Former Vice President and presumptive Democratic presidential nominee Joseph R. Biden, Jr. this week released an outline of his wide-ranging clean energy plan that includes $2 trillion of investments in everything from infrastructure and transit to housing and agriculture. Biden says the plan is designed to spur job growth, drive American innovation, and “build a more resilient, sustainable economy” that will “put the United States on an irreversible path to achieve net-zero emissions, economy-wide, by no later than 2050.”
Biden’s plan for the power sector, which accounts for more than a quarter of U.S. carbon emissions, is even more aggressive. The former Vice President is calling for a carbon-free power sector by 2035, putting it ahead of even the most ambitious state renewable portfolio standards like those in New York, Virginia, and California. Last year, roughly 38% of the electricity produced in the U.S. came from carbon-free sources.
To achieve full power sector decarbonization, Biden plans to make significant investments in energy efficiency, clean energy, battery storage, and transmission infrastructure that are facilitated by tax incentives and new financing mechanisms. Solar photovoltaic and both onshore and offshore wind resources will be key, though novel technologies like green hydrogen will also play a role in diversifying the sector. While the U.S. currently has more than 100 GW of onshore wind capacity, there are only two operational offshore wind farms – one of which is a small pilot project. Several eastern states currently have set mandates and other goals totaling nearly 30 GW of offshore wind development by 2035, though federal permitting delays have cast doubts on their aggressive timelines.
In a somewhat controversial move, Biden’s plan specifically touts the importance of nuclear plants in a carbon-free economy and indicates that he supports not only maintaining the existing fleet, but investing in the development of new, smaller, more flexible reactors. Money will also be deployed to ensure that the issue of radioactive waste is properly addressed, which is a key concern of nuclear opponents. In 2019, nuclear plants accounted for 54% of the carbon-free electricity produced in the U.S.
Another controversial omission from Biden’s plan is support for a federal carbon tax, which some view as the most efficient way to reduce emissions and others view as a non-starter in any clean energy legislation.
Most notable, however, is the fact that the phrase “natural gas” appears just once in the text. Biden does not call for any sort of ban on hydraulic fracturing, which environmental advocates have long supported. Hydraulic fracturing, or fracking, which is the process of extracting gas and oil from rock, has revolutionized the U.S. energy sector over the past decade and contributed to domestic energy independence. Fracking is a key issue in several battleground states in the upcoming presidential election, including Pennsylvania and Ohio. The Marcellus and Utica shale plays straddle the two states and have contributed to significant economic growth in recent years.
Another noteworthy component of the plan is the creation of a task force to address the potential plight of communities that have historically relied on coal mining or coal-fired power generation for jobs and tax revenue. The Obama administration created a similar task force following the decline of the auto industry a decade ago.
While the Democratic frontrunner’s plan is ambitious and will require the deployment of funds at unprecedented levels as well as cooperation across all levels of government and the private sector, its immediate impact on fossil fuel consumption in the U.S. is unclear given that issues like land use and the availability of certain technologies were not addressed. Grid-scale battery storage to complement the massive renewable buildout will be critical to the plan’s success. While states and utilities have set lofty goals for storage development, operating capacity currently stands at less than 1,000 MW, and engineering challenges remain. Legislative approval is another major hurdle for the plan.
EVA is currently assessing both the short-and long-term impact of the Biden plan on the power sector as well as the broader U.S. energy economy. For more information or to engage EVA on your own study, please contact Rob DiDona at [email protected].