Senate Minority Leader Chuck Schumer, D-N.Y., will lead the chamber in 2021. Source: Stefani Reynolds/Getty Images News via Getty Images

Democrats retook the U.S. Senate following Georgia's Jan. 5 runoff election, positioning the party to potentially advance more aggressive climate and clean energy legislation in the 117th Congress.

Democrats Raphael Warnock and Jon Ossoff defeated Republican U.S. Sens. Kelly Loeffler and David Perdue, respectively, in races to represent Georgia in the upper chamber, according to multiple national media outlets. As a result, the U.S. Senate will be split 50-50 between the Republican and Democratic caucuses, giving Democratic Vice President-elect Kamala Harris the deciding vote to break any gridlock in the upper chamber.

With Democrats controlling the White House and Congress, lawmakers could push for provisions of President-elect Joe Biden's $2 trillion plan focused on job creation around climate and clean energy goals.

However, the Democrats' small advantage in the U.S. Senate and narrow majority in the U.S. House may stymie some of the more ambitious progressive climate legislation should moderate Democrats from fossil fuel-producing states, such as U.S. Sen. Joe Manchin, D-W.Va., oppose such measures. With two Democratic victories in Georgia, Manchin will lead the U.S. Senate Energy and Natural Resources Committee after serving as ranking member in the 116th Congress.

Climate focus

In his remarks during the Democratic National Convention in August, Senate Minority Leader Chuck Schumer, D-N.Y., listed climate change third behind healthcare and income inequality as his party's priorities. With Schumer leading the chamber in the majority this January, climate change may be a central focus.

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Democrats in both chambers released climate plans this summer that may serve as a blueprint for proposals in the next Congress. In August, Senate Democrats' Special Committee on the Climate Crisis outlined goals pertaining to a clean energy transition that included calls for a federal clean energy standard, carbon price or other emissions-mitigation market mechanisms. House Democrats also released a plan containing hundreds of specific policy recommendations in June that included a proposal to give the Federal Energy Regulatory Commission a larger role in driving down power sector emissions.

Budget reconciliation, a special legislative process allowing for expedited consideration of federal spending and revenue legislation, could be a vehicle for passing major climate legislation. Such reconciliation bills only need a simple majority to pass and cannot be held up by a filibuster, a tool Senators can use to block legislation supported by fewer than 60 of the lawmakers.

While such a pathway may allow lawmakers to advance more aggressive energy and environmental legislation, outgoing Senate Energy and Natural Resources Committee Chairman Lisa Murkowski, R-Alaska, warned that such a partisan tool may not result in an "enduring policy" needed to tackle climate change.

No 'new political calculus'

Moreover, some of the Democrats that will be sitting in the 117th Congress hail from moderate states and districts and may not support aggressive climate legislation, according to industry observers.

As a result, the election may not yield "a whole new political calculus when it comes to climate," observed Sasha Mackler, director of the Energy Project at the Bipartisan Policy Center. Thus, he said climate policies may need to be seen as pragmatic to have a chance of passage.

"It suggests that a moderate Democratic perspective on energy and climate will be one of the forcing functions to seeing any policy gain traction," Mackler said. "We think we're going to need to continue with the efforts to build bipartisan support for climate policies — in particular support that can generate 60 votes."

Democrat Raphael Warnock, who will represent Georgia in the U.S. Senate after a close Jan. 5 runoff election, and President-elect Joe Biden bump elbows. Source: Raphael Warnock

Economic recovery packages may provide more bipartisan opportunities to invest in clean energy infrastructure and advance some climate provisions, observers said leading up to the November 2020 election. Lawmakers included billions of dollars for energy research and development as well as tax credit extenders in the recently passed stimulus package.

The Moving Forward Act, a $1.5 trillion proposal House Democrats passed largely along party lines in July, may serve as a "good prototype" for what a Schumer-led Senate might pursue as part of a recovery act, said Kevin Book, managing director of the independent research firm ClearView Energy Partners LLC.

Senate Democrats might also seek to scrap the filibuster to more easily pass their bills, according to some observers. While Democrats may not initially target the Senate's filibuster, Republican opposition to Democratic priorities could put the tool on the chopping block.

Eliminating the filibuster would require support from the entire Democratic caucus with Harris issuing the tie-breaking vote. But in November 2020, Manchin told Fox News that he would not vote to end the filibuster, likely blocking such a move in the near-term.

"An intact legislative filibuster would likely limit the magnitude of spending because passage through a thin blue Senate would still require ten GOP votes to clear a de facto 60-vote threshold, and we think that even otherwise-simpatico Republicans could balk at single-digit trillions' worth of green spending," according to a Jan. 5 report from ClearView Energy Partners.