What to Make of Joe Manchin’s Climate Deal

Can the Inflation Reduction Act be the climate policy we need? With Joe Manchin's influence baked into it, it's not a slam dunk.

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Climate and Energy

by Peter Hart

After months of near-misses and false starts, Senate Democratic leaders have announced a compromise spending package. If passed, the package would become the most significant investment in climate and energy spending in decades — totaling $369 billion over ten years. 

The Inflation Reduction Act (IRA) was tailored to the liking of West Virginia Senator Joe Manchin, a coal millionaire who has made no secret of his preference for propping up the fossil fuel industry. The deal — which still has several legislative hurdles — is essentially a slimmed-down version of the Build Back Better Act. That version called for $555 billion in climate and energy spending when it was passed in the House. This bill provides much-needed support for clean energy, that much is true. But it comes with many concessions that advance fossil fuel interests and lock in a dangerous climate future.

The IRA Is A Mixed Deal For The Climate

When it comes to climate action, much of the IRA is geared towards wind and solar credits. These credits would bolster private investment in renewables and clean energy manufacturing. The IRA would also increase the tax rebates associated with purchasing an electric vehicle. On the flip side, there are serious questions about whether the credits would actually apply to most car purchases. There are also funds for home energy improvements and environmental justice spending. However, advocates have criticized those provisions for falling well short of the White House’s own goals. 

There are also some highly unappealing provisions — including billions dedicated to carbon capture and sequestration (CCS). CCS is the dirty energy industry’s favorite false climate “solution.” There are also substantial investments in fossil-based hydrogen, though studies show little to no climate benefit over fossil fuels. Such policies would subsidize ineffective technologies that prolong the life of the fossil fuel industry.

The legislation also devotes billions to a “methane fee.” This fee would penalize companies that leak the potent greenhouse gas into the atmosphere from wells, pipelines and other infrastructure. These leaks are not even currently measured or adequately monitored, so it remains unclear how this approach would work. As written, it amounts to a subsidy for fossil fuel companies, in hopes that the penalty would lessen pollution. 

Several Dirty Energy Devils Lurking in the IRA’s Details

This legislation will increase fossil fuel development in several ways. It bizarrely requires the federal government to reinstate a massive oil and gas lease sale in the Gulf of Mexico. That sale was blocked by a federal judge in January. 

The deal also features a dirty-for-clean public lands tradeoff. If the federal government wants to approve any new wind or solar projects on public lands or waters, it would first have to offer millions of acres of public land for oil and gas leases. 

The IRA reinforces the deluded idea that we can secure real climate victories by both ramping up clean energy and continuing to approve new fossil fuel projects. The last decade of energy development in the United States shows that clean energy doesn’t displace fossil fuels on its own. In fact, we have grown both at the same time. Continuing this dual-track is dangerous — it fools people that progress is happening when fossil fuels are still endangering our future. 

What’s worse, to secure Manchin’s IRA support, the Senate must consider a separate measure to expedite energy infrastructure permitting. While this could help build badly needed transmission infrastructure for renewables, we can expect Manchin and Republican lawmakers to craft something primarily benefiting fossil fuel facilities and projects. Additionally, Manchin has strong-armed cooperation from Senate Democratic leaders and the White House to finish the disastrous Mountain Valley Pipeline. 

This kind of so-called ‘permitting reform’ has been a priority for the fossil fuel industry. That could explain why some dirty energy CEOs appear mostly pleased with the overall package.

Will The Inflation Reduction Act’s Climate Provisions Work?

Obviously, the goal of any climate plan is to reduce climate pollution. IRA proponents argue it will work, citing models that predict a 40% reduction in carbon emissions by the year 2030. However, there are several massive caveats. First, it’s not a 40% reduction in climate pollution; it’s from the emissions recorded at a high point in 2005. And according to the Environmental Protection Agency’s calculations, net emissions have already declined 21% between 2005 and 2020.

Indeed, the models that show a range of 31 to 44% reductions through the IRA also forecast that we would reduce emissions between 24 and 35% without passing any new climate policies. Moreover, the assumptions behind these models remain unclear. For instance, to what extent do they rely on carbon capture’s promised results despite decades of failures? Are they underestimating the impact on pollution from fracking on public lands? 

The IRA is the product of painful compromise. It does not mandate emissions reductions. And it fails to threaten corporate polluters with heavy fines for poisoning communities and threatening the stability of our climate.

If it passes, we will keep pushing for stronger measures to secure a livable future and protect our planet. The type of bold, robust climate action that we need at all levels of government must aim higher. We can — and must — do more.

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