The Biden Administration unveiled a $2.3 trillion infrastructure plan that targets net-zero carbon emissions by 2050.
The plan would establish an Energy Efficiency and Clean Electricity Standard (EECES) to “increase competition in the market,” while also incentivizing “more efficient use of existing infrastructure, and continuing to leverage the carbon pollution-free energy provided by existing sources like nuclear and hydropower.”
Part of the plan includes a tax reform proposal that would eliminate billions of dollars’ worth of “subsidies, loopholes, and special foreign tax credits for the fossil fuel industry,” according to the White House website. It also hopes to restore payments from companies that contribute to pollution into the Superfund Trust Fund, which goes to help cover the cost of cleanups.
A more resilient electric transmission system
Biden called for investments in the grid. His plan starts with the creation of a targeted investment tax credit that incentivizes the buildout of at least 20 gigawatts of high-voltage capacity power lines and mobilizes tens of billions in private capital. In addition, the plan will establish a new Grid Deployment Authority at the Department of Energy that allows for better leverage of existing rights-of-way, along roads and railways, and supports financing tools to spur additional high priority, high-voltage transmission lines.
Hydrogen and carbon capture
The plan calls for pairing 15 hydrogen demonstration projects with a new renewable electricity production tax credit (PTC), intended to encourage carbon emission reductions through capital-project retrofits and installations.
Biden calls for the establishment of 10 “pioneer facilities,” that would test carbon capture systems on steel, cement and chemical production plants, but not for power plants.
Other pilots might include “decarbonized” hydrogen, which might leave room for renewable hydrogen as well as “blue” hydrogen, paired with a newly created production tax credit. “Blue” hydrogen is produced from natural gas and uses carbon capture.
$15 billion in demonstrations is proposed for “[research and development] priorities” that include carbon capture and hydrogen.
Under the Storing CO2 and Lowering Emissions (SCALE) Act, the administration supports large-scale sequestration efforts. The plan encourages carbon capture and storage through the expansion of the Section 45Q tax credit, intended to make the technology “easier to use for hard-to-decarbonize industrial applications, direct air capture, and retrofits of existing power plants.”
The plan calls for tax credits, grants, and federal funding for energy efficiency in buildings. But the plan’s focus is squarely on electrification in transportation. The Administration hopes to increase the US market share of EV sales with a $174 billion investment to “win the EV market.”
The Administration set a goal for a national network of 500,000 EV chargers by 2030. It also establishes a target of replacing 50,000 diesel transit vehicles, 20% of school buses, and most of the federal vehicle fleet.
Biden calls on Congress to invest $50 billion in the National Science Foundation (NSF), creating a “technology directorate” to further existing programs across the government to develop semiconductors and advanced computing, advanced communications technology, advanced energy technologies, and biotechnology.
The plan also calls on Congress to invest $35 billion in R&D and assist in the launch of the Advanced Research Projects Agency-Climate (ARPA-C) program. Another $15 billion is called for demonstration projects in climate R&D, including: “utility-scale energy storage, carbon capture and storage, hydrogen, advanced nuclear, rare earth element separations, floating offshore wind, biofuel/bioproducts, quantum computing, and electric vehicles.”
The federal government can leverage its vast purchasing power to advance investment in clean energy manufacturing. The plan calls on Congress to enable manufacture of EVs, charging ports, electric heat pumps, and clean materials, as well as new technologies, like advanced reactors and fuel, through a $46 billion investment in federal buying power.