President Biden has proposed a ten-year extension and phase down of an expanded direct-pay investment tax credit and production tax credit for clean energy generation and storage.
These credits will be paired with strong labour standards to ensure the jobs created are good-quality jobs with a free and fair choice to join a union and bargain collectively, according to the White House’s American Jobs Plan.
President Biden hopes the move will mobilise private investment to modernise the US power sector.
It also will support state, local, and tribal governments choosing to accelerate this modernisation through complementary policies – like clean energy block grants that can be used to support clean energy, worker empowerment, and environmental justice.
In addition, it will use the federal government’s purchasing power to drive clean energy deployment across the market by purchasing 24/7 clean power for federal buildings.
President Biden will also establish an Energy Efficiency and Clean Electricity Standard (EECES) aimed at cutting electricity bills and electricity pollution, increasing competition in the market, incentivising more efficient use of existing infrastructure, and continuing to leverage the carbon pollution-free energy provided by existing sources like nuclear and hydropower.
According to the plan, all of this will be done while ensuring those facilities meet robust and rigorous standards for worker, public, and environmental safety as well as environmental justice – and all while moving toward 100%carbon-pollution free power by 2035.
The proposals also include a $15bn (€12.8bn) investment for demonstration projects for climate R&D priorities.
This includes 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, as well as strengthening US technological leadership in these areas in global markets.
President Biden is also calling on Congress to invest an additional $17bn in inland waterways, coastal ports, land ports of entry, and ferries.
American Council on Renewable Energy president and chief executive Gregory Wetstone said: “We commend President Biden for his historic efforts to at long last get serious about tackling the climate crisis.
“The American Jobs Plan released today will move the clean energy sector beyond the endless cycles of temporary stopgap incentives toward a stable, long-term tax platform that will put millions of Americans back to work, upgrading our outdated grid and building a 21st century renewable energy economy.
“The direct pay option for renewable generation credits will go a long way toward accelerating the deployment needed to decarbonize the power sector by 2035, and new incentives for transmission and energy storage will be key to securing a more reliable, efficient and cleaner electric power grid.”