Obama Vows To Go Where No Man Has Gone Before: Passing and Signing Climate and Energy Legislation

Obama vows clean energy, climate action

Given the emotional reserve of a man whose aides once referred to as “no drama Obama,” the president is getting pretty fired up about energy.  On Wednesday President Obama concluded an all hands cabinet meeting at the White House by publicly declaring again his resolve to develop a “new energy strategy that the American people desperately want.”

“It is time for us to move to a clean energy future,” the president said, adding that “the entire cabinet here recognizes, with all the other stuff that they’re doing, that if we get energy right, an awful lot of things can happen as a consequence.”

The unscripted outburst came eight days after the president delivered a formal Oval Office summons for a “national mission” to pursue cleaner sources of energy and new practices that limited carbon emissions.  The president’s “national mission” speech, in turn, followed five days after he alerted a bipartisan group of lawmakers and prominent business leaders that he wanted to “move much more aggressively on the energy agenda,”and three weeks after Obama told an audience in Pittsburgh that “the time has come, once and for all, for this nation to fully embrace a clean energy future.”

Not since President Jimmy Carter delivered his famous and perceptive April 1977 address, during which he asserted that solving the energy crisis was the “moral equivalent of war,” has an American leader staked so much political credibility on a new national energy policy. And as energy historians are quick to note, none of President Obama’s successors, starting with President Nixon, achieved anything close to the alternative energy goals they pursued.

Will It Work Now?
The obvious question is whether economic, environmental, and social conditions are sufficiently different today than they were in any of the last four decades, and whether the country is experiencing enough urgency to seriously reckon with how it produces and uses energy.

There are no ready responses. The president’s critics in the energy industry and the Republican party have expressed hostility to Obama’s call to action and have promised an aggressive counterattack. Some allies in the president’s party and the national media wonder if the White House and the nation have sufficient fortitude to accomplish such a significant adjustment in the country’s economic and environmental vector.

For his part, the president has vowed to “find the necessary votes” to pass a strong bill. And environmental advocates who’ve worked for decades to make the case for clean energy and climate action are pressing the Senate and White House to make sure the bill is comprehensive and includes credible measures to reduce emissions of greenhouse gases.

In a capital city devoted to process as much as to politics, the gears of legislative action are grinding to life. The summer of 2010 is shaping up to be a new season for clean energy and climate action, a season that until April 20 was not at all clear would occur at all.

BP Disaster’s Legacy?
That day, of course, the Deepwater Horizon exploded in the Gulf of Mexico, killing 11 men. The blowout turned loose over 100 million gallons of raw crude with no end in sight.

President Obama understands the spill has pitched the country toward a new reckoning with its devotion to oil.  That involves carefully evaluating the deadening costs of a marine ecosystem deluged by oil, and the recklessness of heating the atmosphere with uncontrolled carbon. It also requires coming to grips with an economy distorted by the $400 billion-a-year price for imports that threaten U.S. security, as well as the essential values of choice and mobility that fewer and fewer Americans attain.

It’s for these reasons that President Obama is embracing the moment, and he’s apparently convinced Senate Majority Leader Harry Reid to join him in what both hope will be a steady push to pass comprehensive legislation in the Senate before the August recess. A year ago, the House passed its version of an energy and climate bill that awaits a Congressional conference committee.

The Senate isn’t starting from scratch. Senator Reid and the president have asked lawmakers to choose elements of three proposals, draw up new provisions to respond to the disaster in the Gulf, and introduce a new bill in mid-July. The three existing Senate proposals:

  • In December 2009 Senators Maria Cantwell, a Democrat of Washington, and Susan Collins, a Republican of Maine, introduced the Carbon Limits and Energy for American Renewal (CLEAR) Act, which would set up a program for cutting carbon emissions by selling “carbon shares” to fuel producers. Most of the resulting revenue would generate checks to every American to compensate for what the co-authors predict will be higher energy prices.  The proposal has attracted considerable support from environmental organizations, including 350.org, a global climate advocacy organization.
  • In May 2010 Senators John Kerry, a Democrat of Massachusetts, and Joe Lieberman, an Independent of Connecticut, introduced the American Power Act, which seeks to cut carbon emissions, finance new clean energy and transit programs, and provides considerable financial and regulatory support to develop new oil and gas resources offshore, coal reserves, and nuclear power. Environmental organizations expressed support and said they would to fix provisions they didn’t like. Republicans said they would work to defeat the measure.
  • In June 2010 Senator Richard Lugar, Republican of Indiana, introduced his Practical Energy and Climate Plan that proposes to increase vehicle fuel efficiency, develop cleaner fuels, increase energy efficiency in buildings, encourage more diversity in energy supply including more nuclear energy, and require the government to enhance its ability to monitor and report the effect of the program on greenhouse gas emissions.

Of late, political reporters are focusing on whether the president will take point or follow Senator Reid’s lead in shepherding a bill through the Senate, duplicating the president’s strategy during the bruising health care battle.

But that frame on an otherwise completely compelling political narrative is merely an exercise in Washington gamesmanship. In this instance, regardless of where the president situates himself, there is no mistaking where the urgency of the legislative initiative lies – in the BP Gulf disaster – and who’s driving hard to change the rules of the energy game – the president.

No Surprise, But A Big Blunder
Though the timing is almost serendipitous, nobody paying close attention to the president’s principles and values should be surprised. From the moment he announced his candidacy for president in February 2007, the president has set very clear clean energy and climate goals in order to “be the generation that finally frees America from the tyranny of oil.”

For climate and clean energy advocates, that’s an interesting statement from a president who blundered into a March 31 announcement to expand the offshore territory suitable for new oil and gas exploration, calling it safe.

The president, though, has pushed the country closer — albeit not nearly close enough — to a clean energy economy, and taken more climate action than any American leader. The 2009 American Recovery and Reinvestment Act included over $100 billion in public investment for clean energy, energy efficiency, and transit. The administration, under the authority of the Clean Air Act, has established significantly higher fuel efficiency standards for cars and light trucks, and stricter emissions standards for greenhouse gases that go into effect in 2012 and will save 1.8 billion barrels of oil and eliminate 900 million tons of carbon emissions in its first five years, according to the E.P.A.

The White House also is pursuing new regulations to limit mountaintop mining for coal, reduce the hazards of coal ash piles, increase energy efficiency in buildings, and promote cleaner and greener cities.

A comprehensive climate and energy bill that includes enforceable limits on carbon emissions is the single most important legislative tool to, in the president’s words, “turn this crisis of global warming into a moment of opportunity for innovation, and job creation, and an incentive for businesses that will serve as a model for the world.” President Obama vows to get it done. Most Americans, judging from public opinion polls, understand the gravity of the moment and support where he wants to go.

— Keith Schneider

All Eyes To The Future: The American Power Act’s Imperiled Pragmatism

futurama-416

Over 70 years ago, in the General Motors-sponsored Futurama exhibit at the 1939 New York World’s Fair, an estimated 10 percent of all Americans were transported across a landscape of innovation, creativity, and optimism that became the economic and cultural foundation of the great American century. The Futurama exhibit was a huge diorama of a highway-heavy, congestion-free, car-dependent, time-efficient, leafy green urban and suburban all American pattern of civilization that no one had ever seen before.

What astute observers recognized — among them Lewis Mumford and Walter Lippman — was that GM’s new American geography needed enormous public investments in the roads, sewers, education, research, planning, and industrial infrastructure to make it reality. The vision, though, of an airy, prosperous, shining, and mobile American way of life was powerful and eminently achievable. Over the next two decades voters elected to Congress and the White House lawmakers of both parties who cooperated in steadily enacting big and expensive bills — the GI bill to educate veterans, the 1956 Highway Act to start the Interstate System, water and sewer spending bills, research grants for engineering, just to name a few — to change the way America looked and functioned.

American Power Act Tactics
Last week, Senators John Kerry of Massachusetts and Joe Lieberman of Connecticut introduced The American Power Act, a big and expensive spending bill that is in every way a response to that incredibly accurate 70-year-old GM vision. Its central goal is to preserve American choice and mobility — the two central features of our way of life — in the face of an oncoming train wreck of accumulating economic and environmental consequences.

Kerry and Lieberman propose to execute this impossible task by laying out two paths for legislative action that need to be achieved simultaneously. The first is to generate more supplies of conventional energy sources — oil, coal, and nuclear — in order to stave off the slow demise or even the collapse of America’s convenient, have it your way, drive through economy.

The proposal provides incentives to coastal states to pursue more offshore oil and gas development, while also giving neighboring states the power to block development within 75 miles of their shoreline. It includes $2 billion-a-year in research grants to coal-burning utilities to test carbon capture and sequestration. It proposes to invest tens of billions in loan guarantees and other support to encourage the construction of 12 new nuclear plants.

The second tactical step in the legislation is to push America as insistently as politically practical toward more energy-efficient transportation, and home-grown, renewable, and much cleaner sources of energy. The idea is to spur innovation, new patterns of compact development, and new industrialization that also generates much less carbon pollution.

Kerry and Lieberman proposed spending $70 billion over 10 years on transit, clean vehicles, energy efficiency and other Smart Growth innovations. They lay out a plan for farmers to gain income by siting renewable projects on their land and to grow biofuels. There is money for solar and wind development. And the bill contains provisions to reduce carbon emissions 17 percent below 2005 levels by 2020, and over 80 percent by 2050.

Carbon Pricing and Pragmatism
The bill envisions putting a price on carbon, and providing for trading carbon allowances that applies to large polluters and could generate billions of dollars annually, a portion of which would be rebated to citizens.

As a study in pragmatism, the American Power Act does pretty well. The legislation addresses most of what’s possible and practical in the place where energy, economy, the environment, and politics now meet. It’s as big and bold as it dares in an era when the boom-boom-boom of dire risks to our way of life — climate change, declining competitiveness, rising energy costs — is greeted in political circles with the squeak of small ideas and the clanging of ideological idiocy and anger from every side.

In almost every instance, environmental organizations and business groups commended Kerry and Lieberman for such a solid first draft. And in almost every instance — the exception was the Smart Growth community’s enthusiasm for the $7 billion-a-year investment in transit, clean car, and other transportation and efficiency measures — groups said the intricacies of the bill needed serious reworking.

Environmental groups are not thrilled with the oil, coal, and nuclear provisions. They aren’t thrilled with a section that would withdraw some authority of the EPA to regulate carbon emissions from certain sources. And climate groups are concerned that the bill’s proposal to start in 2019 to dedicate some of the revenue from carbon allowance trading to helping developing nations make the transition to a low-carbon economy is too little and too late.

Many business executives, meanwhile, are nervous about the carbon emissions limits. Democratic lawmakers from the Midwest want more investment in clean tech manufacturing. And the bill’s former sponsor, South Carolina Republican Lindsey Graham who dropped out following an ideological fit, said the proposal would not survive the — so far — uniform Republican opposition.

Transition and Trouble
America, of course, has not always had such trouble responding to change and transition. The America that resulted from executing the Futurama vision was industrious, optimistic, and capable of reacting to favorable market trends. The suburbs and highways, cul-de-sacs and three-car garages, homes with more bathrooms than TVs were made possible by cheap energy (most of which we generated ourselves), cheap land, core competitiveness in major industries, reasoned population increases, growing personal income, wealthy governments, and a willingness of taxpayers to invest in the nation’s future.

We’re not dealing well with the new market trends of the 21st century. Energy prices are steadily rising. Land is expensive. Whole industries have moved beyond our borders. The U.S. is the third fastest growing industrialized nation in the world. Incomes are declining. Governments operate with enormous deficits. Taxpayers are unwilling to invest in a collaborative future.

The result is a nation that is uncharacteristically hesitant and operating in fear. And while ideologues on all sides shout past each other, and make holding office at any level a thankless and grueling experience, the real danger in our governing circles is the entrenchment of the politics of stasis. Doing nothing. Holding the line. Not deciding. Not acting.

The American Power Act contains a suite of reasoned ideas that make sense. Hopefully it not only survives the blizzard of amendments but is strengthened. The sole provision that could be considered a breakthrough, and needs to survive intact, is the bid to put a price on carbon and then to generate revenue by trading allowances. By itself that provision sets the basic foundation to reduce emissions, spur clean energy investment, and prove to the world that the United States is serious about being a leader in the global work to solve climate change. Taking into account the political and economic context, the bill’s passage would be a step, arguably a big step, for America’s future.

— Keith Schneider

Bubbling and Crude: Gulf Coast Spill Reflects Devotion to Wealth, Power, and Oil

On March 17, two weeks to the day before President Barack Obama laid out a new plan to expand offshore oil exploration in the United States, a government auction of federally controlled oil and gas reserves in the Gulf of Mexico was held at the New Orleans Superdome. It took just a few hours for 77 energy companies to pledge $1.3 billion to the U.S. Treasury to look for oil and natural gas across a 2.4 million-acre expanse of bottomlands 200 miles from shore, and in most cases thousands of feet below the surface.

The lease sale, one of the most lucrative on record, bolstered the Gulf’s global reputation as one of the hottest deepwater oil and gas plays on Earth. The Gulf of Mexico is responsible for a quarter of the 5.5 million barrels of oil produced daily in the U.S., according to the Department of Energy. And of the 1.4 million barrels produced daily in the Gulf, 1.1 million barrels comes from over 100 deep sea production platforms. The Interior Department predicts that by the end of the decade, deep sea production in the Gulf could reach nearly 2 million barrels a day.

See USCAN Oil Spill Page

Semi-submersible drilling platform

Source: The Economist

Though offshore oil production is dangerous – 165 people died when an offshore platform exploded off the coast of Scotland in 1998; 10 more people were killed in a drilling rig explosion off the coast of Brazil in 2001 – a kind of Titanic syndrome had set in with Gulf coast oil explorers. The high-tech, semi-submersible, nearly $1 billion floating drilling platforms that operated in the deep Gulf waters were seen as too big, too modern, too well-equipped to fail.

Moreover there is so much oil (and natural gas) beneath the deep Gulf bottomlands – 85.9 billion barrels of oil, according to several estimates – and so much money to be made at $70 to $100 a barrel, that downplaying the risks made economic and political sense. Federal drilling permits obtained by developers normally did not require extensive and time-consuming analysis of the environmental risks, the government has acknowledged.

On April 20, an explosion and fire aboard Transoceans’ Deepwater Horizon drilling platform, which was operating under contract to BP, killed 11 workers. The accident provided the latest unmistakable evidence of the workplace hazards of deep sea exploration. Then two days later, on Earth Day’s 40th anniversary, the Deepwater Horizon sank and simultaneously produced an oil slick that the government says is growing by about 5,000 barrels of oil daily.

America Awake?
By any measure, the Gulf spill has reawakened the nation and magnified the human, environmental, and political consequences of oil production, especially from such treacherous places as the deep ocean. But the spill has not yet made clear what, if anything, the nation is prepared to do in response.

Indeed, the Deepwater explosion and the spreading slick are apt metaphors for an era of striking domestic risks related to energy production and consumption and growing uncertainties about how to reduce them.

Not Santa Barbara, Not 1969
There is no longer much reasoned debate that America’s devotion to fossil fuel, and especially to oil, has contributed to dangerous energy insecurity, rising atmospheric concentrations of climate changing gases, increasing costs, decreasing incomes, and a ferocious national recession. Yet the national response is so different than the  January 1969 oil spill in Santa Barbara, California, which soaked the beaches with crude oil. That spill produced a momentous national that helped to launch Earth Day and a decade of policy making that cleared the skies and cleaned the waters.

In contrast the Deepwater spill, so far, has produced modest public concern nationally and little more than that.

President Obama on April 30 announced he would suspend his March 31 decision to open new areas to offshore exploration pending a full investigation of the Deepwater accident. In the Senate, where a climate and energy bill has been delayed because of partisan infighting, lawmakers debated whether the Gulf spill would 1) break or 2) cement the deadlock.

It is clear the United States needs a new energy policy. The devastating spill has heightened awareness on Capitol Hill to the dangers of U.S. dependence on oil. Democratic Senators Robert Menendez and Frank Lautenberg of New Jersey, and Bill Nelson of Florida held a news conference this week to alert their colleagues that including additional offshore oil exploration has no place in a comprehensive climate and energy bill.

Halting the Spill
In the Gulf, BP says it is moving as fast as it can to plug the well and on Wednesday the company announced that it had stemmed one of three leaks in the pipe that once attached the well to the Deepwater drilling platform. Fishing in the coastal waters, some of the most productive fishing grounds on the planet, has been suspended. Meanwhile the governors of Louisiana, Alabama, Mississippi, and Florida expressed concern about the expanding spill, which was drifting closer to their shores.

Production Data by Year
Deepwater Production
(WD > 1000 Ft)
Total GOM OCS Production % of Total Production
Year Oil, STB Gas, MCF Oil, STB Gas, MCF Oil Gas
1985 21,053,752 33,849,349 350,345,117 4,057,692,707 6.009 0.834
1986 19,077,066 36,900,361 355,542,244 4,043,350,172 5.365 0.912
1987 17,070,926 44,259,499 327,567,672 4,524,823,392 5.211 0.978
1988 12,984,552 38,228,499 301,206,145 4,577,391,080 4.310 0.835
1989 10,007,573 31,889,109 280,717,909 4,636,327,746 3.564 0.687
1990 12,141,988 30,502,933 274,588,473 4,907,774,159 4.421 0.621
1991 22,886,754 58,434,483 294,773,846 4,707,640,841 7.764 1.241
1992 37,295,127 87,256,174 304,865,294 4,650,566,185 12.23 1.876
1993 36,769,914 119,895,532 308,595,948 4,655,807,596 11.91 2.575
1994 41,803,238 159,473,125 314,096,027 4,823,738,315 13.30 3.306
1995 55,200,884 181,019,918 345,074,597 4,778,657,050 15.99 3.788
1996 72,213,069 278,233,940 368,869,292 5,076,875,432 19.57 5.480
1997 108,514,650 381,759,185 411,622,518 5,145,646,361 26.36 7.419
1998 159,232,680 560,475,922 444,286,882 5,041,746,574 35.84 11.11
1999 225,089,761 845,581,180 495,172,107 5,057,740,045 45.45 16.71
2000 271,144,316 998,859,653 523,029,835 4,958,172,377 51.84 20.14
2001 315,392,362 1,178,429,028 558,790,340 5,060,515,587 56.44 23.28
2002 348,566,124 1,286,974,486 567,887,406 4,526,660,570 61.37 28.43
2003 350,151,883 1,425,729,552 561,457,768 4,428,661,841 62.36 32.19
2004 347,916,489 1,396,450,720 535,313,731 4,005,649,257 64.99 34.86
2005 325,565,912 1,189,574,009 466,916,529 3,155,021,736 69.72 37.70
2006 341,286,543 1,093,900,026 472,034,405 2,921,947,061 72.30 37.43
2007 328,111,873 1,027,012,933 468,007,128 2,812,063,179 70.10 36.52
2008 310,628,395 997,860,793 421,221,179 2,328,093,003 73.74 42.86
2009 454,502,063 1,094,148,891 566,000,231 2,427,822,032 80.30 45.06
Deepwater Production Increase – Year to Year
Year % Increase, Oil % Increase, Gas
1985 to 1986 -9.3 9.01
1986 to 1987 -10. 19.9
1987 to 1988 -23. -13.
1988 to 1989 -22. -16.
1989 to 1990 21.3 -4.3
1990 to 1991 88.4 91.5
1991 to 1992 62.9 49.3
1992 to 1993 -1.4 37.4
1993 to 1994 13.6 33.0
1994 to 1995 32.0 13.5
1995 to 1996 30.8 53.7
1996 to 1997 50.2 37.2
1997 to 1998 46.7 46.8
1998 to 1999 41.3 50.8
1999 to 2000 20.4 18.1
2000 to 2001 16.3 17.9
2001 to 2002 10.5 9.21
2002 to 2003 0.45 10.7
2003 to 2004 -0.6 -2.0
2004 to 2005 -6.4 -14.
2005 to 2006 4.82 -8.0
2006 to 2007 -3.8 -6.1
2007 to 2008 -5.3 -2.8
2008 to 2009 46.3 9.64
Average (through 2008) 16.7 18.3

Source: Minerals Management Service

— Keith Schneider