SCOTUS ruling ups pressure on Schumer to strike climate deal with Manchin

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The Supreme Court’s decision Thursday to dramatically limit the Environmental Protection Agency’s (EPA) authority to regulate the greenhouse gas emissions of power plants puts new pressure on Senate Majority Leader Charles Schumer (D-N.Y.) to strike a climate deal with Sen. Joe Manchin (D-W.Va.).

The conservative court’s 6-3 decision in West Virginia v. EPA strikes a blow to President Biden’s climate agenda and has Democrats and activists scrambling to salvage Biden’s pledge to reduce greenhouse gas pollution by 50 percent by 2030.

The setback places renewed importance on Schumer’s efforts to revive a budget reconciliation bill that would include climate provisions such as clean energy tax incentives, a fee on methane emissions and possibly a border tax on carbon-intensive imports.

“This devastating decision is only the latest shot in the arm to Congress to legislate action on climate,” said Melinda Pierce, the legislative director of the Sierra Club.

“What else do we need when we’re looking at wildfires and drought and flooding, with climate impacts on the doorsteps of both red and blue states, what other justification do you need?” she added.

“Today’s Supreme Court decision is stark reminder that the clock is ticking and Congress and must act.”

Schumer on Thursday said the court’s decision lights a fire under Congress to get something done to limit carbon emissions.

“Make no mistake — the consequences of this decision will ripple across the entire federal government, from the regulation of food and drugs to our nation’s health care system, all of which will put American lives at risk, making it all the more imperative that Democrats soon pass meaningful legislation to address the climate crisis,” he said in a statement responding to the opinion penned by Chief Justice John Roberts.

Many Democratic lawmakers have become pessimistic about getting Manchin to agree to any budget reconciliation deal that would include provisions to significantly reduce carbon emissions.

Darrell West, the director of governance studies at the Brookings Institution, said the court’s decision “puts a lot of pressure on Schumer to pass climate provisions, but it doesn’t look like they have the votes.”

“It’s going to be hard for Democrats to take significant action,” he said.

But Schumer is continuing to negotiate with Manchin, and there are some signs of progress.

The Washington Post reported Wednesday that Democratic leaders have finalized a proposal to lower the price of prescription drugs for seniors, which would be a core element of the budget reconciliation package.

This development puts Schumer and Manchin in position to negotiate the other pillars of the reconciliation package: tax reform and climate provisions.

Schumer told reporters last week that he’s making progress with Manchin but that they still have significant differences that need to be resolved. He declined to commit to bringing a reconciliation package to the floor before the August recess, which is scheduled to begin Aug. 6.

Schumer’s and Manchin’s staffs have continued to negotiate over the two-week July 4 recess, leaving some Democrats optimistic of getting a deal in July or early August.

Democrats are desperate to secure an accomplishment after the Supreme Court’s decisions to strike down Roe v. Wade’s abortion protections, repeal a longstanding New York law limiting conceal-carry handgun permits and now Thursday’s decision curbing the EPA.

Manchin may be close to signing off on legislation to lower the prices of some prescription drugs, but getting him to agree to a package of climate provisions will be more difficult, given Manchin’s advocacy for the domestic fossil fuel industry.

“I think Schumer would have to go to Manchin hat in hand and say, ‘Can we work something out that’s going to satisfy the very, very strong environmental base of the Democratic Party and the coal industry in West Virginia?’” said Ross K. Baker, a professor of political science at Rutgers University who served several fellowships in the Senate.

“There’s a sense of urgency particularly as the forecasts for global warming become more and more grim,” he added. “Undoubtedly pressure will be put on Schumer to make some kind of overture to Manchin, but what comes out of that, I think, is unlikely to quiet the anxiety and anger of the Democratic base.”

Schumer has kept his Senate colleagues mostly in the dark about the details of his conversations with Manchin, giving them only the same broad progress reports he has shared publicly.

Democratic senators, however, feel confident that a package of clean energy tax incentives produced by the Senate Finance Committee and a fee on methane emissions, which Sen. Tom Carper (D-Del) largely worked out with Manchin at the end of last year, could be included in the budget reconciliation legislation.

Sens. Sheldon Whitehouse (D-R.I.) and Chris Coons (D-Del.) are also pushing hard for a carbon border adjustment tax that would place a fee on carbon-intensive imports from China and other countries with more lax emission standards than the United States.

“There’s one particular colleague it needs to resonate with, and he said very nice things about it spontaneously in the Appropriations Committee the other day, so we’ll see what happens,” Whitehouse said, referring to what he believes is Manchin’s openness to considering the proposal.

“The dog’s still in the hunt,” he said.

Manchin last week said the border adjustment tax could help U.S. manufacturers compete with Chinese competitors who can get away with operating under much looser environmental standards.

“The reason we have Democrats and Republicans talking about a border adjustment, we think that’s the only level playing field we might have [against China],” Manchin said at a recent appropriations hearing, according to E&E News.

Josh Freed, who heads the climate and energy program at Third Way, a centrist Democratic think tank, said the court’s decision in West Virginia v. EPA may give Manchin more incentive to agree to a budget reconciliation package with climate provisions because such a bill would include 45Q, a tax credit for carbon sequestration.

Freed noted that the court’s decision bars the EPA from implementing sector-wide emissions standards and instead requires the environmental agency to apply individually tailored emissions standards for different energy producers. He said that could give coal-fired power plants incentive to adopt technology to capture and store carbon.

He said the court’s decision “gives power plants a pathway with carbon capture to remain in operation, which would be easier if reconciliation is passed.”

“It reinforces some of the tools that Sen. Manchin supports in reconciliation” such as the 45Q tax credit, he added, and “hopefully gives the senator more reason to support clean energy investments.”

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