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According to researchers interviewed by Nature, the latest economic models suggest that the massive cash infusion could drive down prices for clean-energy technologies and help put the United States on a path to reduce greenhouse gases to 50% below 2005 levels by 2030 — although they also warn that there are still plenty of potential barriers and roadblocks ahead.
Many Republicans supported a related trillion-dollar infrastructure bill that Biden signed into law last month, but they are steadfastly opposing the larger budget bill, which includes new investments in energy and climate technologies, as well as a variety of more controversial social programmes that are holding up negotiations.
During former president Barack Obama’s time in office, Democrats tried to pass legislation to cap the country’s overall greenhouse-gas emissions and force companies to clean up — or compete for an ever-declining pool of carbon credits to cover their emissions.
The legislation would build on clean-energy provisions in the bipartisan infrastructure package, which includes $66 billion to modernize rail networks, $90 billion for broader public-transport investments and some $72.5 billion for clean-energy transmission, grid infrastructure and charging stations for electric vehicles.
All told, the US Department of Energy could see its budget for energy research and development more than double if Build Back Better passes — from around $8 billion to more than $20 billion annually over the next five years — according to an analysis by the Information Technology and Innovation Foundation, a think tank based in Washington DC .
Scientists and environmentalists say that the investments, combined with tax credits and other incentives, could help to change the energy landscape over the coming decades.
Academics and energy experts have been running various models to determine the likely impact of the legislation, and their results suggest that the spending bill and infrastructure bill combined could reduce annual US emissions by anywhere from the equivalent of 739 million to 1.3 billion tonnes of carbon dioxide by 2030 .
But emissions would drop for electricity generation, accomplished largely through the introduction of more wind and solar technology — at three to four times the current pace — and a continued decline in coal-fired power generation.
“This is classic industrial policy,” Jenkins says.
The Build Back Better bill would also boost the subsidy for projects capturing and sequestering carbon emissions from coal and natural-gas power plants, from $50 to $85 per tonne of CO2, while providing a $180 subsidy for facilities that extract CO2 directly from the atmosphere.
“The modelling approaches are producing somewhat different results, but it’s more important to focus on the overlap: there’s a really significant amount of emissions reductions that are on the table with this legislation,” says Robbie Orvis, a senior director at Energy Innovation.
Although the models tend to agree on the economic incentives, what actually happens over the next decade will be driven by human behaviour, bureaucratic delays, supply chains and technical obstacles.
“Just because models say something is economic doesn’t mean that it will happen,” Orvis says.
For Leon Clarke, a climate and energy modeller at the University of Maryland in College Park, the key is momentum.