Airlines get $60bn bailout, but Pelosi’s proposal on halving of emissions by 2050 not included

A $2tn US coronavirus relief package will dole out billions to struggling airlines and offer low-interest loans that fossil fuel companies could compete for – without requiring any action to stem the climate crisis.

The legislation, passed by the Senate late on Wednesday, includes a $60bn bailout for airlines. Nancy Pelosi, the leader of the Democrat-controlled House, had proposed a requirement for airlines to cut their planet-warming emissions in half by 2050, but that provision is not in the bill.

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The House is expected to vote on the package on Friday. It also includes nearly $500bn in lending authority that one environment group, Friends of the Earth, called a “corporate slush fund with insufficient guardrails to protect workers, taxpayers and the climate”.

Congressional Republicans have accused Democrats of taking advantage of the Covid-19 pandemic to pursue climate policy. The Senate leader, Mitch McConnell, a Kentucky Republican, said this week that Democrats were “bargaining as usual” with “counter-offers that demanded things like new emission standards or tax credits for solar panels”. Multiple Republican politicians tweeted accusing Democrats of trying to usher in a Green New Deal with massive climate spending during a crisis.

In the end, the stimulus package focused on direct aid to individuals and the worst-hit industries, while setting climate considerations aside.

Annie Petsonk, international counsel for the Environmental Defense Fund, said that while the situation for airlines and their workers was dire, the industry should have had to commit to slashing emissions as a condition of the aid.

“The provisions we were focused on simply would hold the airlines to what they already said they’re going to do,” Petsonk said. “People do not want to solve one crisis by making another crisis worse.” The 2008 auto industry bailout, in comparison, led to stricter rules for pollution from vehicle tailpipes.

The bill, the third in a series of stimulus packages, offers virtually nothing to climate advocates, but it is not the last word. Scott Segal, a lawyer and lobbyist with the firm Bracewell LLC, which represents energy industry clients, said a fourth stimulus deal was likely to involve “significant discussions of green objectives”.

“Was this a missed opportunity for climate? I think the answer to that is no,” Segal said. “This stimulus package was primarily about getting money into the hands of individual households and workers and in some service sectors that were particularly hurt.”

Kevin Book, the managing director of ClearView Energy Partners, a research firm, said: “Congress is going to be making more deals, and as long as there is a deal to be made, Democrats have made clear what they want.”

Democrats negotiated multiple measures meant to prevent abuse of the $500bn available in lending, including an oversight board, a special inspector general and provisions aimed at limiting Donald Trump’s businesses from benefiting – an issue that has already come under scrutiny.

But climate hawks said those stipulations were not strong enough. “What makes this so frightening is that there are very few binding restrictions on how this money can be used that the secretary of treasury cannot waive,” said Lukas Ross, a senior policy analyst with Friends of the Earth.

“It’s great that [Trump’s son-in-law ] Jared Kushner isn’t going to get a subsidised line of credit. It’s much more worrying in human terms that Chevron, Exxon and every other polluter you can imagine is eligible to be propped up in terms of the stimulus package.”

The bill also does not include specific assistance to the renewable energy industry, although trade associations and lobbyists expect to revisit that possibility as discussions continue about more targeted aid for at-risk sectors of the economy.

The American Wind Energy Association (AWEA) projects that the US wind industry could lose 35,000 jobs and $35bn in investment. Those losses could lead to lease payment and tax revenue reductions for local and state governments. No tax credit extensions have been granted for the solar and wind industries, meaning they may lose access to credits if they miss deadlines.

“Obviously of primary importance is the public health and keeping the economy moving. We applaud that big effort,” said Tom Kiernan, the chief executive of the AWEA, adding that his group would continue to push for tax provisions to stem industry losses.

The Solar Energy Industries Association said the solar sector could lose half its jobs, meaning “125,000 families who will no longer receive a paycheck”.

Abigail Ross Hopper, its president and CEO, said: “Legislators were really focused on industry-wide protections and assistance, like the unemployment insurance, like the loans for which our companies are eligible, and did not include industry-specific solutions for a couple of particularly hard hit ones.”

In one climate win for Democrats, the bill does not include a discussed $3bn to buy oil to fill the Strategic Petroleum Reserve in order to lift global oil prices.