Fixing and building roads, bridges, rail lines, ports and the electric grid could account for nearly $1 trillion of Biden’s forthcoming Build Back Better infrastructure program. The overall US infrastructure program is expected to be in the $3 to 4 trillion range. There will a first official release of information starting Wednesday, March 31, 2021.
There will also be climate change and clean energy-related spending. There is expected to be support and spending for the electric grid, energy-efficient affordable housing, electric vehicle charging stations, and other clean energy priorities.
The stated goal is to buy and enable new technologies and clean energy hardware to decarbonize the US electricity system by 2035.
There has been talk about a $50 per ton carbon tax.
A specific package with four key components is likely:
Tech-neutral tax credits for new clean capacity: An ITC of 30% or a PTC at $25/MWH (67% higher than the current wind PTC) is available for any zero emitting capacity that enters into service before the end of 2031. Fossil capacity with carbon capture, including new retrofits, qualify and get a discounted credit depending on the level of capture. Developers can choose the ITC or PTC, whichever suits them best.
Existing coal retirement incentive: Any coal plant owned by a rural cooperative can have its federal Rural Utility Service loans written off if the plant is retired by the end of 2025 and the energy is replaced with clean generation. We estimate that up to 30 GW of coal could be eligible, which wouldn’t retire under current policy. These plants have an associated outstanding federal debt of roughly $10 billion.
Existing clean retention incentive: An incentive is available for any existing nuclear capacity to stay online at least through 2031. The incentive can be made available to all generators or scaled based on need, similar to a recent proposal by Senators Whitehouse and Barrasso. We assume the incentive is sufficient to prevent roughly 50 GW of economic nuclear retirements that we see in our current policy scenario.
Extension of carbon capture incentives: New and retrofitted fossil plants equipped with carbon capture that enter into service by the end of 2031 can claim the section 45Q carbon capture tax credit of $50/ton if coupled with storage and $35/ton if coupled with utilization or EOR. Developers cannot claim both this and the tech neutral credit.
They will also add in specific climate pollution regulations to accelerate the retirement of coal plants.
They will add in specific investment into solar and wind.
SOURCES – Rhodium Group, Smart Cities
Written By Brian Wang, Nextbigfuture.com
Brian Wang is a Futurist Thought Leader and a popular Science blogger with 1 million readers per month. His blog Nextbigfuture.com is ranked #1 Science News Blog. It covers many disruptive technology and trends including Space, Robotics, Artificial Intelligence, Medicine, Anti-aging Biotechnology, and Nanotechnology.
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