Washington, D.C. (January 28, 2021) - In addition to actions already taken on his first day in office, which included rejoining the Paris climate agreement and revoking the Keystone XL oil pipeline's permit, on January 27, 2021, President Biden released several new initiatives that represent a major shift in climate policy (see our previous alert from January 19). These actions increase the need for businesses to develop strategies for achieving business goals in a new paradigm.
Among other things, the new climate change executive actions will have impacts on oil, gas, coal, and electric utility jobs, which the Administration seeks to replace with future jobs in clean energy and sustainable infrastructure. The orders place a moratorium on federal land and offshore oil and natural gas leasing, committing the federal government to a goal of preserving at least 30% of the nation's land and waters for conservation. The directives also emphasize environmental justice in agency decision-making and promise to deliver 40% of all benefits of relevant federal investments to disadvantaged communities (Justice40 initiative). The President's actions include the following:
- elevating the environment as an
element of national security by establishing a new Special
Presidential Envoy for Climate who will sit on the National
Security Council, and designating National and Deputy National
Climate Advisors to head a central office in the White House that
will coordinate and implement domestic climate agendas;
- forming a National Climate Task
Force, which will be led by officials from 21 federal agencies and
departments;
- directing the Director of National
Intelligence to study the security implications of climate change
and prepare a National Intelligence Estimate;
- requiring each federal agency to
develop plans concerning climate change as related to its
operations and facilities;
- charging the Secretary of Agriculture
with gathering information from stakeholders concerning the
adoption of sustainable agricultural practices;
- creating an Interagency Working Group
on Coal and Power Plant Communities and Economic Revitalization and
directing this group to address emission-reductions of greenhouse
gases and other substances, including methane emissions, oil and
brine leaks, and other environmental issues concerning mining and
well sites;
- forming a White House Environmental
Justice Interagency Council and White House Environmental Justice
Advisory Council to emphasize environmental justice that will work
with offices in the Environmental Protection Agency, Department of
Justice, and Department of Health and Human Services;
- developing a Climate and
Environmental Justice Screening Tool, which will be used to
quantify federal benefits that will be directed toward
disadvantaged communities under the Justice40 Initiative;
- putting in place a directive to
agencies concerning scientific integrity that assigns
responsibility to the Director of the Office of Science and
Technology Policy to assess and ensure that agency policies are
sufficiently evidence-based;
- requiring all agencies to designate a
Scientific Integrity Official; and
- ordering a re-chartering of the President's Council of Advisors on Science and Technology, an entity created by President George W. Bush and re-chartered by each subsequent president, to advise the Administration on science, technology, and innovation policies.
These executive actions come hand-in-hand with other recent government actions centered on climate change. For example, the Federal Reserve (Fed) recently created a Supervision Climate Committee, to be led by Kevin Stiroh, formerly of the New York Fed, which will study the potential impacts of climate change on the financial system. This comes after the Fed said in November that climate change poses a threat to the stability of the system. President Biden has also promised to establish an Environmental and Climate Justice Division within the Department of Justice, intended to step up enforcement of criminal anti-pollution laws and assist the newly-established White House Environmental Justice Advisory Council as outlined above.
And, as noted in our previous alert, leaders in the private sector have advised that companies pay close attention to recently renewed weight given to climate change and investor interest in this issue. In his January 2021 annual letter to CEOs, BlackRock's Larry Fink underscored the need for businesses to emphasize climate change, explaining that as more investors focus on sustainability-focused companies, the movement of investments from carbon-intensive to sustainability-focused companies will cause a "tectonic shift."
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