American Jobs (& Climate) Plan, Mission Economy, moves like Mandela

The newsletter for people "woke" on carbon and climate.

(source: MotorTrend)

Issue No. 72

Welcome to the latest issue of Carbon Creed - a curated newsletter for people “woke” on carbon and climate. 


President Biden announces the $2.3 trillion Infrastructure Plan.


The American Jobs Plan which President Biden says is the “largest American jobs investment since World War II,” calls for repairing roads, bridges and public transit, as well as installing more than 500,000 electric-vehicle charging ports across the U.S. Climate is a common theme woven throughout the plan.

Mr. Biden is well qualified to steer this massive investment. He was instrumental in getting the American Recovery and Reinvestment Act (ARRA) through Congress, then supervised the $831 billion stimulus for the Obama administration.

ARRA's clean energy funds made up $90 billion of the total stimulus, including the DOE 1705 loan guarantee program. These loans helped launch Tesla's original assembly plant, the first utility-scale solar farms and the first large carbon capture project on a coal plant, NRG Energy's Petra Nova in Texas. Within four years, wind and solar capacity doubled.

Under the Biden Administration, the 1705 loan guarantee program is in the able hands of my friend Jigar Shah. I look forward to seeing what he does at the helm!

If you have an opinion on any topic covered in this newsletter, please feel free to send me an email at mcleodwl@carboncreed.com. 

Thank you for your viewpoint and the value of your time.

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QUOTES

Climate quotes and sayings that will inspire you

1 “Electric power is everywhere present in unlimited quantities and can drive the world's machinery without the need of coal, oil, gas, or any other of the common fuels.” ~ Nikola Tesla, Visionary/Inventor

Tesla’s long-held dream was to create a source of inexhaustible, clean energy that was free for everyone. He strongly opposed centralised coal-fired power stations that spewed carbon dioxide into the air that humans breathed.

One of Tesla’s most extraordinary experiments was to transmit electrical power over long distances without wires or cables — a feat that has baffled scientists ever since.

2 “I dream of our vast deserts, of our forests, of all our great wildernesses. We must never forget that it is our duty to protect this environment.” ~ Nelson Mandela, Activist/Politician/Icon

3 “[Sustainability:] It's the right thing to do, it's the smart thing to do, it's the profitable thing to do.”  ~ L. Hunter Lovins, Author/Entrepreneur

Hunter is a renowned author and champion of sustainable development. She believes that citizens, communities and companies, working together within the market context, are the most dynamic problem-solving force on the planet.  She has devoted herself to building teams that can create and implement practical and affordable solutions to the problems facing us in creating a sustainable future.


BOOKS

Mission Economy

Written by Marianna Mazzucato

In 2020, the World Health Organization appointed economist Mariana Mazzucato to head its Council on the Economics of Health for All. She is an architect of Horizon Europe - one of the biggest international research-funding schemes in the world (USD$117 billion ). Her book Mission Economy is a timely and optimistic vision of how to fix the world’s most complex problems through directed public and private investment.

In Mission, Mazzucato asserts that the global trauma experienced in 2020 has shown just how much our leaders have undervalued care and privileged finance, and how vulnerable this makes our economies and societies to pandemics and other disasters.

She then masterfully brings these strands together to advocate a ‘mission’ approach to address society’s complex challenges and to transform capitalism, enabling a more just and sustainable trajectory. Mission Economy is a bold and persuasive call to action, reflecting an influence already felt in many policy areas.

The template for Mazzucato’s vision is the US Apollo astronaut programme of the 1960s. Apollo had the clearly defined goal of landing humans on the Moon within a decade. It required massive expenditure — $26 billion between 1960 and 1973, equivalent to more than $200 billion in 2020. It required unprecedented coordination across government departments in a range of policy fields, as well as private actors; silos had to be broken and chains of command reorganized.

All of this (US Apollo) was achieved because of political support from the top and because the goal captured the public imagination.

Despite hiccups, the agencies involved gained sustained financial support, relative autonomy and organizational flexibility. The mission was successful not just in achieving its stated goal of landing men on the Moon. It also generated many spillover technologies, including camera phones, GPS, magnetic resonance imaging, solar panels and water-purification systems.

Mission has a nice flow - Mazzucato presents her arguments so simply and clearly that they can seem obvious. In fact, they are revolutionary. Rethinking the role of government nationally and in the international economy — to put public purpose first and solve the problems that matter to people — are now the central questions for humanity.

Creed Comments: There’s a lot to unpack in this short, but powerful book. Mazzucato calls for a “massive rethink” of capitalism and the relationship between the public and private sectors in this thought provoking guide. She contends that wealth inequality, inadequate health care, the “rising tide of populism,” and other social ills are the byproducts of forces that have warped capitalism, including the prioritization of shareholder profits over long-term investments and the belief that governments can only fix market failures, instead of playing an active role in shaping the economy. 

Mazzucato makes the case that government should act more like a venture capitalist, making investments for the public good. She suggests that the fallacy has been relying on the free market to solve society’s challenges. Is she right?

We’re about to find out as Mazzucato leads Horizon Europe (USD$117 billion), which includes five government mission targets: 1) adaptation to climate change; 2) climate-neutral and smart cities; 3) soil health and food systems; 4) healthy oceans and other waters; and 5) cancer.

Stay tuned.


INSIGHTS

Does Biden’s “American Jobs Plan” make the grade on climate and jobs?

President Biden unveiled a new $2.3 trillion American Jobs Plan on Wednesday, March 31, focused on infrastructure, the care economy, climate and, as the name implies, creating desperately needed good jobs. Previous U.S. COVID-19 spending stimulus packages were focused on short-term emergency response, and too much of it propped up the business-as-usual, polluting economy.

This new proposal is designed to promote longer-term economic recovery and keep the United States competitive while responding to the economic devastation from the coronavirus pandemic and the  climate crisis.

If the proposal becomes law this summer, as Biden hopes it will, it would simultaneously create millions of good-paying jobs and be the most important climate legislation in U.S. history.

Biden’s jobs proposal would help the United States regain its status as an international leader in climate policy and in clean energy industries. It proposes more spending aimed at addressing climate change and protecting the environment than any other countries have announced in their COVID recovery packages.

The only other economy with a similar level of ambition is the European Union, which is requiring that 30% of its economic recovery package and 2021-2027 budget be climate-friendly. In this U.S. proposal, it would be at least 50%.

The Jobs Opportunity

Evidence shows that climate-friendly investments are an effective stimulus. $1 invested in clean infrastructure returns far more than $1 to the economy. A plethora of recent studies have outlined the huge job creation potential of climate-friendly stimulus in the United States. Investing in clean energy can create 2-3 times more jobs than investing the same amount in fossil fuels; it requires a lot of labor to retrofit buildings to be more energy efficient or to install solar panels. 

When the United States invested $90 billion in clean energy as part of the 2009 Recovery Act, it supported 900,000 job-years (full time jobs over one year) in clean energy fields from 2009 to 2015. Other labor-intensive and climate-smart activities, like restoring nature-based infrastructure, also provide economic output and job creation benefits far greater than the scale of investment.

Climate-friendly stimulus has the potential to not only spur job growth but to create quality employment opportunities in a well-paid workforce and safe, healthy and equitable workplaces.

Below we outline the key climate provisions of Biden’s proposed infrastructure package.

Affordable and Sustainable Housing

The plan proposes spending $213 billion to produce, preserve and retrofit more than two million affordable and sustainable places to live, with a particular emphasis on providing housing to underserved communities across the country. It calls for reform of zoning laws that make cities more unequal and more sprawled.

Investments in building efficiency and resilience to climate change hazards have been proven to be an effective way to quickly create jobs. The United States should be able to quickly ramp up building retrofits through existing programs — such as the Weatherization Assistance Program and the State Energy Program — as it did with the 2009 Recovery Act, when investments in building efficiency created tens of thousands of jobs. More efficient buildings can also save money for residents and businesses, particularly important now since millions of Americans are behind on utility bills due to COVID-19’s economic impact.

The proposal also includes modernizing and improving the energy-efficiency and resiliency of schools and federal buildings, among others, presenting another opportunity to create jobs and lower energy demand.

Sustainable Transportation

The plan proposes investing $174 billion to electrify the nation’s transportation system while creating good jobs in manufacturing and construction. This includes providing sales rebates and tax incentives to encourage drivers to switch to electric vehicles (EVs), building a national network of 500,000 EV chargers by 2030, and electrifying the federal fleet including the Postal Service. The proposal also includes electrifying 50,000 transit vehicles and at least 20% of the school bus fleet (about 96,000 buses) through a new clean school bus program at the Environmental Protection Agency. School buses are critical to school accessibility across the country and electrifying these vehicles will create cleaner and healthier air for kids, reduce greenhouse gas emission and improve communities’ energy resilience through the bus batteries.

The plan proposes investing $85 billion to modernize and expand public transit systems and $80 billion to support Amtrak in repairing and modernizing railways. Public transit has been an effective job creator: When U.S. states had the choice of where to spend 2009 Recovery Act transportation money, each dollar spent on public transit projects created 75% more job-hours than a dollar spent on highways. Public transit investments also support cost savings for everyone in the economy by reducing travel costs, reducing traffic and increasing business productivity — all of which have a long-term positive effect on jobs.

Biden’s proposal includes spending on highways and bridges as well, but is focused on road repair rather than building new roads.

Transmission, Clean Energy and Electric Grid Modernization

The plan proposes $100 billion for power infrastructure, including significant investments in transmission, tax credits, clean energy procurement by the federal government, and grant support to state, local and tribal governments. It suggests that these investments be accompanied by an energy efficiency and clean electricity standard to reach 100% carbon-free power by 2035.

The plan proposes to establish a new investment tax credit for transmission lines, with a goal of building out at least 20 GW of high-voltage capacity lines. It would extend for 10 years the investment and production tax credits for clean energy generation and storage, with expanded direct-pay options — providing these tax credits as direct payments to clean energy developers, overcoming challenges with existing tax equity financing measures. Taken together, these measures provide critical financial incentives and policy certainty for clean energy developers.

The measure also proposes a new Grid Deployment Authority at the Department of Energy, which could make it easier and faster to find the right locations and get the permits to build transmission infrastructure. Delays in transmission deployment cost system operators billions every year and are a barrier to additional renewable energy development. New transmission and grid modernization can help the United States utilize the most productive renewable energy sites and diversify the location of our resources, lowering the costs of the energy transition while increasing grid resiliency.

Next Generation Industries, Advanced Manufacturing and RD&D

Biden’s plan also goes a long way to tackle emissions from industry and manufacturing, which is the most difficult part of the economy to decarbonize. It includes $580 billion to strengthen U.S. manufacturing. This includes $180 billion specifically for Research, Design and Development (RD&D) on emerging technologies, $35 billion of which is focused on climate science and innovation. The measure would also create a dedicated research agency — the Advanced Research Projects Agency-Climate (ARPA-C) — within the DOE for climate research and advanced technologies.

Other measures include extending the 48C tax credit for advanced manufacturing (an oversubscribed program in the 2009 recovery act that helped to increase domestic wind manufacturing) and $15 billion in demonstration projects for a number of technologies including clean hydrogen, advanced nuclear and energy storage.

To accelerate carbon capture and permanent CO2 storage, the plan aims to reform and expand the bipartisan 45Q tax credit to make it direct pay and easier to use for hard-to-decarbonize industrial applications, direct air capture, and retrofits of power plants.

If passed, this would be a historic investment in advanced manufacturing and the next generation industries needed to decarbonize the U.S. economy.

Infrastructure Resilience

President Biden’s plan calls for $50 billion for improving infrastructure resilience across the electric grid, food systems, health systems, urban infrastructure and transportation infrastructure. Part of that investment is in retrofitting buildings to make them better able to withstand climate change impacts.

This could be done by incorporating materials and standards that can better stand up to more severe storms or using roofing materials that can withstand wildfires. As climate change disproportionately affects marginalized communities, part of the plan focuses on building resilient infrastructure in vulnerable communities most at risk of climate impacts disasters. The plan also aims to empower local leaders to shape some of these project funds.

Nature-Based Infrastructure

Part of that $50 billion for resilient infrastructure would go to restoring nature-based infrastructure — our lands, forests, coastal and ocean resources, wetlands and watersheds that families and businesses rely on for their lives and livelihoods. The plan calls on Congress to invest in protection from extreme weather events like wildfires, floods and hurricanes that cost the United States $95 billion in damage to homes, businesses and public infrastructure in 2020 alone.

Biden also asks Congress to support agricultural resources management and climate-smart technologies, and the protection and restoration of major land and water resources like Florida’s Everglades and the Great Lakes. The workforce to implement these proposals could come through the new Civilian Climate Corps, for which Biden calls for a $10 billion investment to provide Americans with good-paying union jobs while conserving public lands and waters, bolstering community resilience and advancing environmental justice.

Creating Opportunities in Distressed and Disadvantaged Communities

The American Jobs Plan includes multiple initiatives intended to reduce inequality and assist disadvantaged communities, including communities that formally relied on fossil fuels and those impacted by local pollution. The plan proposes an immediate investment of $16 billion in plugging oil and gas wells and restoring and reclaiming abandoned coal, hardrock and uranium mines, as well as a $5 billion investment in rehabilitation in Brownfield and Superfund sites.

Such investments can create jobs and bolster energy transition communities while mitigating methane emissions and addressing local environmental impacts on water, soils and air. Research conducted last year suggests that plugging 500,000 wells could create up to 120,000 jobs at a cost of between $12-24 billion. The oil and gas industry lost over 100,000 jobs last year, and this program could be a lifeline for fossil fuel workers (and the local and state economies that depend on them).

Securing a Green, Inclusive Future

President Biden’s American Jobs Plan is an ambitious, inclusive and people-first foundation for a clean energy future. It’s commitment to building a modern energy system, 100% carbon-pollution free power by 2035 and investing in transmission, will underpin rapid electrification over the next decade. Proposed investments in the power, building and transportation sectors promise to create quality jobs and economic growth while lowering emissions. And its focus on sustainable land use and making infrastructure resilient to climate change is welcome since these important topics don’t usually receive the attention they deserve. While there remains more to be done outside the infrastructure space, this is a monumental proposal to secure the country’s future.

Now, all eyes turn to Capitol Hill, where Biden’s proposal is expected to be debated and translated into legislation over the coming months and well into the summer. This proposal will be considered along with existing climate legislation and proposals on surface transportation reauthorization. We can expect ongoing debate about the scale of the American Jobs Plan’s ambition, but if only one thing is clear it is that Congress must rise to the occasion and be bold because the United States cannot afford to wait any longer to take serious climate action.

[This post is adapted from the original written by Joel JaegerKatrina McLaughlinJillian Neuberger and Carrie Dellesk for the World Resources Institute]


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