March 2011 Climate Change Summary Report

Is Obama Mulling an EPA Rollback?

March 1, 2011: From an Investor’s Business Daily op-ed by Steve Milloy, publisher of JunkScience.com: “It looks as though President Obama may have decided that getting re-elected in 2012 is more important than saving the planet from the much-dreaded global warming. But then how does he break it to the people who helped elect him and whose support he will need in 2012? Political prognostication is always a chancy business, but a few new developments have occurred that seem to point to the president moving to rein in the Environmental Protection Agency’s nascent regulation of greenhouse-gas emissions. First, the left-wing British press reported Monday about how a government shutdown may force the EPA to delay its greenhouse-gas regulation by two years. … Later that afternoon, news broke that Ohio Sen. Sherrod Brown wrote the president, worrying about the EPA regulations killing jobs: ‘Without careful consideration, the unintended consequences of imprudent regulation could ultimately undermine our shared objectives of reducing (greenhouse gas) emissions and spurring economic growth. … Brown, however, isn’t the only one up for re-election in 2012. So is the president, and his political survival instincts may be asserting themselves once again over his job-killing, central-planning inclinations. A final relevant omen may be last week’s decision by the EPA to ease up dramatically on its regulation of industrial boilers. Though the president may be rethinking the EPA’s regulatory overreach on greenhouse gases, he needs moral support and rationale from his base to actually make the move. Claussen’s comments and Sen. Brown’s letter could be seen as much-needed and prominent political air cover. But if the president does actually throw out the two-year-delay bone, it should be thrown back. Such a move would be nothing more than a cynical ploy designed to help the president (as well as Sen. Brown) gain re-election.”

‘Soaring Oil Prices Become Popular Argument for Just About Anything’

March 1, 2011: Greenwire reported yesterday: “As the price of oil climbs over $100 a barrel, it’s fueling arguments for congressional action from groups with very different agendas. The corn ethanol industry and farm groups say it underscores why Congress shouldn’t block federal support for the biofuel. Wind’s trade group argues that switching to plug-in vehicles powered by turbines would improve fuel independence. Securing America’s Future Energy, a group of corporate executives and retired military personnel, seeks a slate of changes it believes will help shrink dependence on foreign petroleum. … For now, Congress appears to be paying attention. Rising gasoline prices likely will spur Congress to act on some form of an energy bill, Sen. Lisa Murkowski (R-Alaska) has said. Ranking member of the Senate Energy and Natural Resources Committee, Murkowski believes that more production is needed and that the Arctic National Wildlife Refuge’s coastal plain should be available for drilling. … As the issue flares up, Republicans are likely to argue that it is not just about supply and demand. ‘The opportunity to produce more of our resources here at home offers an opportunity to create jobs and raise federal revenue that can be used to pay down the national debt,’ Dillon said. Money raised through drilling leases and royalties and tax revenues can also be used to advance renewable power, he said. … Democrats are using the issue to make different points. Higher fuel prices should accelerate arguments for ending oil industry tax breaks, said Democratic Rep. Earl Blumenauer (D-Ore.). … The ethanol industry is flagging gasoline prices as it asks the Senate to void two amendments in the federal spending bill passed by the House on Feb. 19. … Analysts, however, discounted ethanol as an answer to high gas prices.”

‘This Is No Time to Discourage U.S. Oil and Gas Production’

March 1, 2011: From a Wall Street Journal op-ed by Robert Bryce, senior fellow at the Manhattan Institute: “Of all the times for the U.S. to be discouraging domestic production of oil and natural gas, right now might be the worst. Libya’s descent into chaos is fueling a rapid rise in oil prices, and unrest in other oil-producing countries in the Middle East and North Africa has led some analysts to predict unprecedented oil-price spikes may be looming. Nevertheless, President Barack Obama’s administration has not only stopped issuing permits for deep water drilling in the Gulf of Mexico, it also wants to stop ‘subsidizing yesterday’s energy’ so that the federal government can boost revenues and spend more on developing alternative energy sources. The president’s 2012 budget, released earlier this month, calls for eliminating a dozen tax incentives that benefit producers of coal, oil and natural gas. … Various studies—including one done in 2009 by Tudor, Pickering, Holt & Co., a Houston-based, energy-focused investment bank—predict that eliminating the deduction for intangible drilling costs could increase natural gas prices by 50 cents per thousand cubic feet. … Changing the tax rules could also slow the surprising resurgence of the U.S. oil industry. After decades of declining production, domestic drillers are increasing their oil output because they are tapping shale deposits with the same new techniques that have helped increase gas production. … But using biofuels to displace oil requires massive subsidies. … Using the CBO’s numbers, that means the total cost to taxpayers this year for the ethanol boondoggle will be about $16.2 billion. That’s compared to the $4.4 billion in foregone tax revenue for oil and gas tax rules. So annual ethanol subsidies are nearly four times as great as those provided for oil and gas, even though domestic drilling provides about 36 times as much energy to the U.S. economy. Per unit of energy produced, the tax preferences given to corn ethanol are 130 times as great as those given to oil and gas. If the president is truly serious about raising revenue, then he should eliminate all energy-related tax preferences and let all sources compete—fair field, no favor. Short of that, he should at least subject ethanol to the same treatment he’s giving to oil and gas.”

‘Uncertainty Drives Up Oil Prices’

March 2, 2011: The New York Times reports: “Just when oil markets appeared to be calming, crude oil prices surged again on Tuesday as the potential for more oil shipment disruptions spread across the Middle East and North Africa. With Libya’s oil exports almost entirely halted for the last several days, renewed unrest in Oman, Iran and Iraq rattled oil traders. An interruption of shipments from any of those countries would further tighten oil supplies, even as Saudi Arabia has rushed to fill the vacuum of Libyan supplies by pumping more oil from its fields. … Refiners around the world have been hoping that Iraq, as violence ebbed, would again become a major oil producer, with production stabilizing at 2.3 million barrels a day. But over the weekend rebels bombed the country’s largest refinery, reducing the refinery’s capacity to refine petroleum products by 75,000 barrels a day. … Saudi officials say they are ready to pump what it takes to fill any supply gap, but much of its 3.5 million barrel excess capacity contains sour crudes that do not easily replace the Libyan sweet crude European refineries in particular desire to produce diesel.”

‘Time to Get Serious About American Oil’

March 3, 2011: From a Wall Street Journal op-ed by Sean Parnell, governor of Alaska: “…The events in North Africa and the Middle East threaten to push the price of oil well above $100 a barrel—and make the importance of oil to America’s security clearer than ever. Over the past several decades, we have allowed ourselves to become dependent on oil from unstable regions that are hostile to our nation. … With gasoline prices surging, and manufacturing and transportation costs rising, the rising cost of goods will soon impact every American, putting our economic recovery at risk. … The time is now for our federal government to re-examine its current policy—which severely hampers domestic oil exploration and development—and to learn from our recent history. … Millions of American jobs are directly tied to our energy production. Even as the energy sector necessarily diversifies, oil will continue to be a key piece of our national energy profile for many decades.  And yet Alaska and the Gulf states have been blocked from developing America’s oil by politically driven federal policy, much of it aided by misinformation. If Americans wonder what our economic Achilles’ heel is, they need look no further than the federal regulatory system that delays permits for domestic exploration and production. … Alaskans have significant limits placed on us by the federal government, but we are hardly alone. In Wyoming, it takes years to get permits for oil-related development. …  Last year Gov. Bobby Jindal (R., La.) pleaded with the Obama administration to end the moratorium on deep-water drilling in the Gulf of Mexico, which affects 33 permitted exploratory wells. … Meanwhile, the EPA received a $3 billion increase in its budget last year. It produced 42 significant regulation packages in the first 18 months of the current administration, each costing our economy tens of millions of dollars. … By shutting down domestic production, the Department of Interior and the EPA are now essentially driving U.S. foreign policy in the Middle East. The State Department is relegated to a reactive role because we remain dependent on foreign oil. … We wonder why the Obama administration is openly hostile to a sector of our economy that has created hundreds of thousands of jobs, kept the country on an even keel even during the recession, and produces a global commodity we depend on every day.”

‘Republicans Float Sweeping Wish-List Energy Bill’

March 4, 2011: The Hill reports: “Dozens of House Republicans including a number of committee chairmen floated a sweeping energy bill that would open vast offshore areas to oil-and-gas drilling and require permitting of scores of new nuclear reactors over 30 years. The bill also opens up the Arctic National Wildlife Refuge (ANWR) to oil drilling, steers substantial federal revenues from ANWR and offshore development into a trust fund for renewable power projects, and blocks EPA climate-change rules. Rep. Devin Nunes’s (R-Calif.) bill has more than 50 co-sponsors, including House Budget Committee Chairman Paul Ryan (R-Wis.) and Mike Simpson (R-Idaho), who leads the Appropriations Committee panel that crafts EPA and Interior Department spending plans. … But the sweeping measure — which also aims to spur development of coal-based transportation fuels — appears to be more of a broad messaging effort than the final shape of GOP energy plans. House Energy and Commerce Committee Chairman Fred Upton (R-Mich.) and House Natural Resources Committee Chairman Doc Hastings (R-Wash.) have both said they hope to move a series of targeted energy bills rather than a single, sweeping measure. They have laid out their agendas in broad strokes but have yet to offer legislative specifics.”

 ‘We Need a Comprehensive Energy Plan’

March 4, 2011: From an op-ed in The Hill by U.S. Representative Phil Roe (R-Tenn.): “Unrest in the Middle East is causing gas prices to skyrocket, with oil prices surpassing $100 per barrel.  This price spike threatens any economic recovery in our own country and underscores our nation’s need for a common sense, comprehensive energy plan that moves us to sustained energy independence. … That means we need to look for new sources of oil wherever we can find it, including Alaska, the Outer Continental Shelf and from shale in the west.  With the need to create more jobs in our country, development in the former moratoria areas of the Outer Continental Shelf and other restricted areas in the Arctic National Wildlife Refuge and the Rockies would directly create 160,000 new jobs by 2030, according to ICF International. … Over the long run, I believe alternative energy sources, like wind, solar, geothermal, biomass, hydroelectric and agricultural products and technologies are part of the solution.  However, it’s important that we recognize that many of these technologies are, at best, years from being widely available and not yet commercially viable, which means that we will continue relying on more traditional energy sources for quite some time.  Any energy policy that simply ignores our existing energy sources is one that could cause great economic harm. … As part of a comprehensive energy policy, we also have to recognize that burdensome environmental regulations are often at odds with our goal of producing more energy.  No one I know wants to harm the environment, but new Environmental Protection Agency (EPA) rules and regulations are unnecessarily slowing development and having a negative effect on American jobs. … Instead of penalizing businesses, why not incentivize companies with tax credits to reduce their own emissions? …  Bringing down the cost of energy will not happen overnight, but is essential to consider ways we can all make our own use of energy more efficient.”

‘Fate of EPA Climate Rules Rests on Budget Battle’

March 7, 2011: The Hill reports: “The fate of the Environmental Protection Agency’s budget and a series of climate regulations will be at stake when the long-simmering fight over government spending comes to a head this week. A government spending bill passed by House Republicans last month would cut EPA’s budget by $3 billion and block funding for the agency’s pending climate rules through the end of September. An alternative from Senate Democrats would leave the EPA’s budget and its climate regulations intact. Test votes on both proposals are scheduled this week in the Senate. Neither bill is expected to pass, leading to negotiations that will determine the fate of the environmental riders in the House package. On Tuesday, the House Energy and Commerce Committee will hold a hearing on climate science. … Meanwhile, fights over President Obama’s proposed fiscal 2012 energy and environment budget will continue with a slew of hearings in the Senate and House. Interior Secretary Ken Salazar will testify before the House Appropriations Committee Tuesday and the Senate Appropriations Committee Wednesday. … EPA Administrator Lisa Jackson will testify on the agency’s budget at a joint subcommittee hearing in the House Energy panel Friday, giving Republicans another chance to grill Jackson on EPA’s pending climate regulations. Other committees will hold hearings on Obama’s fiscal 2012 budget as well. … Other events on Capitol Hill include a House Oversight and Government Reform Committee hearing Wednesday on the ‘cumulative impact of regulation on the government’; a Senate Energy and Natural Resources Committee hearing Thursday on legislation to make light bulbs more energy efficient; and a House Agriculture Committee hearing Thursday on the effect EPA regulations on farmers.”

“On Climate, Who Needs the Facts?”

March 7, 2011: From a New York Times editorial: “The IPCC is the leading international scientific body studying climate change. Despite criticism — much of it manufactured by climate-change deniers — the panel has for more than a decade provided rigorous and balanced information to policy makers to help guide their efforts to prevent and mitigate the potentially disastrous effects of global warming. Regrettably, politics trumps science among House Republicans, who recently voted to zero out this country’s extremely modest $2.3 million annual commitment to the IPCC. The bill also slashes spending on a half-dozen domestic programs that study the causes and effects of climate change. The budget for the Energy Information Agency — which gathers information on energy production, consumption and pollution — would be cut by one-sixth. … We have already pointed to devastating amendments to the budget resolution that, unless reversed by the Senate, will undermine the Environmental Protection Agency’s authority to regulate greenhouse gases. The bill would also make it impossible for President Obama to meet his promises to help poor countries save their rainforests and deploy clean energy technologies, also essential for addressing global warming. … But the worst of it was the House’s apparent belief that wishing away the evidence will eliminate the problem.”

‘When Energy Efficiency Sullies the Environment’

March 8, 2011: The New York Times reports: “…Energy-efficiency standards have been embraced by politicians of both parties as one of the easiest ways to combat global warming. Making appliances, cars, buildings and factories more efficient is called the ‘low-hanging fruit’ of strategies to cut greenhouse emissions. But a growing number of economists say that the environmental benefits of energy efficiency have been oversold. Paradoxically, there could even be more emissions as a result of some improvements in energy efficiency, these economists say. The problem is known as the energy rebound effect. While there’s no doubt that fuel-efficient cars burn less gasoline per mile, the lower cost at the pump tends to encourage extra driving. There’s also an indirect rebound effect as drivers use the money they save on gasoline to buy other things that produce greenhouse emissions, like new electronic gadgets or vacation trips on fuel-burning planes. Some of the biggest rebound effects occur when new economic activity results from energy-efficient technologies that reduce the cost of making products like steel or generating electricity. … That paradox was mostly ignored by modern environmentalists, who have argued that rebound effects are much smaller today.  But economists keep finding contrary evidence. … To economists worried about rebound effects, it makes more sense to look for new carbon-free sources of energy, or to impose a direct penalty for emissions, like a tax on energy generated from fossil fuels. Whereas people respond to more fuel-efficient cars by driving more and buying other products, they respond to a gasoline tax simply by driving less. A visible tax, of course, is not popular, which is one reason that politicians prefer to stress energy efficiency. … But if the benefits of energy efficiency have been oversold, then that’s more reason to consider alternatives like a carbon tax, and to look more carefully at the hidden costs and trade-offs involved in setting rigid standards for efficiency.”

 ‘Won’t Climate Change Help America?’

March 8, 2011: From a Washington Post column by Stephen Stromberg: “Ever heard this one: Even if the Earth’s climate changes, warmer temperatures will be good for America — longer growing seasons, perhaps? Or its cousin: Humans will simply do what they’ve done for millennia — adapt to changing temperatures with different technology and behaviors? Isn’t that better than letting that Al Gore do whatever it is that he wants to do? Actually, this is a treacherously seductive line of argument, and a report Tuesday on the Chesapeake Bay coastline from Washington’s local NPR station, WAMU, shows why. Virginia is experiencing the fastest sea-level rise on the East Coast because of rising ocean levels combined with sinking coastal land. … Humans have adapted to life in a pretty narrow and predictable band of temperatures. It’s foolish to dismiss the many and often obscure costs of adapting all this infrastructure we have built to different circumstances. Clearly, we will have to do some adaptation to temperature increases already on the way. And geoengineering — altering the planet to mitigate the effects of global warming — could make climate change more tolerable and give us time to green the economy. But the question is how to strike the balance between adaptation and prevention, not whether we should simply throw up our hands and insist that we’ll just get along like usual.”

Oil Service Firms Say Gulf Slowdown Will Last Years

March 9, 2011: The Houston Chronicle reports: “A slowdown in the pace of permitting offshore drilling and related work has idled dozens of rigs in the Gulf of Mexico, but the economic pain could be just beginning, service company executives said today. The leaders of companies that provide rigs, manufacture drilling equipment and install it offshore painted a bleak picture during a panel at IHS Cambridge Energy Research Associates’ CERAWeek conference. The current slowdown in work for drilling rigs will translate into dropped demand for subsea equipment and installation work months and even a year down the line, they said. … Other companies that have broader, international portfolios are less exposed to damage from a drop in Gulf work. … The outer continental shelf was a good market for years, but now is ‘a dead man’s zone,’ Johnson said. … With the decline in Gulf drilling, Wall Street’s energy — and capital — has shifted toward shale, he said. … All of the executives said that permit delays that are affecting rigs now will translate to industry-wide slowdowns. ‘Each of our companies have pretty varying business models, but what starts at the rig . . . will soon have a negative impact on the entire industry and the region and the country as a whole,’ said Jim Noe, a senior vice president for Hercules Offshore and the leader of an industry group lobbying for speedier permit processing. ‘We are just now experiencing the early phases of what we will be experiencing for years to come.’ … The executives said they are seeing a slowdown in the government’s issuance of permits for all sorts of work, including development permits to hook up pipelines. Even a big surge in drilling permits wouldn’t immediately mean a jump in demand, Dunbar said. … Johnson predicted that permitting will not rise to historic levels until October 2012, just a month before the presidential elections.”

‘Breakthrough in Biofuels? Maybe.’

March 9, 2011: From a Forbes blog post: “Scientists have pioneered a process for producing isobutanol directly from cellulose, according to research published in the online journal Applied and Environmental Microbiology. ‘Unlike ethanol, isobutanol can be blended at any ratio with gasoline and should eliminate the need for dedicated infrastructure in tanks or vehicles,’ said James Liao, professor of Chemical and Biomolecular Engineering at the UCLA Henry Samueli School of Engineering and Applied Science. … The process uses a microbe from decayed grass that has long been used to improve ethanol production. Isobutanol is a better substitute for gasoline than ethanol. As a ‘drop-in fuel,’ isobutanol can be used as a direct substitute for gasoline, which would avoid complications with using ethanol in older engines and infrastructure. That’s because isobutanol has an energy density, octane value and vapor pressure that are much closer to gasoline than ethanol. … Liao claims that it would take less land to produce more fuel under his protein-driven model. He estimates it would take 1.9 percent of all U.S. agricultural land to produce about one-third of the gasoline needed in the United States.”

‘Republicans, Administration Spar over Obama’s Energy Policies’

March 10, 2011: National Journal reports: “Republicans are taking a page from the Rahm Emanuel playbook: Never let a serious crisis go to waste. As gas prices rise, the GOP is also ramping up criticism of President Obama’s energy policy. ‘Isn’t it a little foolish to have our economy held hostage by events in Libya, North Africa generally, or the Persian Gulf area?’ Sen. Chuck Grassley, R-Iowa, asked on the Senate floor earlier this week. And Sen. David Vitter, R-La., attributed to rise in prices to the President’s opposition to domestic oil drilling. … Last week, in a speech to the U.S. Chamber of Commerce, Mississippi Gov. Haley Barbour accused the administration of deliberately trying to drive up the cost of energy. ‘This administration’s policies have been designed to drive up the cost of energy in the name of reducing pollution, in the name of making very expensive alternative fuels more economically competitive,’ Barbour said. The administration pushed back against the criticism this morning with a blog post by Heather Zichal, Deputy Assistant to the President for Energy and Climate Change. … The post also defended the safety standards the administration put in place after the BP oil spill and noted that since regulation was increased, the administration had granted 35 new shallow water drilling permits and issued the first deepwater permit last week.”

‘Gas Prices Change Senate Energy Politics’

March 11, 2010: Politico reports: “Democratic leaders insist that voters won’t punish their party for high gas prices — but the pain at the pump could make it even harder for them to pass the president’s energy agenda. Republicans have shown no fear in tying the oil price spikes to anything on the Democratic energy agenda, from President Barack Obama’s stance on offshore drilling permits to long dead cap-and-trade legislation and pending climate change rules for power plants. … Floor debates are expected over halting EPA’s climate regulations, offshore drilling and maybe even opening up Alaska’s Arctic National Wildlife Refuge to oil and gas development. All are within a hair of going the Republicans’ way, and several rank-and-file Democrats up for reelection hold crucial votes that Obama and Senate Majority Leader Harry Reid are counting on. … These votes could be especially difficult for in-cycle Democrats including Sherrod Brown of Ohio, Debbie Stabenow of Michigan, Amy Klobuchar of Minnesota, Bob Casey of Pennsylvania, Joe Manchin of West Virginia, Jon Tester of Montana and Claire McCaskill of Missouri. Signals from the Senate Democrats so far are mixed. They say they are not deterred by the Republican attacks and will keep making the pitch for petroleum alternatives, including electric vehicles and renewable fuels. If anything, they hope to pin the GOP with a familiar label as the party of Big Oil. But it can’t be forgotten that Manchin hit pay dirt during his 2010 campaign when he aired a commercial where he fired a bullet through the House cap-and-trade bill. … And Brown, typically a strong ally to green groups, raised eyebrows last month when he sent Obama a letter requesting the president go easy with EPA climate regulations aimed at trade-sensitive manufacturers that call Ohio home. … However circumspect the connections, politicians on both sides of the aisle are sure to latch on to gas prices for campaign traction.”

Jackson: House EPA Bill Would Force Consumers to Waste Oil

March 14, 2011: Greenwire reported Friday: “Though top House Republicans have argued that U.S. EPA’s climate rules will slam consumers by raising the cost of gasoline, a bill to reject the agency’s greenhouse gas regulations would backfire by causing Americans to waste hundreds of millions of barrels of oil, U.S. EPA Administrator Lisa Jackson said today. She made the comments in testimony before members of the House Energy and Commerce Committee, one day after the bill (H.R. 910) cleared the Energy and Power Subcommittee. … House Energy and Commerce Chairman Fred Upton (R-Mich.) and his colleagues have tried to tie the bill to high gas prices, which are flirting with $4 per gallon and are expected to go even higher as summer driving season approaches. They say the new limits on greenhouse gas emissions from power plants, refineries and other large industrial plants will cause a spike in energy prices, but Jackson said today that people would need to spend more money on gas if EPA is not allowed to set new fuel efficiency standards for cars and trucks. … ‘It would do so by blocking EPA’s common-sense steps under the Clean Air Act on vehicle standards, because that bill — although it recognizes past standards — undoes the endangerment finding on which those standards are based, and then takes EPA out of the process for years 2016 and beyond.’ During debate on the bill, Republicans cited a 2009 statement by Jackson in which she said Clean Air Act limits on greenhouse gases would cost more than a cap-and-trade bill setting an overall limit on carbon emissions. … Republicans slammed Jackson on her comments today, pointing to the bill’s exemption for tailpipe emissions rules through 2016. But it would bar the agency from setting future limits on the amount of carbon dioxide that cars and trucks can release for every mile traveled. The measure would not affect the Department of Transportation’s ability to set corporate average fuel economy standards for future years, but advocates for the standards say they would likely be less stringent than EPA’s tailpipe standards because DOT looks at different criteria when it sets them.”

5 Ways to Open the U.S. Oil Spigot’

March 14, 2011: From a USA Today op-ed by U.S. Senator Lisa Murkowski (R-AK): “It’s become nearly impossible to turn on the news or pick up a newspaper without seeing a story about rising oil prices. … At a time when we import more than 60% of our oil supply, the costs and consequences of such high prices pose genuine threats to our economy and security. Regrettably, this emerging crisis is at least partially of our own making. Despite tremendous oil reserves — offshore, in Alaska and in the Rocky Mountain West — many of our lands have been locked up, and many of our most promising opportunities have been put out of reach. …  This is a clear failure of government. … For the sake of our national security, our economy and the world’s environment, that has to change. America must produce as much of the oil that it uses as possible. It’s this balance, in concert with the resulting revenues and benefits to our manufacturing and transportation industries, that will allow us to truly take control of our energy future. There’s very little we can do to immediately reduce fuel prices. But there are concrete steps that we can take today to ensure we don’t face even worse problems in the future. Here are five: •Look north to Alaska. My home state has incredible oil reserves waiting to be tapped for the good of the nation. … •End the ‘permitorium’ and bring back production in the Gulf of Mexico. … •Cut the red tape. The president has ordered his agencies to review regulations to ensure they are cost-effective and not unduly damaging economic growth and job creation, and the Interior Department clearly has its work cut out. … •Our nation must focus on a true ‘all of the above’ policy. … •We need to shelve the bad ideas. With oil prices on the rise, many seem to have forgotten that the oil industry provides Americans with energy and jobs. Higher taxes and permitting issues deprive companies of a stable operating environment, which in turn reduces their willingness to invest in America. The oil industry, like any industry, deserves to be treated fairly.”

Lieberman: EPA Bills a Sign of Politics to Come

March 15, 2011: ClimateWire reports: “President Obama’s climate change agenda will move front and center during the 2012 election cycle if Republicans in Congress can’t stop U.S. EPA from regulating greenhouse gas emissions, Sen. Joseph Lieberman said yesterday. ‘To me, that’s the most significant battle that we’re going to fight in this session of Congress,’ said Lieberman (I-Conn.), referring to GOP-sponsored bills barring EPA from regulating under the Clean Air Act industrial emissions tied to global warming. ‘Trust me, people who don’t want anything to happen will be pouring an enormous amount of money and effort into overturning EPA regulations,’ said Lieberman, a former Democratic vice presidential candidate. ‘If they don’t succeed, this will be a big issue in the 2012 presidential campaign.’ Speaking in Washington at a conference sponsored by the International Emissions Trading Association, Lieberman reiterated support for legislation to impose a national cap on carbon dioxide emissions and create a trading program for pollution permits. … The economy has to improve, he told the audience of financial-sector proponents of a U.S. cap-and-trade system, but there are opportunities to engage the public. ‘We will succeed when the costs of inaction become as clear to the American people as our opponents say the costs of action are.’”

‘House Panel Advances Bill to Limit Greenhouse Gas Restrictions’

March 16, 2011: The Los Angeles Times reports: “A House committee on Tuesday advanced a bill that would block the Environmental Protection Agency from regulating greenhouse gases, boosting a top Republican priority and taking aim at the Obama administration and states like California that favor tougher regulations. The bill was approved by the House Energy and Commerce Committee in a largely party-line vote. Republicans argued that action by the EPA, coming after Congress failed to pass a global warming bill, would impose burdensome and unnecessary rules on industry. Democrats cast the measure as a skirmish in an ongoing GOP war on the science of global warming. The bill is unlikely to win significant support in the Senate, where Democrats hold the majority. … Amending the Clean Air Act to thwart that effort has become a leading goal for the oil, gas and power industries and their allies in Congress. The issue also has been embraced by small-government conservatives of the ‘tea party’ movement, who characterize the EPA’s move as government overreach. But as gas prices began to rise in response to unrest in the Middle East, Republicans shifted their focus to the potential effect on energy costs. EPA regulations would probably have a significant effect on oil refineries — one of the largest stationary sources of greenhouse gas emissions. Those refineries would pass additional costs on to consumers, Republicans said. … California officials are watching the bill closely. A section of the legislation prevents the EPA from issuing a waiver that allows the state to enact vehicle emissions standards that are tougher than federal rules. Without such a waiver, the state would be forced to accept the lower standards on vehicles with model years 2017 or later, according to a Democratic analysis of the bill. … As the House committee voted Tuesday, Democrats in the Senate criticized a similar amendment introduced by Senate Republican leader Mitch McConnell of Kentucky.”

Labor-Enviro Group Voices Strong Support of EPA GHG Rules

March 17, 2011: Inside EPA reports:  “On the eve of a major Senate vote on EPA climate rules, a major union-environmental coalition is for the first time strongly opposing a legislative proposal to eliminate EPA’s authority to regulate greenhouse gas (GHG) emissions, a significant advance for the coalition that previously sidestepped the issue of whether to support the climate rules. EPA supporters are now hoping to carry momentum from the BlueGreen Alliance’s (BGA) defense of the GHG rules to a broader stance across the entire labor movement for opposing Republican efforts to strip EPA of its authority. Labor’s support for the GHG rules could be a key factor in which moderate Democrats in the House and Senate vote for or against proposals to either entirely block EPA’s GHG regulatory authority or to temporarily delay climate rules for two years. But even with the emerging labor support for the agency’s climate rules, some union groups are criticizing the agency’s non-GHG Clean Air Act rules including air toxics limits for cement facilities and power plants. BGA, which includes 10 labor unions and four environmental organizations, released a March 15 statement unequivocally supporting EPA’s GHG regulations and opposing legislation that would block or delay them. … The coalition believes EPA’s rules will provide a boost to the economy and is coming out in defense of them to correct ‘misinformation’ about their potential impacts on jobs, the source says. … One labor source who is not affiliated with BGA suggested that labor groups’ defense of the agency’s climate rules could spread beyond just those union organizations that are members of the BGA. During a weekly meeting March 14, union officials discussed the Inhofe-Upton bill, slated for a House floor vote in the coming weeks. ‘There’s not a single labor union that came out to support what the Republicans did, and there won’t be,’ the source says. Still, some unions outside of BGA might not oppose the Rockefeller measure, but it is unlikely any will mount an aggressive effort to back that legislation, the source says.”

Senate Approves EPA Cuts

March 18, 2011: Inside EPA reports: “The Senate March 17 passed a three-week continuing resolution (CR) for fiscal year 2011, a bill that cuts approximately $237.4 million from EPA’s $10.3 billion budget but does not include controversial policy riders preventing implementation of numerous climate, air, water and waste policies. Passage of the stopgap spending bill, which President Obama is expected to quickly sign in time to avoid a government shutdown, keeps the government running through April 8 while negotiations continue over spending levels for the remainder of FY11, which ends Sept. 30. … But EPA’s budget could see further cuts as lawmakers continue to negotiate on spending levels for the remainder of the year. Senate Environment & Public Works Committee Chairwoman Barbara Boxer told Inside EPA last week that she would be willing to see the agency’s budget fall to $9 billion, the level the Obama administration has requested in its FY12 budget request. In the stopgap bill, the cuts to EPA’s budget are focused most heavily on the state and tribal assistance grant (STAG) program, which is reduced by $192 million to about $4.78 billion compared to $4.97 billion in FY10. … The stopgap CR also eliminates $10 million from a diesel engine retrofit and replacement program that was not funded in Obama’s FY12 budget request, and eliminates $8 million dedicated to the Hunter’s Point Naval Shipyard cleanup that also was not included in the president’s budget request. Other cuts included in the three-week CR are: a $5.7 million cut in EPA’s science & technology account, bringing it to $840 million, from $846 million in FY10; a $30.5 million cut from the programs & management account, bringing it to $2.96 billion from $2.99 billion; and a $500,000 cut from EPA’s buildings & facilities fund, bringing it from $37 million to $36.5 million. The bill also eliminates $5 million in funding included in the FY10 budget to assist Congress in developing a cap-and-trade program, according to a committee summary.”

‘Energy Policy Reset: Forget Nuclear Reactors and Mideast Oil’

March 18, 2011: From a Politico op-ed by Joel Kotkin, presidential fellow at Chapman University: “The two largest crises today — the Japanese nuclear disaster and the widening unrest in the Middle East — prove it’s time to de-fetishize energy policy. These serious problems also demonstrate why we must expand the nation’s ample oil and gas supplies — urgently. … The other shoe dropping relates to the growing chaos in the Middle East, from North Africa to the Gulf. The price of oil is likely to continue climbing, unless the world economy slides back into recession — and perhaps even then. The governments that emerge from the current Mideast upheavals are likely to be far less pliable to Western interests than the authoritarian potentates that Washington long supported. Disruptions in supply, higher energy taxes and emergent environmental movements could constrain markets for months, even years, to come. … Green advocates often overestimated the readiness of renewable fuels — still far more expensive than fossil fuels and highly dependent on subsidies. … The pragmatic way out of this emerging energy mess means focusing on our increasingly abundant supplies of oil and gas. ‘Peak oil’ enthusiasts may not have noticed, but recent discoveries and improvements in technology have greatly expanded the scope of U.S. energy resources. New finds are occurring around the world, but some of the biggest are in the United States. … Shale oil deposits in the northern Great Plains, Texas, California and Colorado could yield more oil annually by 2015 than the Gulf of Mexico. Within 10 years, these finds have the potential to reduce U.S. oil imports by more than half. Even more promising, from the environmental standpoint, are huge natural gas finds. … Producing domestic energy also creates the potential for hundreds of thousands of new U.S. jobs — everything from engineering to high-paying blue-collar work in the fields. A new gas-led energy boom would also spark increases in demand for manufactured goods like oil rig equipment, tractors, pipelines and refineries. And those are sectors that the United States still dominates.”

Crises in Japan, Gulf Thwart US Energy Policy

March 21, 2011: AP reports: “On the road to a national energy policy, President Barack Obama is hitting pothole after pothole. … Making matters worse for Obama, a spike in U.S. gasoline prices is angering Americans just as his re-election campaign cranks up. Experts say gas price fluctuations have almost nothing to do with the tragedy in Japan or the Gulf oil spill. But that hasn’t stopped Republicans from lumping various issues together and using them to club Obama. … Senate Republican leader Mitch McConnell delivered a speech this week highly critical of Obama and congressional Democrats. … With Japan’s nuclear crisis still unfolding, Libya in civil war, and Americans stewing over gasoline prices, U.S. energy policy is bound to be unstable for a while. … Aside from the human tragedies in Japan and the Gulf oil spill, Grumet said, those events also damaged hopes for a bipartisan U.S. energy policy that might have combined increased production of oil and gas with aggressive efforts to promote efficiency and renewable energy sources, such as wind and solar energy. … For now, Republicans seem to have an easier time. Their nuclear stance is similar to Obama’s, and they are using the gasoline price hikes to renew their call for expanded oil and natural gas production on U.S. lands and coastal waters. Palin supporters still chant ‘drill, baby, drill’ at some of her events. But McKenna, who strongly supports increased production, said Republicans have missed great opportunities to lead the energy debate by failing to detail the possibilities of enhanced domestic drilling and the shortcomings of alternatives such as wind and solar energy.”

‘Schumer’s Nouveau “Speculators”’

March 22, 2011From a Wall Street Journal column by Kimberley Strassel: “The Senate Democratic ‘message shop’ these days is being headed up by Chuck Schumer, though it would seem the New Yorker isn’t breaking much ground with his advice to his colleagues on how to address rising gas prices. Mr. Schumer’s suggestion? Pretend it is 2008. At his party’s weekly policy lunch, Mr. Schumer told his colleagues to use next week’s Senate recess to get in front of the gas issue, by once again blaming rising prices on ‘speculators’ and oil companies. New Jersey Sen. Bob Menendez stepped up to help make the point, introducing a bill this week which he is calling ‘Use It or Lose It.’ … The Democratic scramble to come up with convenient bogeymen for higher gas prices comes in the wake of growing criticism of the Obama administration’s de facto drilling moratorium in the Gulf. Rising oil prices are the result of lots of factors—including inflation and upheaval in Libya and elsewhere—though many Americans also see a connection with the White House’s general hostility to fossil fuels. And President Obama’s State of the Union proposal to further load taxes on oil companies, which would also raise prices, is now hanging over the White House. Even former President Bill Clinton recently pronounced the lack of new drilling permits in the Gulf ‘ridiculous,’ given the fragile state of the economy. There was never a shred of evidence that ‘speculators’ drove up oil prices in 2008, though Democrats certainly kept the accusation in the news. … Count on House Republicans, too, to be running hearings that seek to make a connection between rising prices and the Obama record, as well as to set the record straight on ‘speculation.’ It’s not 2008.”

‘EU Goal of Global Carbon Market “Stalled by US Failure”’

March 23, 2011: Platts reports: “EU hopes of establishing a global emissions trading system have been dashed because of a lack of progress in the US, Jos Delbeke, director general of the Climate Action division of the European Commission, said Tuesday. … Contrary to an EC ‘vision’ to establish a EU-led global carbon market by 2015, development has been ‘fragmented’ at best, with slower than expected developments in some key nations such as Australia and India, said experts at the briefing. … ‘Instead we’ll have to support a lot of bottom-up approaches like the development of the energy efficiency trading system in India,’ he said. … A bilateral development has been the ‘political choice’ of other nations but this approach, while allowing time for other markets to develop at their own pace, will lead to a fragmentation of the market with no common-based system, Hession said. … Some developing industrial majors such as China are showing progress on cap and trade which the EC is keen to capitalize on. … As part of a drive to push the EU system to Asia, talks are already planned with Korean counterparts. … ‘There is a lot going on in the world [in terms of carbon market developments]: Korea is planning to develop a cap-and-trade system over the next few years, India is set to go live with its energy efficiency trading system in a month and Australia is also determined to introduce a carbon price,’ he told Platts at the briefing sidelines. The EC has also been negotiating with Switzerland since March 7 over a link-up to the ETS, expected by 2013, said Meadows. … And Portugal’s Barata said the lack of progress in the US could be holding back China.”

‘Chu: Wind, Solar Close to Competing with Fossil Fuels Without Aid’

March 24, 2011: The Hill reports: “Energy Secretary Steven Chu said Wednesday that green energy isn’t far away from besting fossil fuels without subsidies. ‘Before, maybe, the end of this decade, I see wind and solar being cost competitive without subsidy, being competitive with new fossil fuel,’ he said at the Pew Charitable Trusts. ‘You can debate whether it is going to be before the end of this decade or mid-way into the next decade, but it is not going to be three decades,’ Chu said. … Chu, like Granholm, said the U.S. must seize the lead in development of technologies around renewable electricity, advanced batteries for electric cars and other green sectors. ‘The country and the companies who develop those renewable energy resources that become cost-competitive without any subsidies all of a sudden has a world market, and boy, we can’t lose that world market. That’s many trillions per year, and it is within reach,’ Chu said.”

‘Jobs from Real Energy — Not “Green” Projects’

March 24, 2011: From a San Antonio Express-News op-ed by Robert L. Bradley Jr., CEO & founder of the Institute for Energy Research: “Despite record federal deficits, the Obama administration is pouring millions of taxpayer dollars into ‘green’ jobs initiatives. … Policymakers at all levels of government should pause. Washington should rescind such grants and the recipients should return the booty — these jobs are ‘bubble’ jobs, and as such, they’re bad jobs. … Simply put, staking job creation on industries that depend on government favor for survival is not a long-term solution to our economic troubles. To be sustainable, jobs — and the industries that create them — need to be based on actual consumer demand. Green jobs are created not by the market, but by subsidies and by mandate. Currently, oil and natural gas supply 63 percent of our total energy needs, while renewables — wind, solar, hydropower, and ethanol — supply less than 10 percent. As a study by University of Illinois researchers bluntly puts it: ‘Turning off the electricity generated from coal and other non-renewable sources…would mean that most Americans would literally freeze in the dark.’ … The Obama administration’s answer is to hobble the more competitive industries with huge new tax burdens. The 2012 budget has $90 billion in tax increases on the oil and natural gas industry. Consumers will pay those taxes. Consumers will also be paying higher energy prices as renewables drive up costs. The net drain on the economy will no doubt hurt job growth in other sectors, meaning that green job spending could end up a wash or worse. … If the administration wants to get serious about job creation, it should look to industries that don’t need taxpayer money to stay afloat. Moreover, by promoting affordable energy supplies, it could bring down costs in all sectors of the economy — enabling the private sector to create real and sustainable jobs.”

‘Dems Hope to Derail GOP’s Climate Proposal’

March 28, 2011: Politico reports: “Senate Democrats hope to siphon votes from a GOP bid to hamstring EPA climate rules by voting first on a Democratic alternative. Top Democrats plan to hold a vote next week on an amendment from Finance Committee Chairman Max Baucus before allowing a vote on a more sweeping climate amendment from Minority Leader Mitch McConnell, a senior Democratic leadership aide told POLITICO on Thursday. Baucus’s amendment — which aims to exempt agriculture and small industrial facilities from climate rules — would allow moderate Democrats to support limits on EPA regulations without backing the Republican effort to upend the Obama administration’s climate policies. … The Senate is also likely to vote next week on a third climate amendment, from Sen. Jay Rockefeller (D-W.Va.), to impose a two-year delay on EPA climate rules for industrial facilities, the leadership aide said. Leadership hasn’t yet decided whether the McConnell or Rockefeller vote would come first following the Baucus amendment, the aide said. … Farm-state Democrats and those in manufacturing-heavy states — especially those facing reelection in 2012 — might look for political cover by supporting the Baucus proposal. Possible ‘yes’ votes include Sens. Sherrod Brown of Ohio, Bob Casey of Pennsylvania, Jon Tester of Montana, Debbie Stabenow and Carl Levin of Michigan, Kent Conrad of North Dakota, Tim Johnson of South Dakota, Claire McCaskill of Missouri and Amy Klobuchar of Minnesota. But beyond a few Democrats who want to get on the record endorsing a bid to rein in the EPA, the Baucus amendment isn’t expected to get much love in the Senate. Most Democrats are expected to reject a bid to handcuff White House climate policies, and the Republican caucus is likely to unanimously reject the Democrat-led effort.”

‘Climate Votes Promise to Echo on Stump’

March 29, 2011: The Hill reports: “The Senate is heading for votes this week on Environmental Protection Agency rules regarding climate change that are certain to reverberate on the campaign trail in 2012. The chamber could vote on as many as three climate-related amendments to small-business legislation: a GOP plan that strips EPA’s power to regulate greenhouse gases and a pair of Democratic amendments to delay the rules or limit their reach. The GOP plan is highly unlikely to gain the 60 votes needed for passage. But it could nonetheless pay off for Republicans and industry groups by forcing vulnerable Democrats into a tricky spot. … Sen. Patty Murray (D-Wash.), a member of the Democratic leadership team, emerged from a meeting in Majority Leader Harry Reid’s (D-Nev.) office Monday with word that discussions on the small business bill are ongoing. … Dave Levinthal, a spokesman for the Center for Responsive Politics, predicted the votes will result in outside political spending by advocacy groups. … Sen. John Cornyn (R-Texas), the head of the National Republican Senatorial Committee, told The Hill he believes that vulnerable Democrats will pay for it in the 2012 elections if they do not support the GOP plan to strip EPA’s authority. … Tester is one of several in-cycle Democrats — largely from conservative or manufacturing-heavy states — facing difficult votes on climate change, along with senators such as Claire McCaskill (D-Mo.), Ben Nelson (D-Neb.) and Debbie Stabenow (D-Mich.).  But some Republicans face tough votes, too. Sen. Scott Brown (R-Mass.) — who shirked questions about the climate measures before last week’s recess — faces reelection in typically blue Massachusetts, while centrist Republican Olympia Snowe (Maine) faces a Tea Party primary battle from the right.”

‘Obama to Speak on Energy Policy’

March 30, 2010: The Wall Street Journal reports: “President Barack Obama, under pressure to respond to rising gas prices, will outline Wednesday a series of initiatives to cut the nation’s reliance on foreign oil, including new initiatives to expand oil production, increase the use of natural gas to power vehicles and increase production of ethanol. Mr. Obama’s latest attempt to take the initiative on energy policy comes as Republicans in Congress are stepping up criticism of the administration for not allowing more oil and gas drilling in the United States. On Tuesday, House Republicans said they would introduce legislation requiring the administration to sell more offshore leases and to issue drilling permits within a set time frame. The political heat over energy policy is rising in tandem with the price of gasoline and diesel fuels at filling stations, in a ritual that has become familiar in Washington since the oil price shocks of the mid-1970s. … The White House will cast the new effort, a combination of new ideas and previously announced initiatives, as an effort to deal with the nation’s long-term energy challenge, not just the high gas prices of the moment. Mr. Obama will put forward an overall goal of reducing oil imports by one third over a decade, with half the reduction from decreasing consumption and half from increasing domestic supply, according to two people briefed by the White House. … The administration on Tuesday sought to focus attention on oil companies, releasing a report from the Interior Department that said more than two-thirds of the offshore oil leases in the Gulf of Mexico and more than half of onshore leases on federal land are not in use.  …  As part of its effort to reduce oil demand, the administration plans to propose that the nation break ground on four new bio-fuel refineries to produce ethanol in the next two years, according to two people briefed on the plan. It’s not clear what incentives or financing the administration will propose for the bio-fuel initiative. The administration is also expected to back new subsidies for governments or companies to purchase vehicles that run on natural gas for their fleets, they said. The administration has previously said it would continue ratcheting up fuel efficiency standards for cars and establish standards for heavy trucks. Mr. Obama is expected to reiterate a proposal contained in his State of the Union address that the U.S. adopt a clean energy standard that would require that 80% of electricity be generated from clean energy sources by 2035.”

‘The Green Energy Economy Reconsidered’

March 31, 2011: From a Forbes op-ed by Jerry Taylor and Peter Van Doren, senior fellows at the Cato Institute: “‘Green’ energy such as wind, solar and biomass presently constitute only 3.6% of fuel used to generate electricity in the U.S. But if another ‘I Have a Dream’ speech were given at the base of the Lincoln Memorial, it would undoubtedly urge us on to a promised land where renewable energy completely replaced fossil fuels and nuclear power. How much will this particular dream cost? Energy expert Vaclav Smil calculates that achieving that goal in a decade–former Vice President Al Gore’s proposal–would incur building costs and write-downs on the order of $4 trillion. Taking a bit more time to reach this promised land would help reduce that price tag a bit, but simply building the requisite generators would cost $2.5 trillion alone. … Have we ever seen such a ‘green economy’? Yes we have; in the 13th century. Renewable energy is quite literally the energy of yesterday. Few seem to realize that we abandoned ‘green’ energy centuries ago for five very good reasons. First, green energy is diffuse, and it takes a tremendous amount of land and material to harness even a little bit of energy. … Second, it is extremely costly. … Third, it is unreliable. … But in a world where fossil fuels are a thing of the past, we would be forced–like the peasants of the Dark Age–to rely upon the vagaries of the weather. Fourth, it is scarce. … Fossil fuels are everything that green energy is not. … The fundamental question that green energy proponents must answer is this: if green energy is so inevitable and such a great investment, why do we need to subsidize it?”

‘American Ethanol: Lowering Gas Prices, Creating U.S. Jobs’

March 31, 2011: From an op-ed in The Hill by Jeff Broin, Chief Executive Officer of POET and Chairman of Growth Energy: “The price of gasoline is edging up – again – with ongoing political unrest in the Middle East, and some have speculated about $5 per gallon gasoline this year. In response to rising prices, the U.S. Senate Agriculture Committee wisely held a hearing to determine what innovative farming can do to help. … The National Renewable Energy Lab and McKinsey & Company recently summarized those studies, concluding that ethanol keeps U.S. retail gasoline prices about 17 cents per gallon lower (possibly as high as 50 cents per gallon). That translates into an annual savings of $115 per driver and approximately $24 billion in annual savings for drivers as a whole. … The most important thing we can do is follow through on the promise of the RFS. … We need a new policy – one that forces gasoline to compete at the pump. … If we are to create that competition at the pump, we must remove the artificial barriers that prevent motorists from having an alternative to foreign oil and block ethanol from accessing the market.  What the op-ed did not mention, however, is that the ethanol industry is the beneficiary of a U.S. tax credit that is currently at 51 cents per gallon (further import tariffs exist on foreign ethanol, plus mandates exist for its use).  Therefore, this comparison indicates that ethanol does not appear to have a net economic benefit.