What Joe Manchin wants

Manchin knows the coal industry can only survive if we don't give incentives to clean energy

By Carl Pope

Contributing Writer

Published January 1, 2022 2:00PM (EST)

Sen. Joe Manchin (D-WV) speaks during an event with the Economic Club of Washington at the Capitol Hilton Hotel October 26, 2021 in Washington, DC. (Drew Angerer/Getty Images)
Sen. Joe Manchin (D-WV) speaks during an event with the Economic Club of Washington at the Capitol Hilton Hotel October 26, 2021 in Washington, DC. (Drew Angerer/Getty Images)

Senator Joe Manchin's sudden declaration that he opposed the President's Build Back Better initiative sent shockwaves through Washington and the climate movement – although many progressives had previously feared that Manchin would, after weakening many climate vital provisions, turn on the whole project.

They were right.

As Democrats wrestle with how to rescue a reasonably robust version of Build Back Better from the ashes, consider all the progressive positions Manchin has taken in the past. All along, the Democratic senator from West Virginia swore that his lodestar was energy policy aimed at "innovation, not elimination." In other words, encourage all kinds of new energy — particularly carbon capture and storage that might extend the coal and gas era — but also manufacturing sector breakthroughs like green hydrogen.

What is the Senator's excuse for opposing Build Back Better?

"The energy transition my colleagues seek is …. faster than technology or the markets allow" with "catastrophic consequences for the American people," he says.

This is utter nonsense — and Manchin needs to be gently reminded of this. The final version of Build Back Better, after Manchin's pruning,  was probably the most carrot-heavy, stick-free major energy bill ever crafted.  And the transition pace envisaged would leave the United States an also-ran in the global clean energy transition.

Still, the flimsiness of Manchin's excuse for bailing on the bill does strongly suggest a political strategy to win his vote back.

Indeed, Build Back Better was remarkable for its toothlessness, a fact underappreciated by most commentary on the bill. It offered tens of billions of dollars for technology neutral tax credits and finance guarantees — not only for wind and solar, but for energy storage of all kinds: new nuclear, geothermal, green hydrogen and, yes, carbon capture and storage.

Its only restrictive proposal, a tax on leaking methane from oil and well, was designed to encourage innovation within that industry, not shut it down.

On frontier technologies like green hydrogen and carbon capture, Build Back Better (BBB) offered billions of dollars of potential tax credits for technologies Manchin says he supports, like carbon capture and storage. (Indeed, in part because of those investments, the United Mine Workers is opposing Manchin's decision to vote "no" on the bill).

So why did Manchin flip-flop? Two apparent reasons. First, he ran into the internal contradiction of his "innovate don't eliminate" approach. As Bloomberg's Liam Denning pointed out before Manchin walked, "innovation ultimately begets elimination." 

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As Manchin pruned mandates and bans, the White House and Democrats beefed up the incentives to keep the same outcome – ultimately a 45% reduction in emissions and close to 80% zero carbon electricity in 2030. If you run the numbers, those goals — the foundation of Manchin's complaint about a reckless energy transition — don't leave much room for high-priced West Virginia coal and gas. America still consumes some coal, gas and oil in 2030 – but low-cost producers, like coal from Wyoming, gas from the Gulf of Mexico, and oil from the Persian Gulf, will dominate those shrunken markets. In a rapidly decarbonizing economy, there is very little room for steadily dwindling West Virginia coal seams, or $60+ barrels of Texas oil.

Unfortunately Manchin's solution – which is essentially slow down the transition – requires him to sell America short. Way short.  Biden's – or BBB's – pace of transition barely keeps the US competitive in global markets. 

Look at the numbers.  BBB would cut US carbon emissions by 45%. The EU, already ahead of the game, has committed to 55%. BBB attempts to finance the construction of 450 gigawatts of US wind and solar.  China has committed to 1200 GW of renewables, and even India, with a power sector dwarfed by America's, is planning 500 GW.

So if a "let's come in third or fourth" clean energy transition strategy (more or less what BBB offers) is too ambitious for Manchin, his approach requires America to be further saddled with dependence on outmoded coal, oil and gas technologies — in other words, falling even further behind Europe, China, and India in the race to the future.

But Manchin's choice of Fox News as the venue to announce his abandonment of his commitments to work with the Democratic caucus on its keystone Build Back Better bill strongly suggests that he has his eyes firmly planted on how his move plays back home. And the back home voice that most needs to be mobilized is the business community.

That's because the second major driver of Manchin's betrayal was an orchestrated campaign by a narrow slice of West Virginia business determined to lock the US economy into uncompetitive, dirty fossil fuel energy. The arguments Manchin made about needing to slow-walk the energy transformation came straight from America's Power, a coal industry trade organization. Technology neutral tax credits, historically one of the most bi-partisan energy policy tools, were suddenly flagged by the West Virginia coal industry as a fatal threat – because, quite simply, they enable faster replacement of no longer competitive incumbent technologies.

The New York Times reported that the West Virginia Coal Association told Manchin that "the credits … in the bill would have resulted in an almost total displacement of coal generation." There it is. American coal is no longer competitive. Only by cutting off finance for innovation in other energy sectors can it survive.

Here lies the political path forward. If a fading segment of West Virginia business, employing half as many workers as a decade ago,  has driven Manchin to abandon his commitment to innovation, the rest of the the state's business community should be able to bring him back. Data centers, operated using clean energy, are the fastest growing customer of the state's utilities. Wood products, chemicals, metals and glass; health care and pharmaceuticals; aeronautics and automotive manufacturing – the rest of West Virginia's economy — are all energy consumers, not producers. They benefit enormously, and in some cases require, the rapid development of cleaner, cheaper energy. None benefit from an America strangled by overpriced and pollutive fossil fuel energy.

Certainly none flourish in a nation where investment in energy innovation is hobbled because such innovation displaces outmoded technologies.

Will the fossil fuel industry succeed in destroying America's economic future? Joe Manchin's vote may decide. Business – particularly West Virginia business — is the key to that vote.

America's past should not strangle West Virginia's choices. Nor should West Virginia's past betray America's future. 

The mind of Manchin:

By Carl Pope

Carl Pope is the co-author of "Climate of Hope: How Cities, Businesses, and Citizens Can Save the Planet." He is the former CEO and chairman of the Sierra Club.


Related Topics ------------------------------------------

Build Back Better Clean Energy Climate Change Coal Commentary Joe Manchin Renewables