Under Divided Government, Can Anything Get Done on Climate?
As the dust settles (maybe) from the 2020 elections, America is looking at the perennial prospect of divided government. While we won’t know for sure until January, many people in and around Washington are already scrambling to make plans for life with the Democrats in control of the presidency and House of Representatives, and a Republican Senate.
Divided government means that many of the big dreams of partisans on both sides are unlikely to come true. We won’t be seeing a Green New Deal enacted any time soon. Yet even a Biden/McConnell government would not necessarily mean that nothing will get done. Bipartisan action is definitely possible in the right circumstances. Here are several policy initiatives that may see traction in the 117th Congress:
Carbon Offsets
The bipartisan Growing Climate Solutions Act aims to create a government-run verifier for agriculture-related carbon offsets. The program would be voluntary, but would add transparency and credibility to the growing offset market. The program also dovetails with the Republican climate initiatives in the House, which have focused on carbon sequestration via natural systems. While Democrats have often been critical of carbon offsets, due to uncertainties regarding their permanence as well as the timing of when sequestrations are achieved, they may see things differently if winning over some Republican support becomes a requirement for climate efforts.
Trillion Trees
Like carbon offsets, the “Trillion Trees” initiative aims at pursuing low-cost abatement opportunities. The precise effectiveness of the “Trillion Trees” initiative, which both President Trump and House Republicans advocated, is still being debated, but nonetheless is widely supported both domestically and abroad. Formal adoption of legislation, such as Rep. Bruce Westerman’s Trillion Trees Act, would signal a victory for Republicans that would be hard for a Biden administration to oppose.
Resilience Efforts
Both Republicans and Democrats in the House of Representatives have voiced support for improving coastal resilience. For Democrats, this has been viewed as an environmental conservation effort, while for Republicans it has been seen as a way of mitigating the risk to taxpayers from post-disaster relief payouts. As Republicans have signaled a greater willingness to engage in climate-related policy proposals, resilience may be an easy bipartisan lift and could include preservation of mangroves and wetlands, as well as improved urban planning that reduces flood risk (less concrete and impermeable land, better drainage design, etc.).
It should be noted that Rep. Garret Graves, arguably the de facto leader of the Republican climate movement, has already introduced bipartisan legislation with a companion bill in the Senate to establish a “National Disaster Safety Board” to examine opportunities for reducing harm from natural disasters.
Technology Neutral Tax Credits
While Republicans have traditionally been opposed to energy tax credits, and a Republican-controlled Senate will likely return to a philosophy of fiscal conservatism as spending will no longer yield political victories, there may be opportunities in tax credit reform that is part of a broader budget package. In 2015, Republicans agreed to extend tax credits for wind and solar in exchange for a lifting of the oil export ban. Given that there are still considerable barriers to the export of natural gas, which can lower global emissions by displacing foreign coal resources, there may be opportunities for compromise on tax credits (like the bipartisan Energy Sector Innovation Credit) in exchange for reforms that ease gas exports.
As a caveat, tax credits are rarely a preferred mechanism for anyone pushing fiscal conservatism. In an increasingly constrained budgetary outlook, the wisdom or appetite for any new tax credits will be exceptionally low. However, an incremental victory that may strike a political equilibrium is to pivot credits to technology neutrality and focus on getting nascent technology to scale. Doing so can yield greater effectiveness at lower burden to taxpayers than credits for specific mature technologies, and if coupled with some pro-market reform as the 2015 tax-credit-oil-export-ban-swap was it could be could be viable in a Republican Senate with a President Biden.
Reforms to the National Environmental Policy Act and Other Regulations
Under the Trump presidency, Democrats staunchly opposed any efforts to modify the National Environmental Policy Act (NEPA), as environmental groups critiqued any modification of the dated regulatory regime as an environmental harm. In recent years, however, NEPA has become more of a barrier to clean energy than anything else. Not only does it interfere with the siting of large renewable energy projects, but it also is problematic for the large transmission projects needed to deliver electricity from new load centers (where renewable energy is most viable) to existing cities and demand centers.
Simple reforms to NEPA such as a truncation of the statute of limitations (which President Obama already amended once), or expansion of categorical exclusions for renewable energy or transmission projects would likely be supported by Republicans and a handful of moderate Democrats. These low-risk reforms could be popular among Republicans, amenable to moderate Democrats, and would be feasible for a President Biden to sign as he could face pressure to increase renewable energy adoption under his tenure.
These measures are on a smaller scale than some activists would like. But they show that bipartisan action on climate issues is possible. And that’s important. In fact, “climate action” is increasingly effective through voluntarily private behavior, and we’re seeing what constitutes good economic policy has major climate co-benefits.
Whatever the ultimate results of the 2020 election, a record number of Americans voted for both the Republican and Democratic candidate. Sweeping climate policy was not an electoral winner, and durable climate policy that yields good results at low costs is what is in demand. Climate-focused legislators and policymakers would be wise to try and score singles and doubles, instead of trying to set up a grand slam that would require total Democratic control of government and coal-state Senate victories. The five issues listed above should offer a framework for reasonable bipartisan climate progress that can get signed off by both the 117th Congress and the Biden administration.
