The Smarter Cleaner Faster Infrastructure framework can bridge political divides and move the country forward. Infrastructure modernization is among a small set of issues that enjoys active bipartisan support. Congress should seize this moment to develop a proposal with input from both parties via the traditional legislative process. There are urgent economic and environmental needs to accelerate the construction of modern, clean and resilient infrastructure. The principles identified below offer a bipartisan foundation for substantive and legislative success.
One Investment, Multiple Benefits
Clean, modern infrastructure investments have a strong multiplier effect, improving economic growth, creating millions of good-paying middle-class jobs, protecting our climate and environment and advancing environmental justice.
Further Delay Is Not an Option
A major infrastructure investment is essential for our economy and environment. Building infrastructure that reduces greenhouse gas emissions is like putting money into a savings account with a high rate of compound interest; the earlier one makes the investment, the more it will be worth by 2050. Smart and timely investments in clean infrastructure can provide a foundation for achieving climate goals that relies more on innovation and less on taxes and regulation.
To get to our destination, we need to answer these three key questions:
- What is the definition of infrastructure?
- How do we build it faster?
- Do we pay for it now or in the future?
Defining the Scope
With a potentially large infrastructure bill on the horizon, every stakeholder and interest group is understandably advocating that their priorities be included in the definition of infrastructure. While there is appetite among many in Congress to advance a variety of national interests, we believe Congress should focus infrastructure legislation on the transportation and water systems, high quality broadband, and energy infrastructure needed to increase resiliency, grow the economy, and support the timely and economically viable decarbonization of our economy.
Approving and Permitting Projects
The processes to provide project permit approvals at all levels of government are inefficient, creating unnecessary delays that increase project costs, reduce investment, and significantly delay the environmental, societal and economic benefits of new and improved infrastructure. We will not succeed in modernizing the nation’s infrastructure absent equal efforts to modernize the permitting and approval process. The necessary regulatory reforms are significant, requiring difficult trade-offs between climate change goals and issues related to federalism, private property rights and judicial review. Importantly, we can significantly improve the process without changing any of the environmental and safety standards on which permitting and environmental reviews are based. Absent dramatic improvement, important projects and new technologies will sit on the sidelines and achieving net-zero by 2050 will be impossible.
Paying for Infrastructure
The nation simply cannot afford to pass another multi-trillion-dollar legislative package absent any reductions in spending or new revenue. While some will certainly argue that the imperative of economic recovery and historically low interest rates justify additional deficit spending, Congress must take meaningful action to offset some or all of these new expenditures. The public sector also should not be expected or forced to foot the bill for these investments alone, nor is that necessary. We have seen rapid growth of sustainable investment funds for investors who want their investments to have positive benefits to society, and we should do everything possible to facilitate putting this capital to use for public good. Opening the door for all viable project delivery options, including public-private partnerships, will be necessary to close the funding gap and transfer certain risks to the private sector, whose expertise and innovation can make them better suited to bear them.
To decarbonize our economy, improve national security, and ensure every American family, business, and manufacturing facility has access to clean, reliable, affordable energy, we need to significantly reduce emissions from energy production and use, increase and upgrade transmission and distribution, add significant energy generation and storage capacity and deploy a wide range of new technologies at commercial scale.
Inefficient, aging surface transportation and transit systems harm economic competitiveness and decarbonization efforts. Existing systems are also ill equipped to support the transportation and communications technology breakthroughs that are needed to support mobility in a decarbonizing economy. Moreover, as climate patterns shift and the impacts of extreme weather events increase, America’s $4 trillion worth of transportation infrastructure assets will be subject to stressors that will reduce their reliability and capacity. We must accelerate the buildout of clean transportation infrastructure which will reduce emissions, relieve congestion, increase transit options, facilitate continued growth, and prepare for the transition to electric and hydrogen vehicles.
We must ensure every American has access to clean drinking water and that our harbors, dams, sea walls, levees, coastlines, and ports are upgraded for stronger storms and our modern economy. From more extreme flooding that pollutes waterways to droughts and sea level changes that jeopardize drinking water supplies, climate change will continue to wreak havoc on our aging water infrastructure assets.
Every American should have access to broadband internet to expand their economic and educational opportunities and connect with telehealth services. Moreover, digital technology will be the backbone of a clean energy future and it must include all parts of the country and all communities.
Never underestimate the power of American ingenuity to invent solutions to difficult problems. We should ensure that the government is partnering with the private sector to fund promising research that can be commercialized and deployed to reduce emissions, improve quality of life, and compete globally.
Streamlining the Current Process
Federal, state, and local agencies should work collaboratively and concurrently, under the direction of one lead agency, to create a unified permitting and review process that produces a single environmental review and final decision in a reasonable timeframe; where that is infeasible, Congress should act to improve inefficiencies. This process should be transparent to all stakeholders and public engagement should begin early in the process to address local concerns, with a focus on environmental justice and speedy resolution of disputes. Federal and state agencies must have sufficient funding, staffing levels, technical expertise, technology, and training to quickly complete reviews and approvals, with effective dispute resolution and reasonable and efficient processes for judicial review.
Even if improved, better funded and streamlined, the current project approval process will not be able to handle the massive infrastructure transformation required to achieve net-zero emissions within 29 years. We must entertain far bolder reforms that move away from one-by-one permitting decisions for each specific project toward a state, regional, or federal pre-approval system for critical climate infrastructure. Ensuring that historically disadvantaged communities receive equitable economic and public health benefits in these regional and national strategies is a necessary predicate for success.
Many projects need direct federal funding, often matched by local funding, to get off the ground. We must look towards long-term solvency for existing trust funds, ensuring that user fees are designed to maintain solvency through the higher levels of spending necessary and keep pace with inflation. If funding is designated outside of the user fee model, it should be sufficient and for a long enough time period to provide certainty for at least a decade of construction cycles.
Financing allows projects to be completed faster—sometimes years faster than they could otherwise be achieved—and helps to spread project costs over the life of the asset. Congress should continue and expand upon successful financing programs to lower the cost of capital for projects and increase attractiveness to private sector investors. Importantly, private investors take on project risks, including project delays, usually born by state and local governments. Funding—from taxes, fees, or other revenue sources—is needed to repay financing.
Tax incentives should be designed to encourage maximum private sector investment – particularly in clean energy infrastructure – where significant private capital is available and must be deployed quickly. If seeking to incentivize decarbonization, tax incentives should be designed to equitably support all forms of lower and zero carbon energy production, transmission and use.
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