Top 5 Energy Policy Changes to Expect in Biden's Presidency
Path to Zero concludes Season 1 by hearing from a foremost expert on energy policy about carbon pricing, energy storage and the big changes coming in 2021 with the new administration. Andy Stone is Host and Producer of the Energy Policy Now podcast with the Kleinman Center for Energy Policy at University of Pennsylvania.
He is also a monthly Forbes magazine contributor on energy issues having written on subjects ranging from decarbonization to the Federal Energy Regulatory Commission.
show notes
Stone shared his perspective on the biggest changes to expect with the Biden administration.
- Undoing some of the regulatory efforts of the Trump Administration. Andy Stone says no president has ever focused so much on undoing what had been done previously. Over the course of the last four years, President Trump worked to undo more than 100 Obama era environmental protections. Stone also talked about his recent Forbes article about an analysis that shows more than 80% of the Trump rollbacks have been rejected in the courts. Some of Biden’s priorities include reinstating methane rules, the rules that limit methane emissions from new oil and gas facilities. Biden will also focus on rolling back Trump’s weakening of the National Environmental Policy Act (NEPA), which are rules that require any government agency to examine the environmental and climate impact of new infrastructure projects.
- Investing in clean energy research and development. Andy Stone sees this part of the Biden climate plan getting some bipartisan support. Biden has pledged to invest $400 Billion in clean energy research and development over the next ten years. Biden also said he’d like to establish a new agency within the Department of Energy, Advanced Research Projects Agency for Climate (ARPA-C), to focus on climate technology. This effort could include the decarbonizing of industries like steel and concrete, as well as investments in advanced nuclear reactors and carbon capture.
- Rebuilding and making infrastructure more resilient. Biden’s plan calls for making “smart infrastructure investments to rebuild the nation and to ensure that our buildings, water, transportation, and energy infrastructure can withstand the impacts of climate change.” Stone says this effort includes making infrastructure more resilient to frequent flooding in coastal areas and to western wildfires.
- Lower greenhouse gas emissions. Joe Biden’s climate change initiatives include reducing greenhouse gas emissions, in part by setting higher efficiency standards for cars, buildings, and consumer appliances. Stone points out how the transportation sector will be a major focus, which is the number one sector for greenhouse gas emissions in the country. He says Biden is looking to expand railroad and public transportation, including a provision that all U.S. made buses be electric by 2030.
- Energy Equity. Stone details how Biden is seeking to invest in significant energy efficiency upgrades, including weatherization of homes. 40% of that funding is going disadvantaged communities to ensure they get some benefits to the new policy.
Carbon Pricing
Tucker asked Stone about his thoughts on the chances of a national carbon price getting off the ground in the Biden administration. A carbon price is a cost applied to carbon pollution to encourage polluters to reduce the amount of greenhouse gases they emit into the atmosphere.
Stone says carbon pricing is the simplest solution to reducing carbon emissions and that’s why it’s the favorite approach of many economists. Getting a uniform carbon price is still a steep mountain to climb in the near term, according to Stone, because Biden won’t have a filibuster-proof majority in congress. There’s still enough opposition that we won’t see a uniform national carbon price soon, but Stone believes it will eventually happen.
Renewables
Andy Stone also touched on the challenge of intermittency with renewable energy sources.
When the sun isn’t shining and the wind isn’t blowing, we need to have some energy resources to balance renewables.
Currently, natural gas peaking generation plants supplement renewable energy. Stone says that will migrate in the future more toward storage resources, particularly battery technology as the cost of those resources comes down to provide power backup to solar and wind. Stone mentions how progress is being made towards reducing the cost of battery storage. In certain parts of the country, solar power plus battery storage is just about as cheap as a combination of solar plus natural gas.
Federal Energy Regulatory Commission (FERC) Conflict with States
FERC is the regulator of wholesale electricity markets and natural gas pipelines in the United States. The role the agency is quite simple, to ensure inexpensive and reliable electricity for Americans.
FERC is not aa environmental regulator but looks more at the economics of electric generation. According to Stone, FERC has increasingly been drawn into the conversation about climate change.
Some state’s, like Illinois and New York, have tried to incentivize clean energy. FERC is concerned that these subsidies from the states potentially have a distorting impact on electricity markets.
FERC wants a fully competitive wholesale markets while states have a different agenda more focused on public policy goals to reduce carbon emissions from electricity generation.
FERC has implemented a price floor so these subsidized clean resources can’t bid into the market at less than their full market rate. Stone covers who the situation where a national regulator is countering the efforts of some states has turned into a real mess. However, Stone also points out how FERC has recently started discussing the possibility of implementing a uniform carbon price on electricity markets.