White House Threatens Veto of Energy Bill 10

Posted by Brad Johnson Mon, 03 Dec 2007 20:49:00 GMT

In a letter to Congress, White House economic advisor Allan Hubbard reiterated President Bush’s October 15 veto threat of the energy bill deal brokered by the Democratic leadership, leaving no room for compromise from the president’s demands.

On October 15, I wrote you to outline a basic framework for a bill that would not compel the President’s senior advisors to recommend a veto. Based on the limitd information we have received, it seems the provisions under discussion would not satisfy those criteria. In fact, it appears Congress may intend to produce a bill the President cannot sign.

The Administration continues to believe that all the elements described in my earlier letter constitute the appropriate framework for energy legislation. Press reports indicate that your draft energy bill would fail to meet at least some of these conditions, for example by including a mandatory Renewable Portfolio Standard (RPS), a title increasing taxes, or an expansion of Davis-Bacon prevailing wage requirements.

Further criticisms include the difference between the Congressional renewable fuels standard and the White House’s preferred “alternative fuels standard”, and not excluding the EPA’s Clean Air Act authority from CAFE regulation.

The full letter is available here.

Domenici Criticizes Energy Bill 2

Posted by Brad Johnson Mon, 03 Dec 2007 20:19:00 GMT

On Saturday, Sen. Pete Domenici (R-N.M.), ranking member of the Senate Energy and Natural Resources Committee, challenged the energy bill deal brokered by the Democratic leadership, attacking the inclusion of a Renewable Portfolio Standard (also known as the renewable electricity standard).

For weeks, my staff, along with Senator Bingaman’s, has been engaged in good faith negotiations with the House under a defined set of parameters laid out at the start of the process. We have made substantial bipartisan progress toward finalizing a bill. The legislation we have been working on contained a robust, much-needed Renewable Fuels Standard, important provisions on energy efficiency and carbon sequestration, and a long overdue increase in fuel economy standards. The parameters agreed to by Speaker Pelosi and communicated to us by Senate Democrats did not include a renewable portfolio standard.
Domenici complained particularly about what he saw as a lack of good faith.
At this time, I have instructed my staff to cease their work on the energy bill, since the final bill apparently will not be the product of our bipartisan negotiations. As someone who has been working for 35 years to forge bipartisan, good-faith compromises on tough issues like the federal budget and energy policy, I know that your word means everything. It is particularly disappointing for me to see that such a sentiment seems to be a thing of the past.

Sen. Domenici himself has failed to maintain such bipartisan compromises on this very bill. During the May committee markup of the Senate version of the energy bill (S. 1321, H.R. 6), Sen. Domenici failed to maintain a bipartisan deal to avoid controversial amendments during markup—Democrats had agreed not to introduce RPS in committee, and Domenici claimed Republicans would not introduce coal-to-liquids language. However, Sen. Craig Thomas, R-Wyo., introduced a coal-to-liquids amendment, breaking the deal.

Bali: Australia Ratifies Kyoto Protocol 12

Posted by Brad Johnson Mon, 03 Dec 2007 17:05:00 GMT

On the first day of the United Nations Climate Change Conference in Bali, Kevin Rudd, the new prime minister of Australia ratified the Kyoto Protocol, leaving the United States and Kazakhstan the only signatories who have failed to ratify.

Rudd’s statement begins:

Today I have signed the instrument of ratification of the Kyoto Protocol. This is the first official act of the new Australian Government, demonstrating my Government’s commitment to tackling climate change.

Ratification of the Kyoto Protocol was considered and approved by the first Executive Council meeting of the Government this morning. The Governor-General has granted his approval for Australia to ratify the Kyoto Protocol at my request.

Under United Nations guidelines, ratification of the Kyoto Protocol enters into force 90 days after the Instrument of Ratification is received by the United Nations. Australia will become a full member of the Kyoto Protocol before the end of March 2008.

Enviro-Energy Corp Report Says US Can Achieve Greenhouse Goals 5

Posted by Brad Johnson Mon, 03 Dec 2007 16:09:00 GMT

Last week McKinsey & Company released a report, Reducing U.S. Greenhouse Gas Emissions: How Much at What Cost?, that found that the goals of current greenhouse gas emissions reduction legislation for 2030 are achievable with current technology and at manageable cost, although it warned:
Achieving these reductions at the lowest cost to the economy, however, will require strong, coordinated, economy-wide action that begins in the near future.

The report was commissioned by the environmental organizations Environmental Defense and National Resources Defense Council and the energy technology companies Honeywell, National Grid, PG&E Corporation, Shell, and DTE Energy. The Conference Board, the leading U.S. corporate think tank, endorsed the paper.

McKinsey found that a broad mix of abatement options need to be followed; no one strategy accounted for more than 11% of the total abatement, noting:
In regions with high-carbon grids, energy efficiency improvements, typically through upgrades to building standards, HVAC equipment, and appliances, are likely to be the most effective and lowest-cost strategies. Conversely, sectors and regions with access to low-carbon grid infrastructure offer more compelling applications of such emerging technologies as PHEVs (plug-in hybrid vehicles).
In its conclusion the report reiterated the importance of immediately implementing energy efficiency strategies, many of which end up saving more money than they cost, to “buy time” for emerging technologies to develop commercially.

Stage Set for Lieberman-Warner Markup

Posted by Brad Johnson Mon, 03 Dec 2007 15:24:00 GMT

EE News reports that Sen. Boxer likely has sufficient votes to pass her updated version of the Lieberman-Warner cap-and-trade bill (S. 2191) out of committee at Wednesday’s markup, though the markup process may take two days.

EE News reported on some responses to the changes in Sen. Boxer’s version, known as the “manager’s mark”:
Environmental groups have different perspectives on the new version of the Lieberman-Warner climate bill.

Dan Lashof, a senior scientist at the Natural Resources Defense Council, signaled support. “I think the bill continues to move in the right direction,” he said in an interview. “The changes [in the manager’s mark] are incremental from what was passed in the subcommittee.”

Of the new section for HFCs, Lashof predicted “net environmental benefits” by forcing HFC-polluting industries to compete with each other for emission credits.

But Friends of the Earth still has some of the same concerns that caused it to oppose the legislation in subcommittee. In particular, Erich Pica, the group’s economic policy analyst, found fault with the bill’s allocation system. “It gives away too many permits for free,” he said. “It’s a hundred billion dollar windfall for the polluting industries that got us into this mess in the first place. And the targets need to be strengthened.”

Industry also has its own problems.

At the Edison Electric Institute, spokesman Dan Riedinger said the Lieberman-Warner legislation includes targets and timetables that don’t match industry expectations for the readiness of new energy technologies. He also said the bill doesn’t do enough to hold down the costs to the U.S. economy. And it doesn’t press for enough reductions from developing economies like China and India.

“They don’t begin to address our overall concerns about the bill,” Riedinger said.

A collection of power companies that often lines up with Delaware’s Carper also took issue with the legislation. In a prepared statement issued Friday, the Clean Energy Group questioned the way the bill now favors coal-fired electric utilities over more energy efficient nuclear power and natural gas plants.

“We believe this approach will compromise the effective and efficient attainment of the greenhouse gas reduction targets by providing a subsidy to high-emitting generators,” the statement said. The group includes Entergy, FPL and Constellation Energy.