Environment

The US Infrastructure Bill & the Costs of a Sustainable Transition

By David Lapp Jost

Joe Biden’s proposed $2.3 trillion-over-8-years “once in a generation” infrastructure spending bill has launched a flurry of conversation. Infrastructure spending, job creation in the post-Corona economy, and a national response to climate change are on the table. This is good, but if this is supposed to answer our environmental crisis, the bill should be considered in light of what it would cost to make the U.S. sustainably powered, and consider how much the bill accomplishes. Many studies have considered the costs of an energy transition. A comparison between these studies and Joe Biden’s proposals brings into focus what Biden’s plans are designed to accomplish — and what they are not.

Infrastructure and climate concerns

Biden’s infrastructure proposal is generating a lot of press. Of course, much of the focus is on conventional infrastructure, but many articles emphasize the direct investments in climate-related technologies — most notably EVs — which might total around $628 billion. While much of the press and conversation focuses on economic impacts, there is no shortage of articles heralding this as a watershed climate bill — or, frighteningly, the only one.

Many articles note that climate activists and green interest groups would like to see more. This wish is typically left unarticulated and vague at the bottom of a given article, with the implication that a fringe left wants something more, but our mature president is working at the center where we inevitably must work. But Defense Secretary Lloyd Austin calls climate change an “existential threat.” Legislation should be evaluated in light of that threat.

What would it take for the U.S. to transition its energy supply over the next 10 years to sustainable energy that helps preserve our climate and develop technologies that the whole world can use to do the same? And how much of the way does Biden’s plan take us? This first question has been the subject of extensive study. Academics, industry specialists, and think tanks have looked exhaustively at what it would take to transition the U.S. to clean power. They largely target dates like 2030 and 2035 that are critical timelines considering the many vital tipping points in the climate. This research should not simply be forgotten and ignored. Do we want the U.S. to be powered cleanly by 2030? If so, we should look at what it would cost to do that, and then consider how much of the way Biden’s infrastructure bill — which Biden and many others say is the central pillar of his climate plan — takes us. 

So, what would it cost? 

Globally, spending on a clean energy transition totaled $501 billion in 2020. For perspective, experts suggest numbers in the range that we need to be spending $4.4 trillion per year through 2050 globally, or — in an alternative analysis — $90 trillion by 2030. Obviously earlier investments have the greatest impact in restraining emissions and building vitally-needed industry momentum. These numbers imply that globally, we are spending about 1/10th of what we need to be on the energy transition.  

So, what can U.S. Americans claim credit for, outside of a sobering 25% of global greenhouse gas emissions since 1751? To focus on one vital area of sustainable investments, U.S. spending on renewables totaled about $55 billion, by some measures flat in comparison to 2019. That’s about half what we spent on pets, and only modestly more than what we spent on pet food and treats. Perhaps we need to rethink priorities (not to neglect pets, but to invest in green energy)!

What would a good energy policy cost? One 2020 report from UC Berkeley suggests it would cost $1.7 trillion in green energy and grid investments alone to take us to 90% green energy by 2030. Grid and renewable energy–related parts of Biden’s infrastructure plan would take us about 1/10th of the way, but private sector and other government investment is nowhere close to the other 90%. By 2030, we’d need to have spent $170 billion annually. Granted, relevant grid investments are not reflected in our $55 billion of clean energy spending, but we’re nowhere close. And industry forecasts don’t expect meteoric growth that would suggest the private sector making up the difference. A recent projection suggests the entire world will only have invested $3.4 trillion by 2030, or twice the U.S. investment need. U.S. renewables are only to pass coal and gas by 2025, and the U.S. Energy Information Administration suggests renewables will creep up to 21% and 22% of electricity in 2021 and 2022. Needless to say, we cannot afford this trajectory that takes us 1% year by year. “100% by 2100!” is not the slogan for this moment. 

Unfortunately, $1.7 trillion is also perhaps a low estimate. Energy research firm Wood Mackenzie suggests $4.5 trillion (or $4 trillion with nuclear) by 2030 is likelier. This study targets 100% renewable energy and thus assumes significantly more grid and battery investment. But these added goods do not account for the full difference. This study also generally assumes costs would be higher, and Biden’s plan and existing market investments only take us a much smaller part of the way there, perhaps 10–15% of what we need.

Referencing a different timeline, a Stanford report envisions Green New Deals for the U.S. and other countries, and finds it would cost the U.S. $7.8 trillion to achieve 100% clean power by 2050. That timeline is long and we need urgent action in the first part of this decade. Nevertheless the report is describing a scale of response that we are not seeing. And no credible study would suggest we are seeing an effective response.

Where does this leave us?

If this infrastructure bill is indeed, as Joe Biden says, “once in a generation,” and if, indeed, it is the only climate bill we get in the next four years, that would be dangerous. Bridging a small fraction of the gap between our current (minimal) efforts on the climate and what we need will leave our country and world unprepared. Perhaps this is all the federal government can do with Joe Manchin and the Republicans. That does not make it ok to suggest that it is doing enough, or falsely claim to be delivering fundamental change. Climate-conscious citizens should see this as a start, to be followed by further bills and far more muscular action at the local and state level. AOC, Ed Markey, and environmental groups like Sierra Club and THRIVE are proposing plans that actually correspond to the scale of spending needed for a green transition. But no serious study or authority on the costs of a climate response would consider this spending coupled with current anticipated investments adequate. So we should not be talking as if they are. Biden’s proposal and executive actions are not nothing — they take us perhaps 10–15% of the way to where we need to go, which is certainly better than Trump’s worse-than-nothing. 

But current coverage and conversation of the proposal is generating the misleading impression that it constitutes a major reconfiguration of American energy and life — specifically, marketing this falsehood to green-minded citizens. Americans should not accept, though, that this bill is enough. If this is all the federal government can do, we need state and local-level Green New Deals. And perhaps civil disobedience and a reimagination of how we engage politics focused on disruption, because clearly our existing political system is not interested in preserving our lives and world. Sadly, giving the impression that Biden’s bill and executive actions are enough or that the Democrats are taking care of things is a fundamental obstacle to generating the kinds of citizen action that we need. 

It is not enough to do better than Trump. Politicians must also aim to preserve our lives, well-being, and world. The cost of only making marginal, small changes is far too high.


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