February 2011 Climate Change Summary Report

‘Obama’s Bid to End Oil Subsidies Revives Debate’

February 1, 2011: The New York Times reports: “When he releases his new budget in two weeks, President Obama will propose doing away with roughly $4 billion a year in subsidies and tax breaks for oil companies, in his third effort to eliminate federal support for an industry that remains hugely profitable. Previous efforts have run up against bipartisan opposition in Congress and heavy lobbying from producers of oil, natural gas and coal. The head of the oil and gas lobby in Washington contends that the president has it backward — that the industry subsidizes the government, through billions of dollars in taxes and royalties, not the other way around. … Mr. Obama’s proposal rekindles a long-running debate over federal subsidies for energy of all kinds, including petroleum, coal, hydropower, wind, solar and biofuels. Opposition to such subsidies — often euphemistically referred to as incentives, tax credits, preferences or loan guarantees — spans the ideological spectrum, from conservative economists who believe such breaks distort the marketplace to environmentalists who believe that renewable energy sources will always lose out in subsidy fights because of the power of the entrenched fossil fuel industries.  … Mr. Obama specifically proposes to eliminate roughly $4 billion a year in more than a half-dozen tax exemptions for oil and gas companies and an additional $200 million a year in preferences for coal. … The president proposed a global end to such subsidies at the Group of 20 meeting in 2009, and while most nations endorsed the idea in theory, little has been done. And Mr. Obama will have a tough fight trying to get even these relatively modest proposals enacted over the objections of the oil and coal industries, who argue that such tax treatment is necessary to keep drillers drilling and miners mining.”

EPA Chief Slams Bills to Block Climate Rules

February 3, 2011: The Hill reports: “Environmental Protection Agency Administrator Lisa Jackson on Wednesday attacked bills piling up in Congress that would block the agency’s ability to regulate greenhouse gas emissions and reiterated the White House veto threat. Jackson, speaking to reporters, initially declined to address whether President Obama would veto bills that stop climate rules, but later said that past threats still stand. … Jackson defended the agency’s initiatives to regulate emissions from power plants and other facilities. … She reiterated her view that EPA’s Clean Air Act rules are not a drag on the economy. … Several top GOP senators floated a sweeping bill this week that would prevent the federal government from regulating greenhouse gases or addressing climate change through environmental statutes. Later on Wednesday, House Energy and Commerce Committee Chairman Fred Upton (R-Mich.) and Sen. James Inhofe (R-Okla.) are expected to float a measure that would specifically block Clean Air Act rules, a House GOP aide said Tuesday evening. Sen. Jay Rockefeller (D-W.Va.), meanwhile, is pushing legislation that doesn’t remove EPA’s authority for good but would block regulation of greenhouse gases from stationary facilities for two years.EPA and the Department of Transportation currently administer joint vehicle mileage and greenhouse gas requirements. More controversially, EPA has begun phasing in rules that require large new and modified industrial plants to minimize emissions and is crafting broader national emissions standards for power plants and refineries, among other efforts. Critics of EPA rules say they will hinder the economy.”

‘Bernanke and Ethanol Sink Egypt’

February 3, 2011: From a Rasmussen Reports column by Lawrence Kudlow, host of CNBC’s “Kudlow & Company”: “Decades of autocratic government and a lack of free elections are, of course, the main drivers of the political upheaval in Egypt. But did the sinking dollar and skyrocketing food prices trigger the massive unrest now occurring in Egypt — or the greater Arab world for that matter? In addition to Egypt, the people have taken to the streets to varying degrees in Algeria, Jordan, Libya, Morocco and Yemen. Local food riots have even broken out in rural China and other Asian locales. While the mainstream media focus on the political aspects of this turmoil, they are overlooking the impact of rising inflation, driven mainly by record food prices. … The dollar is the world’s reserve currency. And the rise of dollar food prices is a global phenomenon. It is a monetary  phenomenon, as much as anything. And that’s why one can argue that the worldwide revolt against soaring food prices is an unintended consequence of U.S. Fed policy. … A good part of this problem can also be placed at the doorstep of bipartisan U.S. policies to subsidize ethanol. According to The Wall Street Journal, in 2001, only 7 percent of U.S. corn went to ethanol. By 2010, the ethanol share was 39 percent. So instead of growing wheat, our farmers are growing corn in order to cash in on ethanol subsidies. Egyptians who can’t afford to buy bread and have taken to the streets in protest might be very interested to know this. Not even Al Gore still believes that ethanol provides any environmental benefits. As the world watches events in Egypt play out, be mindful that if the U.S. fixed its mistaken monetary and energy policies, the forces of freedom and democratization would have an easier time of it in the rest of the world.”

‘Oil Sands Development a Slippery Topic for Harper, Obama’

February 4, 2011: Postmedia News reports: “In advance of Friday’s White House huddle between Prime Minister Stephen Harper and U.S. President Barack Obama, officials from both countries have touted their leaders’ plan to advance the clean energy agenda they first launched two years ago in Ottawa. But the elephant in the Oval Office could be the ‘dirty energy’ from Alberta oilsands that has — to the dismay of Canadian industry and government — become a subject of unrelenting, high-profile debate in Congress and throughout the Obama administration in recent weeks. Officials from the Canadian and U.S. energy sectors said Thursday they want Harper to press the case for approval of Calgary-based TransCanada’s Keystone XL pipeline, which would ship oilsands crude from Hardisty, Alta., to the U.S. Gulf Coast. … The North American oil industry and environmental movement have been on tenterhooks as they await a decision by the U.S. State Department on whether to grant a ‘presidential permit’ for construction of the $7-billion Keystone XL. … But the big question for proponents and opponents of the pipeline is where Obama — who put clean energy innovation at the centre of last week’s State of the Union address — stands on growing American reliance on oilsands. ‘If you were to bet on it, Keystone might go ahead,’ says Danielle Droitsch, U.S. policy director for the Calgary-based Pembina Institute. … A report prepared for the U.S. Department of Energy this week painted a mixed picture of the need for the Keystone XL.”

Business Groups Target EPA

February 7, 2011: The Wall Street Journal reports: “The Environmental Protection Agency, which enforces rules that affect the U.S. economy from factories to farms, is the No. 1 target of complaints from business groups collected by House Republican leaders. EPA rules were cited more than those from any other agency in more than 100 letters sent by trade associations, businesses and some conservative groups to House oversight committee chairman Darrell Issa (R., Calif.) in response to his call for businesses to identify regulations they deemed burdensome, according to documents reviewed by the Wall Street Journal. The letters are scheduled for release today. The letters will become fuel for a running debate between Republican lawmakers and the Obama Administration over what role, if any, increased federal regulation is playing in the sluggish pace of job creation. … The EPA’s rules to curb emissions of carbon dioxide and other greenhouse gases were cited as an impediment to growth by at least 30 organizations writing to Mr. Issa, including representatives of the agriculture, business, chemicals, energy, paper, manufacturing and steel and iron sectors. Groups complained about dozens of other proposed and existing EPA regulations in letters viewed by the Journal, including the agency’s plans to tighten limits on emissions of some pollutants from industrial boilers, ground-level ozone, mountain-top mining, cooling water intake structures, the level of nutrients in Florida waters, and pollutants in the Chesapeake Bay. … President Barack Obama launched last month a review of all regulations to eliminate those which are outdated or place ‘unreasonable burdens on businesses.’ … But the Obama administration has so far defended the EPA’s efforts to regulate emissions of carbon dioxide and other greenhouse gases which business groups fear could ultimately require costly new technology for power plants, factories, refineries and drive up energy costs for all businesses. … House Republicans have questioned whether the administration’s review will go far enough, and will likely use the business letters to bolster their case. … The top Democrat on the oversight committee, Elijah Cummings of Maryland, has protested that Mr. Issa has not sent him copies of all the letters, and said he will demand tougher scrutiny of the industry groups’ gripes.”

‘GOP Spending Cuts for EPA’

February 7, 2011: Inside EPA reports: “House Appropriations Committee Chairman Hal Rogers (R-KY) is asking the subcommittee with jurisdiction over EPA to cut $2.6 billion in funds for EPA, the Department of Interior and other environmental agencies when the committee considers a continuing resolution (CR) to fund the government for the remainder of fiscal year 2011. The CR under which the government is operating expires March. 4. In his so-called 302 (b) requests to subcommittee chairmen, Rogers asks the Subcommittee on Interior, Environment and Related Agencies to trim $2.6 billion for the remainder of FY11, compared to FY10 levels. The cuts would take the subcommittee’s allocation $2.8 billion below President Obama’s FY11 budget request. Neither Rogers nor Rep. Mike Simpson (R-ID), who chairs the subcommittee, have identified specific cuts from EPA’s budget, but both have been harsh critics of the agency’s aggressive agenda during the Obama administration. Among the policies likely to be targeted, Republicans have previously sought to deny the agency funds to implement its new greenhouse gas regulations, and Rogers last year introduced a bill to cut off funding for implementation of EPA’s new policies on mountaintop mining.”

Oil Isn’t Going Away

February 7, 2011: From a Washington Post column by Robert J. Samuelson: “The Age of Oil continues; we need to deal with it. The upheaval in Egypt reminds us of lessons that, despite decades of warnings, Americans have consistently sidestepped: The United States and the rest of the world will depend on oil for the indefinite future; global oil markets remain hostage to political crises that cannot be predicted or controlled; and we have not taken the prudent steps that would reduce – though not eliminate – our vulnerability to catastrophic oil interruptions. Just what Egypt’s crisis will do to oil markets is, as yet, unclear. … A greater risk involves oil shipments. The Suez Canal and the SuMed pipeline (Suez-Mediterranean) together now move about 3 mbd between Asia and Europe. If these supplies were blocked, prices would almost certainly rise. … The real flash point would occur if a cascade of political turmoil cut production from major suppliers: Saudi Arabia (present output: 8.5 mbd), Kuwait (2.3 mbd), Iran (3.7 mbd), Iraq (2.4 mbd) or Algeria (1.3 mbd). This danger will remain no matter how the present crisis ends. What can we do? Well, two things: decrease oil consumption, preferably by a stiffer gasoline tax; and increase production, preferably by less-hostile regulation. The Obama administration isn’t doing either. Instead, it’s touting a goal of 1 million electric hybrid vehicles by 2015. … By contrast, lost production from restrictions on drilling in the Gulf of Mexico could total 200,000 barrels a day in 2012, by one government estimate. The administration overreacted to the Deepwater Horizon blowout. There hasn’t been much encouragement of on-shore drilling, either, despite better prospects. … A higher gasoline tax – gradually introduced to avoid wrecking the economic recovery – would dampen wild swings in fuel prices and push consumers to buy the more-fuel-efficient vehicles that the government is ordering auto companies to make. … Barring unforeseen technological breakthroughs, oil isn’t going gently into the night. … We cannot escape that reality, even if we ignore it.”

‘EPA Remains Center of Reform Controversy’

February 8, 2011: E&E Daily reports: “With the House Rules Committee expected to consider a resolution today that would direct 10 House panels to review government regulations to see which should be nixed, sparring continues over Republican lawmakers’ contention that U.S. EPA rules are most in need of reform. The Rules Committee is scheduled to hold a markup today of a resolution that would direct House panels to conduct an inventory and review of existing, pending and proposed rules with respect to their effect on jobs and economic growth. The markup comes after House Oversight and Government Reform Chairman Darrell Issa (R-Calif.) yesterday unveiled a list of government regulations that industry groups believe should be wiped from the books for the sake of the United States’ future job growth. An analysis of the letters sent by more than 160 industry groups shows that EPA was the most-cited agency. … Senate Democrats, meanwhile, told reporters last night that Issa and the House Republican majority are using congressional oversight prerogatives to improperly pressure EPA to stop regulating carbon and other pollutants. In addition to the Issa hearing, Rep. Ed Whitfield (R-Ky.) will be holding a subcommittee hearing tomorrow to discuss a bill by Energy and Commerce Chairman Fred Upton (R-Mich.) that would bar EPA from regulating carbon. Sen. Sherrod Brown (D-Ohio) has had his own concerns about the way EPA regulations could impact his home state’s manufacturers, but he said hearings like Issa’s and bills like Upton’s are part of an ‘anti-science agenda’ dictated by the interest groups that make up the Republican base. … Sen. Ben Cardin (D-Md.), a senior member of the Environment and Public Works Committee, said he is concerned Issa’s scrutiny of the agencies may not be motivated by a genuine desire to see that laws are implemented properly.”

‘Obama Avoids Carbon Talk With Chamber’

February 8, 2011: National Journal reported yesterday: “President Obama skirted any mention of his administration’s contentious carbon emissions regulations in a speech today at the U.S. Chamber of Commerce, one of the staunchest opponents of those rules. He also didn’t say anything about the rules in his State of the Union speech last month, despite touting clean energy investments as one of the cornerstones of his legislative agenda. EPA’s carbon emissions regulations are becoming the elephant in the room for Obama. As his administration continues to evade both a firm defense and a compromise on the rules, House Republicans’ attack on the agency starts in earnest this week. In his speech today, Obama gave a nod to the regulatory review he has ordered for his administration, including EPA. The agency’s only explicit mention came in regard to biomass energy, a blip in the energy picture. … Energy and Power Subcommittee Chairman Ed Whitfield, R-Ky., will hold a hearing Wednesday on a draft legislation upending the carbon regulations that he introduced last week with Energy and Commerce Chairman Fred Upton, R-Mich., and Senate Environment and Public Works ranking member James Inhofe, R-Okla. EPA Administrator Lisa Jackson will be the key witness. … Critics of the regulations say the threat of the regulations is enough to stifle private-sector investment and create a de facto construction moratorium. Obama opened the door for more of that criticism today.”

EPA, Enviros Strike Back Against ‘Job-Killing’ Message

February 9, 2011: The Hill reports: “The Environmental Protection Agency (EPA) and green groups are ramping up their campaign to counter GOP claims that air pollution rules are ‘job-killers.’ Their efforts come ahead of Capitol Hill hearings this week that will feature a barrage of GOP and industry attacks on Obama administration regulations. … Jackson — who said the Clean Air Act has provided ‘trillions of dollars in health benefits’ — spoke to a ‘green jobs’ conference hosted by the Blue Green Alliance, a coalition that includes the Sierra Club and the United Steel Workers. … The conference is also featuring the release of a new report that says looming EPA air pollution rules will create scores of jobs. The study from the green investor group Ceres looks at a pair of upcoming rules to limit pollutants from power plants, including sulfur dioxide, nitrogen oxides, mercury, lead and others. It notes that ‘investments driven by the EPA’s two new air quality rules will create nearly 1.5 million jobs, or nearly 300,000 jobs a year on average over the next five years — and at a critical moment for a struggling economy.’ … Committee Chairman Fred Upton (R-Mich.) has also pledged to focus on other EPA rules he alleges will cost jobs and burden the economy. And on Thursday, the House Oversight and Government Reform Committee will hold a hearing on ‘regulatory impediments to job-creation.’”

Senate Dems Push for Oil ‘Subsidy’ Cuts

February 9, 2011: National Journal reports: “Senate Democrats are calling on House Republicans to cut oil and gas subsidies as a way to meet their plan to slash $32 billion from the continuing resolution. ‘We are concerned that some of the cuts you may propose could undermine future growth just as our economy is beginning to recover,’ Senate Majority Leader Harry Reid, D-Nev., and nine other Democrats wrote in a letter to House Speaker John Boehner, R-Ohio, today. ‘Instead, we urge you to consider ending a number of tax loopholes and other subsidies that benefit big oil and gas companies. Closing these loopholes would save the federal government more than $20 billion over 10 years.’ That amounts to $2 billion a year, half as much as President Obama called to eliminate in his State of the Union address last month. Obama has since repeated the call to end $4 billion worth of oil and gas subsidies and will certainly include a similar line item in his budget proposal to be rolled out Monday. Congress will not approve any such measure, though, and surely Reid and the other Democrats know that. The Senate last week voted down, 44-54, an amendment sponsored by Sen. Carl Levin, D-Mich., that would have eliminated one of the biggest tax breaks to major oil and gas companies. …  Boehner’s office dismissed the letter and said eliminating the oil and gas subsidies would amount to a tax increase, a common rebuttal from Republicans and the oil and gas industry. … Seven Democrats, including Energy and Natural Resources Chairman Jeff Bingaman of New Mexico, voted against Levin’s amendment. … Yet Obama has said he wants to divert that funding to clean tech investments and has not mentioned anything about that money going toward cutting the deficit. … The Democrats’ letter today doesn’t mention anything about funding clean energy technology investments with money from oil and gas subsidies.”

‘The Range Fuels Fiasco’

February 10, 2011: From a Wall Street Journal editorial: “President Obama’s budget next week is expected to include even more subsidies for renewable energy. Before Congress bellies up to that bar one more time, it ought to dissect the fate of Range Fuels and the wood chips fad. … The political venture capitalist founded Range Fuels and in March 2007 it received a $76 million grant from the Department of Energy—one of six cellulosic projects the Bush Administration selected for $385 million in grants. … In 2007, Congress doubled down by mandating that the U.S. use 100 million gallons of cellulosic ethanol yearly by 2010, and 250 million gallons by 2011—though not a single commercial facility existed at the time. … The result has not been another Google. … In early 2009, the company said production was not expected until 2010. Undeterred, President Obama’s Department of Agriculture provided an $80 million loan. In May 2009, Range’s former CEO, Mitch Mandich, explained that the problem was that nobody had figured out how to produce cellulosic ethanol in commercial quantities. Whoops. In early 2010, the EPA said Range would finally produce some fuel in 2010—but only four million gallons, not 100 million, and of methanol, not cellulosic ethanol. So taxpayers have committed $162 million (along with at least that much in private financing) to produce four million gallons of a biofuel that others have been making in quantity for decades. … As for current Range CEO Mr. Aldous, he’s blaming this failure on—brace yourself—Washington’s failure to impose a tax on carbon via cap and trade. … He also blamed ‘public apathy toward green fuels.’  Apathy? How many other products get the Presidential seal of approval, taxpayer subsidies, forced-purchase mandates and glowing media attention? … More broadly, the EPA last year had no choice but to reduce the government’s 100 million gallon target for 2010 to 6.6 million gallons. It is also fiddling with the definition of what qualifies as a ‘cellulosic’ fuel. Perhaps Newt Gingrich will ask EPA to let corn ethanol make the cut.”

‘Defund the EPA’

February 10, 2011: From a Washington Times op-ed by Steve Milloy, publisher of JunkScience.com: “The Environmental Protection Agency (EPA) has hit the ground running with its greenhouse-gas regulations. But congressional Republicans are just getting around to introducing well-intended, but futile legislation to stop the agency. There is another way. The GOP could rescue us from the EPA as soon as March, but it won’t. … Senate and House Republicans just announced plans to introduce legislation stripping the EPA of its authority to regulate greenhouse gases (GHGs). That sounds encouraging, but the reality is that even if such a bill winds up on President Obama’s desk, he’ll veto it, and there aren’t enough Republicans to override a veto. At best, these bills are political theater intended for impact in 2012. But the EPA isn’t waiting until then. Its emissions-permitting program went into effect on Jan. 2 and by Jan. 7, the agency was already interfering with job creation and economic recovery. … Its best (and really only) shot at reeling in the arrogant Obama EPA is to cut the agency’s funding. Without House approval, the EPA has no budget. A great opportunity to choke off EPA funding arrives early next month when last December’s deal to fund the federal government until March 4 expires. Congress will then need to approve a budget to keep the federal government – including the EPA – open. But the word from GOP leadership is that it just wants to pass a clean bill with no appropriations riders or other strings attached. This apparently is part of the leadership’s longer-term strategy to reduce federal spending. While that is a noble endeavor, so is preventing the EPA from killing jobs and interfering with our fragile economy. … The Obama administration is preparing to make cap-and-trade look like a walk in the park compared to EPA regulation.”

Feds can’t force ethanol producers to curb output, USDA economist says

February 11, 2011: U.S. ethanol production is helping push down corn stocks to a 15-year low, but there is little that the government can do to make the industry cut back its output, said Joe Glauber, chief economist of the Department of Agriculture. “This isn’t a question of just saying ‘cut it off.’ It’s much more complicated than that,” said Glauber, adding that federal standards, tax credits and healthy returns in 2010 are helping boost production. Reuters

‘House Dems Float Plan to Nix Oil Industry Tax Incentives’

February 11, 2011: The Hill reports: “Several senior House Democrats ramped up calls Thursday to yank tax incentives from large oil companies, alleging they are especially inappropriate amid GOP plans for deep spending cuts. Lawmakers including Reps. Earl Blumenauer (D-Ore.) and Ed Markey (D-Mass.) introduced a bill to end roughly $40 billion over five years worth of tax breaks. The bill stands little chance of passage but provides Democrats a political counterweight to GOP calls to begin curbing the deficit by slashing an array of federal programs. … The bill would end several incentives, such as large oil companies’ ability to claim a lucrative domestic manufacturing tax deduction.”

Senate Dem Leaders Shy Away From Gas-Tax Hike

February 11, 2011: The Hill reports: “Despite pressure from some members, Senate Democratic leaders are reluctant to embrace an increase in the gas tax as they search for ways to rebuild the nation’s infrastructure. ‘At this point, the caucus is not ready to sign off on a gas tax or any tax increase,’ Senate Majority Leader Harry Reid (D-Nev.) told reporters Thursday afternoon. The issue arose because there is strong Democratic support for passing a multi-year transportation authorization bill. … Talk of a higher gas tax came up during Senate Democrats’ two-day retreat at The Boar’s Head Inn in Charlottesville, Va., where they discussed other funding proposals. …  A Senate Democratic aide said the proposal to raise the gas tax, pushed by Sen. Tom Carper (D-Del.) in Charlottesville, ‘did not generate much support.’ … The White House opposes raising the gas tax, but Obama has called for ending tax breaks provided to the oil-and-gas industry. Gene Sperling, whom Obama tapped to serve as director of the National Economic Council, told Democratic senators during the retreat that ending tax breaks for special interests could reap hundreds of billions of dollars for the government, according to senators present. … The fiscal commission also proposed a 15-cent increase in the gas tax, prompting some Democratic senators to say they might support it. Sen. Mark Udall (D-Colo.) noted the fiscal commission recommended that Congress ‘bite the bullet’ and raise the tax, even though it would be unpopular at first glance. But Udall thinks the public could be convinced. … Sen. Mark Pryor (D-Ark.) said he could support a gas-tax increase, ‘but it all depends on the details.’ … Sen. Tom Coburn (R-Okla.), one of the most conservative members of the Senate, won’t rule out supporting a gas-tax increase as part of a broad deficit-reduction plan. … Coburn is working with Democrats such as Senate Budget Committee Chairman Kent Conrad (D-N.D.) on a legislative package to implement the fiscal commission’s recommendations.”

‘How Biofuels Contribute to the Food Crisis’

February 11, 2011: From a Washington Post op-ed by Tim Searchinger, research scholar at Princeton University and fellow of the German Marshall Fund of the United States: “Each year, the world demands more grain, and this year the world’s farms will not produce it. … Food riots have started again. Nearly all assessments of the 2008 food crisis assigned biofuels a meaningful role, but much of academia and the media ultimately agreed that the scale of the crisis resulted from a ‘perfect storm’ of causes. Yet this ‘perfect storm’ has re-formed not three years later. We should recognize the ways in which biofuels are driving it. Demand for biofuels is almost doubling the challenge of producing more food. Since 2004, for every additional ton of grain needed to feed a growing world population, rising government requirements for ethanol from grain have demanded a matching ton. … Agricultural production is keeping up in general with the growing demand for food – but it keeps up with the added demand for biofuels only if growing weather is good. … Higher fuel costs for farmers and a weaker dollar contribute to higher prices, but prices soar only when large consumers, fearing that production will continue to fall short, bid up prices to secure their supplies. … So why has attention shifted away from biofuels? The answer probably lies in the confusing explanations of 2008, when the problem and its ‘cause’ were defined in different ways. … A broad misunderstanding has also arisen from economic models predicting price increases from biofuels that are still far lower than those of the past decade. In fact, these models do not estimate biofuel effects on prices today but those in a future market ‘equilibrium,’ which will exist only after farmers have ample time to increase production to match demand. … The good news is that relief is possible. The same economic studies imply that food prices should come down if we can just limit biofuel growth. Corn ethanol is nearing Congress’s requirement for 15 billion gallons a year, and lawmakers need to hold it there. … Otherwise, the sequel to the food crisis is likely to turn into a series.”

Studies Target Gaps in Biofuel Life-Cycle Calculations

February 11, 2011: Greenwire reported yesterday: “Conducting in-depth life-cycle assessments of the environmental impacts of biofuels is complicated, and new research suggests some questions in comparing biofuels to alternatives like petroleum-based fuels will never be answered. Furthermore, one study argues, consumer choices driven by price differences between bio-based and petroleum-based fuels will play into how biofuels affect the environment, adding another layer of complication that must considered. The two papers were recently published by the Energy Biosciences Institute, a partnership among oil giant BP PLC; the University of California, Berkeley; the University of Illinois, Urbana-Champaign; and the Lawrence Berkeley National Laboratory. … And they warn in a description of what many consider to be a political reality in Washington, ‘once a commitment is made to adopt ethanol, even if it is considered a ‘bridge’ or short-term option, technology momentum will impede opportunities to move to any other alternative.’ … In ‘Indirect Fuel Use Change (IFUC) and the Lifecycle Environmental Impact of Biofuel Policies,’ Deepak Rajagopal, a researcher at the University of California, Los Angeles’ Institute of the Environment and Sustainability, and colleagues take issue with the common assumption that biofuels will replace fossil fuel use on a 1-to-1 basis. … ‘Assuming biofuels are costlier than fossil fuels, a domestic biofuel mandate such as the US Renewable Fuel Standard is likely to raise domestic fuel price and lower domestic fuel consumption. … At the same time, by reducing the demand for fossil fuels, domestic policies lower the international price of fossil fuels and [cause] an increase in fossil fuel consumption in the rest-of-the world,’ they say. The researchers’ larger point, beyond advocating for the inclusion of fuel use change in life-cycle assessments, is that if such analyses are going to include indirect effects stemming not from the fuel’s supply chain but from related system changes, then a much wider field of such effects must be considered.”

Obama’s Budget Seeks to End Some Energy Tax Incentives

February 14, 2011: Bloomberg reports: “The Obama administration will seek to repeal $46.2 billion in subsidies for oil, natural gas and coal companies in the next 10 years, to fund renewable energy spending, Energy Secretary Steven Chu said. The plan is part of President Barack Obama’s commitment to lower dependence on fossil fuels and increase to 80 percent the share of U.S. electricity from ‘clean’ sources by 2035. Cutting the subsidies will help pay for $8 billion in ‘clean energy’ investments, Chu wrote on his blog yesterday. The president is scheduled to present the 2012 budget on Feb. 14. … The reduction in subsidies, which would cost energy companies $3.6 billion in 2012, can be easily absorbed by the profit-rich oil industry, Obama said in Jan. 25 State of the Union address. … The Energy Department will also seek to cut the budget for fossil-fuel research by 45 percent, or $418 million, according to the posting. The cuts to the fossil energy office include ending a program that studies how to extract oil and gas from shale rock, tar sands and other ‘unconventional reservoirs,’ according to an Energy Department fact sheet. … The budget would cut funding for the hydrogen technology program by more than 41 percent, or about $70 million, according to Chu.”

 ‘Why Biofuels Help Push Up World Food Prices’

February 14, 2011: Time Magazine reports: “It’s easy to miss amid the drama of Egypt — though the two stories are connected — but the world is in the grip of a full-blown food crisis. According to the U.N., world food prices hit a record high in January, meaning food is now more expensive than it has ever been in real terms since the U.N. first began tracking the numbers in 1990. … At a time when much of the global economy is still struggling to bounce back from the crisis of the past few years, high food prices could push millions back into poverty and cause millions more to go hungry. … And then there’s ethanol, the production of which sucks up grain and cropland that could be used for food. In America, 40% of the corn crop is currently diverted to make fuel for cars. … In a tight world food market, tightened by bad weather, that diversion of grain and oil makes a difference for food prices, especially in developing countries where a rise in the price of staples is passed directly to consumers. … In 2007 and 2008, grain prices hit what had been record highs, prompting food riots in a number of developing countries, just as they do today — the high price of bread may have helped spark protests in Tunisia and Egypt. A major review of the 2007-08 food crisis by the International Food Policy Research Institute found that the surge in U.S. corn production for biofuels played a key role in the increase of prices. … The ethanol industry in the U.S., though, is hitting back against the suggestion that it is pushing up food prices. … But it’s clear that in a tighter market, diverting corn and other crops to biofuels will only act to raise prices. That might be worth it if biofuels provided substantial environmental and economic benefits, but there’s significant research showing that corn ethanol’s carbon footprint isn’t much better than that of oil. … We’d be wise to use our food for food, not for fuel.”

‘Regulations Stifle Drilling, Push Gas Prices Up at Pump’

February 16, 2010: From an op-ed in The Hill by U.S. Representative Doc Hastings (R-Wash.), chairman of the House Natural Resources Committee: “Americans across the country are facing rising gasoline prices that are squeezing families’ monthly budgets and businesses’ ability to prosper and create jobs. … Instead of addressing this issue head on, the Obama administration has actively opposed efforts to expand American energy production. They’ve imposed burdensome regulations and policies that are slowing economic recovery and casting shadows of uncertainty on job creators. These regulations are locking up American energy resources, costing U.S. jobs, increasing our dependence on foreign energy and leading to higher prices at the pump. … The regulatory cobweb of red tape and constantly moving goalposts created by the Obama administration after the Gulf of Mexico oil spill have resulted in a de facto moratorium on deepwater and shallow-water drilling permits. … Gasoline prices are climbing ever higher; the question is what the administration is doing to address it. For the past two years, their only answer has been more regulations, more red tape and more uncertainty. American businesses need sensible rules and standards that will both protect our environment and allow job-creating projects to move forward safely, responsibly and in a timely manner.”

‘Greens Sour on Natural Gas’

February 16, 2011: Politico reports: “Whatever happened to the romance between the environmental lobby and natural gas? After years of basking in a green glow as the cleanest fossil fuel and a favorite short-term choice to replace cheap-but-dirty coal, gas now finds itself under attack from environmentalists, filmmakers and congressional Democrats — and even from some scientists who raise doubts about whether its total emissions are as climate-friendly as commonly believed. Case in point: the Sierra Club, whose former executive director, Carl Pope, has spoken warmly in recent years about gas as an alternative to coal in power plants. Now, the group is considering calling for natural gas to be phased out by 2050 — about 20 years after it wants coal eliminated. … The assault comes at a time when gas’s fortunes appear to be soaring — blessed by low prices, abundant domestic supplies, quantum leaps in extraction technology and a starring role in the ‘clean energy’ agendas of President Barack Obama and leaders on Capitol Hill.  Some energy analysts believe that natural gas is poised to become the leading fuel for U.S. electric utilities in the next few decades, dethroning King Coal. In large part, that’s because gas’s cleaner-burning nature could potentially dovetail with efforts to reduce carbon emissions. Gas advocates say they’re confident that once the facts are in, clean energy backers will appreciate the fuel’s advantages. … But there’s no mistaking that gas’s green credo is under fire. That’s partly because of the controversy about the extraction technique called hydraulic fracturing, or frac’ing, which has prompted a partial moratorium on the practice in New York and accusations that it has contaminated rivers, streams and groundwater.”

‘“Absolute Madness” of Biofuels’

February 17, 2011: From a Washington Times op-ed by Robert Bryce, senior fellow at the Manhattan Institute:  “Last month, Peter Brabeck, the chairman of the Swiss food giant Nestle, declared that using food crops to make biofuels was ‘absolute madness.’ The epicenter of that madness is the U.S. corn-ethanol sector. This year, it will consume 40 percent of all U.S. corn – that’s about 15 percent of global corn production or 5 percent of all global grain – in order to produce a volume of motor fuel with the energy equivalent of about 0.6 percent of global oil needs. Congress lavishes about $7 billion in annual subsidies, mandates and tariff protections upon an industry that is helping push global food prices to all-time highs and shrink grain reserves at the very same time that global grain production is faltering and protests over food prices are becoming common. … Despite these facts, President Obama said last month in his State of the Union speech, ‘We can break our dependence on oil with biofuels.’ Meanwhile, Newt Gingrich, former speaker of the House, who is considering a run for the 2012 Republican presidential nomination, was in Iowa recently, cravenly wooing the ethanol producers and slamming ‘big city’ critics of the ethanol industry. … Current Speaker John A. Boehner, Ohio Republican, recently told reporters not to expect cuts to the ethanol subsidies because they are ‘not in the discretionary spending pot.’ … In May 2008, the Rand Corp. warned that diverting corn to the ethanol sector was not only bad economics, but a security threat. … In December, a study by two U.S. agriculture economists, Thomas Elam and Steve Meyer, found that corn prices are being directly stoked by demand from the ethanol sector. Mr. Elam and Mr. Meyer, who have done consulting work for the meat industry, found that without the ethanol mandates, the average price of corn would be lower by more than $2 per bushel.”

Obama Effort to Cut Oil ‘Subsidies’ May be Empty Pledge

February 17, 2011: ClimateWire reports: “With G-20 finance ministers meeting in Paris on Friday, the Obama administration will aim to prove it is upholding the United States’ end of a global pledge to phase out subsidies for fossil fuels. But the elimination of $3.6 billion worth of tax breaks to the oil and gas industry Obama outlined in his proposed budget this week — all of which were shot down by Congress for the past two years — are again running up against a Republican political blockade backed by industry. … The House Natural Resources Committee, chaired by Rep. Doc Hastings (R-Wash.), decried the proposal as an ‘anti-energy agenda’ and calculated the combination of eliminated taxes and new fees at $60 billion. … In the run-up to a hyped climate change summit in Copenhagen, Denmark, in late 2009, President Obama led the G-20 in declaring the beginning of the end to fossil fuel subsidies. But in subsequent months, the administration faced lethargy from developing countries, many of which were loath to cut out the subsidies that keep fuel inexpensive for the world’s poorest while countries like the United States and Australia continued to offer sizable producer subsidies in the form of tax breaks. So far, though, the cuts Obama has proposed have gone nowhere. The fiscal 2012 budget proposes — as did his 2011 and 2010 offerings — to repeal provisions ranging from a manufacturing deduction for hard mineral fossil fuels to the expensing of intangible drilling costs and ending a research and development program for oil and gas.”

‘Battle Over Clean Energy: Next Partisan Fight?’

February 18, 2011: ABC News reports: “The House Republicans’ 2011 budget proposal, which proposes deep cuts in clean energy programs, threatens President Obama’s goals and sets the stage for a battle between Republicans and Democrats to define the country’s energy agenda. The House Republicans’ continuing resolution that would fund the government until October is unlikely to pass in the Senate, and the president threatened to veto it this week. But the budget bill, which calls for hefty cuts in energy and environmental research, indicates that finding common ground on the subject may not be an easy task. … It slashes nearly $889 million from energy efficiency and renewable energy programs and cuts billions from federal agencies like the Environmental Protection Agency. It bars the EPA from using Congressional funds to regulate emissions under the Clean Air Act or from denying or approving state implementation plans or permits, and takes away $3 billion from the agency’s budget. … Most committees are prohibited from starting new programs without approval. … It cuts funding for the Department of Energy’s science office budget and other programs that support renewable energy and clean energy research. Democrats charge that the Republicans’ agenda will halt projects already in the works and make it difficult for the Energy Department to guarantee loans. Others say it will halt job creation and curb U.S. global competitiveness. Some of Obama’s own proposals in the budget have come under fire from Republicans, such as ending subsidies for oil and gas companies, which the White House says will save $46 billion over 10 years. … Even though they may not be willing to reach as far as the president on clean energy reforms, there have been some signs that Republicans may not be completely resistant to such efforts.”

Biofuels Are Good Energy Investments for Taxpayers

February 22, 2011: From a Wall Street Journal letter to the editor by David C. Aldous, CEO, Range Fuels, Inc.: “Solutions to the monumental U.S. energy, environmental and economic challenges will not be solved by small private companies alone. It will take broad private and public collaboration. It requires continuity of policy and strategy to provide a consistent business climate that will attract long-term investment to this capital-intensive industry. It will require a wide range of solutions and technologies across the energy and environmental spectrum. Range Fuels employees have put heart and soul into trying to change the way America produces energy. Commercializing first of a kind technology is difficult work.  … Cellulosic biofuels and chemical building blocks will ultimately be successful. As with many other industries, our early production begins at the peak of the cost curve. Economies of scale and operational excellence will dramatically drive down costs in the future. The financial crisis has slowed our industry progress but it continues to move forward. Innovation in energy solutions can either happen in the U.S. or we can wait and import the technology and associated products from China. China already invests more than double the amount of the U.S. each year in renewable energy and energy efficiency. … When gasoline hits $4.50 per gallon, let’s chat again.”

‘Obama, Greens in Permit Conflict’

February 23, 2011: Politico reports: “The Obama administration wants to double the amount of renewable power permits awarded this year but is running into a potential problem: environmentalists. Partly driven by the presidential election, the Interior Department has set a goal of approving permits for 9,000 megawatts’ worth of renewable energy on public lands by the end of 2011. That’s more than twice what Interior approved in 2010 through its Fast Track program for a dozen renewable projects. … Environmental groups can ill-afford to fight forms of energy that they are promising will keep the lights on without contributing to climate change. And renewable energy developers — already struggling to compete with older, more established and, for the moment, cheaper fossil fuels — cannot afford to spend years in court waiting for their projects to move forward. So the groups are continually collaborating to head conflict off at the pass. But there is already grumbling at the margins that one side or the other isn’t holding up its end of the bargain. … The risk is that renewable power development falls into the same routine as oil and gas drilling on federal lands throughout the West: Drillers continually apply for permits in places environmentalists say they can’t accept, and the greens continually sue Interior in an attempt to block the projects from going forward. Now, as renewable energy developers eye the vast federal estate for their projects, the potential for collision with the greens is immense. Many of the same spaces environmentalists prize for their solitude are the hot spots for the wind and sunshine that all parties involved are counting on to power a clean energy revolution. Despite the potential conflict, Chase Huntley — a clean energy policy adviser for The Wilderness Society — believes that environmentalists, the renewable energy industry and the federal government can do better than they have with fossil fuels. The trick, he says, is to create a permitting process that deals with environmental conflicts ahead of time.”

‘The $100 Oil Panic’

February 24, 2011: From a Wall Street Journal editorial: “Our question is: What took so long? We’re referring to the latest oil market panic, as prices for U.S. crude hit $100 a barrel yesterday (European crude hit $111) and gasoline nears $4 a gallon in parts of California. This oil trouble has been building for some time, and there’s much more at work here than turmoil in the Middle East. … It’s important to keep in mind, however, that oil was already trading in the $85 to $90 a barrel range before the recent irruption in the Arab world. The run-up to that price territory began in earnest last year after the Federal Reserve embarked on its QE2 strategy of further monetary easing. The Fed absolves itself of any responsibility for rising oil prices, attributing them to rising demand from a recovering global economy. Demand has been rising, but not enough to explain what has been a nearly across-the-board spike in prices for dollar-traded commodities. … The $100 oil plateau is also bringing out the usual suspects demanding that we end our ‘addiction to oil’—as if that were even remotely possible short of some great technological breakthrough. The last such political mania in the waning Bush years gave Congress an excuse to hand out more corporate energy subsidies, amid promises that cellulosic ethanol and wind would go to commercial scale in short order. We’re still waiting, as the ethanol fiasco at Range Fuels attests. Meanwhile, oil imports keep rising despite additional mandates for corn ethanol. While we await energy miracles, rising oil prices will act like a tax on American consumers. … This would seem to cry out for more domestic oil production, including an end to the Obama Administration’s de facto drilling moratorium. … But this conflicts with the President’s larger energy agenda, which is to deliberately increase prices on fossil fuels so alternative energy sources become more competitive. This is the strategy behind cap and tax, which the Administration is now trying to impose via regulation, as well as the limits on domestic oil and even natural gas drilling.”

‘Mideast Oil Shock Threatens U.S., Again’

February 25, 2011: From a USA Today editorial: “…In 1973, an embargo by Arab oil producers caused short supplies and long lines at U.S. gas stations. In 1979, it was the revolution in Iran. In 1990 and 1991, it was Saddam Hussein’s invasion of Kuwait and the Persian Gulf War. This time, it’s violent unrest in Libya— and the threat that it will spread elsewhere in the region — that has sent prices close to $100 a barrel, menacing the fragile economic recovery at home. … Once again, Americans are reminded how events thousands of miles away can affect their daily lives. Despite four decades of promises to free the U.S. from its dependence on volatile foreign oil, the nation remains frighteningly vulnerable to price spikes and sudden reductions in supply. … The U.S. doesn’t have nearly enough oil to feed its habit; domestic production has declined since 1970, and the country has long imported more than half its oil. … So the U.S. doesn’t have the luxury of picking a few energy strategies it likes and fencing off the rest. The nation needs a do-everything policy to bridge to a time when the choices are better. That means maximizing domestic oil supplies, by expanding exploration off the East Coast, in the Gulf of Mexico and in northern Alaska. … It means phasing in higher taxes on gasoline to help trim oil use, reduce the deficit and make cleaner energy sources more competitive. … It means taking advantage of enormous new supplies of natural gas and, if the economics work, relying on a new generation of nuclear power plants — the existing ones have proved they can deliver reliable, reasonably priced electricity. And it means adopting conservation and efficiency strategies, because the cheapest energy is energy that isn’t used. The nation could do all this, and more. The only question is how many more Middle East oil shocks it will have to endure before it acts.”

EPA Climate Regs, Budget Face Scrutiny in Hearings

February 28, 2011: E&E Daily reports: “… On Wednesday, Jackson will appear before the Senate Environment and Public Works Committee to discuss President Obama’s proposed 2012 budget with the lawmakers who have legislative oversight over EPA. The next day, she will make her way to the other side of the Capitol to discuss the same subject with the House Appropriations subcommittee that oversees environmental agencies. Also Thursday, a House subcommittee on water resources will review EPA’s budget request and its ‘impacts on jobs, liberty, and the economy.’ Jackson faces an uphill battle trying to convince lawmakers to fund EPA at the levels the administration has recommended. … The gap between the Republican-sponsored CR and the president’s proposal for 2012 suggests there will be tough fights ahead as appropriators craft EPA’s budget for the next full fiscal year. So far, Jackson has declined to comment on the Republicans’ plan, saying that her agency is already making serious efforts to cut back on its spending. … There are also major disagreements between the administration and Republicans about how the agency should use its funding, especially when it comes to the ever-divisive issue of climate change. Republicans likely will challenge the administration’s request to spend more money on enforcement and new pollution rules, especially EPA’s greenhouse gas regulations. … Republicans and some Democrats in the upper chamber may offer EPA-blocking language to spending measures on the floor or in committee. Sen. James Inhofe (R-Okla.), the ranking member of the Environment and Public Works Committee, said he is considering such an amendment.”

‘Re-energize the Economy’

February 28, 2011: From a New York Times op-ed by Bill Ritter Jr., former Democratic governor of Colorado and director of the Center for the New Energy Economy at Colorado State University: “Nearly every governor in America is wrestling with budget issues, making unenviable choices on which services, programs or salaries to reduce or eliminate, and deciding whether higher taxes and fees are viable. Most governors are hemmed in by state requirements that the budget be balanced without deficit spending. And I know how daunting — and all-consuming — the task can be. What I hope does not get lost in this effort is the governors’ responsibility to help develop a clean energy economy in America, one that will help create jobs, wean us off foreign oil and protect the environment. Building this new economy starts with understanding how clean energy legislation can create jobs. … As a result, Colorado now ranks fourth among the 50 states in its number of clean energy workers per capita, and 1,500 clean energy companies call our state home — an 18 percent increase since 2004. Wind- and solar-energy companies that have built factories and opened offices in Colorado have brought in thousands of new jobs. Governors should also be strong advocates for natural gas, the cleanest-burning fossil fuel, while still ensuring that drilling and production are environmentally sound. … But with new rules in place, we have proved that protection and production can coexist. Last year we capped our clean energy work with a bill that required shutting down several dirty, inefficient coal plants and replacing them with cleaner energy fuels, principally natural gas. President Obama’s goal to produce 80 percent of America’s energy from clean sources by 2035 is absolutely achievable. But as Washington ponders its next move on energy legislation, governors can and should lead the way.”

‘A Climate Change Activist Prepares for the Worst’

February 28, 2011: From a Washington Post op-ed by Mike Tidwell, executive director of the Chesapeake Climate Action Network: “…As a longtime environmental activist, I was deeply alarmed by new studies on global warming, so I went all out. I did my part. … I haven’t given up the cause. I still work overtime to promote clean energy, and I take solace when top climate scientists say we can still avoid the worst effects of global warming if we move quickly. It’s just that, well, we’re running out of time. The proof is everywhere – outside my front door, in my neighborhood, on the news. After a decade of failure to address climate change at the national and international levels, our weather has gone haywire. … This may seem like a stunt, or a sign that this frustrated environmentalist has finally lost it. But I’m not crazy. Just wait. The mega-storms and social disruptions on the horizon will be the best proof of that. … After all, the many climate effects we’re already seeing – massive wildfires, bigger hurricanes, astonishing Arctic ice melt – all result from just 1.2 degrees of planetary warming since 1900. Now scientists at the U.N. Intergovernmental Panel on Climate Change say the planet could warm another five degrees by the end of this century.”