study found that it cost 25 percent more to decarbonize the electricity grid if you tried to avoid building new transmission at the same time.

Building more transmission makes sense, and it’s one of the cheapest ways for Americans to reduce their energy costs while fighting climate change. That doesn’t mean it’s a sure thing. The same dynamics that make building new transmission hard may also make it tough to reform the system. We don’t yet know if Manchin’s compromise is, overall, a good deal for the climate. We don’t even know if it will pass yet. But we do know that like it or not, everyone is going to have to care about power lines.

Think Twice About Working for a ‘Climate Villain’

2022-09-14T10:04:00-04:00

A few years ago, I attended a federal court hearing about the Dakota Access Pipeline. The pipeline passed near the Standing Rock Indian Reservation and beneath a lake that is sacred to local bands of Lakota and Dakota people, and a protest camp had sprung up to block its construction.

At the time, in 2016, the pipeline story was one of the country’s biggest climate controversies. The Obama administration would go on to freeze the pipeline, before President Donald Trump revived it. (It is now operational.) But the courtroom, where the pipeline’s fate was ostensibly going to be decided, was largely empty. I was one of maybe a dozen journalists in the gallery; other than that, it was just the two legal teams and the judge. The only other young people in the room, besides me, were one of the judge’s clerks and an entire row of young lawyers seated behind the legal team—for the pipeline.

I thought of that experience this week as I read the philosopher Kwame Anthony Appiah’s recent “Ethicist” column in The New York Times. The column is addressed to an anonymous law student who is debating taking a high-paying job at a big law firm to pay down their student debt and help their family.

“The firm’s work entails defending large corporations that I’m ethically opposed to, including many polluters and companies that I feel are making the apocalyptic climate situation even worse,” the student writes. “Even if I only stay at the firm for a short time to pay off my loans, I would be helping in these efforts for some time … Will defending polluters, even for a short time in a junior position, be a permanent black mark on my life?”

Appiah does not give a resounding “no.” He recognizes that climate change is a real problem, but offers a series of justifications for why it might be okay to work for a company knowingly and intentionally making it worse. (None of them includes the standard—and most straightforward—reason to work for, say, an oil company, which is that people still want a lot of oil.) Because companies are required to hire good and experienced lawyers, Appiah seems to say, that means that you should not feel bad about working for one: “For an adversarial legal system to function justly, there have to be lawyers who are willing to serve clients they disapprove of.”

[Read: A hotter, poorer, and less free America]

His thinking gets more slippery from there. “Even if what your clients are doing is legal, you may still feel uncomfortable supplying guidance and representation, because the activities shouldn’t be legal,” he writes. “We ought to have laws and regulations that treat the climate crisis with full seriousness, and we don’t.” Yet he treats this problem—that the country’s climate policy, even after the Inflation Reduction Act, remains insufficient—as an unfortunate coincidence that has nothing to do with the behavior of companies or, indeed, their lawyers.

If the story’s headline asks “Is It OK to Take a Law-Firm Job Defending Climate Villains?,” the correct response is “probably not.”

Appiah’s biggest mistake is that he assumes that all lawyers are equally talented. But in fact, the quality of lawyering matters. For proof of this, you need look no further than the experience of one Donald Trump. The former president has perennially struggled to hire lawyers, both in a personal capacity and in his role as president. Four major law firms reportedly declined to represent him during the Russia probe in the early part of his presidency. His White House suffered from unprecedented staff turnover, including among its legal advisers. In energy and environmental policy, his administration regularly appointed people to senior roles who had far less experience than their equivalents would have had in an earlier Democratic or Republican administration.

And you can see this failure in Trump’s results, particularly on beyond-the-headlines policy questions. For instance, presidents normally win about 70 percent of their regulatory-law cases, The Washington Post has reported. But the Trump administration lost 78 percent of its cases, according to data from the Institute for Policy Integrity at the NYU School of Law. Having covered a few of these failures, I can attest that they usually stemmed not from the fact that Trump's administration was trying to do something illegal per se, but because his lawyers had failed to dot their i’s.

This made the Trump administration unusual, because malign actors can usually rely on all the assistance that the legal profession can offer. One of the open secrets of the American legal system is that some of the country’s most retrograde and malevolent companies rely on some of its youngest, most promising lawyers. Every year, a river of law-school graduates surges out of Cornell, Columbia, and Harvard and flows directly into the nation’s biggest law firms. Once ensconced at these firms, those promising young lawyers—many of whom championed progressive causes while in school—defend the world’s most egregious polluters, child-labor-law abusers, and tax cheats. That’s how a brilliant and idealistic 20-something with the world’s best legal education might find themselves fighting to build an oil pipeline beneath a sacred Lakota site.

No doubt that a young person in such a situation could find many ways to justify their own behavior. They might reassure themselves that everyone wants and needs energy, and that the energy business still remains in large part the fossil-fuel business, so the country needs more pipelines. Or they might say that they need to pay off law-school debt so that they can take care of an aging parent. Or they might protest that, as Appiah writes, “representing a malefactor isn’t, ipso facto, an act of malefaction.”

The point is that anyone can come up with many elegant, well-argued, and even correct justifications for their own behavior. (Coming up with excuses will, in fact, be the anonymous law student’s future job.)

[Read: Wall Street’s skirmish with Exxon is ‘monumental’]

What interests me about this question is that it forces each of us to ask where, exactly, we might draw the line. As the climate warms, and as the economy decarbonizes, we will all have to decide exactly what sort of behavior we find morally acceptable—and we will have to take note of the fact that “There is no alternative” can sometimes rapidly turn into “There is no excuse.” Right now, I live in a city with almost no street-side electric-car chargers, so I feel like I have no alternative but to own a gasoline-powered car. But one day, I’m sure, I will feel that it’s wrong to own anything but an electric car.

Likewise, I have no compunction about intercontinental air travel, even though it’s among the most carbon-intensive activities that one can do, because it’s a marvel of modern society and because there is no technological substitute for it. But will climate change one day get so catastrophic that I can no longer justify the carbon pollution?

Already, the calculus isn’t as simple as the student and Appiah make it out to be. The student probably does not have to work for an evil law firm anymore to pay off their loans: If they care about climate change, they could go work for any number of climate start-ups that are hiring and paying market-rate salaries. In economics, we have outgrown the idea that there is some trade-off between helping the climate and helping the economy. But the same is true of careers now too.

“We’re rightly concerned when corporations do damage to the environment, and so to humanity as a whole,” Appiah writes at one point. “But it’s hard to see how the world would be improved if such corporations couldn’t find legal advice and representation.”

On the contrary, I think it’s quite easy. If companies could not find lawyers to represent them when they do bad things, they would lose more lawsuits. This would cost them money, and discourage them from doing more bad things. Some questions are better suited to an accountant than an ethicist.

A Very California Lesson on Just How Weird Electricity Is

2022-09-13T07:38:20-04:00

Last week, Americans had a rare view into what the future might look like. It came from California, as usual, but it was not courtesy of Apple’s annual keynote, or indeed of any technology company. It came from the state’s electricity grid.

Wait—wait! Don’t click away yet. Electricity is, I hasten to add, extremely interesting. It is the energy source of the future. In basically any world in which America addresses climate change and zeroes out carbon pollution from its economy, we will have to use more electricity. Electricity will propel our cars, cook our food, and heat our homes. And that means we should start to cultivate the kind of commonsense understanding of the electricity system that many of us already have about, say, gasoline, or oil prices, or car engines. Because especially if you’re used to living in a world of physical commodities—and physical fuels—electricity is really, really weird.

Here’s an example. Last week, California broiled under one of its worst heat waves in written history. San Jose, Sacramento, and Redwood City recorded their hottest all-time temperatures, with the state capital hitting 116 degrees Fahrenheit. That record-smashing heat led to grid-straining demand for air-conditioning. Last Tuesday, California’s electricity use spiked to more than 52,000 megawatts, surpassing previous all-time records for peak power demand by more than 3 percent.

That’s one view of the future: To state the obvious, these unusually intense heat waves are going to become more common under climate change, which is making heat waves generally more frequent, more intense, and longer-lasting. More important, climate change is also expanding the spatial extent of heat waves, meaning that pockets of hot air in the atmosphere are now physically larger—and therefore cover a much larger land area—than they once did. That’s what happened this week. Although California got the brunt of the heat wave, record-setting warmth stretched across the West, knocking down nearly 1,000 records and enveloping Nevada, Utah, and Montana.

In the past, California could deal with surging power demand by importing electricity from nearby states. But if people across the West are cranking up their AC to fend off the warmth, then there’s simply less electricity to go around.

And here is the first lesson from this week: This particular problem is most acute in the early evening. California has one of the cleanest grids in the country, with more than 15,000 megawatts of installed solar capacity. (How much is a megawatt? While per capita electricity use varies widely from one region of the U.S. to another, one megawatt is enough to power about 750 California homes at once.) In the middle of the day, nearly all of that solar capacity pumps electricity into the grid. But in the afternoon, it begins to fade, literally, as the sun falls lower in the sky. And it shuts off, of course, with the arrival of dusk.

In other words, solar has almost entirely dropped off the grid by 7 or 8 o’clock at night. But that’s exactly when electricity demand peaks—especially on a very hot day. That creates a painful window, lasting from roughly 6 to 9 p.m., when it’s still hot outside, so people still have their air-conditioning on high, but when solar is no longer keeping the grid afloat. Engineers have to fill in the missing supply with any other source of power. This week, nearly all of California’s crunch times have come during this late-evening period.

When the state last suffered such a widespread heat wave two years ago, its grid lapsed into rolling blackouts. But this time, the grid held fast. State officials have said that an emergency cellphone alert that asked residents to reduce their power usage helped save it. Within 45 minutes of the alert going out, the state had cut more than 2,000 megawatts of electricity, roughly as much energy as it normally takes to power more than 1.5 million homes. And the grid was fine.

There’s the second lesson: A shortage of electricity doesn’t work like a shortage of a physical commodity. Imagine that a hurricane makes landfall and cuts off a city from receiving gasoline for a few days. At first, gas stations might sell off their inventory, perhaps rationing fuel as reserves dwindled. Eventually all of the city’s gasoline would be sold. But even after gasoline shipments started to flow in again, the city would remain crucially short on gasoline for a few days as drivers made “make up” purchases to fill their tanks. In other words, a brief stoppage of gasoline shipments can lead to a much longer-lasting shortage.

This is not how electricity shortages work. Because the electricity system must balance supply and demand at every instant, electricity shortages themselves are very brief. The grid operator can foresee a shortfall at 7 p.m. but know that everything will be all right by 8 p.m. Unless something really catastrophic happens, the grid will emerge unhurt. This is why it works to simply mass-text an entire population and ask them to solve a temporary grid problem by turning the AC a few degrees warmer or by shutting off their laundry machines.

The grid’s struggles have led some commentators to predict a clash with another aspect of California’s future: the state’s ban on the sale of new internal-combustion cars, which will take effect in 2035. “I did wonder how that same scenario might play out a few years hence, as California’s electric-vehicle mandate kicks in,” the columnist Megan McArdle wrote. “Can California’s infrastructure hold up under the strain?”

It just might. (That’s the final lesson we learned this week.) Electric vehicles may actually help the grid, Michael Wara, a scholar of climate and energy policy at the Stanford Doerr School of Sustainability, told me.

Once you use an EV, “you immediately begin to understand that the way the charging works on these cars is designed to avoid exactly the kind of impacts that people are talking about, and is actually very beneficial to the grid,” said Wara, who described himself as “lucky enough to own a Tesla Model 3.”

“The car won’t charge between 3 p.m. and 11 p.m.” unless you override it, he said. “The reality is either you charge at work, and then you’re done by 3. Or you get home, plug your car in, and it doesn’t draw from the grid until 11 o’clock. But you don’t care because you’re having dinner with your kids, then you go to sleep, and it charges.”

More and more appliances may soon work like this, especially if, as in California, time-of-use electricity rates become the default. (Under these plans, electricity is usually slightly more expensive in the early evening, when power demand is peaking but solar is beginning to fade.) Yesterday, Apple announced a new “Clean Energy Charging” feature that allows users to set their iPhones to charge during the parts of the day when the grid is most likely to be dominated by renewable sources.

But EVs will also cause demand for electricity to increase, Wara said, and that is likely to be a boon for utilities. For the past 15 years, electricity demand has been more or less flat. That has led overall investment in the basic infrastructure of the grid to lag. “We need to do all this grid investment because—forget about climate change—the grid is old and rickety,” he said. “But industries that don’t have growth can’t do investment.”

EVs will give utilities that opportunity for growth. The National Renewable Energy Laboratory has projected that U.S. power generation will need to rise at least 25 percent by 2050 even if Americans don’t switch to electric vehicles very quickly. If Americans do flock to EVs, then power demand could rise as much as 72 percent. The Inflation Reduction Act’s generous tax credits for new solar, wind, geothermal, and nuclear plants could also help spur utilities to turn over their fleets.

Electricity is the lifeblood of technical society. Two decades ago, the National Academy of Engineering ranked electrification as the greatest engineering feat of the 20th century, outranking the automobile (No. 2), the airplane (No. 3), and computers (No. 8). Yet of late the public’s understanding of energy has been treated as identical to its understanding of fossil fuels. That outlook must change: Nothing less than progress requires it.

It Wasn’t Just Oil Companies Spreading Climate Denial

2022-09-07T10:59:00-04:00

The MIT professor was unequivocal.

“If we had to stop producing CO₂, no coal, oil, or gas could be burned,” Carroll Wilson declared. The world would have to adopt nuclear energy en masse and perhaps even turn to “electric motor vehicles.”

It was June 9, 1971. Wilson, a management professor, wasn’t speaking at an environmental rally or a scientific meeting. He was talking to a room full of engineers and businessmen who had gathered in Cleveland, Ohio, for the electricity industry’s annual conference.

His speech was as up-to-date a discussion of climate science as you could find in the early 1970s. Although he said that global warming wasn’t yet a scientific certainty—which was true in those days—he was clear that it needed to be taken seriously. And the conference’s organizer, the Edison Electric Institute, seemed keen to get the best climate research in front of its members, even if it had radical implications for their business.

Yet scarcely two decades later, virtually the entire electric-utility industry—including the Edison Electric Institute, its flagship lobbying group, and the Electric Power Research Institute, its leading R&D alliance—united against any effort to understand or stop climate change. In 1992, an EEI article said that global warming would not portend disaster, but bring “cooler days, warmer nights, and better vegetables.”

Why has it taken so long for the United States to treat climate change seriously, much less adopt serious efforts to stop it? Over the past few years, the public has come to understand at least one cause: A handful of oil companies understood the reality of climate change years before the general public, but waged an expensive and secretive campaign through the 1990s and 2000s to muddy the science and play down the dangers.

But oil companies did not act alone. “Utilities were also in the room,” Emily Williams, a researcher at UC Santa Barbara and a co-author of a new study about the electricity industry’s role in spreading climate denial, told me. Years after scientists had reached a consensus that global warming was real, dangerous, and caused by fossil fuels, utilities sold climate half-truths and untruths to policy makers and the public.

The study, published this month in Environmental Research Letters, reveals the half-century arc that took electric utilities from feting the country’s top climate scientists in the 1960s to denouncing the importance of their research in the 1990s to reluctantly undertaking efforts to decarbonize their own grids in the 2010s.

In the aftermath of the Inflation Reduction Act, the country’s first comprehensive climate law, much of this may seem like academic history. But utilities’ legacy of denial, doubt, and dawdling continues to hold back the country’s energy transition, Leah Stokes, an author of the study and a political scientist at UC Santa Barbara, told me. Many utilities still operate damaging, debt-ridden coal plants today because of the decisions that they made decades ago.

Yet utilities remain crucial to fighting climate change. In many scenarios where America has a zero-carbon economy, utilities play a larger role, generating, distributing, and transmitting far more electricity than they do today. “We can’t do this without utilities onboard, honestly,” Stokes said.

Electric utilities might be some of the most powerful and least understood companies in America. They count almost every American as a customer, and they bring in more revenue combined each year than Apple does. Yet utilities are so complicated—and, truth be told, so straight-up boring—that they escape public scrutiny. There are investor-owned utilities, publicly owned utilities, and utilities that are somewhere in between. Some utilities are regulated monopolies, generating their own electricity and selling it to captive customers, while others work as middlemen in a deregulated electricity market.

But all stripes of utilities fought climate policy aggressively and enduringly, the study finds.

The new research looked at 188 speeches, memos, articles, ads, and other industry documents from 1968 to 2019 that mentioned climate change, carbon dioxide, or other climate-related keywords. It isn’t the first study to look at the role of utilities in climate denial: The Brown University sociologist Robert Brulle and the Energy and Policy Institute, an energy-industry watchdog, have both done so.

Together, the three studies clarify the root of that opposition. Electricity companies saw themselves as part of a coalition that included their biggest suppliers—namely coal and natural-gas firms—and their biggest customers—steel companies and heavy manufacturers. Freight railroads, which move coal around the country, joined the coalition as well. Because climate policy posed an existential danger to coal and other fossil fuels, utilities saw it as a threat to their own business. (But of course electricity can be generated in cleaner ways too.)

This is the first peer-reviewed publication to survey the industry’s messaging specifically, Dave Anderson, an author of the Energy and Policy Institute report, told me. “This is a very important study,” says Naomi Oreskes, a Harvard science historian who has researched on the fossil-fuel industry’s climate denial, and was not involved in the study. “It reminds us that climate disinformation has not been the domain of just one, or even a handful, of fossil-fuel companies, but has been perpetuated by a network of cronyistic industries that support and depend on fossil fuels,” she told me.

Neither the Edison Electric Institute nor the Electric Power Research Institute denied the new study’s findings.

“The progress that EEI’s member companies have made speaks for itself. We are leading the world in reducing carbon emissions, and today, 40 percent of U.S. electricity comes from clean, carbon-free resources,” Brian Reil, an EEI spokesperson, told me in a statement.

The Electric Power Research Institute “examines all risks to the grid, including climate, as part of an overall effort to drive innovation to ensure the public has clean, reliable, affordable, and equitable access to electricity across the globe,” Rachel Gantz, a spokesperson for the group, said.

Utilities didn’t start out seeking to distort climate science. As the issue dawned in the 1970s, they treated climate change mostly as a scientific matter, the study finds.

In 1977, an internal memo from the Electric Power Research Institute, or EPRI, straightforwardly described fossil fuels as the “principal manmade source of CO2 emissions” and warned that the amount of that gas in the atmosphere could double by 2030.

That seriousness continued into the next decade. In 1986, an EPRI article about climate change warned that the “sweeping consequences of accumulating greenhouse gases in the atmosphere may turn out to be the greatest environmental problem of modern times.”

But as the science became more concerning, utility executives began to downplay what they could do to stop climate change. By the late ’80s, the industry had started to channel a certain learned helplessness: Even if the greenhouse effect was real, executives argued, neither the power sector nor the United States could solve it alone. At the time, the U.S. power sector alone generated about 7 percent of all global emissions.

Then the science became unmistakable. In 1988, one of NASA’s top climate scientists told a Senate panel that global warming had already begun. Two years later, the new United Nations–led Intergovernmental Panel on Climate Change (IPCC) said that “immediate reductions” in greenhouse-gas emissions were needed.

The industry’s leaders made a fateful decision: They began denying that climate change existed altogether. “You get this huge divergence where as the science becomes clearer, the utility messaging becomes muddier,” Stokes told me.

The Edison Electric Institute and three utilities helped establish the Global Climate Coalition, or GCC, one of the most notorious advocates of climate denial and doubt. The GCC opposed any effort to reduce greenhouse-gas emissions, attacked individual climate scientists, and ran an extensive, secretive campaign to tone down the IPCC’s research findings. Utilities made up more than a quarter of the GCC’s members at its peak; an EPRI employee also participated in GCC meetings.

The GCC wasn’t the only group that utilities propped up. In 1991, the Edison Electric Institute helped start the Information Council on the Environment, a short-lived PR group that sought to discredit climate science. The group ran infamous ads in several cities that asked, “Who told you the earth was warming, Chicken Little?” and claimed there was “no hard evidence” that climate change “is occurring.”

The efforts were successful. One of the GCC’s main goals was to prevent the United States from entering the Kyoto Protocol, an early climate treaty. In 1997, the Senate effectively blocked the U.S. from carrying out the protocol or any similar treaty; in 2001, President George W. Bush announced that the U.S. would not implement the treaty.

Bush “rejected Kyoto, in part, based on input from you,” a State Department official later told the GCC’s leaders, according to a briefing memo from that year.

After 2000, the industry switched to delaying climate policy rather than sowing doubt about it. The study finds that the industry embraced the promise of carbon capture and “clean coal” to combat climate change. Industry documents mention these largely notional technologies as often as they mention renewables or more proven ways of reducing emissions.

At the same time, utilities also participated in at least three organizations that aimed to block climate policy, the study finds. EEI attended the meeting of one of these groups, the American Legislative Exchange Council, as recently as 2019; that group still publishes open climate denial on its website.

Not until 2015 did EEI and EPRI consistently acknowledge the reality of climate change and the need for policy in their documents. And this year, EEI was “fairly constructive” during legislative negotiations over the Inflation Reduction Act, pushing for the most aggressive and generous version of the clean-energy tax credits, Stokes said.

Still, despite that recent turn, utilities must confront their role in propping up climate denial for so long, Stokes told me. Many of them are still dealing with the afterlife of their denial: billions of dollars of debt tied up in uneconomic coal plants. Of the 10 utilities that did the most to spread climate denial, eight remain heavily invested in coal and fossil fuels and have the most inadequate transition plans, the study found.

Fifty utilities in EEI now have “clear forward-looking carbon-reduction goals,” Reil, the institute’s spokesperson said, and “dozens … are aiming for net-zero or equivalent by 2050 or sooner.”

“In general, the utility industry has not been visionary. They’ve been stuck in the past and have not been able to see the change that the clean-energy revolution could bring,” she added. Even though climate change represents the industry’s first pathway for growth since the 1970s, utilities resisted following it for years, Stokes said. Its objection to climate change was as much sociological as it was profit-driven.

That backwards-looking attitude is exactly the opposite of what Wilson preached in his 1971 speech. Begging his audience to consider the next 30 to 50 years, he reminded them that the problems of the 21st century were not so far away.

‘The Biggest Thing to Happen in International Climate Diplomacy in Decades’

2022-08-31T09:49:00-04:00

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Nearly seven years ago, a single mischosen word nearly killed the Paris Agreement.

With only hours left to go on the final day of the talks, American diplomats noticed a discrepancy in the new climate agreement’s text. Where previous drafts of the pact had said that rich countries “should” take the lead on preparing greenhouse-gas reductions plans, the final draft replaced that word with the more definitive “shall.” If the new treaty had created new binding legal requirements for the United States, President Barack Obama would have had to submit it to the Republican-controlled Senate, which would have surely rejected it. After some tense bargaining, a revision was rushed through at the last moment.

The episode reflected just how central the United States has been to international climate diplomacy: Although 174 countries agreed to the Paris Agreement, it was tailor-made to accommodate America.

For decades, climate policy makers have had to navigate two extremes. On the one hand, humanity probably can’t solve climate change without the United States, and the rest of the world knows it. America is simply too big, too rich, and too powerful to ignore. On the other, America has treated the climate with tremendous negligence: Few countries have thwarted global climate policy—or done as much to cause the climate problem—as has the U.S.

That may have started to change this month with the passage of the Inflation Reduction Act. The first comprehensive climate law in American history, the IRA mostly focuses on the domestic economy, aiming to cut emissions by supercharging the development of clean technology.

But it will also influence the international politics of climate change. For the first time since the modern era of climate politics began more than 30 years ago, the United States can credibly claim to be a leader on climate change.

“Genuinely, my view is that this is possibly the biggest thing to happen in international climate diplomacy in decades,” Joseph Curtin, the managing director for power and climate at the Rockefeller Foundation and a former climate adviser to the Irish government, told me. “That sounds quite dramatic, especially given that [the law] doesn’t have an international dimension. But it establishes the U.S. bona fides on the international stage.”

Over the past week, I’ve talked with international climate experts working in the United States and around the world. They agreed that the IRA will permanently alter the world’s fight against climate change, even if it is not yet clear exactly how. Here are five takeaways from our conversations.

1. The law finally gives America some climate credibility.

Fighting climate change has been one of President Joe Biden’s biggest foreign-policy goals. During his first 100 days in office, he held a “Leaders Summit on Climate” from the White House, where he committed to cutting the country’s annual emissions by at least 50 percent by 2030 compared with their all-time high. In international meetings, his administration has beseeched other countries to increase their emissions-reduction targets.

This is a continuation of America’s approach to climate under previous Democratic presidents, most notably Obama. Yet for years, America has almost never matched its rhetoric with its action. Congress has repeatedly failed to pass a bill aimed explicitly at reducing U.S. carbon pollution; its pro-climate regulations have flailed in court. And since April of last year, the Biden administration has continued to promise major emissions cuts by 2030—while being unable to furnish any actual policy that will lead to those cuts.

[Read: Biden’s climate law is ending 40 years of hands-off government]

The IRA has changed that dynamic. “We definitely needed something for the U.S. to have a modicum of credibility,” said Claire Healy, a former British Labour Party adviser who now leads the Washington, D.C., office for E3G, an international climate think tank. “There’s now a plan. And before, there wasn’t a plan; there was a gaping hole.”

For years, America’s lack of credibility weakened the force of any pronouncements it made about climate change, and could (reasonably!) give the impression that Americans wanted only to pay lip service to the climate problem. Now its diplomats have a leg to stand on when they spar with their peers from other countries or talk to the world directly. “The U.S. can come to [this year’s UN climate conference] with the position of We’re not only talking the talk; we’re walking the walk,” Curtin said.

2. It will reshape America and China’s relationship over climate change.

Perhaps the only idea that has defined Biden’s foreign policy more than climate change—and that unified Biden’s and Donald Trump’s approaches to the world—is that America is locked in a global competition with China and must strengthen its position accordingly.

The IRA fuses those two ideas, creating a new national industrial policy designed to reshore certain clean-energy industries and nurture U.S. competitors to Chinese EV companies. It joins other efforts, such as the recent bipartisan CHIPS and Science Act, that enact a more muscular U.S. industrial policy than the country has seen in a generation.

That makes the new U.S.-China competition real in a way that it wasn’t before, Alex Wang, a UCLA Law professor and expert on Chinese climate policy, told me. “There’s a lot of discussion from Biden about competing with China, but you’d have to say that it felt like talk, because the U.S. wasn’t acting. This is necessarily a big action. It should make everyone take the U.S. much more seriously,” he said.

At the same time, the IRA more closely resembles China’s own approach to climate policy—that is, the law tries to decarbonize by making strategic investments in certain industries, not by regulating or taxing carbon emissions. “It’s a validation of that approach, which, in a sense, China has been doing all along, for the past 15 years,” Wang said.

Chinese leaders will take note of the fact that U.S. clean-energy companies may soon compete with their own, he said, but they may also enjoy the indirect endorsement that America has just given their style of economic management. Other countries are paying attention too. “I think that’s positive—that state support is not viewed as a dirty word in the U.S.—and hopefully it validates that approach around the world,” he said.

3. But America’s allies are wary of the law’s protectionist impulses.

The IRA attempts to remake several clean-energy industries in ways that will benefit America’s trade balance. Some of its subsidies, such as its aggressive solar-manufacturing or hydrogen incentives, are available only to American firms making things on American soil, and it all but tries to entirely reshore the battery industry.

That made allies’ response to the bill “a bit muted,” Healy, the E3G analyst, told me. “Other countries must be looking at this and [getting] worried about those local-content requirements,” she said, referring to provisions in the bill that say EVs will qualify for some subsidies only if the minerals used in their batteries were mined and processed in the United States or countries that it has a free-trade agreement with.

But America’s free-trade pacts don’t cleanly overlap with its list of security allies: The U.S. has free-trade agreements with Australia, Canada, and Mexico, for instance, but not with Japan, South Korea, Germany, or the United Kingdom. Representatives of those countries may now want to negotiate with the U.S. to see how they can soften the blow to their own industries, a process that will wind up integrating U.S. climate policy with the larger apparatus of American state power. The future may see more agreements like last year’s U.S.–European Union steel arrangement, where each jurisdiction agreed to subject its steel industries to higher environmental standards in exchange for looser trade restrictions.

4. It will help developing countries by reducing the cost of green technology.

Although a handful of places—such as China, the U.S., and the EU—dominate global emissions today, that won’t be the case in the future. By the middle of the century, some of the world’s most populous countries—such as Indonesia, Pakistan, and Nigeria—will contribute a much larger share of the world’s emissions. (That’s assuming, at least, that they follow the same carbon-intensive development path that China, Japan, and the United States did before them.)

Although the IRA is targeted domestically, it may help set up a green vortex, lowering the cost of wind, solar, batteries, and other crucial technologies for decarbonizing. That would make them easier for poorer countries to purchase, Fabby Tumiwa, an Indonesian climate expert and the executive director of the Institute for Essential Services Reform, an Indonesian energy think tank, told me.

[Read: The best evidence yet that the climate bill will work]

The IRA, he said, “is really good for a developing economy like Indonesia due to spillover effects because of lower costs.” Over the past decade, China and Europe have driven most of those spillover effects: They’re chiefly responsible, for instance, for the tenfold decline in solar prices that has helped fuel that technology’s explosive growth around the world. Now the IRA might fuel a huge boom in supply and demand from the U.S., driving further declines.

In the Indonesian economy, Tumiwa said, those cost declines are crucial, because the cost of energy must be kept low as the country industrializes. One of Indonesian policy makers’ biggest concerns is that “the cost of energy will increase” too much at once, he said. “That will cause the loss of our competitiveness.”

“In an emerging economy like Indonesia … we see emission reductions” as really having “to come from developed economies,” Tumiwa told me. “We need more time. So if developed countries like the U.S. and some EU members can make a significant reduction by 2030, I think that is good.”

5. The IRA doesn’t help with one of the biggest hurdles to global decarbonization.

In sub-Saharan African and several other regions of the world, the greatest obstacle to decarbonizing today is not the cost of an individual solar panel or wind turbine. “The key issue is not the cost of technology; it is the cost of money,” Saliem Fakir, the director of the African Climate Foundation, told me.

In general, renewables can sometimes be more expensive to operate in sub-Saharan Africa than they are elsewhere in the world—not because the technology is any different, but because the financing costs are much higher, Fakir said. What these countries need above all, he said, is access to loans and other forms of financing at rates similar to those the United States and Western European countries can access. Not only do cheaper borrowing costs make it easier for countries to build more renewables in general, but they also hasten the arrival of the moment when it’s less expensive to build new clean-energy sources than it is to operate existing fossil-fuel power plants.

The IRA does nothing to change that status quo, even though this problem has been on the radar of policy makers in the West. Last year, the U.S. and several European countries agreed to help South Africa secure financing for its clean-energy transition, Curtin told me. But so far, the richer countries haven’t yet coughed up the promised capital.

This is the inevitable problem with laws such as the IRA that are domestically oriented. For the past few years, Western governments have announced huge spending bills devoted to solving climate change or recovering from the COVID-19 recession, Healy said. But that money was always meant to help their own economies.

“So if I was sitting in another part of the world, I’d say, ‘Great shakes, you’ve pulled out a pot of money to deal with COVID for Europeans and Americans, then you’ve pulled out another pot of money for climate. Where’s the pot of money for us?’ Where is the offer to those countries to build the modern economy?”

The EPA Just Quietly Got Stronger

2022-08-24T08:00:00-04:00

Sign up for The Weekly Planet, Robinson Meyer’s newsletter about living through climate change, here.

All carrots, no sticks. That is the story of the Inflation Reduction Act. Since the law was unveiled last month, savvy commentators have noted that its policies consist almost entirely of “carrots,” incentives meant to encourage companies to decarbonize, with very few “sticks,” policies meant to punish them for using fossil fuels or emitting carbon. (Just so we’re clear: This analogy is meant to invoke a stubborn donkey that, Looney Tunes–style, is craning to reach a carrot hanging in front of its face while its driver whacks its behind with a stick.)

Indeed, although the IRA includes dozens of new benefits, it creates only one new penalty for pollution: the methane-emissions fee, which will charge oil and gas companies at least $900 for every ton of methane that they leak into the atmosphere.

However you feel about the IRA, it probably has something to do with this fact. While some climate activists have fretted that the law does not punish fossil-fuel companies enough, centrists have argued that its complicated industrial policy would have been better as a simple carbon tax. But just about everyone has recognized that this all-carrots, no-sticks aspect is why the law passed in the first place. It’s a big part of why Senator Joe Manchin, who has criticized and even directed a lawsuit against the Environmental Protection Agency during his political career, could champion the IRA.

But this pat formulation overlooks something important. While it’s true that the IRA itself consists almost only of carrots, that is not true of the broader structure of American climate law. There is, in fact, a big “stick” for tackling carbon pollution already on the books in the United States, as well as an agency tasked with wielding that stick. I’m talking about the Clean Air Act and the EPA. And the IRA, by design, strengthens the government’s ability to wield that stick.

It does this in at least two ways. The first is that the IRA confirms that carbon dioxide is a type of air pollution covered by the Clean Air Act, as initially reported by The New York Times earlier this week.

This has broader consequences than it might seem. In 2007, the Supreme Court ruled in Massachusetts v. EPA that carbon dioxide counted as an air pollutant, and that, if the EPA decided that CO₂ harmed human health and the environment, it could regulate CO₂ under the Clean Air Act. That ruling—and the EPA’s official determination, a few years later, that CO₂ is dangerous—has anchored the agency’s climate regulations on cars and trucks, and its proposed rules for the power grid.

But then in June, the Court circumscribed some of the EPA’s authority over the power grid. Conservative justices have harped on the fact that Congress has never clearly delegated the power to regulate greenhouse gases to the EPA.

Now it has. The IRA repeatedly defines greenhouse gas as a form of air pollution. It amends several sections of the Clean Air Act to define “greenhouse gas” as encompassing “the air pollutants carbon dioxide, hydrofluorocarbons, methane, nitrous oxide, perfluorocarbons, and sulfur hexafluoride.” In another section, it grants money under the Clean Air Act for any project that “reduces or avoids greenhouse gas emissions and other forms of air pollution.”

Congress has now clearly spoken: Carbon dioxide is a form of air pollution. And though this will not undo this year’s ruling, it buttresses the EPA’s underlying legal authority to regulate climate pollution.

But that change is not the only—or even the most important—way that the IRA strengthens the EPA’s ability to regulate greenhouse gases. The law will also allow the EPA to pass much stricter rules than it could have previously.

The reason has to do with a quirk of American law. Since the 1980s, every major proposed regulation has had to show that it passes a cost-benefit analysis demonstrating that its benefits to the economy as a whole exceed its costs. In the EPA’s case, that means that the cost of complying with a regulation can’t exceed the benefit to society of cleaner air or water. Over the years, this has turned out not to be much of an impediment to the EPA, because even small amounts of air pollution are massively damaging to public health, so preventing any air pollution has very high benefits.

But the IRA’s many carrot-like policies, such as its clean-electricity subsidies and carbon-capture incentives, would functionally lower these limitations on the EPA even more by skewing the cost-benefit analysis in the agency’s favor.

That will happen in two ways. First, the IRA’s economy-wide tax credits and subsidies will reduce the costs that companies face in complying with broad EPA rules that encourage wind, solar, or electric-vehicle adoption. Second, the IRA contains new grants that will allow the EPA to subsidize the cost of compliance directly by writing checks or issuing loans to oil and gas firms and other regulated companies so that they can meet the terms of the rules. This works in the EPA’s favor because the cost-benefit analysis looks only at the effect of the regulation itself; it does not include any funding from Congress that makes achieving that regulation more feasible. Both of these moves will lower the costs of regulation, allowing the EPA to pass much more expansive rules.

This effect is important, but it was not accounted for in the law’s projected 40 percent reduction of U.S. carbon emissions. That was not a mistake—the modelers design their studies to look at what the new law alone will do, and so they assume zero further EPA action—but it means that the IRA’s emissions-cutting power could very well exceed what the models suggest today.

The whole point of the IRA is that it brings down the cost of clean energy. It makes renewables cheaper, it makes nuclear power cheaper, and, as I wrote last week, it even makes the technologies that we’ll need to fight climate change in the 2030s cheaper. So far, most commentary on the law has focused on the immediate effects of that shift, and on how the law’s new incentives will reduce emissions simply by driving turnover in the energy system. But in the weeks and years to come, the secondary effects could become more important. Now that the IRA has passed, it will be easier for states and cities to pursue aggressive climate policy, and it will be simpler for companies to cut their emissions faster than would otherwise be economical.

That’s why looking at the modeled emissions effects of the IRA—something that, to be clear, I did in this newsletter—is a little silly. The IRA isn’t like an EPA regulation that will modestly bend the curve of U.S. emissions. Instead, it catapults the country into a whole new landscape where the economics of every other climate action are different.

We thought the IRA was doling out carrots. It was actually planting an entirely new garden.

Biden’s Climate Law Is Ending 40 Years of Hands-Off Government

2022-08-18T17:42:00-04:00

On Tuesday, President Joe Biden signed the Inflation Reduction Act into law. It is no exaggeration to say that his signature immediately severed the history of climate change in America into two eras. Before the IRA, climate campaigners spent decades trying and failing to get a climate bill through the Senate. After it, the federal government will spend $374 billion on clean energy and climate resilience over the next 10 years. The bill is estimated to reduce the country’s greenhouse-gas emissions by about 40 percent below their all-time high, getting the country two-thirds of the way to meeting its 2030 goal under the Paris Agreement.

Since the law emerged from a surprise compromise between Senator Joe Manchin and Senate Majority Leader Chuck Schumer last month, most attention has been paid to the fact of the bill itself: that it is a climate bill, that America’s sorry environmental record has begun to reverse. Far less attention has been paid to the ideas that animate the IRA. That is a shame. Every law embodies a particular hypothesis about how the world works, a hope that if you pull on levers A and B, then outcomes C and D will result. Yet even by the standards of landmark legislation, the IRA makes a particularly interesting and all-encompassing wager—a bet relevant to anyone who plans to buy or sell something in the U.S. in the next decade, or who plans to trade with an American company, or who relies on American military power. And although not a single Republican voted for the IRA, its wager is not especially partisan or even ideological.

[Read: Not even a single Republican voted for the climate bill]

The idea is this: The era of passive, hands-off government is over. The laws embrace an approach to governing the economy that scholars call “industrial policy,” a catch-all name for a wide array of tools and tactics that all assume the government can help new domestic industries get started, grow, and reach massive scale. If “this country used to make things,” as the saying goes, and if it wants to make things again, then the government needs to help it. And if the country believes that certain industries bestow a strategic advantage, then it needs to protect them against foreign interference.

The approach is at the core of how the IRA seeks to resolve climate change. Democrats hope to create an economy where the government doesn’t just help Americans buy green technologies; it also helps nurture the industries that produce that technology.

This reflects a homecoming of sorts for the United States. From its founding to the 1970s, the country had an economic doctrine that was defined by its pragmatism and the willingness of its government to find new areas of growth. “Yes, there was an ‘invisible hand,’” Stephen Cohen and Brad DeLong write in their history of the topic, Concrete Economics. “But the invisible hand was repeatedly lifted at the elbow by the government, and placed in a new position from where it could go on to perform its magic.” That pragmatism faded in the 1980s, when industrial policy became scorned as one more instance of Big Government coming in to pick so-called winners and losers.

The IRA is not the only bill intent on bringing back industrial policy. The two other large bills passed by this Congress—the $1 trillion bipartisan infrastructure law and the CHIPS and Science Act—make down payments on the future as well; both laws, notably, were passed by bipartisan majorities. They alone would be notable commitments to a different vision of the next decade. But it is in the IRA that these general commitments become specific, and therefore transformative.

Fifty-eight feet above the floor of the Capitol Rotunda is a painting, meant to look like a marble inscription, that tells the story of the country’s history as it seemed in the late 1870s, when it was first painted. But Congress couldn’t decide how that story ended, and the last few scenes sat unfinished for decades. Finally, in 1951, lawmakers set upon a final image that seemed to cap the country’s history: the Wright brothers assembling the first airplane.

Aviation is a good way to think about how industries are born, grow, and become major forces in the economy. Long before they got off the ground, the Wright brothers had spent several years researching key concepts in flight at their bike shop in Dayton, Ohio. Finally, in late 1903, they built a plane at a base camp in North Carolina, and on December 17, Orville Wright rode it into the air, completing the first heavier-than-air flight in human history.

And that’s where the grade-school account of aviation stops. In one miraculous moment, a human being leapt into the air; today, we have Top Gun, FedEx, and Spirit Airlines. Yet the one flight near Kitty Hawk is not actually the end of the story. Although the Wright flier proved that heavier-than-air flight was possible, it was only one piece of machinery. To manufacture multiple aircraft, the brothers opened the Wright Company Factory, the world’s first airplane factory, in Dayton in 1909. In Kitty Hawk, flight became a scientific fact, but six years later, in Dayton, it became an industry.

And that is something closer to how technology actually develops. First, you have research and development, where important ideas are tested and proved on a small scale. Second, you have a prototype, such as that first Wright flier, that translates the ideas into a real technology. Third, you have early commercialization: Engineers and assembly-line workers must learn how to produce multiple copies of that technology, must ensure that the first version wasn’t a fluke, and, perhaps most important, must find people and companies who will serve as their first customers. This is the core work that the Wrights did in their Dayton factory. Only after completing all three steps do you begin to approach something like the enormous Boeing factory outside Seattle today, where 747s are made.

For too long, this story about technological development has focused almost exclusively on steps one and two. We have heard about the brilliant founders in a garage who changed the world with their ideas, but not about the factories where those ideas turned into silicon and plastic. Federal policy has reflected that: Since the 1980s, when Congress has wanted to spur technological progress, it has usually thrown money exclusively at R&D. We have had a science policy, not an industrial policy.

Until this year, that is, when Congress started passing industrial policy right and left. Why the change? Part of it, surely, is that in a post-Trump world, no party really champions globalized free markets anymore. But inextricable from that turn is Washington’s consuming anxiety over China’s rise—and China has embraced industrial policy.

It’s worth clarifying here that industrial policy really isn’t a single “policy” at all, at least not in the same way that, say, a carbon tax is. It’s more like a toolbox of different approaches that act in concert to help push technologies to grow and reach commercial scale. The IRA and the two other new laws prefer four tools in particular.

The first tool is the demonstration project. A demonstration project helps a technology that has previously existed only in the lab get out in the real world for the first time. Although prototypes are used in every type of invention—the Wright flier was a demonstration project—they rise to the level of needing policy when a given technology is so experimental, expensive, or far from market that banks or venture capitalists would decline to fund it.

The second set of tools is supply-push policies. As the name suggests, these tools “push” on the supply side of an industry by underwriting new factories or assuring that those factories have access to cheap inputs to make things. In 2010, Tesla benefited from a supply-push policy when it won a low-interest government loan to build one of its first factories. Supply-push policies tend to get paired with the third category, demand-pull policies, which create a market for whatever is coming out of those new factories. The government can “pull” on demand by buying those products itself or by subsidizing them for consumers.

Finally, there are protective policies, meant to insulate industries—especially new ones that are still growing—from foreign interference. Infant-industry protection goes all the way back to Alexander Hamilton, who called for tariffs to protect American manufacturers until they achieved sufficient scale. (In countries with no industry, “the importations of manufactured supplies seem invariably to drain the merely Agricultural people of their wealth,” he wrote.)

These four tools make up every piece of industrial policy in the three new laws. Although both parties have moved to embrace industrial policy, Democrats are clearly ahead of their Republican colleagues. You can see it in their policy: While the bipartisan infrastructure law sets up lots of demonstration projects, and the CHIPS Act adopts some supply-push and protectionist theory, only the IRA uses all four tools. But that makes sense, because Democrats’ climate priorities mean that they have a clearer idea of what they want the future economy to look like. In order to stop climate change, experts believe, the United States must do three things: clean up its power grid, replacing coal and gas power plants with zero-carbon sources; electrify everything it can, swapping fossil-fueled vehicles and boilers with electric vehicles and heat pumps; and mop up the rest, mitigating carbon pollution from impossible-to-electrify industrial activities. The IRA aims to nurture every industry needed to realize that vision.

Take hydrogen and carbon removal, two industries that are essential to creating a greener America but that remain in their early stages. A pure stream of hydrogen is an almost ideal industrial fuel: It burns hotter than coal, has the highest energy-to-weight ratio of any combustible substance, and can supply the raw molecular inputs for chemical- and steelmaking. Hydrogen doesn’t release any carbon when burned (because it has no carbon in it to burn!), but today, the cheapest way to make it is an industrial process that is extremely carbon-intensive. Meanwhile, carbon removal—sucking CO2 out of the atmosphere—has not been proven on any mass scale. The Intergovernmental Panel on Climate Change says that by 2050, the world must remove at least a billion tons of carbon dioxide, and likely much more, from the atmosphere every year in order to avoid the worst of climate change; right now, it removes only several thousand at most.

Hydrogen and carbon removal are going to benefit from nearly every tool the government has. The bipartisan infrastructure law will spend more than $11 billion on hydrogen and carbon-removal “hubs,” huge demonstration projects where companies and federal agencies will work together to make hydrogen or remove carbon at factory scale. These hubs will also foster geographic concentration, the economic idea that when you put lots of people working on the same problem near one another, they solve it faster. You can see such clustering at work in San Francisco’s tech industry, and also in China, which now creates hubs for virtually every activity that it wants to dominate globally—even soccer.

Then the IRA will take over and deploy some good ol’ supply push and demand pull. It includes new programs to underwrite new hydrogen factories; on the demand side, a powerful new tax credit will pay companies for every kilogram of low-carbon hydrogen that they produce. Another tax credit will boost the demand of carbon removal by paying firms a $180 bounty for trapping a ton of carbon dioxide and pumping it underground. (More controversial, the IRA also rewards firms for capturing carbon from coal-plant smokestacks, and it pays a bounty—albeit a smaller one—if they use captured carbon to drill for more oil.)

The same suite of tools is about to remake America’s lithium-ion battery industry. Lithium-ion batteries are a bedrock technology of the modern world: They are in hedge trimmers, Juuls, and the Mars Curiosity rover. But in terms of the climate, their most important use is in EVs, which are little more than batteries with four wheels and a motor. Today, not only does China make most batteries worldwide; it alone makes the tools that make the batteries, Nathan Iyer, an analyst at RMI, a nonpartisan energy think tank, told me. This extreme geographic concentration—which afflicts not only the battery industry but also the solar-panel industry—could slow down the energy transition and make it more expensive, the International Energy Agency has warned.

So the IRA uses a whirlwind of supply-push policy to try re-creating the battery industry in the U.S., subsidizing new mines, new metal refineries, and new battery factories. But by far the most ambitious battery-centric policy in the IRA is the new slate of tax credits for EVs, which have completely replaced an older Obama-era policy. For the first time, Americans can get a $4,000 tax credit for used EVs, and they will be able to take the $7,500 tax credit for new EVs as a discount at the dealership instead of waiting for tax season in April. On its own, these amount to a nice bit of demand pull to help jump-start EV purchases. But the new tax credit is also supply-minded, arguably even protectionist. Under the new scheme, very few electric cars and trucks will immediately qualify for that full $7,500 subsidy; it will go only toward vehicles whose batteries are primarily made in North America and where a certain percentage of minerals are mined and processed in the U.S. or one of its allies. Will these policies accelerate the shift to EVs? Well, no, not immediately. But the idea is that by boosting domestic production of EVs, batteries will become cheaper and more abundant—and the U.S. will avoid subsidizing one of China’s growth industries.

And then there’s solar policy. Right now, next to no solar panels are made in the U.S., even though the technology was invented here. The IRA endeavors to change that by—you guessed it—a mix of supply-push, demand-pull, and protectionist policies. Under the law, the government will underwrite new factories to make every subcomponent of the solar supply chain; then it will pay those factories for every item that they produce. Meanwhile, a powerful set of clean-electricity tax credits will cause demand for new solar panels to boom. “It’s realistic that within four to five years, [U.S. solar manufacturers] could completely meet domestic demand for solar,” Scott Moskowitz, the head of public affairs for the solar manufacturer Q CELLS, told me.

[Read: The best evidence yet that the climate bill will work]

In each of these industries, you’ll notice that the government isn’t only subsidizing factories; it is actually paying them to operate. That choice, which is central to the IRA’s approach, is “really defending against the mistakes of the 2009 bill,” Iyer told me. In its stimulus bill passed during the Great Recession, the Obama administration tried to do green industrial policy, underwriting new solar-panel factories across the country. But then Chinese firms began exporting cheap solar panels by the millions, saturating domestic demand and leaving those sparkly new factories idle, Iyer said. Policy makers learned that demonstration projects and supply-side policy alone won’t cut it; you need demand pull too.

So many other industries will also be touched by these laws. There’s a new program to nurture a low-carbon aviation-fuel industry in the U.S. (Long-distance jet travel is one of those climate problems that nobody knows how to solve yet.) There are a slew of policies meant to grow and decarbonize the U.S. industrial sector; every tax credit pays out a bonus if you use U.S.-made steel, cement, or concrete. “You would need thousands and thousands of words to capture the industries that will be transformed by this,” Josh Freed, the climate and energy leader at Third Way, a center-left think tank, told me. Surveying all the programs in the bill, he recalled a moment in 1995 when a friend’s father brought him into a university lab to look at something on the screen called the internet. “This is going to change everything,” he said.

Industrial policy is hard. The IRA bets on a certain vision of the world, and plenty could keep that world from becoming a reality. Even some of Biden’s governing priorities could get in the way: The IRA imagines new mines opening up across the country, for instance, but most of the country’s untapped lithium, cobalt, and nickel reserves sit within 35 miles of a Native American reservation. How will Democrats weigh a mining expansion against their environmental-justice concerns?

And even if the policies do succeed, America’s green industries are not guaranteed to outcompete China’s or speed up the green transition in the process. Just look at China itself: For all of its efforts to build a competitive semiconductor industry, its chips still trail behind Taiwan’s. Five EVs were sold in China last year for every one EV sold in the United States; that larger domestic market will provide a significant economy of scale when Chinese EV makers begin exporting their cars abroad. For that reason and others, many people in China are “deeply skeptical” that the U.S. can catch up with its lead, according to Li Shuo, a Greenpeace campaigner in Beijing.

But consider the world if even a few of the IRA’s policies do succeed. Electricity will be cheap and plentiful, much of it coming from farms of U.S.-made solar panels or offshore wind turbines. Across the Great Lakes, new steel refineries will be producing zero-carbon steel for export to Europe; a new fleet of factories, stretching across the West, will use nuclear energy to capture carbon from the air and store it in rocks below the subsurface. Air pollution will have fallen substantially, meaning that fewer Americans will die of heart attacks or lung disease every year, and fewer children will have asthma attacks. The Fortune 500 might still include Apple or Exxon, but it will also encompass EV makers, green-hydrogen producers, and carbon-removal specialists. “We are about to have a huge new set of vested interests who want the economy to be clean and benefit from that. We’ve literally never had that before,” Freed told me.

For decades, when environmentalists imagined an America that had begun to solve climate change, they pictured many of the trappings of post-industrial urban liberalism: bike trails, micro-grids, and organic farms. No doubt that stuff will exist in a decarbonizing world—and in fact one of the next fights for the climate movement will be to loosen the chokehold that cars have on American cities. But the revelation of the IRA is that decarbonizing the United States may require reindustrializing it. A net-zero America may have more refineries, more factories, and more goods production than a fossil-fueled America—while also having cheaper cars, healthier air, and fewer natural disasters. And once the U.S. gets there, then it can keep going: It can set an example for the world that a populous, affluent country can reduce its emissions while enjoying all the trappings of modernity, and it can export its cheap zero-carbon technologies abroad, helping reduce the approximately 88 percent of annual carbon pollution that it does not cause.

And that is the IRA’s biggest idea, its biggest hypothesis: that America can improve its standard of living and preserve its global preeminence while ruthlessly eliminating carbon pollution; that climate change, actually, doesn’t change everything, and that in fact it can be addressed by changing as little as possible. This hypothesis has already proved itself out in one important way, which is that the IRA passed, and the previous 30 years of climate proposals did not. Now comes the real test.

Not Even a Single Republican Voted for the Climate Bill

2022-08-12T18:38:00-04:00

The Inflation Reduction Act, passed by the House of Representatives today, is about to become the first comprehensive climate legislation in U.S. history. Compared with Congress’s desultory approach to the issue in the past, the numbers are striking: The legislation will spend roughly $374 billion on decarbonization and climate resilience over the next 10 years, getting us two-thirds of the way to America’s Paris Agreement goals.

But perhaps the most important number about the package is zero. Zero Republicans in the House. Zero Republicans in the Senate. The IRA was adopted entirely along party lines, with all Democrats and not a single congressional Republican in support of the legislation.

The number drives home an unmistakable reality: Even after years of effort from environmentalists, climate change remains a starkly partisan issue in America. The bill passed only because there were 50 Democrats in the Senate, with a Democratic vice president to cast the tie-breaking vote. Had any of those Democrats lost their elections—had Joe Manchin, for instance, decided against running for reelection in 2018 in his heavily Republican home state, or had Democrats not eked out two Senate wins in Georgia last year—then the bill would not have made it across the finish line.

No congressional Republicans who have publicly committed to some measure of climate action supported the measure. Nor did any of the score of House Republicans on the Climate Solutions Caucus. Senator Mitt Romney of Utah, who recently wrote in The Atlantic that America was “in denial” about the scale of the climate threat, opposed the bill, as did Senator Lisa Murkowski of Alaska, a moderate who has spoken about how climate change is transforming her state.

Granted, the Inflation Reduction Act is not only a climate bill, and Republicans oppose it for reasons beyond its climate policy. During congressional debate over the past week, GOP lawmakers have generally spent more time attacking the bill’s tax and health-care provisions than its energy measures. “Today, Democrats returned to their same tired playbook to raise taxes, spend more money, and expand the size of government,” Romney said in a statement after his vote. “Rather than listening to the American people who are suffering from inflation, Democrats have voted for a liberal wish list.” His statement alluded to the climate provisions only once, in an allegation that the IRA “reduces oil and gas production.”

The GOP’s intransigence comes despite years of efforts aimed at getting Republicans to sign onto climate policy. Since Senators John McCain, a Republican, and Joe Lieberman, a Democrat, first put together a cap-and-trade bill in 2003, environmentalists have held out hope that the parties could come together to address the issue. That never worked out: Even McCain bailed on climate talks during Obama’s presidency.

Republican-led climate efforts have also failed to bear fruit. Since the George H. W. Bush administration, the GOP’s pro-fossil-fuel faction has treated climate policy as an existential threat that must be prevented at any cost. In 2017, a set of GOP graybeards endorsed a revenue-neutral carbon tax as a sufficiently conservative solution to the climate problem. But the party rejected it when rewriting parts of the tax code the following year.

And President Donald Trump went further, arguing that fossil fuels, especially coal, are not natural resources with environmental and economic trade-offs but an unadulterated positive good that should be wholeheartedly embraced.

The GOP hasn’t been totally unwilling to address climate issues. Republicans have supported smaller, more incremental bills that tackle more limited aspects of the climate problem. If you look there, a more hopeful through line comes into view, Carlos Curbelo, a former Republican House member from South Florida who tried to forge a carbon-tax deal while in Congress, told me.

“There’s been an unmistakable trend in Congress favoring bipartisan climate action up until Manchin-Schumer,” Curbelo said. He cited a series of smaller wins—a major 2020 energy law; a ban on hydrofluorocarbons, a category of climate super-pollutant; and the climate provisions in the bipartisan infrastructure deal—that show a gathering momentum on policy. “This was a partisan process from the very beginning; all reconciliation bills are. We shouldn’t read too much into Republicans’ opposition to this legislation,” he added. “And what is more likely is that, once this is behind us, the trend resumes.”

Even if Republicans are making a stink about the bill now, it’s possible that they “can then be constructive in some more behind-the-scenes follow-up,” Kristin Eberhard, the climate-policy director at the Niskanen Center, a moderate think tank with libertarian roots, told me. Last year in Washington State, Republicans voted unanimously against an ambitious cap-and-trade bill, but then helped create a more productive follow-up to the bill, she said.

That may not happen in national politics, which remains significantly more ideological and acrimonious than a West Coast statehouse. But national Republicans will have an opportunity to work with Democrats on the climate if they so choose, she observed. As part of his deal with Senator Joe Manchin over the IRA, Senate Majority Leader Chuck Schumer promised to bring a bill loosening some environmental permitting rules to the Senate floor. Permitting reform was a major plank of the climate policy that House Republicans announced earlier this year.

But if the GOP sticks to its steadfast opposition to any significant climate policy, that could have complications for the IRA going forward. President Joe Biden is expected to sign the bill into law early next week, but at some point, can Republicans reverse it? In a way, the question is meaningless. Congress can do anything it wants within its constitutional limits. The geography of the Senate is skewed against Democrats’ current demographic coalition, and there’s a good chance the GOP will take over the chamber in November. If Republicans win 60 votes in the Senate, creating a filibuster-proof majority, then no possibility is off-limits. And Biden’s approval rating is near historic lows, opening the door for a Republican to win the White House in two years.

But some parts of the IRA will be much, much harder to reverse than others. By January 2025, when Biden’s first term ends, tens of millions of dollars from the bill will already be spent. “In two years, a lot can get started, and a lot can get planned, and some steel is going to be in the ground,” Nathan Iyer, an associate at RMI, a nonpartisan energy think tank, told me. Any infrastructure that is built by 2025—new solar farms, wind turbines, factories—would have to be torn up or excessively taxed to be taken out of commission once Republicans take power.

But there will be many important policies only starting to be felt by the end of 2024. The new clean-energy electricity tax credits, for instance, which are projected to provide a large share of the bill’s emissions reductions, will not come into effect until 2025. Once that policy is fully in effect, removing it could hike electricity bills, discouraging Republicans from repeal, but a Republican White House might be able to act before that point. (A less complete version of the policy, applying only to some zero-carbon technologies, will already be in effect.)

It is possible for Republicans to reverse those provisions, but that seems unlikely unless “a strong ideological call” develops to trash the entire package, Iyer said. During the Trump administration, Republicans did not gut an earlier version of the tax credits, which applied only to renewable energy, although they did reduce their value. And Republicans failed to repeal the Affordable Care Act, despite years of insisting that they would try.

By 2025, even if clean-energy facilities have not yet opened, construction on many will be under way, Iyer said. The odds are good that most of those new facilities will be in red states. A recent Bloomberg survey found that the congressional districts with the most planned wind, solar, and battery capacity are overwhelmingly Republican-led; GOP-led states dominate the manufacturing industry too. Repealing the IRA would also take away the expanded carbon-capture and removal subsidies that oil companies are already banking on.

When clean-energy companies break ground or make investments in GOP districts, they should be clear about what policy is making their new facilities possible, Iyer said. By the time that Republicans can undo the IRA, he said, their constituents may be the ones whose jobs are on the line.

Congress Just Passed a Big Climate Bill. No, Not That One.

2022-08-10T09:47:00-04:00

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Updated at 2:55 p.m. ET on August 10, 2022

Yesterday, President Joe Biden signed into law one of the most significant investments in fighting climate change ever undertaken by the United States. The new act will boost efforts to manufacture more zero-carbon technology in America, establish a new federal office to organize clean-energy innovation, and direct billions of dollars toward disaster-resilience research.

No, I’m not talking about the Inflation Reduction Act, the landmark Democratic climate and taxes bill that passed the Senate on Sunday along party lines. I’m talking about a different piece of legislation: The CHIPS and Science Act.

Since it sailed through Congress last month, the CHIPS Act has mostly been touted as a $280 billion effort to revitalize the American semiconductor industry. What has attracted far less attention is that the law also invests tens of billions of dollars in technologies and new research that matter in the fight against climate change.

Over the next five years, the CHIPS Act could direct an estimated $67 billion, or roughly a quarter of its total funding, toward accelerating the growth of zero-carbon industries and conducting climate-relevant research, according to an analysis from RMI, a nonpartisan energy think tank based in Colorado.

That would make the CHIPS Act one of the largest climate bills ever passed by Congress. It exceeds the total amount of money that the government spent on renewable-energy tax credits from 2005 to 2019, according to estimates from the Congressional Research Service. And it’s more than half the size of the climate spending in President Barack Obama’s 2009 stimulus bill. That’s all the more remarkable because the CHIPS Act was passed by large bipartisan majorities, with 41 Republicans and nearly all Democrats supporting it in the House and the Senate.

Read: [The best evidence yet that the climate bill will work]

Yet CHIPS shouldn’t be viewed alone, Lachlan Carey, an author of the new analysis and an associate at RMI, told me. When viewed with the Inflation Reduction Act, which the House is poised to pass later this week, and last year’s bipartisan infrastructure law, a major shift in congressional climate spending comes into focus. According to the RMI analysis, these three laws are set to more than triple the federal government’s average annual spending on climate and clean energy this decade, compared with the 2010s.

One word of caution: The CHIPS bill only authorized much of its new clean-energy spending, but did not appropriate it, a legal distinction that means agencies must go back to Congress in the future to secure the right to put the funds toward specific purposes.

But if Congress follows through on the vision of the bill, the government will spend roughly $80 billion a year on accelerating the development and deployment of zero-carbon energy and preparing for the impacts of climate change. That would exceed the GDP of about 120 of the 192 countries that have signed the Paris Agreement on Climate Change, Carey said.

By the end of the decade, the federal government could eventually spend more than $521 billion—more than half a trillion dollars—to accelerate the development and deployment of zero-carbon energy and to prepare for the impacts of climate change, he added.

The CHIPS Act is not a comprehensive climate bill in the same way that the Inflation Reduction Act, or IRA, is. Unlike the IRA, the CHIPS bill isn’t supposed to drive immediate reductions in carbon pollution or subsidize the replacement of fossil fuels with cleaner alternatives. It probably won’t help the United States get closer to achieving its 2030 target under the Paris Agreement.

Instead, the bill’s programs focus on the bleeding edge of the decarbonization problem, investing money in technology that should lower emissions in the 2030s and beyond. That’s an important role in its own right. The International Energy Association has estimated that almost half of global emissions reductions by 2050 will come from technologies that exist only as prototypes or demonstration projects today.

To get those technologies ready in time, we need to deploy those new ideas as fast as we can, then rapidly get them to commercial scale, Carey said. “What used to take two decades now needs to take six to 10 years.” That’s what the CHIPS Act is supposed to do, at least in theory.

The law, for instance, establishes a new $20 billion Directorate for Technology, which will specialize in pushing new technologies from the prototype stage into the mass market. It is meant to prevent what happened with the solar industry—where America invented a new technology, only to lose out on commercializing it—from happening again, Carey said. Although the directorate will focus on broad improvements across technology, such as AI and high-performance computing, two of the directorate’s 10 new focus areas are climate or clean-energy related. Congress has explicitly tasked the new office with studying “natural and anthropogenic disaster prevention or mitigation” as well as “advanced energy and industrial efficiency technologies,” including next-generation nuclear reactors.

Read: [Why America doesn’t really make solar panels anymore]

The bill could direct about $12 billion in new research, development, and demonstration funding to the Department of Energy, according to RMI’s estimate. That includes doubling the budget for ARPA-E, the department’s advanced-energy-projects skunk works. (ARPA-E is modeled on DARPA, the Defense Department lab that helped give rise to GPS, the internet, weather satellites, and some mRNA vaccines.)

And it authorizes billions to upgrade facilities at the government’s in-house defense and energy research institutes, including the National Renewable Energy Laboratory, the Princeton Plasma Physics Laboratory, and Berkeley Lab, which conducts environmental-science research.

RMI’s estimate of the climate spending in the CHIPS bill should be understood as just that: an estimate. The bill text rarely specifies how much of its new funding should go to climate issues. So whenever possible, Carey and his colleagues extrapolated from existing agency spending. For instance, the National Science Foundation has spent about 5 percent of its budget on climate and clean-energy research over the past few years, so the team assumed that about that portion of the NSF funding in CHIPS would go to those topics, he said.

Regardless of exactly how much new climate spending CHIPS ends up generating, the broader trend is clear. When you add CHIPS, the IRA, and the infrastructure law together, Washington appears to be unifying behind a new industrial policy, focused not only on semiconductors and defense technology but clean energy. The three bills combine to form a “a coordinated, strategic policy for accelerating the transition to the technologies that are going to define the 21st century,” Carey said.

For the past few years, scholars and experts have speculated about whether industrial policy—the intentional use of law to nurture and grow certain industries—might make a comeback to help fight climate change. Industrial policy was central to some of the Green New Deal’s original pitch, and it has helped China develop a commanding lead in the global solar industry.

But with these three bills, little doubt remains about the direction of the U.S. economy, Carey told me. “Industrial policy,” he said, “is back.”

History’s Greatest Obstacle to Climate Progress Has Finally Fallen

2022-08-07T15:35:56-04:00

Updated at 5:19 p.m. on August 7, 2022

Climate change was born as a modern political issue in the United States Senate. On a hot June day in 1988, a senior NASA scientist warned a Senate committee that global warming, which was previously mooted only as a hypothesis, was not only real but already under way. “It is time to stop waffling so much and say that the evidence is pretty strong that the greenhouse effect is here,” James Hansen said.

An auspicious start, and an ironic one. Since then, the fight against climate change in the United States and abroad has been defined by one constant: You can’t get the Senate to do anything. For 34 years, the upper chamber’s peculiar failure to act on the issue has shaped nearly every facet of policy and politics. Because the Senate could not pass a comprehensive climate bill, Congress could not; because Congress could not pass a climate bill, climate-concerned presidents had to rely on executive action and the permissiveness of the Supreme Court, and climate activists had to win smaller state and local reforms. This uniquely American reliance on regulatory, state, and local climate policy has never quite worked—the country still lacks a comprehensive plan to decarbonize its electricity sector, for instance, which remains dirtier than Western Europe’s—and it has been too disjointed to help the United States transition away from fossil fuels.

Even the edifice of international climate diplomacy was built with the Senate in mind. In 2015, diplomats wrote the Paris Agreement on Climate Change to be strictly voluntary for rich countries, so that the Senate would not have to ratify it. (In the final moments, the American delegation had to change an errant shall into a should to save it from Senate jurisdiction.) Madeleine Albright once said that America was “the indispensable nation.” But on climate change, the Senate has been the invincible obstacle.

But now, on a broiling August day 34 years after Hansen spoke, that record began to change. After an all-night session that stretched from Saturday evening into Sunday afternoon, Democrats voted along party lines to pass the first comprehensive climate law in American history. The bill will touch every sector of the economy, subsidizing massive new investments in renewable and geothermal energy, as well as nuclear power and carbon capture and removal, and encouraging new clean-energy manufacturing industries to develop in the United States.

It is the first economy-wide emissions-reduction bill adopted by the Senate. At more than $369 billion, its investment in climate change is the largest in the country’s history.

As the bill neared a final vote, Senate Majority Leader Chuck Schumer of New York declared that it would “endure as one of the defining legislative feats of the 21st century.”

“To the tens of millions of young Americans who have spent years marching, rallying, demanding that Congress act on climate change, this bill is for you,” he said.

The bill will reduce U.S. emissions to about 40 percent below their all-time high, according to several studies from independent analysts. That will get the country about two-thirds of the way to accomplishing President Joe Biden’s goal of cutting emissions 50 percent below their all-time high by 2030, Jesse Jenkins, a Princeton engineering professor and the author of an emissions model, told me. It does this by subsidizing zero-carbon electricity production, encouraging the transition to electric vehicles, and nudging industrial firms to adopt low-carbon manufacturing techniques, and despite a new provision that the government must lease some public lands for oil-and-gas drilling whenever it offers them for renewable construction.

“We have never seen the Senate pass a major climate bill. It felt nearly impossible for decades—it felt nearly impossible for the last month,” Leah Stokes, a political-science professor at UC Santa Barbara, told me.

It is something of a shock that a final bill emerged at all. Democrats spent much of last year negotiating a large spending bill that would accomplish many of their domestic priorities, not only on climate change and taxes but also on child poverty, free community college, and home care for senior citizens. That process fell apart in December when Senator Joe Manchin of West Virginia, one of the caucus’s two most moderate members, pulled out entirely. Negotiations restarted in the winter over a slimmed-down package, then broke down again a month ago when Manchin declared that he was too concerned about inflation to proceed.

Only a last-minute, Hail Mary negotiating effort from Manchin and Schumer salvaged the package. Manchin only endorsed this bill, rechristened the Inflation Reduction Act, in exchange for Schumer’s promise that Congress will, later this year, revisit rules governing where energy facilities are located. The bill passed today reflects Manchin’s particular concerns for the future of the fossil-fuel industry, and in particular West Virginia’s gas companies.

“The fact that Schumer pulled a rabbit out of a hat here and put together a very good climate package—even with a few warts—is unbelievable,” Stokes said.

After all, the Senate has been failing on climate for Stokes’s entire career—really, for most of her (and my) life. The two highest-profile failures came on bills very much like this one, landmark energy legislation considered early in a Democratic president’s first term. In 1992, President Bill Clinton proposed what became known as the “BTU tax,” a surcharge on energy production that would have reduced American emissions and functioned something like a carbon tax. (But not exactly like a carbon tax: The BTU tax would have levied a fee on nuclear energy, which a carbon tax does not do.) The House of Representatives passed the proposal, but the Senate never took it up. Eighteen years later, President Barack Obama endorsed a sweeping piece of climate legislation that would have created a new artificial market where companies could buy and sell the right to emit carbon. The House passed the measure. The Senate left it to die.

But these were not the Senate’s only climate-related failures, Matto Mildenberger, a political scientist and the author of Carbon Captured, a history of American climate inaction, told me. In 1997, the Senate voted 95–0 to forbid the United States from joining the Kyoto Protocol, the first attempt at an international climate treaty. In 2001, President George W. Bush took office with a new promise to regulate four air pollutants, including carbon dioxide. “Even the Bush transition documents said that they were going to do it,” Mildenberger said. The plan perished in part because of strong opposition from conservative Republican senators.

A few years later, Senators John McCain and Joe Lieberman introduced a bill to create a new market for trading carbon emissions—arguably the most aggressive bipartisan climate bill ever proposed in Congress. It went nowhere. Neither did the Lieberman proposal co-written with Senator Mark Warner in 2007.

“What’s different is, it’s more clear to just about everybody that this is a huge problem; this is a huge challenge,” Senator Ed Markey of Massachusetts, who was one of the primary authors of the Obama-era bill, told me. “Two weeks ago, the temperature in London was 105 degrees. The Tour de France, they couldn’t run parts of the race because the pavement was melting. We have wildfires here.

“The other thing that’s different is, we have strong leadership in the White House, and I give them a lot of credit.”

The Inflation Reduction Act will now proceed to the House, where it must receive nearly every Democratic vote in order to pass. It will face two potential obstacles: On the caucus’s right, a set of members, led by Representative Josh Gottheimer of New Jersey, has insisted that it cannot accept a bill that does not increase the tax break given for paying state and local taxes; on the left, a set of members may conclude that the bill does not go far enough on climate change. Neither of these groups, however, is likely to present quite the problem that the Senate did: Gottheimer’s once-large set has already been whittled down to a few members, and left-wing House members are likely to follow Senator Bernie Sanders’s lead in criticizing the bill for not going far enough while still voting yes on it.

The bill’s passage in the Senate is the most significant climate news since China announced two years ago that it would aim to achieve net zero by 2060, perhaps even since the adoption of the Paris Agreement five years earlier. The structure of international climate politics is on the verge of changing: For the first time ever, America’s Article I Congress, with its unique power to tax and spend and remake the shape of the economy, is going to push the U.S. economy to decarbonize. Many fights remain for climate advocates, and state and local laws, as well as the Environmental Protection Agency, must continue to work at decreasing the country’s emissions. (Indeed, Biden can meet his 2030 target only with continued state, local, and executive action.) But never again will climate action have to rely solely on executive action, and on the sort of administrative kludges that the country has previously depended on.

It’s fitting that the Senate passage of the bill happened within days of Australia’s Parliament passing its own climate bill. Australia and the United States—two Anglophone ex-colonies with sizable extraction industries—have epitomized the world’s struggle to take on climate change. (Australia even passed a carbon tax, then repealed it.) By the end of the year, the richest democracies in the world could all have a legislative climate policy for the first time.

As the final votes went through, the floor erupted into applause. (Most Republicans had already left the room.) Democrats exchanged celebratory hugs and backslaps, and a few senators teared up. “This is a planetary emergency, and this is the first time that the federal government has taken action that is worthy of the moment,” Senator Brian Schatz, the Hawaii Democrat who started an initiative in 2019 to coordinate the party’s climate policy, told me. “Now I can look my kids in the eyes,” he said, choking up, “and say we’re really doing something about climate.”

The Best Evidence Yet That the Climate Bill Will Work

2022-08-03T18:58:00-04:00

First we got the bill. Now we have the numbers.

The Inflation Reduction Act, the surprise deal that Senator Joe Manchin and Senate Majority Leader Chuck Schumer struck last week, would significantly reduce greenhouse-gas pollution from the American economy. If passed, the bill would cut annual emissions by as much as 44 percent by the end of this decade, according to a new set of analyses from three independent research firms.

That would make the Inflation Reduction Act, or IRA, the most significant climate bill ever passed by Congress. No law has ever made such a big dent in U.S. emissions, or cut them as rapidly: It would more than double the pace at which the American economy has been decarbonizing, the analyses say.

“I was skeptical of it when we started doing the modeling,” Anand Gopal, the executive director of strategy at Energy Innovation, a nonpartisan policy group in San Francisco that prepared one of the studies, told me. “But now I’m convinced that this is a really meaningful action by the United States on climate in this decade.”

Two-Thirds of the Way to Paris

The Inflation Reduction Act would cut emissions 41 percent by 2030, compared with their all-time high, according to a new analysis from Princeton researchers. That would get the country two-thirds of the way to meeting its current commitment under the Paris Agreement.

The three new estimates were conducted by Energy Innovation; Rhodium Group, an energy-research firm in New York; and the REPEAT Project, a university-associated team led by Jesse Jenkins, a Princeton engineering professor. The studies represent a new spin on an old approach. Normally, when Congress considers a major piece of legislation, outside economists pore over its details, feeding them into computer models to estimate how each provision might affect GDP, inflation, and the federal budget deficit. Instead, the three groups looked at the bill’s climate effects, sketching what the bill could mean for carbon emissions, clean-energy deployment, and energy costs.

All three analyses reached a broadly similar conclusion, pointing to a roughly 40 percent drop in emissions by the end of the decade.

That sort of decline would place one of President Joe Biden’s biggest climate goals in reach for the first time. When the United States rejoined the Paris Agreement last year, Biden committed to cutting the country’s emissions in half by 2030 compared with their all-time high. That goal is in line with estimates that say carbon pollution from the world’s richest countries must go to zero by 2050 if the world wants to stave off the worst effects of climate change by the end of the century.

The Manchin-Schumer bill wouldn’t get all the way to Biden’s 2030 goal, Jenkins told me. But it would get close enough that states, cities, companies, and the Environmental Protection Agency could get the country over the finish line. And it would also boost America’s clout in international climate negotiations, giving it more credibility to push other countries to rapidly decarbonize. “At the moment, the U.S. has just gone to these [UN climate] forums—or even engaged bilaterally with countries—with very limited credibility,” Gopal said. If the bill passes, “that is going to change.”

Three Studies, One Conclusion

Independent analyses of the climate impact of the Inflation Reduction Act arrived at the same finding: If passed, the bill will cut U.S. emissions by about 40 percent compared with their all-time high.

At its core, the bill has one idea that would help accomplish these cuts. “The biggest thing is, it makes clean energy cheap. That’s really the bottom line,” Jenkins said. At nearly every point in the energy economy, it aims to lower the cost of clean energy, providing generous subsidies to spur clean-electricity production while creating programs to tackle bottlenecks on deploying that electricity, such as America’s inability to build an interconnected and blackout-proof grid.

But it is worth dividing the policies in the bill into two categories. In the first category are policies that will drive greenhouse-gas pollution out of the economy this decade. The crown jewel of these policies is a new set of tax credits that will apply to any form of zero-carbon power production, subsidizing the cost of new zero-emissions power plants. These new policies replace an older and kludgier regime where every individual electricity-generating technology had to be subsidized separately, which led to a strange, uneven status quo where, for instance, the federal government would subsidize only the opening of a new solar farm, not the production of solar energy.

The bill takes a similar approach in the transportation sector, the most carbon-intensive part of the American economy. The bill subsidizes the cost of new electric cars, SUVs, pickups, and vans by up to $7,500. Together, the power and transportation sectors make up the largest share of emissions cuts in the bill, Jenkins said.

That’s only half of the policies in the bill, though. The second half of policies focuses on reducing emissions after 2030 by developing today the technology that will make that possible. That means it focuses primarily on the industrial sector, which is poised to become the country’s most-polluting sector by the end of the decade. The bill offers a slew of incentives to underwrite new factories, encourage clean-energy manufacturing, and push that sector toward reaching net-zero emissions. If its policies are successful—and they are, for once, funded well enough that they should be—it will turn the United States into a global leader in the nascent geothermal, hydrogen, and carbon-removal industries.

One thing that every modeler agrees on is that their estimates are going to be wrong. Reality will not look like what their projections suggest. Energy-system models as used in these reports do not account for sudden changes in consumer taste or major geopolitical upheavals, such as Russia’s invasion of Ukraine. Nor do they consider that some consumers, for practical or cultural or political reasons, might want to stick with, say, gasoline-powered vehicles, even at lurid personal cost.

But they’re still useful tools for orienting how to think about this bill. Take Rhodium’s forecast, for instance, which projects that the IRA will cut carbon pollution by 31 to 44 percent by 2030. That worst-case scenario, only 31 percent, assumes that virtually everything that could go wrong will, at least short of a world war, Ben King, one of the firm’s analysts, told me. It would require the rapid cost declines for solar, wind, and electric vehicles that we’re seeing right now to stop altogether, he said. Natural-gas prices would have to crash from their current near-record highs to their historic lows, then remain in the doldrums for 15 years straight. Oil prices, too, would have to collapse. “All of those things could happen, but it’s pretty darn unlikely,” King said.

The scenarios also assume that, were Congress to pass the IRA, no further entity at any level of the American government would pass any climate policy for a decade. The EPA would have to decline to regulate carbon pollution from power plants or cars and trucks, even though the Biden administration is already beginning to write rules for those sectors. States and cities would have to not pass local climate laws, even though the IRA would make it cheaper to do so.

Which isn’t to say that the U.S. will automatically overshoot the best-case scenarios in these reports. A future Republican president and Congress could weaken the IRA provisions. Nobody knows the future. But it suggests that compared with nothing, passing the IRA will improve the country’s odds of tackling climate change no matter what the future holds.

Earlier this year, Rhodium projected that under current policy, America could cut its emissions 24 to 35 percent by 2030, compared with their all-time high. Now it says that under the IRA, the U.S. can expect emissions cuts of 31 to 44 percent. In other words, even in a (very unlikely) worst-case scenario where the IRA passes and then everything goes wrong, U.S. emissions will be just a few percentage points higher than if nothing had passed and absolutely everything went right.

There is no perfect climate bill, but these reports suggest that the IRA is a pretty good one, and much better than Democrats might have once expected. The analyses show that the IRA clearly and easily meets one of the core requirements of any climate bill: It cuts emissions on net compared with the status quo. In all likelihood, it will leave us significantly better off. Ten years from now, even in a worst-case scenario, the United States will have knocked out much of its emissions from the power and transportation sectors. And the country will have a much better idea of how to eliminate the final 50 or 60 percent of emissions remaining in the economy.

Finally, the results point to one overarching conclusion: Only Congress has the power to decarbonize the economy. With one piece of legislation—a bill that Joe Manchin, whose family owns a coal-trading business, has agreed to, for crying out loud—the legislature can double the pace at which the American economy is cutting emissions. One single, imperfect act could do more for the climate than 30 years of federal, state, and local action combined. Because of the demographic doom that the party is facing, this may be Democrats’ last chance to pass a bill for the next decade or so. This is the country’s best and last opportunity to meet the 2030 goal and, with it, a world where net zero by mid-century is actually possible. But to get there, Congress has to pass the bill.

Manchin and Schumer’s Astonishing Climate Deal

2022-07-28T07:02:42-04:00

Every few years, American politics astonishes you. Yesterday was one of those days.

In the late afternoon, Senator Joe Manchin announced that he had reached a compromise with Senate Majority Leader Chuck Schumer over President Joe Biden’s long-ailing legislative agenda. In a move that seemed to shock almost all of their colleagues, the two men unveiled a nearly completed bill that will reduce the federal budget deficit, reduce greenhouse-gas pollution, invest in new energy infrastructure, and lower health-care costs.

By 8:30 p.m., the complete text of a bill that nobody had known about four hours earlier had been released. The Senate is aiming to vote on it next week.

The most popular parts of the bill will likely be everything that doesn’t have to do with climate change. The proposal allows Medicare to negotiate the cost of prescription drug prices, for instance, potentially lowering drug costs for seniors. It extends the current subsidies for Affordable Care Act insurance plans to 2025, meaning that they will stay on the books at least through the next presidential election. The bill also salvages Treasury Secretary Janet Yellen’s global minimum-tax deal, meant to keep large companies from location-shopping in order to keep their tax burden low.

But on climate and energy in particular, the bill is a landmark. It authorizes $369 billion of new climate spending, the largest investment in emissions reduction in American history—and, more important, the biggest blow against climate change ever struck by the U.S. government. “This is it. This is the real victory,” Sam Ricketts, a co-founder of Evergreen Action, a climate think tank, and a former adviser to Governor Jay Inslee of Washington State, told me. “I struggle to find enough superlatives to describe this deal.”

The legislation is so big, so multifaceted, that I don’t think it’s possible to summarize in this narrow space. But I will hit a few highlights that are crucial to understanding how the bill’s energy provisions work and what they could mean for the country and the world:

The core of the bill is a set of tax credits that could touch nearly every aspect of the energy economy.

The bill’s main tool, its proverbial bludgeon, is a new set of tax credits that could remake the way America generates electricity.

To understand why they’re important, remember that, for the past decade, the U.S. has encouraged the growth of wind and solar through a particularly kludgy set of tax credits. For instance, a developer could get a tax break by investing in, but not producing, solar power. And if Congress wanted to increase the market share of any new zero-carbon form of power generation, it had to pass a new law creating a tax credit for that specific technology. Because of the way these tax credits were structured, they typically had to run through a large bank or investment firm, and they couldn’t be used at all by a publicly owned utility or nonprofit.

However tedious this approach was, it worked. It helped drive massive declines in the cost of wind and solar power and cut carbon pollution from the U.S. power sector 40 percent below its all-time high.

The new bill will significantly broaden the scope of these incentives, replacing them with technology-neutral tax credits that can be used for any low- or zero-carbon form of power generation. At the outset of a project, developers can make a choice: Either they can take the new investment tax credit, which will generally cover 30 percent of the cost of their project, or they can take the new production tax credit, which will pay them for every kilowatt-hour of zero-carbon electricity that they generate.

When economists at the University of Chicago and the Rhodium Group analyzed an earlier version of this proposal last year, they found that these technology-neutral tax credits were strikingly efficient, creating $1.5 trillion in economic surplus while eliminating more than 5 billion tons of carbon pollution. The tax credits had a benefit-to-cost ratio of about 3 to 1, Michael Greenstone, the Milton Friedman Distinguished Service Professor in Economics at the University of Chicago, told me. “It’s very rare that we get opportunities to have policies with a benefit-to-cost ratio of 3 or 4 to 1. Normally it’s, like, 1.3 to 1, and we economists get very excited,” he said.

The bill will transform electric-vehicle sales.

Among the tax credits is a new $7,500 rebate for new EV purchases. This is quite a big deal: Transportation is the most carbon-intensive sector of the U.S. economy, and privately owned cars and light trucks—that is, normal family vehicles—produce 15 percent of the country’s carbon pollution. The $7,500 subsidy phases out as buyers’ income level increases—it goes to zero at $150,000 for single filers, $300,000 for couples—and it will subsidize the cost of expensive SUVs, pickups, and vans more than it will the cost of sedans and coupes. Importantly, the new tax credit will encourage the manufacture of cars and their constituent parts in North America.

The bill also extends a new (and similarly structured) $4,000 incentive for Americans to buy used electric vehicles—a first.

It will also change how Americans heat, cool, and power their home.

The bill includes 10 years of subsidies for households to buy heat pumps, electric water heaters, and rooftop solar panels. That’s separate from the $10 billion in funding for low-income Americans to increase their home’s energy efficiency and electrify key appliances.

The bill contains a slew of programs to decarbonize heavy industry.

U.S. industry is poised to become the country’s most carbon-polluting sector by the end of the decade. The bill’s tax credits and incentives will help nurture domestic clean-hydrogen, direct-air-capture, and advanced-nuclear industries. While the bipartisan infrastructure law, passed last year, included tens of billions to fund one-off demonstration projects for these technologies, this bill provides longer-term tax credits meant to help these industries scale into full-size businesses.

It also invests in the old, polluting fossil-fuel system.

The bill seems to include two sets of provisions that environmentalists are likely to despise, and that could send American emissions in the wrong direction. The first is a requirement that the government open up new locations for oil and gas leasing in Alaska and the Gulf of Mexico. The second is that it ties renewable development on federal property to fossil-fuel development. One of its provisions forbids the government from selling leases to install solar or wind on federal land or seafloor when it has not also recently opened territory to oil and gas developers. Many advocates knew that this deal would involve some compromise, and there it is.

Schumer will now move to get the bill to Biden’s desk as soon as possible. But the deal is not even a bill yet, nor is it a done, uh, deal. First it has to make it out of the Senate, where it will need the support of every Democratic senator. That will require senators to stop getting COVID, which they have been doing a lot lately, and Senator Patrick Leahy of Vermont—who has been absent since his hip-replacement surgery last month—to make it back into work. Moreover, it will require the support of Senator Kyrsten Sinema of Arizona. The bill seems to include certain tax provisions, namely closing the “carried interest loophole,” which allows investment advisers to treat a certain portion of their returns as capital gains instead of as income, that Sinema had previously said she could not support.

Then it must go to the House of Representatives, where it faces another difficult battle, again rooted in its tax provisions. The bill does not cut taxes for high-income earners in New Jersey, New York, and other high-tax blue states as much as Representative Josh Gottheimer of New Jersey had wanted. But if skeptics kill the bill over that alleged failure, they will have nixed a once-in-a-decade chance for Democrats to decarbonize and develop the U.S. economy.

A few weeks ago, when the previous version of the reconciliation bill was still alive, I set out two questions by which any climate legislative effort should be judged: First, would the bill reduce U.S. emissions on net compared with doing nothing at all? (By that point, it seemed likely that Schumer would concede some amount of new fossil-fuel development to Manchin.) And, second, would the bill make global decarbonization more likely? That is, would it help make zero-carbon technologies cheaper, help produce them in abundance, and generally strengthen the political position of those who want to see the world decarbonize?

The bill aces both tests. It will almost certainly slash U.S. emissions on net, even when accounting for the increased carbon pollution from leasing new sites for oil drilling in Alaska and the Gulf of Mexico. And it puts Biden’s ambitious Paris Agreement goal—to cut emissions by 50 percent, compared with their 2005 level, by 2030—back in reach.

Estimates of earlier versions of the bill found that its provisions would get the country 90 percent of the way to meeting that goal, and although the updated version probably does not go that far, Schumer’s office has claimed, in essence, that it can still get the U.S. about 70 percent of the way to meeting Biden’s goal from current emission levels. That will leave a much smaller chunk of emissions for executive action to try to deal with.

“It looks like the estimate from Senator Schumer’s office that this will take U.S. [emissions] to about 40 percent below 2005 levels is accurate,” Jesse Jenkins, a Princeton engineering professor who runs a team that estimates the emissions effects of climate policy, told me in an email. “That’s huge.”

The bill could also set the world back on the right track. Over the past few months, the energy crisis and Russia’s invasion of Ukraine have imperiled global decarbonization by sending countries hunting for any fuel that they can get their hands on, carbon content be damned. Some European countries have even restarted burning coal out of a lack of options. This massive public investment in clean energy should help reduce costs around the world, creating a new energy abundance. It also improves America’s ability to cast itself as a defender of the climate and, in turn, cajole other countries into cutting their own emissions.

In short, the bill “keeps us in the climate fight and makes it possible that executive action, state and local government policies, and private sector leadership can get us across the finish line,” Jenkins said. “Without this bill, we’d be hopelessly far from our climate goals. I very much hope they get this across the finish line and to President Biden’s desk ASAP.”

A Plan to Lower Gas Prices—And (Maybe) Help the Climate

2022-07-27T10:15:00-04:00

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If you drive along the Gulf of Mexico from Corpus Christi, Texas, to Baton Rouge, Louisiana, you will pass four U.S. government sites that look like nothing special—a bland patch of concrete, a few office buildings, some oil silos huddled together. These facilities conceal something extraordinary: a network of cathedral-esque caverns carved into underground rock salt that can collectively hold more than 700 million barrels of oil. Together, these caverns, which are wide and deep enough to swallow the Empire State Building, make up the Strategic Petroleum Reserve, a marvel of American engineering and the largest emergency stockpile of crude oil anywhere in the world.

The Strategic Petroleum Reserve, or SPR, is one of those pieces of infrastructure that nobody needs to think about in ordinary times. And for the most part, nobody has. Created after the 1973 oil embargo, the reserve has become a kind of all-purpose cushion for oil supplies in times of war or natural disaster. But in recent months, it has become a lifeline for President Joe Biden. Since April, the government has sold about 1 million barrels a day from the reserve to private oil companies. It is the largest and fastest release of SPR supplies ever, an emergency release that Biden says is justified by “Putin’s price hike at the pump.” Along with recession fears and China’s ongoing lockdowns, the release has helped lower oil and gasoline prices since they peaked earlier this year.

But the reserve might soon play a more prominent role for the Biden administration and the American public than it does right now. Yesterday, the White House announced that it would rewrite the rules governing the reserve so that it can buy a barrel of oil without actually getting it delivered for months, essentially providing domestic oil drillers with a form of insurance and placing a partial floor under oil prices. Advocates of the policy say that it may allow the government to stabilize energy markets, lower gas prices—and maybe even help the climate along the way.

Let’s back up. After entering the White House with dreams of becoming the next FDR, Biden’s many plans have been tripped up by, well, just about everything—inflation, the war in Ukraine, Senator Joe Manchin, and his own mistakes. His approval ratings are so low as to be lodged in a subterranean salt cavern of their own. Democrats are heading for a disaster in this year’s midterm elections, and some people in his party have contemplated replacing Biden on its 2024 ticket, when he will be 81.

Part of Biden’s struggle is that his desires seem to be directly at odds with one another. His biggest priority is to slow down the scorching inflation that is driven in part by high energy prices, especially oil prices, that have surged largely because of Russia’s invasion of Ukraine. Lowering global oil prices almost inevitably means encouraging more U.S. oil drilling, to fill the gap left by Russia and decrease global oil prices.

Yet Biden doesn’t want to burn more fossil fuels. During the 2020 campaign, Biden said that climate change was one of the four major crises facing the country. One of his first acts as president was to block the Keystone XL pipeline and hit pause on new permits for oil drilling on public lands. Especially now that the Senate has given up on his climate bill, Biden is under pressure to make good on his climate rhetoric and reduce emissions.

The White House’s latest move seems to be broadly following a plan released by the liberal think tank Employ America. Over the past few months, the group has been making a claim that may sound too good to be true: He can fight climate change and lower gas prices at the same time. By using the Strategic Petroleum Reserve as a swing buyer and seller of oil, he can put a de facto floor and ceiling on oil prices, the group claims. Thus Biden can slow the rise of gas prices and ward off recession, while also helping avoid a total collapse in oil prices such that people don’t feel a need to buy electric vehicles or avoid unnecessary travel.

In essence, the Strategic Petroleum Reserve’s ability to hold enormous amounts of oil for long periods of time—a very specific task that the government knows how to do well—can be harnessed for the greater good. It allows the government to intervene in the oil market when the price of oil falls too low or too high, buying or selling oil to keep the price in a certain window, then holding that oil until the price changes. The newly proposed rule changes will make that kind of intervention possible.

At the root of its proposal is an alluring idea: There is a “Goldilocks zone” for oil prices. When oil gets expensive, it can stifle the economy and start a vicious cycle of inflation. When oil gets cheap, it can cause damage to the climate: It can slow down the energy transition, encourage wasteful car purchases, and broadly increase emissions. But, crucially, cheap oil is also bad for oil companies, because it does not provide them with enough revenue to pay off their debts or invest in new drilling. Although pushing the fossil-fuel industry into insolvency might sound attractive to many progressive politicians in the short term, it can come back to bite them—as Biden is seeing now. That’s because when oil prices collapsed during the pandemic, companies closed down refining capacity and stopped drilling for more oil, partly setting up the current cycle of price hikes.

In a memo that Employ America circulated last week, the think tank proposes that the Biden administration rewrite the rules that the Department of Energy uses to purchase oil for the reserve. (It wasn’t the first group to propose a rethink of the SPR: Researchers at Columbia University did the same in 2018.) This could allow the government to function as a de facto swing supplier, buying more oil when demand is weak and selling it when demand is strong. That could add as much as 1.8 million barrels a day, claims Skanda Amarnath, Employ America’s executive director. If true, that would exceed OPEC Plus’s own ability to swing production prices.

The first tool that Employ America suggests is functionally the same as what the White House just announced that it will do: allow the government to buy oil at a market price without immediately taking delivery of that oil. (Instead of using fixed-price forward contracts, Employ America proposed that the government should write a type of contract called a put option that allows, but does not obligate, oil companies to sell it oil. But that is a minor difference.)

The second tool—which the Biden administration has not yet adopted—is auctioning off contracts to oil producers through a type of auction called a Dutch auction. Through such a procedure, Employ America hopes that the reserve can account for more than the price of a marginal barrel: It could write options for companies that would be able to drill the most additional barrels, for instance, or for companies that could use high environmental standards to drill. In that way, the government might even use its power as a buyer of first resort to encourage oil companies to reduce their methane leaks or wasteful flaring.

Here’s the rub: Yes, replenishing the SPR does help the fossil-fuel industry, at least in the short term. Although the White House’s plan will provide more price certainty for consumers, it does so via a subsidy for fossil-fuel producers, Mark Paul, an economics and environmental- studies professor at the New College of Florida, told me. That means it will “increase extraction, which will increase greenhouse-gas emissions.”

It will also underwrite the creation of fossil-fuel infrastructure that will last for decades to come. “Once additional resources are developed for extraction, it’s not like they’re going to be wound down over two years,” Paul said. “It’s a policy to increase extraction when all the data show us we can’t extract even the oil reserves we already have.”

The plans’ advocates respond that gas prices are a first-order political crisis for Biden: If Democrats can’t lower them, then they will lose in 2022 and Biden will lose in 2024, putting the White House—and the power to regulate carbon from any sector of the economy—out of reach for years. By keeping gas prices in this “Goldilocks zone,” Biden might be able to help keep consumers happy without also making gas so cheap that would-be EV buyers are instead opting for SUVs. And Paul agreed that there are better and worse ways to encourage extraction: If most of the surge in drilling comes from shale wells, which produce most of their oil in the first 18 months, then Biden can avoid significant carbon lock-in, he said. “But that isn’t the way [the White House announcement] is written,” he said. “Producers will get to make that decision.”

The Biden administration hasn’t yet said what price it will seek as a floor for oil. After asking around among experts, I’ve heard suggestions anywhere from $70 to just below $100 a barrel for the “ideal” price of oil at this moment—enough to unlock production but still encourage continued decarbonization.

But Biden may not need such a complicated proposal to do the same amount of good, Ben Cahill, a senior fellow at the Center for Strategic and International Studies, told me. Although he had not analyzed the specifics of Employ America’s proposal, he worried that such an intricate plan to intervene in the oil industry or refinery system would create opportunities for canny investors to exploit. “We should be skeptical of new initiatives that could just support refiner or trader profits,” he said. “I tend to think the market is pretty clever.”

But Cahill still agreed that it’s time to get more creative about using the SPR. “The world has changed since the SPR was created. It was designed to protect the U.S. from a dramatic cutoff of imports,” Cahill told me, but that risk is much less likely now than it was in the 1970s. More recently, it’s often used to cushion oil prices after a major natural disaster—usually a hurricane—takes out production capacity. “But the idea that we’re going to have a series of natural disasters so big they deplete the SPR is just fanciful,” he said.

If this approach works, then eventually, the government could expand its energy stockpiles beyond petroleum and other fossil fuels. It could open a lithium, cobalt, or graphite reserve, which are essential to the energy transition and much simpler to store than oil. (You need a warehouse, not a salt cavern.) It’s unclear whether the White House could open a strategic reserve for these inputs without further approval from Congress.

One of the main lessons of the pandemic is that during an emergency, the government can best flex its muscle where it already has expertise and capacity. In March 2020, the government quickly sent checks to most Americans—it does a version of that with most people’s tax returns, after all. But it struggled to lend money to small businesses as effectively and fairly. The government had the infrastructure and state capacity to buttress sending checks, but not keeping small firms solvent.

The good thing about the SPR plan is that the government already has this capacity: It knows how to store, sell, and buy up oil. Biden’s political future just might hinge on whether he can use that power more creatively.