The American Jobs Plan prepares us for a 21st century clean energy economy
On March 31st, the Biden administration unveiled The American Jobs Plan— the largest infrastructure investment plan in decades– featuring a strong emphasis on clean energy. If enacted, this proposal would jumpstart the U.S. economy and pull us out of the pandemic-induced recession while achieving marked progress in the fight against climate change. It was a truly historic day for our country.
ACP CEO Heather Zichal underscored how significant the administration’s plan is, saying, “Simply put, this is a plan to put steel in the ground to build a clean infrastructure system that will be the envy of the world. We can’t afford to miss this moment. We’re staring in the face of a once-in-a-generation opportunity for jobs and energy transformation… This infrastructure plan is a steroid shot to rebuild our economy and get serious about climate change, and they’re intertwined.”
The package covers a wide portion of our infrastructure and economy, so here’s a rundown of what’s notable for the U.S. clean energy industry in the American Jobs Plan:
- Groundbreaking transmission investment: The plan calls on Congress to invest $100 billion in transmission, which will be crucial to both continued clean energy growth and ensuring homes and businesses have access to affordable, reliable, clean power. The American Jobs Plan seeks:
- A targeted investment tax credit that incentivizes the buildout of at least 20 gigawatts of high-voltage capacity power lines;
- 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.
- Tax: Proposes 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.
- Credits are paired with strong labor standards to ensure the jobs created are “good-quality” jobs with “a free and fair” choice to join a union and bargain collectively.
- Federal Procurement: The American Jobs Plan seeks to use the federal government’s purchasing power to drive clean energy deployment across the market by purchasing 24/7 clean power for federal buildings.
- Electric Vehicles: The package proposes $174 billion of investment in the EV market, giving consumers point of sale rebates and tax incentives to buy American-made EVs. It also establishes grant and incentive programs for state and local governments and the private sector to build a national network of 500,000 EV chargers by 2030.
- Ports: Calls on Congress to invest $17 billion in inland waterways, coastal ports, land ports of entry, and ferries. This infrastructure investment will be crucial as the U.S. begins tapping into its world-class offshore wind resources.
- Infrastructure permitting: The plan would create coordinated infrastructure permitting to expedite federal decisions while prioritizing stakeholder engagement, community consultation, and maximizing equity, health, and environmental benefits. Streamlining permitting in this fashion will ensure well-sited clean energy projects can come online without unnecessary delays.
- Block grants for clean energy: The American Jobs Plan supports state, local, and tribal governments through clean energy block grants that can be used to support clean energy, worker empowerment, and environmental justice,
- Energy Efficiency and Clean Electricity Standards (EECES): The proposal requires utilities and grid operators to improve energy efficiency and promote carbon-pollution-free energy, as well as cutting electricity bills, through increasing competition in the market, incentivizing more efficient use of existing infrastructure, and leveraging the carbon pollution-free energy provided by existing sources like nuclear and hydropower.
- Hydrogen: Invest in 15 decarbonized hydrogen demonstration projects in distressed communities with a new production tax credit.
- R&D: The plan calls on Congress to invest $35 billion in the full range of solutions needed to achieve technology breakthroughs that address the climate crisis and position America as the global leader in clean energy technology and clean energy jobs by:
- Launching ARPA-C to develop new methods for reducing emissions and building climate resilience, as well as expanding across-the-board funding for climate research.
- Investing $15 billion in demonstration projects for climate R&D priorities, 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, as well as strengthening U.S. technological leadership in these areas in global markets.
- Manufacturing: The American Jobs Plan calls on Congress to:
- Invest $300 billion to strengthen manufacturing supply chains for critical goods;
- Invest $50 billion to create a new office at the Department of Commerce dedicated to monitoring domestic industrial capacity and funding investments to support production of critical goods;
- Invest $50 billion in semiconductor manufacturing and research, as called for in the bipartisan CHIPS Act;
- Enable the manufacture of cars, ports, pumps, and clean materials, as well as critical technologies like advanced nuclear reactors and fuel, here at home through a $46 billion investment in federal buying power;
- Extend the 48C tax credit program and create a new financing program to support debt and equity investments for manufacturing to strengthen the resilience of America’s supply chains.
- Workforce Development/Labor: The proposal calls on Congress to:
- Invest $40 billion in a new Dislocated Workers Program and sector-based training;
- Ensure all workers have a free and fair choice to join a union by passing the Protecting the Right to Organize Act, and guarantee union and bargaining rights for public service workers;
- Tie federal investments in clean energy and infrastructure to prevailing wages;
- Link federal investments to Project Labor, Community Workforce, local hire, and registered apprenticeships and other labor or labor-management training programs so that federal investments support good jobs and pathways to the middle class;
- And include a commitment to increasing American jobs through Buy America and Jones Act provisions.
In order for the U.S. to remain competitive on the world stage we need an infrastructure and workforce that’s ready to handle the needs of a 21st century clean energy economy. The American Jobs Plan checks so many of the boxes we need to get there.