“Today, the Trump administration officially left the Paris Climate Agreement,” former Vice President Joe Biden tweeted Nov. 4, the day after the elections. “And in exactly 77 days, a Biden administration will rejoin it.”

There’s no doubt the federal government’s climate policy will change abruptly come January. President-elect Biden’s transition website lists climate change among his four top priorities, promising to “meet these challenges on Day One” of his administration. The new president is expected to quickly undo the environmental rollbacks President Trump accomplished by executive power.

But a Republican-controlled Senate and a narrower Democratic edge in the House of Representatives would likely prevent him from winning approval of  his proposed $2 trillion climate plan. His ability to include incentives for renewable energy in a new economic recovery package would also be ratcheted down. (See Biden Offers $2 Trillion Climate Plan.)

Democrats still have a chance at winning effective control of the upper house, with two Senate races in Georgia headed to runoff elections Jan. 5. Winning both seats would result in a 50-50 tie that would be broken by Vice President-elect Kamala Harris.

Failing that, any legislative action will depend on Biden’s ability to cut deals with Senate Majority Leader Mitch McConnell (R-Ky.), who is certain to oppose any bill that threatens what remains of his state’s coal industry.

Author Anand Giridharadas expressed optimism in a New York Times op-ed titled, “Biden Can’t Be FDR. He Could Still Be LBJ.”

“Mr. Biden could turn out to be an improbably deft salesman for progressive priorities, using his disarming, folksy, median-voter-friendly patois, that ‘C’mon, man’ Americana vibe, to make major changes seem like common sense,” Giridharadas wrote.

But former House Majority Leader Eric Cantor (R-Va.) said there are limits to Biden’s powers of persuasion. “With a divided government, with the election turning out the way it is, I’m not so sure there is any incentive to all the sudden make a U-turn and everybody come together,” Cantor said during the Edison Electric Institute’s Financial Conference on Monday. “I think it will take a lot of work on the part of the Biden White House … to make the gestures to really, really want to work with Mitch McConnell.”

With prospects for legislative action uncertain, observers are considering how much Biden can accomplish through his executive power, and how a Democrat-controlled FERC could spur policy changes.

The left-leaning Center for Policy Integrity issued a report in September on its proposed priorities for the commission, including revising its regulations to account for greenhouse gas emissions in its review of natural gas infrastructure projects. It also called for changing its transmission policies to support renewables and for the Department of Energy to delegate its authority to designate national interest electric transmission corridors to FERC.

Paris

The Biden transition site promises the president-elect will “lead an effort to get every major country to ramp up the ambition of their domestic climate targets” under the Paris Agreement. Under President Barack Obama, the U.S. made a “nationally determined contribution” (NDC) to cut U.S. GHG emissions 26 to 28% below 2005 levels by 2025.

Biden could attempt to nudge federal policy through regulations, stimulus provisions and tariffs on carbon-intensive goods. He will also have the support of state and corporate clean energy targets.

America’s Pledge, launched in 2017 by former New York City Mayor Michael Bloomberg and former California Gov. Jerry Brown, annually quantifies the climate actions of U.S. states, cities, businesses and other non-federal actors. Its September 2020 report said that “bottom-up climate leadership has kept the U.S. on a path of progress” and that “ambitious, expanded action by U.S. states, cities and businesses can reduce emissions up to 37% [below 2005 levels] by 2030.”

“If the federal government re-engages, invests in a green stimulus recovery and works together with states, cities and businesses to enact climate-forward policies, we can cut emissions by 49% from 2005 levels by 2030 and put America back in alignment with the Paris Agreement, reaching net zero emissions by 2050,” the report said.

Mandate?

Despite Democrats’ failure to gain decisive control of Congress, some observers contend Biden will enter office with a mandate for taking action on climate change.

Morning Consult’s exit polling found almost three-quarters of Biden voters said climate change was “very important” to their votes. Exit polling by the Associated Press and Fox News found that two-thirds of all voters support “increasing government spending on green and renewable energy.” A ballot measure requiring Nevada utilities get half of their electricity from renewable sources by 2030 won 57% support in the state — more than either presidential candidate. (See related story, Nevada Clean Energy Amendment Winning.)

Anthony Leiserowitz, director of the Yale Program on Climate Change Communication, told Bloomberg News that Biden will have “an enormous amount of runway to enact a bold climate agenda” and that some voters might even favor him declaring climate change a national emergency. “There’s even strong support among Democrats and independents for that,” he said.

Regulations, Executive Orders

Biden is expected to immediately reverse most of Trump’s executive orders on energy, including ordering government agencies to take actions to cut GHG and reversing a 2017 order directing federal agencies to revoke their climate policies. (The New York Times reported Nov. 9 that Trump had removed the scientist responsible for the National Climate Assessment, a report from 13 federal agencies and outside scientists that the government is required by law to produce every four years.) Activists have called for creation of a White House interagency group like the National Economic Council to coordinate decisions across the federal government.

“Many agencies, like [the Federal Housing Finance Agency, Department of Housing and Urban Development and Department of Transportation] could do a lot to integrate climate into agency actions without new legislation,” tweeted clean energy consultant and attorney Miles Farmer, a former member of New York Gov. Andrew Cuomo’s energy team. “Tackling challenges of realigning institutional priorities now would also position them to go much further if broad climate legislation is ever signed.”

Biden is also expected to order new methane limits on oil and gas wells and increase fuel economy standards and efficiency standards for buildings and appliances. He has also pledged an executive order requiring public companies to disclose climate change-related financial risks and their GHG footprints.

But Biden’s autonomy could be limited by the federal judiciary, half of whom are now Republican-appointed — up from 42% in 2017 — including a 6-3 conservative majority on the Supreme Court. He is not expected to resurrect the Obama administration’s Clean Power Plan, which was stalled by court challenges and discarded by Trump.

Congress

Eliminating carbon from the electric sector by 2035, as Biden has pledged, would require the closing of virtually all gas and coal generation and a huge expansion of energy storage. Efforts to get there could be aided by clean energy research and development funding and an extension of renewable tax credits.

If Biden is unable to work with McConnell, he could seek support from moderate Republican Sens. Susan Collins (Maine), Lisa Murkowski (Alaska) and Mitt Romney (Utah). But Romney made clear Sunday that he would oppose any legislation to institute a “Green New Deal.” And any efforts undermining coal would likely also face resistance from some Democrats, such as Sen. Joe Manchin (W.Va.) and Senator-elect John Hickenlooper (Colo.).

Former Murkowski aide McKie Campbell, now managing partner of the bipartisan energy consulting firm BlueWater Strategies, told The Washington Post he hopes divided government “means we may have a return of people working with each other to work out some solutions. The question is, in the middle, do you have compromise, or do you have stalemate and nothing happens?”

John Gimigliano, a principal with KPMG, predicted progress during a panel discussion Friday sponsored by law firm Norton Rose Fulbright. “I think overall, the climate is going to improve with a Biden White House for all things renewable, even with a Republican-controlled Senate,” he said. “There are always deals to be made.

“The question is, how much do the Democrats have to give up to get some of these things?” he added.

“Even with a 50-50 Senate that is notionally Democrat, [Biden] is going to be substantially limited to executive actions,” Christine Tezak, managing director with ClearView Energy Partners, said during the same panel. “He’s going to be fairly constrained to moving forward with massive policy initiatives. Limits on greenhouse gas doesn’t pencil for us. The only thing that might be possible under a 50-50 Senate is a clean energy standard, but not one broadly sketched by Joe Biden’s campaign.

“You might have to bring hydrogen and nuclear along just to start the conversation,” she continued. “The incrementally and substantially more conservative judiciary that has materialized over the last four years of the Trump administration is likely to challenge any administration that tries to pursue the bounds of its statutory authority. Something as ambitious as the Clean Power Plan is kind of doomed.”

Cantor, now vice chairman and managing director for investment bank Moelis & Co., said Biden’s reputation as a dealmaker gives him an opportunity. But he said that after Obama entered office promising bipartisan cooperation, his staff failed to make good on it. “There was just a one-party rule in [2009 and 2010], which made it very, very difficult once we claimed the majority in 2010 to even begin to work together,” Cantor said.

Casey Herman, leader of PwC’s U.S. power and utilities practice, told the EEI conference that Biden’s support for decarbonization, clean energy investments and large-scale electrification “provides potentially an exciting opportunity for the sector.”

“But if the Republicans do hold the majority in the Senate, that’s going to moderate the speed and the size of those policy initiatives,” he said.

FERC

How much impact could a Democrat-majority FERC have?

“It’s really going to be dependent on what McConnell wants,” said Tezak, who noted that Trump’s nominations for two FERC vacancies, Republican Mark Christie and Democrat Allison Clements, have not cleared the Senate and Energy Natural Resources Committee yet.

If they are approved, the Republicans would hold a 3-2 majority, at least as long as Republican Neil Chatterjee, whose term expires in June, remains. Trump replaced Chatterjee as chairman last week with Republican James Danly. (See related story, Trump Demotes Chatterjee; Names Danly FERC Chair.)

“Danly could take his short tenure as chairman and move on to the next thing. If he doesn’t and goes back to being a commissioner, I think it’s intriguing to what extent does Chatterjee become the [Justice] Anthony Kennedy or the [Chief Justice] John Roberts of FERC,” she said, referring to two Republicans who have been swing votes on the Supreme Court. “In terms of carbon pricing, offshore wind, transmission interconnections … he is clearly more aligned with Glick.”

Carbon Pricing

On Oct. 15, Chatterjee joined with Glick in supporting a proposed policy statement inviting states to introduce carbon pricing in wholesale electricity markets to address climate change. (See FERC: Send Us Your Carbon Pricing Plans.)

Tezak said carbon pricing is not necessarily a partisan issue. “We’re seeing the carbon price in wholesale tariffs offered as a bridge,” she said. “There’s a common interest there. I hope that with something like carbon pricing, we can look at it more like SO2 and NOx emissions. That’s part of the conversation we’re looking at now. Carbon has an opportunity to integrate. The conversation is … at least broadening a little bit. If FERC gets a Democratic majority, does the MOPR [minimum offer price rule] even survive?”

Some have suggested Biden could seek to add carbon pricing to a budget reconciliation bill, which would be exempt from filibuster and require only a simple majority vote in the Senate.

Herman said it would be “an aggressive” move. “But there seems to be some level of growing support that a carbon tax might provide some certainty to bolster investment as opposed to scaring people away from investment,” he added.

Infrastructure, Natural Gas

George Bilicic, vice chairman of investment banking and global head of power, energy and infrastructure for Lazard, told the EEI panel that he sees natural gas-fired generation remaining “highly relevant” for the foreseeable future as a supplement to renewables and storage.

Panel moderator Richard McMahon, EEI’s senior vice president for energy supply and finance, noted that EEI’s Natural Gas Sustainability Initiative with the Natural Gas Association is attempting to reduce mid- and upstream methane emissions. “Hopefully, that will go a long way to satisfying the desire of the [environmental, social and corporate governance] folks and investors.”

Bilicic also said that utilities and other infrastructure spending could find its way into an economic relief package because of their multiplier effects across the economy. “A dollar spent in utilities generates tremendous economic growth,” he said. “To get to the best renewable resources, we’re going to need a lot of investment in transmission and … help on the permitting front.”

“Infrastructure might creep into the top three or four priorities” with a Republican-controlled Senate, Joe Mikrut, a partner with Capitol Tax Partners, said during the Norton Rose Fulbright session.

Infrastructure spending was also seen as possible for bipartisan spending during the Trump administration. But it never happened.

Partisan gridlock is a major reason why Americans’ trust in government has diminished since the 1960s, Democratic political strategist Donna Brazile told the EEI conference.

“I hope [those just elected] understand that [voters] want us to get back to work,” she said. “They want us to focus on them and their priorities and not go back to the politics as usual and this whole thing of revenge: ‘I lost so now I’m going to make it hard for you. I won so I don’t have to work with you.’ I’m sick of that.”