US energy industry sees opening in infrastructure push to address priorities
U.S. energy producers are aiming to have key industry priorities addressed as President Joe Biden and congressional lawmakers work to draft massive legislation to upgrade the country’s aging infrastructure.
Energy and mining trade groups hope the plan will tackle a whole host of issues, ranging from the need to ease power transmission permitting to providing support for greater domestic minerals production to feed the clean energy transition.
Tax policy could also be a significant component of the bill. Some trade groups want Congress to amend the tax code to better promote clean energy technologies or allow their members to capitalize on existing policies.
“Historically, changes to the tax code have always been a part of an infrastructure discussion, and without question, we anticipate that changes to tax policy are going to be an important piece of the discussion both on transportation infrastructure and energy infrastructure,” said Louis Finkel, senior vice president of government relations for the National Rural Electric Cooperative Association. “We believe it’s an appropriate conversation to be had.”
White House officials are preparing to present Biden a roughly $3 trillion infrastructure and jobs package, The Washington Post reported March 22. The infrastructure piece is expected to include $400 billion to combat climate change, spending that could underpin Biden’s goal to decarbonize the power sector by 2035 and achieve net-zero emissions economywide by 2050.
Democrats in Congress have also floated infrastructure proposals that include major climate provisions. On March 11, Democrats on the House Energy and Commerce Committee proposed a $312 billion infrastructure bill that would devote nearly $70 billion to clean energy and energy efficiency and $48.1 billion to electric vehicle deployment, clean ports and smart cities. The legislation followed the committee’s introduction of a broad climate bill that aligns with Biden’s decarbonization targets.
But the climate and energy provisions that actually make it into the infrastructure package will hinge partly on what process Democrats use to advance the legislation.
Senate Majority Leader Chuck Schumer, D-N.Y., has said he is willing to move infrastructure legislation through budget reconciliation, an expedited process that allows bills to pass the Senate with a simple majority rather than the 60 votes needed to avoid a filibuster. But doing so will limit the infrastructure bill to provisions that change federal spending, revenues or deficits, which could exclude measures such as permitting reforms if they do not have budgetary effects.
Using reconciliation “may limit some of what we would like to see in the bill,” said Desmarie Waterhouse, vice president of government relations and counsel for the American Public Power Association, or APPA. “I’m hearing conflicting things about whether it will be under reconciliation, or they’ll make an attempt to do it through regular order and then if that doesn’t pan out do budget reconciliation.”