Biden Details $2 Trillion Plan to Rebuild Infrastructure and Reshape the Economy

WASHINGTON — President Biden will unveil an infrastructure plan on Wednesday whose $2 trillion price tag would translate into 20,000 miles of rebuilt roads, repairs to the 10 most economically important bridges in the country, the elimination of lead pipes and service lines from the nation’s water supplies and a long list of other projects intended to create millions of jobs in the short run and strengthen American competitiveness in the long run.

Biden administration officials said the proposal, which they detailed in a 25-page briefing paper and which Mr. Biden will discuss in an afternoon speech in Pittsburgh, would also accelerate the fight against climate change by hastening the shift to new, cleaner energy sources, and would help promote racial equity in the economy.

The spending in the plan would take place over eight years, officials said. Unlike the economic stimulus passed under President Barack Obama in 2009, when Mr. Biden was vice president, officials will not in every case prioritize so-called shovel ready projects that could quickly bolster growth.

But even spread over years, the scale of the proposal underscores how fully Mr. Biden has embraced the opportunity to use federal spending to address longstanding social and economic challenges in a way not seen in half a century. Officials said that, if approved, the spending in the plan would end decades of stagnation in federal investment in research and infrastructure — and would return government investment in those areas, as a share of the economy, to its highest levels since the 1960s.

signed into law this month, the “American Rescue Plan.”

“The American Jobs Plan,” White House officials wrote in the document detailing it, “will invest in America in a way we have not invested since we built the interstate highways and won the Space Race.”

While spending on roads, bridges and other physical improvements to the nation’s economic foundations has always had bipartisan appeal, Mr. Biden’s plan is sure to draw intense Republican opposition, both for its sheer size and for its reliance on corporate tax increases to pay for it.

Administration officials said the tax increases in the plan — including an increase in the corporate tax rate and a variety of measures to tax multinationals on money they earn and book overseas — would take 15 years to fully offset the cost of the spending programs.

The spending in the plan covers a wide range of physical infrastructure projects, including transportation, broadband, the electric grid and housing; efforts to jump-start advanced manufacturing; and other industries officials see as key to the United States’ growing economic competition with China. It also includes money to train millions of workers, as well as money for initiatives to support labor unions and providers of in-home care for older and disabled Americans, while also increasing the pay of the workers who provide that care.

Many of the items in the plan carry price tags that would have filled entire, ambitious bills in past administrations.

Among them: a total of $180 billion for research and development, $115 billion for roads and bridges, $85 billion for public transit, and $80 billion for Amtrak and freight rail. There is $42 billion for ports and airports, $100 billion for broadband and $111 billion for water infrastructure — including $45 billion to ensure no child ever is forced to drink water from a lead pipe, which can slow children’s development and lead to behavioral and other problems.

The plan seeks to repair 10,000 smaller bridges across the country, along with the 10 most economically significant ones in need of a fix. It would electrify 20 percent of the nation’s fleet of yellow school buses. It would spend $300 billion to promote advanced manufacturing, including a four-year plan to restock the country’s Strategic National Stockpile of pharmaceuticals, including vaccines, in preparation for future pandemics.

In many cases, officials cast those goals in the language of closing racial gaps in the economy, sometimes the result of previous federal spending efforts, like interstate highway developments that split communities of color or air pollution that affects Black and Hispanic communities near ports or power plants.

Officials cast the $400 billion spending on in-home care in part as a salve to “underpaid and undervalued” workers in that industry, who are disproportionately women of color.

Mr. Biden’s pledge to tackle climate change is embedded throughout the plan. Roads, bridges and airports would be made more resilient to the effects of more extreme storms, floods and fires wrought by a warming planet. Spending on research and development could help spur breakthroughs in cutting-edge clean technology, while plans to retrofit and weatherize millions of buildings would make them more energy efficient.

The president’s focus on climate change is centered, however, on modernizing and transforming the United States’ two largest sources of planet-warming greenhouse gas pollution: cars and electric power plants.

A decade ago, Mr. Obama’s economic stimulus plan spent about $90 billion on clean energy programs intended to jump-start the nation’s nascent renewable power and electric vehicle industries. Mr. Biden’s plan now proposes spending magnitudes more on similar programs that he hopes will take those technologies fully into the mainstream.

It bets heavily on spending meant to increase the use of electric cars, which today make up just 2 percent of the vehicles on America’s highways.

The plan proposes spending $174 billion to encourage the manufacture and purchase of electric vehicles by granting tax credits and other incentives to companies that make electric vehicle batteries in the United States instead of China. The goal is to reduce vehicle price tags.

The money would also fund the construction of about a half-million electric vehicle charging stations — although experts say that number is but a tiny fraction of what is needed to make electric vehicles a mainstream option.

Mr. Biden’s plan proposes $100 billion in programs to update and modernize the electric grid to make it more reliable and less susceptible to blackouts, like those that recently devastated Texas, while also building more transmission lines from wind and solar plants to large cities.

It proposes the creation of a “Clean Electricity Standard” — essentially, a federal mandate requiring that a certain percentage of electricity in the United States be generated by zero-carbon energy sources like wind, solar and possibly nuclear power. But that mandate would have to be enacted by Congress, where prospects for its success remain murky. Similar efforts to pass such a mandate have failed multiple times over the past 20 years.

The plan proposes an additional $46 billion in federal procurement programs for government agencies to buy fleets of electric vehicles, and $35 billion in research and development programs for cutting-edge, new technologies.

It also calls for making infrastructure and communities more prepared for the worsening effects of climate change, though the administration has so far provided few details on how it would accomplish that goal.

But according to the document released by the White House, the plan includes $50 billion “in dedicated investments to improve infrastructure resilience.” The efforts would defend against wildfires, rising seas and hurricanes, and there would be a focus on investments that protect low-income residents and people of color.

The plan also includes a $16 billion program intended to help fossil fuel workers transition to new work — like capping leaks on defunct oil wells and shutting down retired coal mines — and $10 billion for a new “Civilian Climate Corps.”

Mr. Biden would fund his spending in part by eliminating tax preferences for fossil fuel producers. But the bulk of his tax increases would come from corporations generally.

He would raise the corporate tax rate to 28 percent from 21 percent, partly reversing a cut signed into law by President Donald J. Trump. Mr. Biden would also take a variety of steps to raise taxes on multinational corporations, many of them working within an overhaul of the taxation of profits earned overseas that was included in Mr. Trump’s tax law in 2017.

Those measures would include raising the rate of a minimum tax on global profits and eliminating several provisions that allow companies to reduce their American tax liability on profits they earn and book abroad.

Mr. Biden would also add a new minimum tax on the global income of the largest multinationals, and he would ramp up enforcement efforts by the Internal Revenue Service against large companies that evade taxes.

Administration officials expressed hope this week that the plan could attract bipartisan support in Congress. But Republicans and business groups have already attacked Mr. Biden’s plans to fund the spending with corporate tax increases, which they say will hurt the competitiveness of American companies. Administration officials say the moves will push companies to keep profits and jobs in the United States.

Joshua Bolten, the president and chief executive of the Business Roundtable, a powerful group representing top business executives in Washington, said on Tuesday that his group “strongly opposes corporate tax increases as a pay-for for infrastructure investment.”

“Policymakers should avoid creating new barriers to job creation and economic growth,” Mr. Bolten said, “particularly during the recovery.”

Coral Davenport and Christopher Flavelle contributed reporting.

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Serbia Hails Chinese Companies as Saviors, but Locals Chafe at Costs

METOVNICA, Serbia — The well in the retired couple’s yard, their only source of clean water, began to dry up two years ago. Last year, dead fish started washing up on the banks of the river that runs by their home in a bucolic village in southeastern Serbia.

But most disturbing of all for Verica Zivkovic and her husband, Miroslav, are the ever-widening cracks in the walls of the house they built after moving to the countryside more than a decade ago to raise goats.

“We came here for the peace and quiet,” said Ms. Zivkovic, 62, but that all changed when a Chinese company arrived.

In 2018, the company, the Zijin Mining Group, took control of a money-losing copper smelter in the nearby city of Bor and began blasting away in the nearby hills in search of copper and gold.

pro-democracy group Freedom House downgraded Serbia in 2019 from “free” to “partly free,” citing a tightening grip on politics, civil liberties and the media.

In January, 26 members of the European Parliament demanded a review of the “growing impact of China’s economic footprint in Serbia,” including “reckless projects with potentially devastating multiple impacts on the wider environment as well as surrounding population.”

The roots of Serbia’s tilt toward China date to 1999, during the Kosovo war, when U.S. warplanes mistakenly bombed the Chinese embassy in Belgrade, killing three Chinese journalists. On that site now stands a huge Chinese cultural center. A marble memorial stone outside bears inscriptions in Serbian and Chinese hail China’s “martyrs.”

But memories of shared suffering at American hands have faded in places like Bor, site of the Chinese-owned smelter.

Pollution from the Bor plant skyrocketed to many times the legally permitted level in 2019 and 2020, setting off a series of street protests and prompting Zijin Mining’s general manager in Serbia to tell his managers last October that he was “very dissatisfied” with the “frightening” level of pollution, according to leaked minutes of the meeting.

He blamed the bad publicity, which he said had damaged “the government of the People’s Republic of China,” on “people who are in favor of the West and receive support” who “have stood in opposition to our work.”

Bor’s mayor, Aleksandar Milikic, a Vucic loyalist, initially dismissed the protests as the work of political agitators.

But, apparently worried about losing votes, he announced last year that he would file a court case against Zijin for negligence. It is not clear whether he actually did so. The mayor declined to be interviewed. Zijin Mining did not respond to requests for comment.

Milenko Jovanovic, an air pollution expert, said he was fired in November from Serbia’s Environmental Protection Agency after raising concerns about dangerously high levels of sulfur dioxide and arsenic in the air around Bor.

The government, he said, rejected anything that might upset China and its investors. “It lets them do whatever they want to do,” he said.

A court in Belgrade ruled this month that Mr. Jovanovic had been unfairly dismissed and ordered that he be given his job back.

Activists concede that air pollution levels in Bor have fallen since protests, but say that the main danger has now shifted to towns and villages to the south, where hundreds of Chinese workers brought in by Zijin are developing one of the world’s biggest unexploited copper deposits, and digging for gold.

The earth around the new mine trembles from blasting work and the heavy trucks, driven by Chinese workers, that rumble along roads adorned with China’s red national flag. Rivers and streams are discolored by effluent.

The government has added to public anger by issuing expropriation orders so that Zijin can build access roads and expand its mine. Dragan Viacic, a farmer, said he had received a letter from Serbia’s finance ministry informing him that he must sell 13 acres of his land at a fraction of the market price.

“They said this was necessary in the public interest but in reality this is just the interest of the Chinese,” he said.

In Metovnica, a village near the mine, Mr. Zivkovic and his wife used to have 25 goats but, with no clean water on hand after their well dried up, they now keep just one.

“Why don’t we have any water anymore? Why are there no fish in the river?” The answer, he said, is Zijin Mining Group.

Pointing to fissures radiating across the wall of his house that appeared last year after Chinese miners started using explosives, Mr. Zivkovic said: “It was a tiny crack at first but then it spread.”

Confident that it has the support of Mr. Vucic and his officials, the mining company and other Chinese ventures in Serbia have mostly ignored complaints and shrouded their operations in secrecy.

Sasa Stankovic, an environmental activist and elected member of the Bor regional council, said he had tried unsuccessfully to contact Zijin to discuss pollution levels. The copper smelter in Bor, he said, had been hazardous to health for decades, but the dangers jumped sharply after Zijin arrived and ramped up production.

Bor now accounts for a stunning 80 percent of Serbian exports to China, repeating a pattern widely seen in Africa of Chinese firms extracting natural resources for shipment back to China.

At Slatina, a village down the road, Miodrag Zivkovic, a local farmer stood on a rickety bridge over the Bor River, its waters thick with sludge and garbage, and said: “We didn’t go to the Chinese mine but the mine came to us.”

All the same, he said, given the few jobs available in the region, his son would still like to get work at the smelter, which pays relatively well. “Everyone here needs a salary and is ready to risk everything,” he lamented.

Cao Li contributed reporting from Hong Kong and Monika Pronczuk from Brussels.

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China’s Climate Ambitions Collide with its Coal Addiction

Xi Jinping, China’s top leader, has promoted an uplifting vision for growth increasingly freed from greenhouse gas pollution, but turning that plan into action is already proving contentious.

The big issue is coal.

Mr. Xi’s climate-saving ambitions are a pillar of a plan for the country’s post-pandemic ascent that was endorsed by China’s Communist Party-controlled legislature days ago.

The plan is designed to steer the country toward two signature commitments that Mr. Xi made last year. China’s emissions of carbon dioxide would peak before 2030, he said, and the country would reach net carbon neutrality before 2060, meaning it would emit no more of the greenhouse gas than it takes from the atmosphere by methods like engineering or planting forests.

But unusually sharp debate has risen in China over how aggressively it should cut the use of coal, which has fueled its industrial takeoff yet made it the world’s top-polluting nation in recent decades.

Leon Clarke, a professor at the University of Maryland and a leading co-author of a recent study on China’s options for curtailing emissions. “On the one side, there’s a sense that coal has driven the economy and you don’t want to give that up. On the other hand, coal is the biggest target for climate action, particularly in the near term.”

China’s environmental pressures were brought to life last week as a thick smog hung over Beijing, reflecting an uptick in industrial pollution.

28 percent of the global total, roughly the same as the next three biggest emitters combined: the United States, the European Union and India. The accumulated emissions of the United States and other rich economies across the entire industrial era, though, remain much bigger than China’s.

Representatives of the coal industry attending the national legislative session in Beijing argued that China needs to keep burning coal, albeit in cleaner, more efficient plants.

The China National Coal Association issued a report this month proposing modest increases in its use for the next five years, reaching 4.2 billion metric tons by 2025, and also said China should create three to five “globally competitive world-class coal enterprises.”

“The principal status of coal in our national energy system, and its role as ballast, will not shift,” the association said in an earlier position paper about the industry’s outlook in the next five years.

Provincial governments have recently proposed more new coal mines and power plants, while vowing that their projects will limit emissions. In answer to the call for a carbon peak, Shanxi Province, one of China’s biggest coal producing areas, announced plans for 40 “green,” efficient coal mines.

Chinese officials in such areas also worry about losses of jobs and investment and the resulting social strains. They argue that China still needs coal to provide a robust base of power to complement solar, wind and hydropower sources, which are more prone to fluctuating. And many energy companies backing these views are state-owned behemoths that have easy access to political leaders.

Center for Research on Energy and Clean Air in Helsinki. “The central contradiction between expanding the smokestack economy and promoting green growth appears unresolved.”

China’s new plan appears to give the different camps in the carbon debate a foothold. The plan promises green growth and expansion of hydro, solar and wind power, in addition to nuclear power plant construction. By 2025, the plan says, non-fossil fuel sources will provide one-fifth of China’s energy.

Yet the plan also appeared to hearten defenders of coal and disappoint environmental groups and climate policy experts. It did not include an absolute ceiling on annual carbon dioxide emissions and indicated that coal-fired power stations would keep being built.

“Many areas still believe that before 2030 they can keep substantially increasing fossil fuel use,” Wang Jinnan, the president of the government’s Chinese Academy of Environmental Planning and a senior member of the national legislature, said in an interview with a Chinese magazine posted on the academy’s website. “This will have a big negative impact on China reaching carbon neutrality before 2060.”

Mr. Xi may face calls from abroad to offer more ways to curb emissions as China turns the plan into actual policies. For China, action on climate change is also a way of building good will, including with the United States and the European Union.

international pact to limit global warming this century to below 2 degrees Celsius (3.6 degrees Fahrenheit), and to 1.5 degrees Celsius if possible, is not possible without more urgent efforts from China and the other major powers to reach carbon neutrality by around midcentury.

“The longer the delay, the harder it is to achieve those midcentury targets. It’s just math,” said Kelly Sims Gallagher, a professor at the Fletcher School of Tufts University who studies China’s climate policies. China’s plan, she said, “will not have the effect of injecting new momentum into the global climate negotiations.”

Mr. Xi has a political stake in the issues. He has promoted himself and China as guardians of an “ecological civilization” and has made cleaning China’s air, water and soil a basis for public appeal. When he announced China’s pledge last year to curtail greenhouse gas emissions, he also called for a “green recovery” from the Covid-19 pandemic.

China’s air pollution has eased markedly in recent years. Mr. Xi created environmental inspection teams to pressure officials usually fixated on economic and political goals. The inspectors flashed their teeth early this year when they issued strikingly blunt criticisms of the National Energy Administration, which helps oversee power plant approvals.

“Environmental protection has not been given the high priority it should be accorded,” the inspectors wrote in their report on the administration. They criticized the administration for letting coal power projects go ahead in eastern China, where stringent pollution limits are supposed to apply. In recent days, the environmental authorities also cracked down on steel makers in Tangshan, a northern industrial city, that were found breaking pollution curbs, including submitting fake data.

to the Rhodium Group, an economic research firm.

To transit away from coal, China must confront the costs of closing mines and plants, including the needs of millions of potentially displaced miners and other workers. Many coal-dependent regions and their workers seem unprepared for that possible shift.

“I’ve never thought about the coal mine shutting down, never thought about leaving,” Gui Lianjun, a 39-year old miner in Shenmu, a coal city in northwest China, said by telephone. He sounded nonplused when asked about the link between coal and global warming.

“The government close down a mine because of global warming? I don’t think that’s possible,” he said. “I’ve never heard of that reason.”

Liu Yi contributed research.

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Air Pollution Plummeted During the Pandemic, Except in Areas With Wildfires

Pandemic shutdowns led to a rare decline in air pollution around the world during 2020, except in those cities affected by smoke that spewed from huge wildfires, including much of the Western U.S.

With fewer people traveling amid economic shutdowns and quarantines, most major cities experienced double-digit decreases in average particular levels compared with 2019, according to an annual air quality report released Tuesday by IQAir Group, a Swiss-based air-quality technology company. Air pollution readings fell 38% in Singapore, 23% in Beijing, 17% in Paris, 15% in New Delhi and the surrounding region, and 12% in Johannesburg.

Los Angeles was on its way to join that list with one of its cleanest years in decades through the first half of 2020. Then wildfires burned a record 4.3 million acres in California beginning last summer, including three that raged at the same time around America’s second most populous city. L.A. ended up with a 15% increase in particulate air pollution, according to IQAir.

Similarly, air pollution rose 35% in San Francisco, 38% in Portland, Ore., 53% in Phoenix and 18% in Salt Lake City.

Dirty West

Smoke from wildfires caused air pollution to rise in major cities in the Western U.S., while it fell in most of the East

Range of annual average concentration (PM2.5) across U.S. cities

Range of annual average concentration (PM2.5) across U.S. cities

Range of annual average concentration (PM2.5) across U.S. cities

Range of annual average concentration (PM2.5) across U.S. cities

Smoke from wildfires also drove pollution increases in Melbourne, Australia, where the readings soared 27% and in Buenos Aires, where it rose 15%.

“This really shows the alarming scale of the wildfires,” said Meghan Thurlow, vice president of sensing systems and applied science for Aclima, a San Francisco firm that measures air pollution.

Cities on the other side of the U.S. mirrored the global declines. Air pollution fell 13% last year in Chicago, 9.5% in Philadelphia and 7% in New York.

The worst air quality overall was still in Asia last year. India’s New Delhi and the surrounding region had the dirtiest air of all the world’s capital cities measured, according to IQAir, and 49 of the 50 most polluted cities measured world-wide were in Bangladesh, China, India and Pakistan.

Global satellite data indicate wildfires are becoming bigger and more intense. WSJ talks with NASA’s Doug Morton to understand the science behind what’s making the planet more flammable and making fires harder to control. Noah Berger/Associated Press

Air pollution accounts for seven million premature deaths annually, the World Health Organization has estimated. With life returning to normal around the globe, air pollution levels linked to human activity will likely increase again, IQAir officials say.

Even before Covid-19, the world’s biggest economies were already trying to reduce air pollution amid pressure to reduce carbon emissions.

In China, where the Covid-19 pandemic began, 86% of the country’s cities recorded cleaner air in 2020 than in the previous year. Half that improvement was attributable to the lockdowns early last year, while the other half was due to China’s long-term pollution fighting measures, said Lauri Myllyvirta, lead analyst at the Center for Research on Energy and Clean Air.

A sandstorm swept across northern China on Monday, blotting out skyscrapers and turning the sky yellow in Beijing. WSJ’s Jonathan Cheng explains what the country’s economic recovery has to do with it. Photo: Getty Images

China’s air quality has been steadily improving since 2013, when the government began, among other measures, shifting from coal to gas heating.

The lowering of emissions world-wide was “an unplanned scientific experiment” that showed how quickly air pollution levels can be reduced, said Glory Dolphin Hammes, chief executive of IQAir North America, an IQAir subsidiary. “What we have been able to determine is we can do it,” Ms. Hammes said.

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How can the world draw upon lessons from 2020 to address air pollution in coming years? Join the conversation below.

But when fires start in California, Australia and elsewhere, they grow faster than in the past and create an unprecedented public health threat, according to researchers. The fine particulates they generate are of the most concern, because they often contain incinerated pipe, plastic and other household materials, said Lisa Miller, a professor at the University of California Davis School of Veterinary Medicine.

“We are thinking perhaps the particulate matter from these fires may be more dangerous than particles from an automobile,” Dr. Miller said.

Write to Jim Carlton at jim.carlton@wsj.com and Sha Hua at sha.hua@wsj.com

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A Sandstorm in China Revives Memories of ‘Airpocalypses’ Past

When China’s leader, Xi Jinping, met with Communist Party delegates from Inner Mongolia last week, he urged them not to relent in the fight to improve the environment.

“We must adhere to the concept that clear waters and green mountains are as good as mountains of gold and silver,” he said.

On Monday, large parts of China experienced just how bad the environment can still be.

The largest and strongest dust storm in a decade swept across northern China, grounding hundreds of flights, closing schools in some cities and casting a ghastly shroud over tens of millions of people — from Xinjiang in the far west across to the Bohai Sea, according to China’s meteorological service.

airpocalypses” that the country routinely experienced a few years ago, forcing crash government efforts to address what had become a political and public health crisis.

air quality significantly, especially around the capital. But this week, three forces — the post-Covid industrial rebound, the continued impact of climate change on the deserts of northern China, and a late winter storm — combined to create a dangerous, suffocating pall.

“Beijing is what an ecological crisis looks like,” Li Shuo, the policy director for Greenpeace China, wrote on Twitter.

the concentration of PM2.5, or particulate matter of a size deemed especially harmful, were also dangerously high.

meme that spread online grafted an image of the iconic headquarters of China’s state television network with a still from “Blade Runner 2049,” the dystopian 2017 science fiction film. Another showed spacecraft and figures from “Ultraman,” a Japanese superhero franchise, marching through Beijing’s gloom.

Given the improvements in air quality in recent years, newcomers in Beijing experienced air like this for the first time.

accelerate its efforts to reduce carbon emissions, which have contributed to climate change.

Pollution has proved to be a pernicious challenge, though, as officials continue to prioritize economic development.

warned the authorities in Tangshan, the country’s steel-making hub in Hubei Province, after finding that four steel mills had failed to reduce production to lower pollution.

In Inner Mongolia, a northern Chinese region whose delegates Mr. Xi met in Beijing, the local edition of The People’s Daily featured an article about efforts to combat desertification, which has contributed to the dust storms. The article appeared on Monday just as the worst pollution in years hit.

“Yellow sands are going away and green trees are flourishing,” it proclaimed.

Albee Zhang and Elsie Chen contributed research.

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U.S. judge approves Daimler’s $1.5 billion diesel emissions settlement

WASHINGTON (Reuters) – A federal judge on Tuesday approved Daimler AG’s $1.5 billion settlement to resolve a U.S. government probe into the German automaker’s use of undisclosed software that allowed excess diesel pollution to be emitted by 250,000 of its vehicles in the United States.

FILE PHOTO: A new Daimler AG, FUSO battery-powered eCanter urban delivery truck is unveiled during a news conference in New York City, U.S. September 14, 2017. REUTERS/Brendan McDermid

The settlement with the U.S. Justice Department and California Air Resources Board, which was announced in September, includes an $875 million civil penalty levied under the Clean Air Act, $70 million in additional penalties and $546 million to fix the polluting vehicles and offset excess emissions, court papers show.

U.S. District Judge Emmet G. Sullivan called the California settlement fair, reasonable and in the public interest, and noted settlement talks lasted for more than three years.

As part of the settlement, Daimler will pay California $285.6 million.

The German company has separately agreed to a $700 million settlement with diesel vehicle owners. That settlement has won preliminary approval and is likely to get final approval this summer, said Steve Berman, a lawyer for the owners.

In December, the Justice Department said the settlement ensured Daimler would “repair around 250,000 vehicles at no cost to consumers” and fully address excess air pollution.”

Diesel vehicles have come under scrutiny in the United States since Volkswagen AG admitted in 2015 to installing secret software on 580,000 U.S. vehicles that allowed them to emit excess emissions.

In 2019, Daimler agreed to pay a 870 million-euro ($1.03 billion) fine in Germany for violating diesel emissions regulations.

Both Volkswagen and Daimler halted sales of U.S. passenger diesel vehicles.

Fiat Chrysler, which is now part of Stellantis NV, reached an $800 million settlement in 2019 to resolve claims by regulators and owners that it used illegal software that produced false results on diesel-emissions tests.

Stellantis said last week in a securities filing that it remains in talks to resolve an ongoing U.S. Justice Department criminal probe, and previously set aside 200 million euros ($238 million) to address the issue.

Reporting by David Shepardson and Jonathan Stempel; Editing by Chizu Nomiyama and Paul Simao

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Exclusive: Chinese EV trio eye HK listings this year to raise combined $5 billion – sources

HONG KONG/BEIJING (Reuters) – U.S.-listed Chinese electric vehicle (EV) makers Li Auto Inc, Nio Inc and Xpeng Inc plan to list in Hong Kong as soon as this year, tapping a growing investor base closer to home, said people with direct knowledge of the matter.

FILE PHOTO: An Xpeng P7 performance electric vehicle is seen outside the New York Stock Exchange ahead of the Chinese company’s IPO in New York, Aug. 27, 2020. REUTERS/Mike Segar/File Photo

The trio each aim to sell at least 5% of enlarged share capital in the Asian hub, the people said. Based on their New York market capitalisation on Monday, proceeds could reach $5 billion.

The companies have been working with advisors on the sales which could begin as early as mid-year, said one of the people, who declined to be identified due to confidentiality constraints.

Li Auto, Nio and Xpeng – which have raised $14.7 billion in U.S. markets since 2018 – declined to comment.

The plans come as the trio increase capital raising efforts to fund technology development and expand sales networks, to better compete in the world’s biggest EV market where U.S. peer Tesla Inc is boosting sales of its China-made vehicles.

This year is set to be crucial for EV makers to seize market share as the industry expects China sales of new-energy vehicles (NEVs) to jump almost 40% from last year to 1.8 million units.

“Despite much richer financial resources now compared with a year ago, EV start-ups still need to invest heavily in next-generation technology,” said analyst Shi Ji at Haitong International. “Exploring a secondary listing much closer to their home market, if any, is a good move.”

Selling shares in Hong Kong would also add the trio to a slew of New York-listed Chinese firms seeking a presence on more local exchanges amid Sino-U.S. political tension.

The rising number of such listings “has enhanced the status of Hong Kong’s capital markets globally, and also helped issuers reach higher valuations and raise more capital,” said Zhang Zihua, chief investment officer at Beijing Yunyi Asset.

Slideshow ( 2 images )

TRACK RECORD

Under Hong Kong rules, a secondary listing requires at least two financial years of good regulatory compliance on another qualifying exchange.

Li Auto and Xpeng went public in the United States mid-last year so will likely apply in Hong Kong for a dual primary listing, said three people with direct knowledge of the matter.

As per Hong Kong’s dual primary listing rules, firms are subject to full bourse requirements in Hong Kong and a second exchange, but are not bound by the two-year condition.

Xpeng is also considering a third listing on Shanghai’s STAR Market for new-economy firms, said two other people.

“In the long run, it’s helpful for consumer-focused companies like us to connect with domestic capital markets and domestic investors,” Xpeng President Brian Gu told Reuters last week, declining to comment on any Hong Kong listing plan.

“This is the direction we should pay attention to.”

GOING GREEN

China’s government has heavily promoted NEVs – such as battery-powered, plug-in petrol-electric hybrid and hydrogen fuel cell cars – in response to chronic air pollution, spurring interest from technology companies and investors alike.

Last month, Reuters reported telecommunications firm Huawei Technologies Co Ltd plans to market EVs as early as this year.

China forecasts NEVs will make up 20% of its annual auto sales by 2025 from around 5% in 2020.

Domestic vehicle deliveries last year totalled 32,624 by Li Auto, 43,728 by Nio and 27,041 by Xpeng. That compared with 147,445 vehicles by Tesla, industry data showed.

Reporting by Julie Zhu and Scott Murdoch in Hong Kong, Yilei Sun in Beijing; Editing by Sumeet Chatterjee and Christopher Cushing

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For Planet Earth, No Tourism is a Curse and a Blessing

For the planet, the year without tourists was a curse and a blessing.

With flights canceled, cruise ships mothballed and vacations largely scrapped, carbon emissions plummeted. Wildlife that usually kept a low profile amid a crush of tourists in vacation hot spots suddenly emerged. And a lack of cruise ships in places like Alaska meant that humpback whales could hear each other’s calls without the din of engines.

That’s the good news. On the flip side, the disappearance of travelers wreaked its own strange havoc, not only on those who make their living in the tourism industry, but on wildlife itself, especially in developing countries. Many governments pay for conservation and enforcement through fees associated with tourism. As that revenue dried up, budgets were cut, resulting in increased poaching and illegal fishing in some areas. Illicit logging rose too, presenting a double-whammy for the environment. Because trees absorb and store carbon, cutting them down not only hurt wildlife habitats, but contributed to climate change.

“We have seen many financial hits to the protection of nature,” said Joe Walston, executive vice president of global conservation at the Wildlife Conservation Society. “But even where that hasn’t happened, in a lot of places people haven’t been able to get into the field to do their jobs because of Covid.”

From the rise in rhino poaching in Botswana to the waning of noise pollution in Alaska, the lack of tourism has had a profound effect around the world. The question moving forward is which impacts will remain, and which will vanish, in the recovery.

more than 10 percent, as state and local governments imposed lockdowns and people stayed home, according to a report in January by the Rhodium Group, a research and consulting firm.

The most dramatic results came from the transportation sector, which posted a 14.7 percent decrease. It’s impossible to tease out how much of that drop is from lost tourism versus business travel. And there is every expectation that as the pandemic loosens its grip, tourism will resume — likely with a vengeance.

Still, the pandemic helped push American emissions below 1990 levels for the first time. Globally, carbon dioxide emissions fell 7 percent, or 2.6 billion metric tons, according to new data from international climate researchers. In terms of output, that is about double the annual emissions of Japan.

“It’s a lot and it’s a little,” said Jason Smerdon, a climate scientist at Columbia University’s Lamont-Doherty Earth Observatory. “Historically, it’s a lot. It’s the largest single reduction percent-wise over the last 100 years. But when you think about the 7 percent in the context of what we need to do to mitigate climate change, it’s a little.”

United Nations Environment Program cautioned that global greenhouse gases would need to drop 7.6 percent every year between 2020 and 2030. That would keep the world on its trajectory of meeting the temperature goals set under the Paris Agreement, the 2016 accord signed by nearly 200 nations.

“The 7 percent drop last year is on par with what we would need to do year after year,” Dr. Smerdon said. “Of course we wouldn’t want to do it the same way. A global pandemic and locking ourselves in our apartments is not the way to go about this.”

Interestingly, the drop in other types of air pollution during the pandemic muddied the climate picture. Industrial aerosols, made up of soot, sulfates, nitrates and mineral dust, reflect sunlight back into space, thus cooling the planet. While their reduction was good for respiratory health, it had the effect of offsetting some of the climate benefits of cascading carbon emissions.

For the climate activist Bill McKibben, one of the first to sound the alarm about global warming in his 1989 book, “The End of Nature,” the pandemic underscored that the climate crisis won’t be averted one plane ride or gallon of gas at a time.

“We’ve come through this pandemic year when our lives changed more than any of us imagined they ever would,” Mr. McKibben said during a Zoom webinar hosted in February by the nonprofit Green Mountain Club of Vermont.

“Everybody stopped flying; everybody stopped commuting,” he added. “Everybody just stayed at home. And emissions did go down, but they didn’t go down that much, maybe 10 percent with that incredible shift in our lifestyles. It means that most of the damage is located in the guts of our systems and we need to reach in and rip out the coal and gas and oil and stick in the efficiency, conservation and sun and wind.”

herd of Great Orme Kashmiri goats was spotted ambling through empty streets in Llandudno, a coastal town in northern Wales. And hundreds of monkeys — normally fed by tourists — were involved in a disturbing brawl outside of Bangkok, apparently fighting over food scraps.

In meaningful ways, however, the pandemic revealed that wildlife will regroup if given the chance. In Thailand, where tourism plummeted after authorities banned international flights, leatherback turtles laid their eggs on the usually mobbed Phuket Beach. It was the first time nests were seen there in years, as the endangered sea turtles, the largest in the world, prefer to nest in seclusion.

Similarly, in Koh Samui, Thailand’s second largest island, hawksbill turtles took over beaches that in 2018 hosted nearly three million tourists. The hatchlings were documented emerging from their nests and furiously moving their flippers toward the sea.

For Petch Manopawitr, a marine conservation manager of the Wildlife Conservation Society Thailand, the sightings were proof that natural landscapes can recover quickly. “Both Ko Samui and Phuket have been overrun with tourists for so many years,” he said in a phone interview. “Many people had written off the turtles and thought they would not return. After Covid, there is talk about sustainability and how it needs to be embedded in tourism, and not just a niche market but all kinds of tourism.”

In addition to the sea turtles, elephants, leaf monkeys and dugongs (related to manatees) all made cameos in unlikely places in Thailand. “Dugongs are more visible because there is less boat traffic,” Mr. Manopawitr said. “The area that we were surprised to see dugongs was the eastern province of Bangkok. We didn’t know dugongs still existed there.”

He and other conservationists believe that countries in the cross hairs of international tourism need to mitigate the myriad effects on the natural world, from plastic pollution to trampled parks.

he told Bloomberg News, is to set the stage so that “nature can rehabilitate itself.”

increased poaching of leopards and tigers in India, an uptick in the smuggling of falcons in Pakistan, and a surge in trafficking of rhino horns in South Africa and Botswana.

Jim Sano, the World Wildlife Fund’s vice president for travel, tourism and conservation, said that in sub-Saharan Africa, the presence of tourists was a powerful deterrent. “It’s not only the game guards,” he said. “It’s the travelers wandering around with the guides that are omnipresent in these game areas. If the guides see poachers with automatic weapons, they report it.”

In the Republic of Congo, the Wildlife Conservation Society has noticed an increase in trapping and hunting in and around protected areas. Emma J. Stokes, regional director of the Central Africa program for the organization, said that in Nouabalé-Ndoki National Park, monkeys and forest antelopes were being targeted for bushmeat.

Glacier Bay National Park and Preserve. Dr. Fournet, a postdoctoral research associate at Cornell University, observed a threefold decrease in ambient noise in Glacier Bay between 2019 and 2020. “That’s a really big drop in noise,” she said, “and all of that is associated with the cessation of these cruise ships.”

Sound Science Research Collective, a marine conservation nonprofit, had her team lower a hydrophone in the North Pass, a popular whale-watching destination. “In previous years,” she said, “you wouldn’t have been able to hear anything — just boats. This year we heard whales producing feeding calls, whales producing contact calls. We heard sound types that I have never heard before.”

Maya’s Legacy Whale Watching, insist that their presence on the water benefits whales since the captains make recreational boaters aware of whale activity and radio them to slow down. Whale-watching companies also donate to conservation groups and report sightings to researchers.

“During the pandemic, there was a huge increase in the number of recreational boats out there,” said Mr. Friedman, who is also president of the Pacific Whale Watch Association. “It was similar to R.V.s. People decided to buy an R.V. or a boat. The majority of the time, boaters are not aware that the whales are present unless we let them know.”

Two years ago, in a move to protect Puget Sound’s tiny population of Southern Resident killer whales, which number just 75, Washington’s Gov. Jay Inslee signed a law reducing boat speeds to 7 knots within a half nautical mile of the whales and increasing a buffer zone around them, among other things.

Many cheered the protections. But environmental activists like Catherine W. Kilduff, a senior attorney in the oceans program at the Center for Biological Diversity, believe they did not go far enough. She wants the respite from noise that whales enjoyed during the pandemic to continue.

“The best tourism is whale-watching from shore,” she said.

Debates like this are likely to continue as the world emerges from the pandemic and leisure travel resumes. Already, conservationists and business leaders are sharing their visions for a more sustainable future.

laid out a plan to become carbon neutral by spending $1 billion over 10 years on an assortment of strategies. Only 2.5 percent of global carbon emissions are traced to aviation, but a 2019 study suggested that could triple by midcentury.

In the meantime, climate change activists are calling on the flying public to use their carbon budgets judiciously.

Tom L. Green, a senior climate policy adviser with the David Suzuki Foundation, an environmental organization in Canada, said tourists might consider booking a flight only once every few years, saving their carbon footprint (and money) for a special journey. “Instead of taking many short trips, we could occasionally go away for a month or more and really get to know a place,” he said.

For Mr. Walston of the Wildlife Conservation Society, tourists would be wise to put more effort into booking their next resort or cruise, looking at the operator’s commitment to sustainability.

“My hope is not that we stop traveling to some of these wonderful places, because they will continue to inspire us to conserve nature globally,” he said. “But I would encourage anyone to do their homework. Spend as much time choosing a tour group or guide as a restaurant. The important thing is to build back the kind of tourism that supports nature.”

Lisa W. Foderaro is a former reporter for The New York Times whose work has also appeared in National Geographic and Audubon Magazine.

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