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US Congress: Climate, clean energy tax bills to be 'front and center' in 2020

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US Congress: Climate, clean energy tax bills to be 'front and center' in 2020

SNL Image

Actress and activist Jane Fonda, center, attends a protest in November 2019 outside of the U.S. Capitol in Washington, D.C., that called on Congress to address climate change.
Source: AP Photo

Despite facing low odds of enactment, U.S. lawmakers are likely to keep pushing ambitious legislation in 2020 to address climate change as they sharpen their messages on the issue ahead of the November elections.

But members of the U.S. Congress could score victories on more modest, bipartisan measures to curb global warming, including bills to fund research and development of low-carbon technologies and expand tax incentives for clean energy sources. Chances are also good for signing a broad surface transportation bill into law that contains climate- and energy-focused provisions, industry sources say.

Democrats' takeover of the U.S. House of Representatives in 2019 spurred a wave of climate and clean energy bills, including a proposal to keep the U.S. from withdrawing from the Paris Agreement on climate change. In addition, many Democrats co-sponsored a high-profile but non-binding resolution calling for a "Green New Deal" to eliminate energy-sector carbon emissions while providing jobs and healthcare guarantees for Americans.

Both measures ultimately stalled out amid resistance from Republicans and more centrist Democrats. But lawmakers are set to roll out more climate legislation in 2020 while promoting bills that did not get much attention in 2019.

"Obviously, climate will be front and center," said Desmarie Waterhouse, vice president of government relations and counsel for the American Public Power Association.

Democrats with the House Committee on Energy and Commerce plan to release several bills to decarbonize the U.S. power sector and other segments of the economy by 2050. In early December, U.S. Rep. Paul Tonko, D-N.Y., who chairs the panel's Subcommittee on Environment and Climate Change, said that a power-focused discussion draft could come out in late 2019 or early 2020 and lay the foundation for a potential tax or fee on carbon emissions.

Americans for Carbon Dividends, an advocacy group promoting a national fee on carbon emissions where the proceeds are returned to taxpayers, is also working with lawmakers to draft carbon tax legislation that could come out in the first half of 2020. The group does advocacy work for the Climate Leadership Council, whose members include energy companies such as BP PLC, Exelon Corp., and Exxon Mobil Corp.

"If something is going to be done, it's likely going to be done in the first quarter or maybe early second quarter of [2020]," AFCD's managing director and former Republican congressman Ryan Costello said. "After that, everyone has turned on their campaign hats and... it would be a judgment call on whether we would even want something introduced in 2020 that fell outside of that window."

House Democrats could also try to advance some or all of the proposals in a draft clean energy tax package unveiled in November 2019 entitled the Growing Renewable Energy and Efficiency Now Act of 2019, or GREEN Act. In late December, Congress approved one-year extensions to the federal wind energy production tax credit and incentives for smaller-scale renewable technologies. But proponents of the GREEN Act hope to see more action on tax breaks for clean energy technologies, including the creation of investment tax credits for standalone energy storage projects and offshore wind farms.

Although Democrats and other climate hawks will introduce new climate policies in 2020, the GOP's hold on the U.S. Senate will make advancing major climate bills tough in the 116th Congress.

"With it being a presidential election year, I think the vast majority of the legislative work that will occur will be about messaging [rather] than actually getting something done," Waterhouse said. But those efforts will lay "the groundwork for what the Democrats will bring up in the [next] Congress if they maintain the majority."

In addition to promoting messaging bills, Congress stands a "decent chance" of fully passing at least two substantial non-appropriations bills in 2020 that will touch on energy, Waterhouse said. One is a bipartisan surface transportation bill that would provide funding for electric vehicle infrastructure and climate adaptation. The other is a water resources bill that Congress traditionally passes every two years and could include provisions pertaining to hydropower projects managed by federal power marketing administrations.

The middle road

Amid gridlock on big climate legislation, energy leaders in Congress will try to move more bipartisan measures that could help cut carbon emissions.

The Senate Committee on Energy and Natural Resources approved dozens of bipartisan energy bills in 2019 that have yet to receive full Senate consideration. Those bills, which include legislation to promote research and development of advanced nuclear reactors, wind power, and energy storage, could be rolled into a broad energy bill that committee chairman U.S. Sen. Lisa Murkowski, R-Alaska, hopes to release in early 2020.

Republicans on the House Energy and Commerce Committee have meanwhile called to pass a dozen climate and energy bills in 2020, many of which have Democratic cosponsors. Those proposals include the Utilizing Significant Emissions with Innovative Technologies Act, or USE IT Act, which encourages the commercial use of carbon capture technology.

"We think these are [bills] we can find common ground on that would help," said Rep. Greg Walden, R-Ore., the top Republican on the Energy and Commerce Committee.

In addition to clean energy policies, lawmakers could advance legislation to better guard energy infrastructure against cyber- and physical threats. In September 2019, Murkowski and Senate energy committee ranking member Joe Manchin, D-W.Va., introduced a bill to direct the Federal Energy Regulatory Commission to incentivize cybersecurity investments by electric utilities. The legislation would also establish a grant and technical assistance program within the U.S. Department of Energy for advanced cybersecurity technology.

But time for action, particularly in an election year, will be short. "It's hard for me to see any of these things getting across the finish line," Waterhouse said.

Even if those bills do not become law, the Senate will likely vote in early 2020 to confirm James Danly as the next Republican member of FERC after the Senate energy committee favorably reported his nomination. But Senate Democrats remain unfulfilled in their desire for the White House to tap a Democrat to replace former FERC member Cheryl LaFleur, who stepped down from the agency in August 2019.