Solving the Climate Crisis: The Congressional Action Plan for a Clean Energy Economy

Mike Levin: The climate crisis is the defining challenge of our time, and if we fail to take aggressive action, our children and grandchildren will suffer the worst consequences. With worsening droughts, heat waves, and rising sea levels in California and across the country, we must focus on solutions to the climate crisis. I’m proud to be a member of the Select Committee on the Climate Crisis, offering a comprehensive plan to combat climate change, grow our economy, and protect our planet for future generations. Our report represents the broad consensus among House Democrats and the vast majority of Americans who know that we must act on climate change, and I am proud to be a part of this historic effort.

As someone who was at the first VerdeXChange conference 13 years ago, I am honored that excerpts of the report are being presented here.
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Key components of the climate action plan

To have a chance at limiting warming to 1.5°C and avoiding increasingly severe impacts from climate change, the Intergovernmental Panel on Climate Change (IPCC) concluded that global net anthropogenic carbon dioxide emissions must fall by at least 45% from global 2010 levels by 2030 and reach net-zero by 2050. As the largest historic emitter of greenhouse gases, the United States must lead the world in confronting the climate crisis.

The Climate Crisis Action Plan establishes a goal of reaching net-zero greenhouse gas emissions economy-wide in the United States by no later than 2050; directs the president to set ambitious interim targets to meet or exceed progress toward that goal; and calls for achieving net-negative greenhouse gas emissions during the second half of the century. To achieve these goals, the Climate Crisis Action Plan will build an American economy that protects public health and values workers, families, communities, and current and future generations who are depending on Congress to tackle the existential threat of climate change in a just and equitable way. The Climate Crisis Action Plan calls for congressional action across the economy and is based on 12 key pillars.

Pillar 1: Invest in Infrastructure to Build a Just, Equitable, and Resilient Clean Energy Economy
Pillar 2: Drive Innovation and Deployment of Clean Energy and Deep Decarbonization Technologies
Pillar 3: Transform U.S. Industry and Expand Domestic Manufacturing of Clean Energy and Zero-Emission Technologies
Pillar 4: Break Down Barriers for Clean Energy Technologies
Pillar 5: Invest in America’s Workers and Build a Fairer Economy 
Pillar 6: Invest in Disproportionately Exposed Communities to Cut Pollution and Advance Environmental Justice
Pillar 7: Improve Public Health and Manage Climate Risks to Health Infrastructure
Pillar 8: Invest in American Agriculture for Climate Solutions
Pillar 9: Make U.S. Communities More Resilient to the Impacts of Climate Change
Pillar 10: Protect and Restore America’s Lands, Waters, Ocean, and Wildlife
Pillar 11: Confront Climate Risks to America’s National Security and Restore America’s Leadership on the International Stage
Pillar 12: Strengthen America’s Core Institutions to Facilitate Climate Action 
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Pillar 1: Invest in Infrastructure to Build a Just, Equitable, and Resilient Clean Energy Economy 

Infrastructure policy is climate policy. The infrastructure decisions the United States made decades ago—such as building coal-fired power plants and a transportation system that offers households few convenient alternatives to driving—reveal themselves in the country’s greenhouse gas emissions profile today. Similarly, the infrastructure decisions the United States makes from today onward will either help reduce the risks posed by climate change or make them worse.

The Intergovernmental Panel on Climate Change (IPCC) 1.5° report lays bare the infrastructure challenge:

"Pathways limiting global warming to 1.5°C with no or limited overshoot would require rapid and far-reaching transitions in energy, land, urban and infrastructure (including transport and buildings), and industrial systems (high confidence). These systems transitions are unprecedented in terms of scale, but not necessarily in terms of speed, and imply deep emissions reductions in all sectors, a wide portfolio of mitigation options, and a significant upscaling of investments in those options."

To turn the tide on climate change, the United States needs to make different infrastructure choices than it has made in the past and do so at an enormous scale. The longer the U.S. government waits to make clean energy infrastructure investments, the harder it will be to limit warming. The IPCC warns that any delay increases the risk of cost-escalation, lock-in of carbon-intensive infrastructure, and stranded assets.

 Since a certain amount of warming is already baked in, the U.S. government also needs to invest in making communities resilient to the impacts of climate change and improving communities’ ability to rebound after a climate-fueled disaster. The IPCC notes that “increasing investment in physical and social infrastructure is a key enabling condition to enhance the resilience and the adaptive capacities of societies.”

These massive infrastructure investments should benefit all communities. Too often, U.S. infrastructure policy has prioritized high-income communities over lower-income communities and neglected more rural parts of the country. Decisions to build a new highway or rail line near or even through a community of color often reflected and perpetuated societal racism.71 To avoid these outcomes, Congress must ensure the policymaking process values “the voices and positions of EJ frontline and fenceline communities.”
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Pillar 2: Drive Innovation and Deployment of Clean Energy and Deep Decarbonization Technologies

 While widespread deployment of existing clean energy technologies would significantly reduce greenhouse gas emissions across the U.S. economy, full decarbonization of the economy will require new technologies that have yet to be invented. The opportunities are enormous, but cutting-edge technologies face barriers to development and deployment. The truly transformational technologies needed to decarbonize the economy take a long time to mature and often require new hardware solutions, which then require more capital. This results in multiple capital gaps along the development timeline of these technologies.Since energy is treated as a commodity, that makes it difficult for new technologies to overcome higher initial costs, and the emphasis placed on electricity reliability has led to a regulatory framework that does not appropriately value flexible and distributed characteristics of many innovative clean technologies. Moreover, the market also fails to value the clear advantage of these carbon-free technologies and their climate mitigation potential. Thus, robust innovation policy at all process stages—research, development, demonstration, and deployment (RDD&D)—will be critical to the timely and widespread implementation of these new technologies.

The research stage, often characterized as basic or applied, consists of scientific discovery and knowledge creation, with applied research directed toward a specific aim or objective. All innovations begin with research, but it often takes decades for research discoveries to reach the market, especially for clean energy and decarbonization technologies. The federal government largely funds research because individual private sector entities cannot fully reap the benefits of investments in research. 

The development stage translates research discoveries into practical products and processes. Inventions must prove themselves to be scalable and capable of commercial production at a reasonable cost, but the difficulty of commercial risk assessment and the long timelines and high fixed costs of energy technologies lead to limited investment in development. Some funding comes from the federal government at the development stage but significantly less than it provides for basic or applied research.

The demonstration stage involves testing and demonstration of technologies, at both pilot and commercial scales, with the objective of preparing the technologies for adoption by actual users. Like the development stage, long time horizons, large capital requirements, and the high risk associated with new decarbonization technologies limit the overall amount of funding and the types of technologies and applications that receive funding for demonstration.The private sector overwhelmingly provides demonstration funding, largely through end-use producers and suppliers, as well as venture capital.

During deployment, a technology or product undergoes widespread adoption and diffusion into the marketplace after proving economic viability at scale. While the risk of the technology failing is less of a concern, there is still a need for large amounts of capital to scale and support the business, so market demand and financing become important drivers for investment. Like demonstration, the private sector dominates funding through corporate investment (raised from a variety of passive investors), project financing, and private equity.

Technology rarely progresses smoothly through the stages, and advancement to the next stage often requires multiple series of feedback. Between the stages are so-called “valleys of death,” where technologies and companies fail to proceed to the next stage of innovation. In the wake of the COVID19 pandemic, government support for all stages of RDD&D will be even more important to maintain a robust innovation system that can help shepherd promising technologies across the valleys of death. While policies targeting technologies at different phases of maturity will have varying degrees of effectiveness for immediate stimulus and short-term job creation, investments across the innovation pipeline will fuel long-term economic growth. The United States and the world cannot allow the COVID-19 crisis to delay these investments to develop and deploy the technologies needed to decarbonize the economy by midcentury and avert another global crisis.
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Pillar 5: Invest in America's Workers and Build a Fairer Economy

Tackling climate change and reaching net-zero emissions by 2050 will reshape the U.S. economy. This offers a unique opportunity to build a new, clean energy economy on a foundation of equity and fairness for workers and their communities. Smart climate policy must invest across the country and in economically vulnerable communities and deliver good-paying, high-quality jobs and accessible career pathways into them for all Americans. Throughout this report, the majority staff for the Select Committee has offered recommendations to advance American leadership in clean technology innovation and deployment, rebuild America’s manufacturing base, and invest in resilient infrastructure projects—all of which will create jobs across the United States. These recommendations are even more important in the wake of the COVID-19 pandemic that left 40 million Americans out of work by the end of May 2020 and mothballed manufacturing facilities. In the following pages, the majority staff for the Select Committee identify additional policies to put working people front and center as the clean energy economy takes shape.