Fed climate bill could fuel greening of economy

Photo | Courtesy State House News Service Boston Mayor Michelle Wu and U.S. Sen. Edward Markey praised the U.S. Senate's passage of the Inflation Reduction Act in a press conference Monday at the Kennedy Federal Building

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By Chris Lisinski | State House News Service

Elected officials and environmental activists are still waiting to see what Gov. Charlie Baker will do with a reshaped clean energy bill on his desk, and they hope major legislation that cleared the U.S. Senate on Sunday will give the governor a bit of extra motivation.

A day after Vice President Kamala Harris cast the tie-breaking vote to secure Senate passage of a sweeping climate, prescription drug pricing and tax reform bill, the praise rolled in from across the Bay State. U.S. Sen. Ed Markey called it "decades in the making." Boston Mayor Michelle Wu said it would set up the city "to serve as a model for the rest of the world." And Environment Massachusetts State Director Ben Hellerstein pointed to "so many pieces in here that are going to help Massachusetts achieve our vision."

"There's no question in my mind that this bill is a big deal," Hellerstein said in an interview.

The bill would generate close to $740 billion in new revenue through a series of tax changes, including a 15 percent corporate minimum tax, according to a summary produced by Senate Democrats.

It would invest more than $300 billion toward reducing the nation's deficit, which Markey said would slow inflation that has cascaded rampantly for months.

On the health care front, Democrats say the bill would allow Medicare to negotiate prescription drug prices for members, cap out-of-pocket costs at $2,000 and lower Affordable Care Act premiums for millions of people.

But climate was the big draw Monday, when Markey and Wu gathered with environmental advocates who have spent years pressing for action -- mostly unsuccessfully -- in Congress.

The bill would authorize $369 billion in spending on a wide range of action to blunt the impact of climate change, including significant investment in clean energy rebates on technologies like heat pumps and rooftop solar, a first-of-its-kind $4,000 tax break for purchasing a used electric vehicle, and additional credits to accelerate the shift to renewable sources of power.

Markey said it also features a $30 billion "Climate Bank" that would leverage federal dollars for local climate-related projects and $10 billion to support manufacturing of offshore wind equipment in the United States -- an industry positioned for rapid growth in Massachusetts.

"It is the funding we need for the health of the planet and the funding we need for the health of families in our country to pay their health care bills," Markey said. "We are going to ultimately say to the American people: there's no reason why you have to pay $4 or $5 a gallon for gasoline when you could have an all-electric vehicle that averages 75 cents for your payment."

In a breakdown of the climate-specific investments, Senate Democrats said the bill would put the country on a path to slash greenhouse gas emissions roughly 40 percent by 2030 "and would represent the single biggest climate investment in U.S. history, by far."

Markey also pointed to a study published last week by the UMass Amherst Political Economy Research Institute, which estimated the legislation would create about 912,000 jobs per year over a decade.

Wu said Boston officials would work to "seize all of the opportunities" in the bill, including the potential job growth in clean energy industries and federal funds to help electrify the transportation and building sectors.

"Most of all, I am deeply emotional and relieved as a mother that we are finally seeing a bit of the scale of action that we need for our kids," she said.

The bill heads now to the U.S. House of Representatives. A spokesperson for Congresswoman Lori Trahan said the House plans to vote on the bill Friday.

"The House will return and move swiftly to send this bill to @POTUS' desk — proudly building a healthier, cleaner, fairer future for all Americans," Speaker Nancy Pelosi of California tweeted on Sunday.

The bill, Pelosi said, would help in "lowering kitchen table costs, reducing the cost of health care, creating jobs and addressing the climate crisis."

"We have a long way to go, but this bill is a crucial first step," Massachusetts Sen. Marc Pacheco of Taunton, a longtime advocate for climate action, said during a lightly attended Senate session Monday. "We are on the cusp of a sustainability revolution and I am confident decisive federal action such as the legislation passed by the U.S. Senate this weekend will help showcase the substantial benefits that accompany a swift and strategic clean energy transition by creating new jobs, improving public health, and establishing energy sector independence, all while lowering emissions to prevent the worst effects of our ongoing climate crisis."

In the corner office here, Baker's desk still features a reworked clean energy and climate bill lawmakers sent him in their end-of-formal-session frenzy after incorporating some, but not all, of his proposed changes to an earlier draft.

That legislation seeks to put many of the tools in place to achieve the net-zero emissions by 2050 target cemented in an earlier climate law, and advocates said Monday they believe the state and federal bills would dovetail well.

"With movement on federal climate legislation, the case for Gov. Baker to sign this climate bill into law has grown even stronger," Hellerstein said. "There are so many investments in this bill that line up with the goals of the climate bill that's on the governor's desk."

Hellerstein said an expansion of clean energy tax credits and rebates in the federal bill would "make it much easier" for Bay Staters to install small-scale rooftop solar panels on a wider scale, tying into the state bill's expansion of net metering eligibility.

The bill Baker is reviewing also calls for a Mass Save pilot program to retrofit low- and moderate-income homes with energy efficient, electric-powered appliances, Hellerstein added.

"Having these rebates and tax credits available is going to make all that work easier and will reduce the cost for Massachusetts to do that," he said.

Several supporters of the bill described it as a compromise that stopped short of going as far as they had hoped. Hellerstein said he is concerned about some language that could tie offshore wind development to drilling on federal lands, an issue Markey said he would "be monitoring very, very closely."

For 350 Mass Political Director Cabell Eames, the success Senate Democrats had passing the bill marks a sea change.

"Until today, as a veteran climate activist, the movement and myself, we've been frustrated, we've been broken by the lack of action in addressing the climate crisis," Eames said at the event with Markey and Wu. "In fact, I remember a time when we were mocked, belittled and blatantly ignored. But that's not the case today."