Hill Heat: Category Legislation

Gang of 10 Energy Proposal

The Cunctator — Thu, 14 Aug 2008 13:41:00 -0500

At the beginning of the month, five Republican senators and five Democratic senators unveiled an energy package that increases offshore drilling and coal-to-liquids, as well has rolling back some oil industry subsidies in favor of renewable tax breaks.

Leading the group are Sen. Kent Conrad (D-N.D.) and Sen. Saxby Chambliss (R-Ga.). The other members of the group: Sens. John Thune (R-S.D.), Ben Nelson (D-Neb.), Lindsey Graham (R-S.C.), Blanche Lincoln (D-Ark.), Mary Landrieu (D-La.), Johnny Isakson (R-Ga.), Bob Corker (R-Tenn.) and Mark Pryor (D-Ark.). Pryor, Landrieu, Thune, and Graham are up for reelection; Graham is a close associate of Republican presidential nominee John McCain (R-Ariz.).

Provisions of the bill, as described by E&E News:

Offshore drilling. The drilling provisions would open up large swaths of new acreage in the eastern Gulf of Mexico to new oil-and-gas drilling. Current law provides a 125-mile buffer for Florida in most areas; the proposal would shrink the no-drill zone to 50 miles. It would also allow drilling in federal waters in the Atlantic off the coasts of four Southeastern states – Virginia, North and South Carolina and Georgia – if the states allow it. The states would share in some revenue if they allow leasing.
Oil subsidy repeal. Total funding for the proposal’s various energy programs is $84 billion—$30 billion of this would come from oil companies, according to a summary circulated today.
The oil industry revenues would come in part from repeal of major oil companies’ ability to claim the Section 199 domestic manufacturing credit and provisions to ensure federal revenues from flawed late 1990s deep-water gulf leases that currently allow royalty waivers regardless of energy prices.
$20 billion automotive incentives. The conservation and alternative fuels provisions include $20 billion for an “Apollo Project” aimed at weaning 85 percent of America’s motor vehicles from oil-based fuels in 20 years. The program would include research and development in areas like advanced batteries and funding to help automakers re-tool to make alternative fuel vehicles. Also in the mix are tax credits of up to $7,500 per vehicle for consumers who buy cars that run primarily on non-petroleum fuels.
Four-year clean credit extension. The proposal would also extend a suite of renewable energy credits – for wind, solar and other projects – and energy efficiency credits through 2012. Current renewable power production and investment tax credits are set to expire at year’s end, and the industry has been pressing for multi-year extensions to provide “certainty” to the market.
New incentives. Elsewhere, the bill includes new tax credits for highly efficient vehicles and $2.5 billion in funding for development and demonstration of next-generation biofuels and infrastructure, among the suite of conservation and renewable energy provisions.
Coal-to-liquids and nuclear. In addition to the drilling measures, the bill offers grants and loan guarantees for building coal-to-liquids plants capable of capturing carbon dioxide emissions. It also contains provisions to expand domestic nuclear power, such as increasing staff at the Nuclear Regulatory Commission – which has begun receiving the first applications to build new reactors in decades – as well as work force training.

National Conservation, Environment and Energy Independence Act introduced in US House: oil drilling, coal-to-liquid, Renewable Energy Reserve Fund planned

The Cunctator — Fri, 01 Aug 2008 05:58:00 -0500

22 members of the US House of Representatives have introduced the National Conservation, Environment and Energy Independence Act that would lift many restrictions on offshore oil drilling, while providing a projected $2.6 trillion in lease and royalty payments that would generate $390 million for a Renewable Energy Reserve Act. The bill introduced by 11 Democrats and 11 Republicans would open up all protected Outer Continental Shelf lands and end the oil shale leasing moratorium. The bill is in sharp contravention of Democratic leadership but in line with Republican demands.

The leaders of the effort were John Peterson, R-Pa.; Neil Abercrombie, D-Hawaii; Thelma Drake, R-Va.; Tim Walz, D-Minn.; Jim Costa, D-Calif.; and Dan Burton, R-Ind.

A group of ten senators is working on a similar plan. “There’s going to be substantially more drilling and substantially more conservation,” Sen. Mary L. Landrieu (D-La.) said of the Senate plan.

The House bill includes:

Ending moratorium on Outer Continental Shelf, Gulf of Mexico, and oil shale lease sales: funds apportioned 30% to general treasury, 30% to states, 8% to conservation, 10% to environmental restoration, 15% to renewable energy, 5% to CCS/nuclear waste, 2% to LIHEAP
Repealing the Waxman provision (Section 526)
6-year extension of renewable energy/energy efficiency tax credits
Drawdown of light grade petroleum from the Strategic Petroleum Reserve, with $100 million going into LIHEAP, $60 million for university research, $15 million for wind research, $30 million for solar research, $30 million for hydro research, $40 million for automotive research, $110 million for industrial emissions research, $70 million for building efficiency R&D, $30 million for geothermal R&D, $30 million for smart grid R&D, $385 million for CCS R&D, $65 million for natural gas extraction research, $5 million for a hydrogen prize, $100 million for battery research

LiHEAP Funding Increase Filibustered

Wonk Room — Sun, 27 Jul 2008 21:17:00 -0500

On Saturday, Senate Republicans successfully filibustered the Warm in Winter and Cool in Summer Act (S. 3186), a bill which would have provided an additional $2.5 billion in funding for the Low-Income Home Energy Assistance Program (LIHEAP), nearly double its current funding.

Sen. Bernie Sanders (I-Vt.), a cosponsor of the bill, issued this statement:

“At a time when oil companies are raking in record profits, the stubbornness of those who stood in the way of helping people in desperate need is incomprehensible to me. It is an outrage. The American people do not want to see the most vulnerable among us held hostage by the Senate Republican leaders.”

The National Energy Assistance Directors’ Association has projected that nationwide, the average cost of heating a home this winter will total about $1,114 – 14.6 percent more than last year.

Republican senators Coleman (Minn.), Collins (Maine), Smith (Ore.), and Snowe (Maine) voted with the 45 Democrats and Independents in attendance in favor of the bill. Coleman, Collins, and Smith are up for reelection this year (and are from northern states).

Senators not voting: Allard (R-Col.), Bond (R-Mo.), Bunning (R-Ken.), Burr (R-N.C.), Dole (R-N.C.), Graham (R-S.C.), Harkin (D-Iowa), Inhofe (R-Okla.), Inouye (D-Haw.), Isakson (R-Ga.), Kennedy (D-Mass.), McCain (R-Ariz.), Murray (D-Wash.), Obama (D-Ill.), and Warner (R-Va.).

House GOP to Unveil 'American Energy Act'

The Cunctator — Wed, 23 Jul 2008 11:28:00 -0500

Today at 2 PM, the entire House GOP caucus is holding a Capitol rally to support their drill-drill-drill bill, dubbed the “American Energy Act” (H.R. 6566) and being promoted as an “all of the above” approach to energy policy. Their memo, acquired by the Wonk Room, reveals their plans to promote the bill as a panacea for high gas prices.

Read the full text of the legislation.

As Center for American Progress Action Fund’s Daniel Weiss points out, however, the House GOP is pushing a number of misleading or false talking points. In particular, they grossly overestimate the expected returns on drilling offshore, opening the Arctic Refuge, or mining oil shale—and fail to mention that any such returns would only be noticeable in decades.

Gore's Audacious Goal: Clean-Energy Grid In Ten Years

Wonk Room — Thu, 17 Jul 2008 10:56:00 -0500

From the Wonk Room.

Former Vice President Al Gore is set to give a major energy policy speech today, in which he will challenge “the nation to produce every kilowatt of electricity through wind, sun and other Earth-friendly energy sources within 10 years, an audacious goal he hopes the next president will embrace.” Gore is speaking at noon at the Daughter of the American Revolution Constitution Hall in Washington D.C.

The electricity sector is the largest producer of greenhouse gases in the United States, with its fossil-fired power plants and an obsolete power grid generating one-third of all our global warming emissions. Gore’s “unprecedented challenge” is a “moonshot” goal, but it is also on the scale of what is needed to avoid climate catastrophe. To stabilize the climate, the Intergovernmental Panel on Climate Change found that industrialized nations need to cut emissions to 25 to 40 percent below 1990 levels. For the United States, whose emissions have risen 15 percent since 1990, that goal translates to 34 to 48 percent below today’s pollution. Transforming the grid would cut global warming pollution by 33 percent from current levels by 2018—what we need for an even shot to halt our global fever.

Moving to all clean electricity would likely spur related reductions in the transportation sector, as the new “smart grid” of electricity distribution designed for renewable sources such as solar and wind power would be able to use plug-in hybrid vehicles for distributed electricity storage. Instead of everyone reliant on a few massive power plants controlled by large utilities, the system would allow both large and small-scale electricity production and storage. The giant wind farms of T. Boone Pickens would be complemented by millions of solar roofs, all feeding into the same dynamic electricity network.

House to Debate Several Energy Proposals

The Cunctator — Mon, 23 Jun 2008 15:41:00 -0500

House Speaker Nancy Pelosi has announced that the lower chamber of Congress will consider several pieces of legislation targeted at oil companies, energy markets, and transportation.

Reducing Transit Fares (H.R. 6052) – Gives grants to mass transit authorities to lower fares for commuters pinched at the pump and expand transit services.

Cracking Down on Price Gouging – Gives enforcement authority to the Federal Trade Commission to investigate and punish those who artificially inflate fuel prices, similar to legislation passed last year.

Closing the Enron-like “London Loophole” for Petroleum Markets – Takes steps to curb excessive speculation in the energy futures markets, which experts have noted is driving up the price of a barrel of oil.

“Use It Or Lose It” for Oil Companies Holding Permits and Not Drilling – Compels the oil industry to start drilling or lose permits on the 68 million acres of undeveloped federal oil reserves which they are currently warehousing, keeping domestic supply lower and prices higher.

Republicans Filibuster Renewable Tax Credit Legislation Again

The Cunctator — Wed, 18 Jun 2008 07:54:00 -0500

By a 52-44 vote, the Senate failed to achieve cloture on the Renewable Energy and Job Creation Act of 2008 (H.R. 6049), the tax package that included extensions of the renewable production tax credit, energy efficiency incentives, and a suite of other tax credit extensions. This version included an Alternative Minimum Tax (AMT) patch without any offset.

Sen. Reid (D-Nev.) cast a procedural vote with the Republicans and Sens. Clinton, Kennedy, McCain, and Obama did not vote. Sens. Collins, Coleman, Corker, Smith, and Snowe voted with the Democrats (Collins, Coleman, and Smith are up for re-election). The voting was otherwise entirely on party lines.

The timeline of the tax credits:

FILIBUSTERED: June 17: H.R. 6049 filibustered 52-44 (Reid procedural vote with GOP)
FILIBUSTERED: June 10: H.R. 6049 filibustered 50-44 (Reid procedural vote with GOP)
PASSES SENATE, DIES IN HOUSE: April 10: S.Amdt. 4419 (tax credits without offsets, attached to Dodd housing bill) passes 88-8; not in House version
PASSES HOUSE: February 27: House passes Renewable Energy and Energy Conservation Tax Act (H.R. 5351; tax credits paid by closing oil loopholes) 236-182; referred to the Senate Finance Committee.
FILIBUSTERED: February 6: S. Amdt 3983 to H.R. 5140 (tax credits without offsets, attached to stimulus package) filibustered by one vote (58-41; Reid procedural vote with GOP, McCain not voting)
January 30: Senate Finance Committee attaches tax credits to stimulus package
FILIBUSTERED: December 13: H.R. 6 (tax credits paid by closing oil loopholes) filibustered by one vote (59-40; Landrieu with GOP, McCain not voting). Version of H.R. 6 without tax credits or RES passes 86-8.
PASSES HOUSE: December 6: House passes H.R. 6 with tax credits and RES 235-181.
June 21: Senate passes S.Amdt.1502 to H.R. 6 (no tax credits or RES)
FILIBUSTERED: June 21: S.Amdt. 1704 to S.Amdt. 1502 to to H.R. 6 (tax credits paid by closing oil loopholes) filibustered 57-36 (Landrieu with GOP, Boxer, Brownback, Coburn, Johnson, McCain, Sessions not voting)
PASSES HOUSE: January 18: House passes H.R. 6 with tax credits and RES 264-163.

House Democrats Introduce Climate MATTERS Act

The Cunctator — Tue, 17 Jun 2008 11:19:00 -0500

U.S. Representatives Lloyd Doggett (D-Texas), Chris Van Hollen (D-MD) and Earl Blumenauer (D-OR) today introduced the Climate MATTERS Act (Climate Market Auction Trust and Trade Emissions Reduction System) to institute a cap-and-trade system designed to reduce greenhouse gas pollution. This is the first such bill to receive primary referral to the Ways and Means Committee, which is scheduling a hearing on it within a month.

The bill’s 2050 target is 80% below 1990 levels, and auctions 85% permits from the start, moving to 100% by 2020. Funds from the auction are directed primarily to consumers and workers, including a fund for healthcare.

The following environmental organizations released a joint statement heralding the legislation for its “strong, science-based targets” and “best practices of cap-and-trade policy”: Alaska Wilderness League, Defenders of Wildlife, Earthjustice, Environmental Defense Fund, Environment America, Greenpeace, League of Conservation Voters, National Audubon Society, Physicians for Social Responsibility, Sierra Club, Union of Concerned Scientists, The Wilderness Society.

Bill summary provided by the authors:

The Climate MATTERS Act (Climate Market, Auction, Trust & Trade Emissions Reduction System)

The Climate MATTERS Act develops an innovative plan for the auction, revenue and trade aspects of a cap and trade system.

Strikes a Balance: The Climate MATTERS Act is environmentally strong, but realistic about its goals and methods to accomplish them.

Domestic Auction

The Climate MATTERS Act emissions cap will reduce emissions 80% below 1990 levels by 2050.
Beginning by auctioning 85% of all emissions allowances, this bill quickly moves to a 100% auction in 2020.
While excluding agriculture, forestry and small businesses from the emissions cap, this bill also provides incentives for these sectors to reduce their emissions.

Green Investment Plan for Auction Revenue

As the comprehensive auction system raises significant new revenue, this bill recognizes that this revenue is an important aspect of a comprehensive response to global warming. The Climate MATTERS Act devotes this revenue to addressing the social, economic and environmental aspects of adapting to a clean energy economy and offsetting the inevitable impacts of climate change.

Consumer and Worker Assistance

Consumer Assistance: Provides substantial assistance to American families in meeting their household needs and making energy efficient improvements.
Part of the revenue is used to create the “Healthy Families Fund.” The reserve fund acknowledges that climate change and lack of access to affordable healthcare are two of the largest problems America confronts. This fund will assist households with the costs of obtaining and maintaining healthcare coverage as we transition to a new clean energy future.
Affected Worker Assistance: Provides funding for adjustment assistance, employment services, income-maintenance, and needs-related payments for workers to ease the transition to a low carbon economy. Funds will also assist communities in attracting new employers, provide local government services.
Worker Training: Supplements funding for green worker training, and provides funding for the advancement of environmental education to create an environmentally-literate workforce.

Environmental Protections

Provides funding to conserve natural resources, mitigate impacts and help wildlife and ecosystems survive global warming. Provides funding to help the developing countries begin to adapt to a changing climate.

Provides funding to achieve real, verifiable, additional, permanent, and enforceable reductions in greenhouse gas emissions from the agriculture and forestry sectors, as well as promoting forest restoration and deforestation reduction efforts internationally.

Transition to a Clean Energy Economy

Technological Development: Provides funding for the advancement of basic renewable energy technologies.
Energy Efficiency: Provides funding for energy efficiency and conservation, advancement in mass transit and provides funding to load serving entities to implement energy efficiency programs for their customers. In addition, the bill provides funding for heating and weatherization assistance programs.
Early Action: Provides funding to operators of emitting facilities in recognition of early action to reduce greenhouse gases.
International Technology and Adaptation: Provides funding to qualified developing countries to accelerate low carbon technologies and assist the most vulnerable developing countries cope with climate change impacts.

International Cooperation

The Climate MATTERS Act also provides strong encouragement to other countries such as China and India to participate through a combination of carrots and sticks in a manner designed to be WTO compliant.

The bill provides incentives to encourage early implementation of cap and trade agreements by allowing flexibility in setting emissions levels in a limited number of initial agreements.

Carbon-intensive goods from countries lacking such emissions caps cannot enter the U.S. market without allowances purchased to cover their carbon footprint.

In addition, the Climate MATTERS Act acknowledges the substantial benefits of tropical deforestation reductions by providing negotiators the ability to reward countries that significantly reduce deforestation, even if they are unable to implement a comprehensive emissions cap.

Tax Offset

The Climate MATTERS Act devotes a portion of the auction proceeds to ensure the bill does not add to our national debt.

Ten Democratic Senators Voice Industry-Based Concerns With Climate Legislation

Wonk Room — Thu, 12 Jun 2008 14:01:00 -0500

From the Wonk Room.

The ten Democratic signatories: Debbie Stabenow & Carl Levin (MI), Mark Pryor & Blanche Lincoln (AR), Evan Bayh (IN), Sherrod Brown (OH), Jay Rockefeller (WV), Jim Webb (VA), Claire McCaskill (MO), and Ben Nelson (NE). Download the letter.

Ten Democratic senators echoed polluters in a letter sent to Sen. Barbara Boxer (D-CA) about her filibustered climate change legislation last Friday. The senators, nine of whom supported cloture to end debate and vote on amendments, wrote, “We commend your leadership in attempting to address one of the most significant threats to this and future generations; however, we cannot support final passage of the Boxer Substitute in its final form.” Their letter continues:

To that point we have laid out the following principles and concerns that must be considered and fully addressed in any final legislation.

The senators’ letter uses practically the same talking points and specific policy demands as the industry polluters who fought to kill the legislation, in particular the industry lobbying groups American Coalition for Clean Coal Electricity (ACCCE) and the National Association of Manufacturers (NAM). A review of the letter reveals the Boxer substitute (S. Amdt. 4825 to the Lieberman-Warner Climate Security Act, S. 3036) already made concessions to these parochial and fossil-industry demands:

Point #1: “Contain Costs and Prevent Harm to the U.S. Economy.”

Fossil Ten Senators	“While placing a cost on carbon is important, we believe that there must be a balance and a short-term cushion when new technologies may not be available as hoped for or are more expensive than assumed.”
ACCCE	“Protect American consumers and the U.S. economy through effective cost-containment measures.”
NAM	“Include a safety valve or other equally effective and responsive cost-containment mechanism . . . Support economic growth and do no harm to U.S. economy.”

Commentary: Lieberman-Warner already included a significant “transition assistance” in the form of free permits to polluters [Secs. 541 – 572], borrowing (15 percent of obligation) [Sec. 511] and offset provisions (30 percent of obligation) [Title III], and a “cost containment” auction that would contain the price of seven percent of all allowances sold to polluters [Sec. 522]. A “carbon market efficiency board” is given the authority to loosen restrictions on borrowing and offset use—but not to tighten them [Sec. 521]. What’s left is even greater permit giveaways or “safety valves” that would allow polluters to bust the cap.

Point #2: “Invest Aggressively in New Technologies and Deployment of Existing Technologies.”

Senators	“It is critical that we design effective mechanisms to augment and accelerate government-sponsored technology R&D programs and incentives that will motivate rapid deployment of those technologies without picking winners and losers. We also want to include proposals to provide funding for carbon capture and storage and other critical low carbon technologies in advance of resources being available through the auction of emission allowances.”
ACCCE	“Guarantee, through public-private sector partnerships, aggressive, near- and long-term investments in new, advanced technologies that 1) avoid or reduce CO2 emissions, 2) capture, transport, and safely store CO2, and 3) use CO2 in beneficial ways, whenever practical.”
NAM	“Promote advanced, energy efficient and zero-and-low-GHG emission and sequestration technologies as part of a long-term strategy.”

Truth: The Fossil Ten claim they don’t want to pick “winners and losers” but then call for special support for “carbon capture and storage”—an important but experimental coal industry technology that already received special consideration under the Boxer substitute. In fact, the Boxer substitute called for a special “Kick-Start for Carbon Capture and Sequestration” fund that would go into effect within 120 days, years before emissions reductions would have to take place [Sec. 1005]. Evidently that’s not enough.

Point #3: “Treat States Equitably.”

Senators	“The allocation structure of a cap-and-trade bill must be designed to balance these burdens across states and regions and be sufficiently transparent to be understood.”
ACCCE	“For example, if a cap-and-trade program were to be implemented, it would be essential to have fair and equitable allocation of emission allowances.”
NAM	“Be equitable and economy-wide in scope”

Commentary: Lieberman-Warner reserved three to four percent of allowances for states with high manufacturing and coal mining, in an admittedly complex formula [Sec. 602]. Another one percent of allowances would go to Alaska [Sec. 624], and four to seven percent of allowances to the other 49 states, divied up for coastal states, Indian tribes [Sec. 625], and wildlife restoration [Sec. 631], for adaptation efforts in coordination with the Secretary of the Interior. In addition, significant funding is allocated to American automobile manufacturers [Title XI] and the coal industry [Title X]. Of course, “equitable” and “designed to balance” is in the eye of the beholder.

Point #4: “Protect America’s Working Families.”

Senators	“For instance, one way to provide some relief would be to provide additional allowances to utilities whose electricity prices are regulated, which would help to keep electricity prices low.”
American Electric Power Service Corporation	“AEP feels strongly that the electric sector should receive emission allowances commensurate with its pro rata share of the emission caps in the legislation, whether emissions are regulated upstream or downstream.”

Commentary: Even though experts agree allowances should be auctioned, Lieberman-Warner already provided such utilities with free allowances – 18 percent of all initial permits given away for free to fossil-fueled electricity generators [Sec. 551]. Furthermore, the bill already had significant assistance provisions for American families: a tax rebate fund that grows from 3.5 percent of permits to 15 percent in 20 years [Sec. 582], 13 percent of allowances reserved for local distribution companies to provide support to low- and middle-income consumers [Sec. 601], and the aforementioned assistance to states.

Point #5: “Protect U.S. Manufacturing Jobs and Strengthen International Competitiveness.”

Senators	“The final bill must include enhanced safeguards to ensure a truly equitable and effective global effort that minimizes harm to the U.S. economy and protects American jobs. Furthermore, we must adequately help manufacturers transition to a low carbon economy to maintain domestic jobs and production.”
NAM	“Give consideration to industries exposed to foreign competition if a U.S. climate change policy creates competitive disadvantages.”

Commentary: As the senators’ letter recognized, Lieberman-Warner already has a “mechanism to protect U.S. manufacturers from international competitors that do not face the same carbon constraints [Sec. 1306].” And Lieberman-Warner already reserved 11 percent of allowances for the first ten years of the program to be given away for free to carbon-intensive manufacturers [Sec. 541].

Point #6: “Fully Recognize Agriculture and Forestry’s Role.”

Senators	“Strong, aggressive and verifiable offset policies can fully utilize the capabilities of our farmers and forests.”
ACCCE	“Allow broad use of verifiable actions to offset manmade greenhouse gas emissions. Use of verifiable offsets (from domestic or international action), should be unlimited because they help achieve cost-effective reductions in manmade greenhouse gas emissions. . . Programs such as terrestrial carbon sequestration, conservation, and energy efficiency are important domestic and international tools to reduce the carbon footprint of greenhouse gas emitters.”
Edison Electric Institute (EEI)	“Provide for the robust use of a broad range of domestic and international GHG offsets.”

Commentary: Lieberman-Warner already included “strong, aggressive and verifiable” offset policies – 15 percent each for domestic and international projects. Behind the rhetoric of “farmers and forests” lies the reality that the most easily verifiable offsets come from methane emissions from coal mining and industrial agriculture waste ponds – practices that should be dealt with for other safety and health reasons. As the restrictions on offset use are loosened, the regulatory infrastructure needed to verify offsets increases. The pollution industry would like to see offset usage be unlimited, which would require a complex new regulatory bureaucracy that the polluters would oppose tooth and nail.

Point #7: “Clarify Federal/State Authority.”

Senators	“Congress should adopt a mandatory federal cap-and-trade program that will be the single regulatory regime for controlling greenhouse gas emissions.”
ACCCE	“Avoid a patchwork of conflicting standards or duplicative programs through the adoption of a uniform federal program.”
NAM	“Preempt all state climate change laws”
EEI	“Provide certainty and a consistent national policy”

Commentary: Lieberman-Warner would distribute four percent of allowances (growing to ten percent by 2032) to states who “show leadership” on reducing emissions—but only those that do not have a conflicting cap-and-trade program. The senators are joining the Bush administration in the attempt to block and preempt state-level regulation of greenhouse gases.

Point #8: “Provide Accountability for Consumer Dollars.”

Senators

“The cap and trade program developed in the Lieberman-Warner bill has the potential to raise over $7 trillion. Much of these funds will be indirectly paid for by consumers through increased energy prices. The federal government has a fundamental obligation to ensure these funds are being spent in a responsible and wise manner. The development of any cap and trade program must recognize the sensitivity of this obligation and eliminate all possibility of waste, fraud or abuse.”

American Petroleum Institute

“Be transparent and understandable to all consumers and stakeholders.”

Commentary: Considering that these senators are also calling for federal preemption of stronger state regulations, greater subsidies for the coal industry, electric utilities, and manufacturers, and even greater “cost-containment” provisions than those already in Lieberman-Warner, it’s hard to imagine what they consider to be “responsible and wise” spending or the elimination of “waste, fraud or abuse.”

Sen. Boxer’s version of Lieberman-Warner attempted to satisfy these kinds of demands as well as progressive principles espoused by other senators. Download the This letter.

Senate Republicans block movement on two bills to spur renewable energy investment

Kate Sheppard — Wed, 11 Jun 2008 08:16:00 -0500

Cross-posted from Gristmill.

With gas prices now averaging a record $4.04 a gallon in the United States, the Senate voted on two bills Tuesday that would have revoked tax breaks for Big Oil and extended tax credits to renewable energy. Proponents of the two measures touted them as vital for consumer relief and transition to new energy sources, but both measures failed to muster the 60 votes needed to proceed.

The first vote, on the Consumer First Energy Act (S. 3044), fell short of cloture by a vote of 51-43. The second, on the Renewable Energy and Job Creation Act of 2008 (H.R. 6049), failed by a vote of 50-44. Both votes fell largely along party lines.

The Consumer First Energy Act

The Consumer First Energy Act would have levied a 25 percent tax on “windfall profits” of major oil companies, the proceeds of which would be invested in the Energy Independence and Security Act Trust Fund. Companies could avoid the tax by investing in renewable energy.

“It will force the oil companies to do something to help us get out of this mess instead of just profiting from it,” said Sen. Chuck Schumer (D-N.Y.) on the floor shortly before the vote.

The bill would also repeal tax breaks for major oil and gas companies, estimated at a value of $17 billion over the next 10 years, and suspend filling of the Strategic Petroleum Reserve through the end of 2008. There were measures to discourage “price gouging” and limit speculation in oil markets. The bill would also call for a NOPEC policy (clever acronym alert: “No Oil Producing and Exporting Cartels”). This would crack down on the Organization of the Petroleum Exporting Countries (OPEC) by amending anti-trust laws and allowing the U.S. Attorney General to take legal action against countries and companies. Currently, a court ruling from 1979 gives OPEC members immunity in U.S. courts.

Republican leaders spoke on the floor in favor of expanding domestic oil drilling in places like the Arctic National Wildlife Refuge as a solution to gas-price woes rather than measures to move toward renewable energy sources. “This bill isn’t a serious response to high gas prices. It’s just a gimmick,” said Minority Leader Mitch McConnell (R-Ky.). “Republicans are determined to lower gas prices the only way we can: increasing supply.”

But proponents of the bill were adamant that the only way to bring down the costs of oil in the long term is to curb the country’s dependence on the fossil fuel. “We are in an oil crisis, and we better start taking action to get out of this mess,” said Bob Menendez (D-N.J.). “Feeding that addiction by tapping another vein just drills us into a deeper hole.”

Democratic leaders pointed out that Republicans wanted to talk about gas prices last week, when a climate change bill was on the floor, but when a bill addressing the underlying causes of high gas prices came up, Republicans refused to let it proceed.

“Last week they wanted to make global warming legislation about gas prices,” said Majority Leader Harry Reid (D-Nev.). “When they have the chance to vote on it, they walk away.”

Six Republicans – Norm Coleman (Minn.), Susan Collins (Maine), Chuck Grassley (Iowa), Gordon Smith (Ore.), Olympia Snowe (Maine), and John Warner (Va.) – voted in favor of moving to debate on the proposed legislation. Democrat Mary Landrieu (La.) voted against it (as did Reid, but his was a procedural move to ensure that he can bring the bill to the floor again in the future).

The Renewable Energy and Job Creation Act

The second bill, the Renewable Energy and Job Creation Act of 2008, was the Senate partner to the tax-extenders legislation that passed in the House last month. The $54 billion package would have extended tax breaks for renewable energy that are set to expire at the end of this year. It includes a six-year extension of the investment tax credit for solar energy; a three-year extension of the production tax credit for biomass, geothermal, hydropower, landfill gas, and solid waste; and a one-year extension of the production tax credit for wind energy. The bill also has incentives for the production of renewable fuels such as biodiesel and cellulosic biofuels, incentives for companies that produce energy-efficient products, and incentives to improve efficiency in commercial and residential buildings. Funding for the tax credits would come from closing loopholes for hedge-fund managers and multinational corporations.

Republicans Smith, Snowe, and Bob Corker (Tenn.) voted in favor of cloture on the bill, as did all of the Democrats present for the vote.

The tax-break extensions have stalled in the Senate several times before, and folks in the renewables industry are starting to get nervous as we near the expiration of those credits at the end of this year.

“More than ever, with record energy prices, record unemployment, and grave concerns about global warming, Congress needs to work out differences so we can stabilize energy costs for consumers and businesses, improve our nation’s energy security, and create tens of thousands of quality, green-collar jobs,” said Solar Energy Industries Association President Rhone Resch following the vote.

Green groups rushed to chastise GOP leaders for the obstruction. “By once again blocking efforts to extend these crucial clean energy tax incentives that are in danger of expiring, this minority is responsible for kicking the economy while it’s down,” said Sierra Club Executive Director Carl Pope in a written statement. “Jobs are already being lost in the renewable-energy industry and at least 100,000 more could disappear unless Congress acts to immediately renew these tax incentives.”