America and climate change
America’s better future
This is the moment for an ambitious attempt to deal with climate change
【1】TEXAS PRIDES itself on being different. Yet it is in the grip of a winter storm that typifies the Snowmageddon-size problems facing energy in America. Although nobody can be sure if this particular freeze is a sign of climate change, the growing frequency of extreme weather across the country is. Texan infrastructure has buckled. The problem is not, as some argue, that Texas has too many renewables. Gas-fired plants and a nuclear reactor were hit, as well as wind turbines. Worse, Texas had too little capacity and its poorly connected grid was unable to import power from elsewhere. Texas shows that America needs both a cleaner grid and a more reliable one.
【2】Plans to overhaul American energy will come before Congress in the next few months. President Joe Biden has said that he wants fossil-fuel emissions from power generation to end by 2035 and the economy to be carbon-neutral by 2050. America is not just the world’s second-largest emitter, but also a source of climate-related policy, technology and, potentially, leadership. What is about to unfold in Washington will set the course in America for the next decade—and quite possibly beyond.
【3】Time is pressing. Neither Mr Biden nor his successors may get a second chance to recast policy on such a scale. Global emissions from fossil fuels and cement production in 2019 were 16% higher than in 2009. It will be even harder to limit climate change to less than 2°C above the pre-industrial level, the global threshold from which America’s target for 2050 comes. To be carbon neutral, the world must curb emissions by 7.6% a year for a decade, a steeper decline than in 2020, when covid-19 cut demand for oil and coal. For America, delaying action to 2030 would nearly double the cost of reaching net zero or, more likely, mean it overshoots its targets.
【4】Yet there are grounds for hope. Although the Republican Party is against almost all action, voters are increasingly alarmed by climate change. Two-thirds of them think the federal government is doing too little about it, and that share includes plenty of younger Republicans. Although the fossil-fuel lobby remains powerful, many Republican business donors want more action—partly because asset managers are urging firms to align their strategies with the net-zero world Mr Biden envisions.
【5】Most encouraging of all, the costs of power from wind and solar have plunged by 70% and 90% over the past decade. Along with cheap gas, this has already helped America decarbonise at an impressive rate, despite Donald Trump’s rolling back of fossil-fuel regulations. Price has not been the only factor; more than half of the states have some sort of clean-energy mandate, a device that Mr Biden wants to introduce on a national scale.
【6】This involves a regulatory framework that favours renewable-energy developments and grid connections to hook them up. It will take a lot of extra investment—about $2.5trn in the coming decade, say researchers at Princeton. In a new book, Bill Gates, a billionaire philanthropist, argues that research is needed into a host of areas such as energy storage, advanced nuclear reactors to complement renewables and technologies for clean concrete-making and other activities that are hard to decarbonise. Without these, even if a clean grid is powering electric cars and light trucks, it will displace only around half of emissions.
【7】America is good at innovation, but new ideas need to be deployed at scale, not languish in the lab. One tool is a carbon price which, if it were high enough and if investors believed it would last, would signal what improvements were needed where. But for all its attractions, carbon pricing failed in Congress in 2009. Although many economists and opinion-makers on the right favour it, Republican politicians do not. And even if a carbon price were in place, public-private co-operation would still be needed for America to act as fast as Mr Biden proposes.
【8】For all those reasons, an ambitious climate-oriented infrastructure bill looks like Mr Biden’s best chance of getting new policy on climate through the Senate. Unfortunately such a plan will be lucky to attract any Republican votes. Yet, if mustering the 60 needed to see off a Senate filibuster is improbable, a plan could be stripped of some measures, including a clean-energy standard, and passed with a simple majority through the parliamentary manoeuvre known as reconciliation. The bill must still be of a scale and ambition that matches America’s challenge.
【9】Failure to act would bring big risks. For a start, it would make America less competitive in the new clean-energy economy. China is the dominant producer of solar panels and batteries; it has also invested in foreign mines to secure minerals needed for them. Europe has its own “green deal” to boost its clean-energy industries. It plans to tax imports from countries that do not pledge to lower their emissions.
【10】America would also be deprived of global influence over climate. It has direct control over only about 10% of the world’s greenhouse-gas effluvia. If it wants the benefit of a stabler climate—and with it a stabler world economy, stabler geopolitics and much avoided suffering—it needs to influence the other 90%, too. Mr Biden has appointed John Kerry, a former secretary of state, to spearhead that effort. America is to rejoin the Paris agreement on February 19th, making it a full participant in the UN conference to be held in Glasgow, in Scotland, in November, when countries will be able to lodge new and more ambitious pledges to cut emissions. If America tables goals and gives evidence that it will back them with domestic policy, it will gain influence. China’s two big development banks have doled out $51bn for foreign coal plants since 2008. America should be part of a push against such subsidies.
Enough drifting
【11】Unfortunately, America brings little credibility to action on climate. Mr Trump took pleasure in subverting it, but his country’s poor record precedes him. George W. Bush declined to implement the Kyoto protocol. Congress has not considered serious climate legislation since 2009. Today must be different. There will never be a better chance for Mr Biden to show real ambition. If the blackouts in Texas are any guide, it would not just be the world that would thank him, but Americans, too.