What Climate Means to the Infrastructure Package

The Biden-Harris Administration and Congress have been focused on addressing the nation’s infrastructure for the first half of 2021. So far this year, the White House rolled out the $2 trillion American Jobs Plan in late March, which sets forth the investments President Biden believes are needed to reach his goals of a carbon-free power sector by 2035 and net-zero emissions, economy-wide, by 2050. President Biden and Senate Republicans, led by Sen. Shelley Moore Capito (R-WV), began negotiations over the infrastructure package, but President Biden ended talks on June 8 after the two sides remained hundreds of billions apart in their desired spending totals. Attention has since turned to a bipartisan group of 20 senators who are negotiating an alternative proposal. The group released a two-page framework on June 16 for a $1.2 trillion package. How to address climate has sat front and center in these discussions, particularly for President Biden and many Democratic lawmakers.

While questions remain regarding what path an infrastructure package will take, the President and many Democrats have remained steadfast in the need for strongly addressing climate. The American Jobs Plan provides an overview of the President’s position on the issue and builds on his Build Back Better campaign platform, which emphasized the jobs these investments will create as the nation transitions to a clean energy economy. For instance, the plan calls for $621 billion in transportation infrastructure and resilience, which includes the President’s goal to invest in a national network of 500,000 EV chargers by 2030, as well as $100 billion for the nation’s power infrastructure. The plan spans transportation electrification, climate resilient infrastructure, a Civilian Climate Corps, carbon capture, and energy efficiency investments. In addition to investments, the plan proposes various climate policies, such as an Energy Efficiency and Clean Electricity Standard (EECES) to achieve 100 percent carbon-pollution free power by 2035 and the elimination of subsidies and special foreign tax credits for the fossil fuel industry.

The American Jobs Plan is an ambitious proposal that incorporates climate considerations into all sectors of the economy. However, Republicans have criticized the President’s proposal for its cost and broad definition of “infrastructure.” Given the breakdown of negotiations between President Biden and Senate Republicans, Democrats in Congress have been discussing the potential to use budget reconciliation to pass President Biden’s priorities. However, the proposal being assembled by the bipartisan group of 20 senators may provide a pathway to link a bipartisan package passed through regular order with a more partisan, budget reconciliation package, potentially providing political cover for more moderate Democrats. Based on the framework released on June 16, that bipartisan package would include $73 billion for power infrastructure, $47.2 billion for resiliency, and $15 billion for “electric vehicles: infrastructure & buses/transit.”

As the debate over the overall infrastructure package continues, various committees have begun consideration and debate on aspects of the plan, including surface transportation. The Senate Environment and Public Works (EPW) Committee unanimously advanced a $312.4 billion surface transportation bill in May, and the House Transportation and Infrastructure Committee passed their $547 billion bill on June 10. The Senate Commerce Committee also approved a five-year, $78 billion rail and safety bill on June 16. The House Energy and Commerce Committee is expected to consider their portion of the infrastructure package this summer.

The infrastructure debate is far from over as President Biden and lawmakers maneuver campaign pledges, a closely-divided Senate, and an upcoming 2022 congressional election. We will continue to monitor the climate and environmental provisions of the Biden-Harris Administration’s infrastructure plan, and will provide further updates on our blog, Environmental Edge.

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© Arnold & Porter Kaye Scholer LLP 2021 All Rights Reserved. This blog post is intended to be a general summary of the law and does not constitute legal advice. You should consult with counsel to determine applicable legal requirements in a specific fact situation.