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Can Biden Get Energy Bills Through Congress?

By Cas Biekmann | Wed, 01/27/2021 - 15:41

Can US President Joe Biden push a 100 percent clean energy bill through both Congress and the Senate? Analysts consulted by GreenTech Media think that the chances of clearing a Senate filibuster yields little chance. Nevertheless, budget reconciliation can pave the road toward the energy transition. Moreover, should Biden need to push some buttons, Mexico’s energy policy could find itself under US pressure as well.

As Bloomberg News reported, current evidence shows Biden has kickstarted the US clean energy transition. The goal is to have the country operating on 100 percent clean energy by 2035. To achieve this, Biden has appointed a team with unprecedented expertise in the area of clean energy. Whether the 2035 goal is viable is still questionable, but the issue now is how the Biden administration plans to get there in the first place.

Experts agree that a complete break from past energy standards would likely not gain the 60 votes needed to clear a Senate filibuster, a well-known tactic to obstruct votes in the senate by endlessly extended debate. But climate policy experts see another possible route: budget reconciliation. This could create a way to pass tax and spending legislation on a simple majority of 51 votes. The route has been effective for difficult policy approval before, like Obamacare and the 2017 tax cuts. Now that both Georgia Senate seats went to the Democrats, the party holds the minimal majority possible. Experts such as Leah Stokes, Political Science Professor at the University of California, furthermore noted that establishing a clean energy credit trading system on the government balance sheet would provide an ample incentive. Utilities would be forced to reach climate goals or purchase credits from the government to offset their non-compliance. Reconciliations offers another option, where companies pay fines if they miss climate targets and receive benefits if they achieve them.

Biden’s climate plans could still influence Mexico’s stance on privately-run energy, as well. President López Obrador has stated it will not budge in its policy to strengthen state-run PEMEX and CFE. “There is not going to be a change because we are not going to continue with the policy of dismantling the nation’s companies,” he said. “They (the US) should not be surprised. They, like any country, defend their strategic economic areas.”

MBN Experts have shared their expectations regarding US energy policy, noting that narrow majorities can easily break down the ambitious plans and that other countries, such as China, might have a bigger role in clean energy development in general. Nevertheless, a bigger focus on clean energy investment is good news.

Furthermore, ATCO Energía CEO Ramón Basanta noted that internal barriers might just push the US to look toward the international sphere instead. “Biden will therefore focus on his international agenda, where he has a freer mandate that does not depend on so many internal regulations. He will attempt to make the US’ trade partners, including India, Mexico and Canada, adjust to his policies and leadership. The first areas where he will make changes is in emissions of methane, CO2 and mercury from cars, airplanes and boats. This will immediately send a strong message to the world,” Basanta says. During this decade, Basanta believes that many countries will work to become net-zero by 2050 – goals that the EU and China are already committed to. With the US now added to this fold, combined leadership will bring clear pressure toward countries that are not yet on board. Real progress toward decarbonization could be made within this timeframe.

The data used in this article was sourced from:  
GreenTech Media, Reuters, Bloomberg Green, MBN
Cas Biekmann Cas Biekmann Journalist and Industry Analyst