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US Climate Bill Seeks Balanced Transition

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It’s dangerous to count chickens before they hatch when dealing with the US Congress, but if new compromise legislation passes, the US could be close to having an energy policy that addresses both its short- and long-term needs. The landmark spending bill, which has a decent chance of passing in the coming weeks, combines provisions for continued near-term investments in oil and gas with $369 billion in climate and clean energy spending, which would help the Biden administration approach its goal of reducing greenhouse gas emissions by 50% by 2030. Importantly, the bill is a practical manifestation of the “more now, less tomorrow” approach to oil and gas that has gained traction in the Ukraine crisis, involving a balancing act that has challenged policymakers worldwide. The bill, known as the "Inflation Reduction Act," was unveiled last week after swing vote US Senator Joe Manchin announced a surprise deal with Democratic leadership. Manchin, a centrist Democrat from West Virginia, a state that has long relied on fossil fuels, described the bill as a “balance,” saying its energy provisions “should knock down [gasoline] prices,” streamline energy infrastructure permitting and support clean energy — without forcing an abrupt pivot away from fossil energy. The bill summary maintains it would reduce greenhouse gas emissions 40% by 2030. Passage still faces obstacles in the Senate, where Democrats hold the slimmest majority and need full party support. Chiefly, it requires backing from another centrist Democrat, Arizona's Kyrsten Sinema.

Topics:
Policy and Regulation, Low-Carbon Policy, CO2 Emissions, Exploration, Carbon Capture (CCS), Methane Emissions
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