Compromise on fracking
As much as Democratic presidential candidate Joe Biden campaigned in the Democratic primaries as a moderate, he is using the coronavirus lockdown to collaborate with leaders of the progressive wing of his party. The vehicles for this collaboration are so-called “unity” teams made up of high-profile representatives spanning the moderate and progressive spectrum in the Democratic Party on issues like health care, immigration and climate change. These teams have the task of seeking workable compromises for the Biden campaign that will not alienate Biden’s moderate base while making the platform more appealing to those who would have preferred Bernie Sanders or Elizabeth Warren to have been the Democratic candidate.
One of the key topics for the climate unity task team (CUTT), co-chaired by former Secretary of State John Kerry and Green New Deal (GND) champion and Democratic member of Congress Alexandria Ocasio-Cortez, is the controversial subject of fracking. The current Biden proposal is to limit a ban on fracking to land controlled by the federal government but progressives want this ban to also apply to privately-owned land effectively prohibiting fracking across the entire country.
A nationwide ban on fracking, while appealing to climate activists, is a tough political sell. It would, for example, have a major economic impact in Pennsylvania and Ohio, swing states critical to winning the presidency. These two states are home to the Marcellus shale formation, which like many of the nation’s most productive fracking regions, lies under private land and therefore would be outside the scope of the current Biden policy.
If, as seems most likely, Biden holds firm to limiting his fracking ban to federal lands, the CUTT will need to work harder to find points of compromise. This will mean delving into the technicalities of fracking, as well as, looking for ways to drive stronger action on environmental justice and to levy penalties on those perceived to be holding back climate progress.
Even the most pragmatic members of the Biden climate team are not in favour of fracking — the question is not about support for fracking but about the practicality of a nationwide ban and the wisdom of trying to fight too many battles simultaneously. It seems that both Biden moderates and the candidate himself accept that oil and gas will be needed for the foreseeable future and having these produced cheaply and locally is not such a bad thing. They will see short-term value in the fact that fracking and low-cost gas (along with renewables) are driving coal plants out of existence and might even recognise a faint possibility that gas with carbon capture and storage could be needed in the future to support a grid reliant on wind and solar. In short, they see a 2020 nationwide ban on fracking as politically and economically impossible.
Fortunately, there are options on fracking policy that lie between a nationwide ban and the continuation of the Trump administration’s deregulation efforts. Most notably there is the potential to rein in fracking through stricter oversight of well construction, groundwater monitoring and particularly minimising methane leaks. Methane is a strong greenhouse gas — roughly 50 times more potent than carbon dioxide and an important target for climate activists. Oil and gas extraction invariably involve some loss of methane through faulty pipework and inadequately sealed drilling hardware. While producers seek to reduce losses of saleable product, many environmentalists feel economic drivers set a leakage acceptance threshold far higher than is justified on environmental grounds. Furthermore, they are concerned that a lack of monitoring and reporting both conceals the potential for major methane losses and allows negligent operators to avoid being held to account for their actions.
Gina McCarthy, the EPA Administrator in the second Obama administration, is a member of the CUTT and ideally qualified to advise on using the existing federal legislation to reduce methane losses and limit fracking through stricter regulation. Regulation will not be popular with the oil and gas industry and is a less permanent solution than new targeted legislation but, unless Biden foresees Democratic control of both houses of Congress, it is an easier and more flexible route that hints at a nationwide squeeze on fracking while avoiding overt focus on states like Pennsylvania and Ohio during the presidential campaign.
From a compensation and punishment perspective, existing and potentially higher royalties and severance taxes could be used to redress past environmental wrongs. Equally, giving local communities greater rights to challenge and prevent fracking as well as insisting on a wider distribution of profits could go some way to addressing what progressives regard as a power imbalance between major oil and gas communities and the communities they operate in. This sort of regulation crosses into territory under state jurisdiction so while it would be difficult for a Biden administration to unilaterally make these changes, the CUTT can formalise a Democratic fracking platform that puts pressure on future Democratic state governors.
In summary, there are a number of incremental steps that, while falling short of a nationwide ban on fracking, could form the basis of a compromise. Achieving these will, of course, require those representing different climate positions to make concessions.
Moderates and progressives
To describe climate discussions, both inside the CUTT and more broadly in the climate community, in terms of moderates and progressives is obviously a simplification. As mentioned above, moderates include those whose main goal is winning elections and who therefore calibrate issues like fracking based on potential votes won or lost. These moderates will naturally seek to avoid an all-out war with the oil and gas industry in key swing states. Others within the moderate camp will present themselves as pragmatists rather than cynical party apparatchiks when they reject a nationwide fracking ban or an accelerated net zero carbon timeline as being technically impossible. Rhetoric suggesting otherwise is viewed at best as a distraction and at worst as irresponsible and reckless.
While those aligned with progressive leaders all agree on the need for more urgent action, there is divergence on priorities. Technocrats, particularly those who have been part of a decades-long struggle for global commitments, remain focussed on the technical, legal, and public policy minutiae needed to eliminate carbon. Among these long-term climate warriors, there is often a deeply pessimistic vein that regards catastrophic climate impacts as almost inevitable and blames this on fossil fuel misinformation campaigns. This sub-group will struggle to accept any compromise that is seen to prolong fracking.
Other, often younger progressives, like Sunrise Movement leader and CUTT member Varshini Prakash and Ocasio-Cortez, are the new guard promoting a GND vision that is broader, more forward-looking and arguably more optimistic. They will be accused of diluting the net zero carbon focus by broadening the definition of climate victory but perhaps they recognise that creating a winning coalition needs to offer worker and minority groups something more positive than impending oblivion.
Who wins in the new clean energy economy?
The optimism contained within the GND recognises that the cost of generation from wind and solar is now lower than that from either coal or gas, essentially guaranteeing that renewables will soon dominate the electricity grid. Electrification of the transport sector, another key part of the decarbonisation journey, is not quite at this point but the elements needed for electric vehicles to replace the internal combustion engine are in place. More efficient and cost-effective batteries continue to be developed making it more likely that electric vehicles will have the power, size and range to match petrol-driven cars. If major victories are imminent for those fighting climate change, what is still in play is how the benefits of this transition are shared out.
Those supporting the GND are worried that Big Oil and King Coal will simply be replaced by Big Wind and Solar and that Google and Apple will take over the role currently filled by General Motors and Ford Motor Company. This outcome would be akin to winning the battle but losing the war. As a result, the GND seeks to limit new corporate entities from controlling access to fundamental needs like energy and freedom of movement, thereby eliminating the significant political power that the fossil fuel, automotive and utility industries now enjoy. In the eyes of GND supporters, failure to win the battle for the new energy economy means profits will continue to flow to executives rather than workers, communities will fail to win the right to determine what happens in their local environment and opportunities for women, minorities and migrants will not improve.
Timing is critical in the battle for the new energy economy – these issues weren’t relevant five years ago because the new enabling technologies were not fully available and proven. Now, addressing these issues arguably can’t be delayed much longer because a new generation of corporate entities are emerging that will soon be strong enough to mould the new order to their own needs. This could be the area where a big picture compromise will emerge. Will GND-aligned progressives make this — the future of the new energy economy — their key negotiating point and will they make compromises to achieve what they want?
If so, they will demand that the Biden administration’s planned $1.7 trillion climate investment and the process of “leveraging additional private sector … investments” doesn’t mean tax breaks and subsidies for the next generation of energy billionaires. They will need to see federal money tied to stipulations such as mandated union jobs that reflect the diverse mix of the nation, capping executive remuneration at some modest multiple of the lowest-paid employee and perhaps even a commitment to avoid lobbying and making financial contributions to political candidates. There could also be requests for a new oversight model that includes board representation for workers and the local communities as well as public ownership in any intellectual property developed as a result of federal investment. Imposing these sorts of requirements now — when new and emerging businesses are desperate for federal funding — will be far easier than dealing later with powerful and profitable corporations, a realisation that might make this an attractive place to draw a GND line in the sand.
Is a compromise possible?
Joe Biden isn’t obliged to reach a compromise with the progressive wing of the party and if he does, it doesn’t have to be on climate. Yet with that said, the CUTT is made up of some very high-profile players, making it unlikely or at least damaging if it fails to produce substantive additions to the platform Biden takes to the general election.
Fracking will inevitably be covered by the CUTT, either directly or as part of a broader compromise. At first pass, fracking seems like a binary issue — either a nation-wide ban or just a commitment to stop all new permits on federal lands — but as discussed above there is, in fact, scope for nuanced compromise. This could be regulatory tweaks directed at fracking itself or a trade-off limiting the ban to federal lands in return for concessions elsewhere. Promoting affordable electric vehicles could be one such concession. This would appeal to the technocrats within the climate community but seems unlikely to be the sort of initiative that would appeal to the GND vision of Ocasio-Cortez and Prakash. They will want progress on either compensation for historic exploitation or new operating rules covering future energy investments — or both.
Joe Biden has been forthright about the threat he believes another four years of President Trump poses to the United States and his supporters have billed the 2020 presidential election the most consequential in modern history. But within the party which has selected him as its presidential nominee, there is a great concern about the global consequences of another four years of climate denial from the White House. The strategies to redress this climate crisis, decades older than the Trump administration, will need to be formalised at the Democratic National Convention (DNC) in August when the party will establish its national platform. In the leadup to that convention, whatever form it takes amid the pandemic, expect to see some of the friction points of the CUTT play out in the media.
This could mean more discussion on decarbonisation timetables and strategies, concern over methane leaks, litigation strategies for environmental crimes, spit-balling about strategies to seek costs and liability for corporate climate denial, pushback on Silicon Valley’s dominant role in electric vehicles, proposals for direct federal investment in wind, solar or electricity storage or a nationwide ban on fracking.
In the quest for unity, the Biden campaign has established the infrastructure for the Democratic Party to express its points of difference before the election. But when it comes to complex issues like fracking, this will be a difficult task to formalise in time for the election.