Meaningful Congressional action on climate change seemed doomed in the 50-50 U.S. Senate after Democratic Senator Joe Manchin of West Virginia tanked President Joe Biden's Build Back Better proposal earlier this year. But on August 7, Vice President Kamala Harris cast the tie-breaking 51st vote to approve the Inflation Reduction Act of 2022. All Republicans, including Iowa's Senators Joni Ernst and Chuck Grassley, voted against final passage.
Assuming the U.S. House approves the bill (a vote is scheduled for August 12), Biden is poised to sign into law "the single biggest climate investment in U.S. history, by far." In addition to significant changes to the tax system and health care policy, the massive package includes $369 billion in spending aimed at reducing greenhouse gas emissions and promoting clean energy.
According to summaries of the bill's energy and climate provisions, enclosed in full below, the bill could help reduce greenhouse gas emissions to 40 percent below 2005 levels by 2030. However, the bill's incentives for the fossil fuels industry—which were necessary to get Manchin on board—are troubling for many environmental advocates.
Bleeding Heartland sought comment from some Iowans who have been engaged in policy battles related to climate change and the environment.
"A MIXED BAG, BUT A NEEDED STEP"
Iowa Citizens for Community Improvement has been advocating for social and environmental justice for decades. In recent years, the group has been organizing for ambitious climate change policies as part of a nationwide alliance called the Green New Deal Network.
In a statement provided to Bleeding Heartland, Iowa CCI echoed sentiments expressed by national environmental groups ranging from the long-established Sierra Club to the newer, youth-oriented Sunrise Movement and Interfaith Power and Light, which mobilizes people of faith to act on climate change.
Iowa CCI characterized the Inflation Reduction Act as "a mixed bag, but a needed step that the House should pass and President Biden sign into law."
We applaud this measure as being the largest federal investment into climate action, and for finally allowing Medicare to negotiate certain drug prices and begin to challenge Big Pharma’s chokehold on our health and pocket books.
However, this legislation will fast track two new major gas pipelines and prioritize oil and gas leasing on public land, as well as give billions for false solutions like carbon capture pipelines. And it still largely keeps in place the power of the health insurance and pharmaceutical industries through subsidies and other missed opportunities to cap costs.
The bill is a hard-fought win for the health of our people and planet. And it's still not enough to meet the need of the moment. So we’ve got work to do.
Iowa CCI and its allies will continue to urge Biden and other elected officials "to declare a climate emergency and fully implement the Green New Deal," along with bolder health care policies such as Medicare for All.
FEDERAL TAX CREDITS FOR CARBON CAPTURE ADD "INSULT TO INJURY"
Tim Wagner, a board member of the Iowa Coldwater Conservancy and retired soil health and water quality advocate, told me, "While I am very much in favor of the measures in the bill to advance more renewable energy across the economy's sectors, I have significant concerns with regards to the trade offs that were agreed upon in order to get final passage, particularly provisions for more oil and gas drilling and also financial assistance for proposed CO2 transport pipelines." (Disclosure: Wagner and I both signed a recent letter urging the Iowa Utilities Board to reject permit applications for a carbon dioxide pipeline that would run across Iowa.)
The carbon capture provisions thrilled representatives of industries looking to profit from the technology as well as the Clean Air Task Force. They were essential to bring Manchin (who has deep ties to the coal industry) on board with a climate bill.
Wagner is aligned with farmers and landowners who don't want their property used (and soil health degraded) to construct a carbon dioxide pipeline capturing ethanol plant emissions. He told Bleeding Heartland that the pipelines "have no demonstrable public good." On the contrary: "a few will profit greatly at the expense of everyone else. This is a clear-cut example of 'privatizing the profits, while socializing the costs' on a grand scale."
For Wagner, allowing "generous federal tax credits" to partly finance carbon dioxide pipelines would amount to "insult to injury."
I also am deeply concerned about how the pipelines are being falsely promoted as a solution to climate change. Nothing could be further from the truth. The amount of CO2 that would be captured is negligible within the larger picture. Additional insult is that the captured CO2 would be used in enhanced oil recovery so we can burn more fossil fuels.
While most national environmental groups hailed Senate passage of the Inflation Reduction Act, Food & Water Watch harshly criticized the legislation, saying it would "bolster fossil fuels" and used "emissions reduction projections based on industry hype."
Food & Water Watch Managing Director of Policy Mitch Jones said in a written statement,
It’s no surprise that climate policy tailored to meet the demands of a coal baron would fall well short of what’s needed to adequately address the severity of the climate crisis we face. The bill devotes billions to industry schemes like carbon capture, which exist solely to extend the life of the fossil fuel industry. Models touting the emissions reductions this legislation would provide rely heavily on carbon capture despite decades of evidence that the technology can’t be implemented effectively.
There is already abundant evidence that investing in clean, renewable energy does not, in and of itself, displace fossil fuels. Over the past decade, both have grown side-by-side, as fossil fuel interests have pushed to create profitable export markets for oil and gas. There is nothing in this legislation that would stop this march towards the climate cliff.
We know that any adequate climate policy must directly confront fossil fuels. The fact that oil and gas executives seem pleased with this legislation speaks volumes about its glaring shortcomings. [...]
"MORE AG PORK" WHILE ENVIRONMENTAL JUSTICE IS AN "AFTERTHOUGHT"
Silvia Secchi, a professor in the Department of Geographical and Sustainability Sciences at the University of Iowa, shared her thoughts with Bleeding Heartland after carefully reviewing the Inflation Reduction Act's environmental provisions. Analysis by the REPEAT project at Princeton, the Rhodium group, and Energy Innovation "are consistent in their assessment of the bill. It does reduce emissions by 39-42 percent compared to 2005, versus a reduction of 24-35 percent under pre-existing policies. There are benefits in the bill in terms of reduced mortality from air pollution and reduced energy costs."
That said, Secchi cited three major problems with the legislation.
More ag pork
Secchi sees the bill as promoting "a Business As Usual approach in agriculture." For instance, "The bill includes nearly $20 billion in additional funding for existing farm bill conservation programs, which are entirely voluntary. There is nothing in the bill to curb emissions from the agricultural sector using a regulatory approach, nor does the bill address the potential for increases in emissions from livestock agriculture."
Secchi also questioned whether extra carbon would be sequestered by pouring more into current agricultural conservation programs. "For example, farmers already implement no till practices without payments. Many of the practices that are being promoted, like cover crops and no till, are also not permanent, so the benefits are short lived if they exist."
Only carrots and no sticks help polluters
"Agriculture is probably the sector in which the money is being used least effectively, but overall the bill is structured to reward other polluters as well," Secchi noted. On the tax side, the bill is "broadly progressive," because it funds additional tax credits with a new 15 percent corporate minimum tax." Poor people will also benefit from lower utility bills, thanks to provisions geared toward energy efficiency.
On the other hand, Secchi wrote,
Many of the subsidies will go to the renewable energy sector, but there are substantial subsidies for Carbon Capture and Sequestration which are a way for the fossil fuel industry to continue operating and polluting: carbon is not the only pollutant generated by the fossil fuel industry and combustion is not the only point at which fossil fuels generate pollution.
The other important component of the bill that rewards polluters is linking the development of solar and wind projects on federal lands to on and offshore oil and gas leases. This is a major reason why there are differing opinions on the bill’s overall benefits.
Frontline communities would be harmed
The statement from Senate Democrats touted planned spending of "$60 billion in environmental justice priorities to drive investments into disadvantaged communities.
Secchi pointed to a skeptical take on the environmental justice provisions, which Indigenous climate activist Tara Houska posted on Twitter. Although some funding will address existing environmental justice issues, "the bill quite clearly does not center EJ going forward."
For example, the Carbon Capture and Sequestration provisions will bring about more pipelines – which Indigenous groups have been opposed to, including in our state. And a centerpiece of the compromises in the bill is setting minimum acreage requirements for on and offshore oil and gas leasing.
The fact that these are “within historical trends for onshore and offshore lease offerings” as the Rhodium Group assessment of the bill notes, is proof that in this sense the bill is very much Business As Usual as well. The incentives described above will mean a continuation of local pollution problem, “directly and indirectly harm[ing] frontline communities."
For Secchi, the environmental justice portions of the bill look like an "afterthought." While the Inflation Reduction Act would move the U.S. closer to its commitments in the Paris Agreement, signed in 2015, Secchi highlighted the bill's "distributional effects."
Most of the analysis has "focused on the overall greenhouse gas effects and not looking at which specific communities will be harmed," or how the legislation will affect water pollution and local air quality. "The process through which the bill was enacted is certainly seen as a problem by frontline communities from the Gulf of Mexico to Alaska," she concluded.
I'll update this post as needed with more Iowa perspectives.
UPDATE: Irene DeMaris, executive director of Iowa Interfaith Power & Light, said her organization rejoices in the bill's passage.
We are excited for the clean energy tax credits that will come to Iowa as we continue to invest in renewable energy and the uplifting of environmental justice priorities. We will continue to advocate for good paying clean energy jobs to be union jobs as part of the BlueGreen Alliance of Iowa and for just transition plans as we work to retire MidAmerican’s coal plants by 2030 as part of the Clean Up MidAm coalition. Iowa needs more clean energy tax credits, more electric vehicles on our roads, and more energy efficient infrastructure. We will work to make sure that all Iowans, whether rural or urban, have access to these important resources coming to Iowa.
The Inflation Reduction Act is the first step, of many we hope, to take climate action on the federal level. It’s the right and just thing to do, but our work is not done. It is not perfect as it includes some worrisome provisions around fossil fuel expansion. Iowa IPL along with the entire Interfaith Power & Light movement will continue to lead in renewable energy and advocate for bold and just executive action from the Biden Administration so that the U.S. can meet our climate goals.
Appendix 1: U.S. Senate Democratic staff "Summary of the Energy Security and Climate Change Investments in the Inflation Reduction Act of 2022"
Appendix 2: Summary of Inflation Reduction Act provisions prepared by Sierra Club staff
Cross-cutting Environmental, Equity, and Labor Standards
Key provisions included move us toward incorporating cross-cutting environmental, equity and labor standards into public investments and ensuring accountability, including:
- $25 million to the Office of Management and Budget
- $25 million to the Government Accountability Office
This bill contains clean energy tax credits and other investments to deploy solar, wind, offshore wind, geothermal energy, and batteries across the country, including:
- Residential solar, geothermal heat pumps, small wind, battery storage credit of 30% extended through 2033
- Solar investment tax credit of 30% extended through 2033
- Wind production tax credit extended through 2033
- Offshore wind tax credit extended through 2033
- Allocates roughly $30 billion in grant and loan programs for states and electric utilities to decarbonize the grid through investing in renewable power and clean technologies
Clean Energy Manufacturing and Industrial Sector
The package includes billions of dollars of production-based clean energy manufacturing tax credits, including:
- Up to $20 billion in loans to build new clean vehicle manufacturing facilities
- $10 billion investments tax credit to build clean technology manufacturing facilities
- Over $9 billion for federal procurement of American-made clean technologies
- Almost $6 billion for a new Advanced Industrial Facilities Deployment Program to reduce emissions from the largest industrial emitters like chemical, steel and cement plants
Investments in EVs and clean transportation benefits consumers and cuts costs, including:
- $4,000 consumer tax credit for lower/middle-income individuals to buy used EVs
- Up to $7,500 tax credit to buy new EVs
- $3 billion to the U.S. Postal Service for the purchase of zero-emission delivery vehicles
- $3 billion in grants to reduce toxic air pollution at ports by purchasing zero-emission trucks and equipment
- $1 billion for zero-emission heavy-duty vehicles, which will help transition the dirtiest diesel vehicles to clean trucks, school buses, and transit buses
- Nearly $2 billion in grants for the Federal Highway Administration
Building Decarbonization and Efficiency
The bill invests billions of dollars to make household electrification and clean energy upgrades significantly more affordable for consumers, including:
- The High Efficiency Electric Home Rebate Program allocates $4.5 billion in rebates for low- and moderate-income electrification
- $4 billion to boost Department of Housing and Urban Development programs to improve affordable housing
Cleaning Up Legacy Pollution and Creating Healthy, Toxic-Free Communities
This reconciliation bill includes about $60 billion in investments to support programs that will clean up pollution and create healthy, toxic-free communities, including:
- Environmental and climate justice block grants, funded at $3 billion, to invest in community-led projects in disadvantaged communities
- Neighborhood Access and Equity Grants, funded at $3 billion, to support neighborhood equity, safety, and affordable transportation access
- Greenhouse Gas Reduction Fund, a clean energy and sustainability accelerator funded at $27 billion, with at least 60% of those funds focused on disadvantaged communities
- Reinstates the Hazardous Substance Superfund financing rate tax on oil production and import, raising over $11 billion and ensuring that Superfund cleanups will have a guaranteed stream of funding for years to come
- Improving energy efficiency or water efficiency or climate resilience of affordable housing, funded at $1 billion
Public Lands and Waters
The bill includes critical reforms that update federal oil and gas bonding standards, updating minimum bids, rents, and royalty rates, and ending non-competitive leasing. However, the Sierra Club is concerned with the provisions related to the mandated lease sales and tying federal wind and solar development to required federal oil and gas leasing. Continuing to prop up the fossil fuel companies that are responsible for the dual crises of inflation and climate change is the last thing we should be doing in the name of addressing these crises.
- Mandated Lease sales:
- Reinstates an offshore oil and gas lease sale conducted in the Gulf of Mexico
- Conducts two more lease sales in the Gulf and another in Alaska’s Cook Inlet
- Mandates new offshore (60 M acres) and onshore (2 M acres) leasing
- $1.8 billion for hazardous fuels reduction projects on National Forest System land within the wildland-urban interface (WUI); there are no provisions for hazardous fuel reduction projects in the backcountry or outside the WUI
- $50 million for mature and old-growth protection and a nationwide inventory
- Includes restrictions on funding any new temporary or permanent roads, or motorized trails, in wilderness areas or WSAs
- $250 million for the Fish & Wildlife Service: $125 million for Endangered Species Act recovery; $125 million for National Wildlife Refuges and state wildlife management areas
Methane Emissions Reduction Program
Methane, the primary component of gas, is responsible for nearly 30% of the impacts of climate change we are experiencing today. The Methane Emissions Reduction Program includes more than $1.5 billion to support efforts to reduce methane emissions, improve methane monitoring, fund environmental restoration, and help communities reduce the health effects of pollution. It also includes a fine on wasteful methane pollution that will begin in 2024 to incentivize oil and gas companies to avoid unnecessary emissions.
National Environmental Policy Act
The National Environmental Policy Act is our bedrock environmental law that gives communities with environmental concerns a voice in the process during permitting and construction of federally funded infrastructure projects. The bill includes funding for NEPA standards that will ensure effective review and community engagement, including the following:
- Department of Energy: $225 million
- Department of Interior: $150 million
- Forest Service: $100 million
- Department of Transportation: $100 million
- Federal Permitting Improvement Steering Council Environmental Review Improvement Fund: $70 million
- Council on Environmental Quality: $62 million
- National Oceanic Atmospheric Administration: $20 million
- Environmental Protection Agency: $40 million
Agriculture, Forest Restoration, and Land Conservation
The reconciliation bill includes key investments in agriculture, rural economic development, and forest restoration, including:
- More than $20 billion to support climate-smart agriculture practices
- $5 billion in grants to support fire resilient forests, forest conservation, and tree planting
- Tax credits and grants to support the domestic production of biofuels and to build the infrastructure needed for sustainable aviation fuel and other biofuels
- $2 billion for the Rural Energy for America Program (REAP), with hundreds of millions of dollars directed for underutilized renewable energy technologies
- $2.6 billion in grants to conserve and restore coastal habitats and protect communities that depend on those habitats
Black Lung Disability Trust Fund
Permanent extension to the tax ensuring that coal miners suffering from black lung disease have access to medical care.
Omissions from the Bill
- The bill includes no language buying back the active leases on the coastal plain of the Arctic National Wildlife Refuge, or undoing the Arctic drilling language passed as part of the 2017 Tax Act.
- No international fossil fuel subsidy repeals are included.
- The package offers no additional funding for lead service line replacement.
- No dedicated funding for a Civilian Climate Corps is included in this package.
About the Sierra Club
The Sierra Club is America’s largest and most influential grassroots environmental organization, with millions of members and supporters. In addition to protecting every person's right to get outdoors and access the healing power of nature, the Sierra Club works to promote clean energy, safeguard the health of our communities, protect wildlife, and preserve our remaining wild places through grassroots activism, public education, lobbying, and legal action. For more information, visit www.sierraclub.org.
Top graphic created by the U.S. Senate Democrats.