E2-Wire

OVERNIGHT ENERGY: Is Obama’s ‘clean’ standard the next cap-and-trade?

by Andrew Restuccia and Ben Geman - 01/26/11 11:07 PM ET

Welcome back to OVERNIGHT ENERGY, E2’s daily roundup of the energy news you need to know and a look ahead to tomorrow’s action. Please send tips and comments to Ben Geman, ben.geman@digital-staging.thehill.com, and Andrew Restuccia, arestuccia@digital-staging.thehill.com.

STATE OF PLAY: Obama’s ‘clean’ plan faces uncertain future

Is President Obama’s State of the Union push for a “clean” energy standard the stuff of bipartisan deals, or destined to fall victim to partisan battles?

Maybe the not-so-distant past provides a clue. Climate advocates pushing cap-and-trade plans — and now lamenting their death — have long noted that the concept has conservative and Republican roots. A cap-and-trade plan to cut sulfur dioxide emissions (which cause acid rain) was a key part of 1990 amendments to the Clean Air Act, which then-President George H.W. Bush proposed and Congress overwhelmingly approved.

(This piece in Smithsonian magazine notes early support from a “a strange alliance of free-market Republicans and renegade environmentalists.”)

But jump ahead two decades, and Democratic cap-and-trade proposals for greenhouse gases are kaput on Capitol Hill and vilified by Republicans.

With climate bills dead for now, Obama floated a plan in Tuesday’s speech to generate 80 percent of U.S. electricity from low-carbon “clean” sources — including renewables, nuclear, coal plants that trap carbon, and natural gas — by 2035.

It’s another idea with GOP roots that top Democrats have now embraced. During a big energy bill debate in 2007, now-retired Sen. Pete Domenici (R-N.M.) countered Democratic proposals for a renewable electricity mandate on utilities. His plan? A broader “clean” standard that also credited nuclear power and coal plants with carbon capture, although the latter technology isn’t yet commercialized.

Even more recently, Sen. Lindsey Graham (R-S.C.) has talked up the idea of a “clean energy standard” for utilities that Obama has now embraced (at least in concept — the White House hasn’t released a specific plan).

But, as E2 reported Tuesday, key Republicans including Energy and Commerce Committee Chairman Fred Upton (R-Mich.) greeted Obama’s speech skeptically, although Upton did not address the “clean energy standard” idea head-on.

It remains to be seen what form Obama’s plan takes. Any proposal that imposes requirements on power companies could face big GOP hurdles, but at the same time, nuclear power and natural gas enjoy wide GOP support. Stay tuned.

NEWS BITES:

Whitfield open to talks on ‘clean’ standard

Rep. Ed Whitfield (R-Ky.), the chairman of the Energy and Power subcommittee, told reporters Wednesday he’s open to talks on a
“clean” standard, which Obama proposed Tuesday.

But he also cautioned that the long federal approval process for
nuclear power plants — a frequent target of nuclear advocates — could
hinder the effort.

“There are some practical problems with it. No. 1, the 10-year
permitting process for nuclear really does make a clean energy standard
sort of meaningless in a way,” Whitfield told reporters when asked if
he could get behind a clean energy standard.

But he added: “We are open for discussion about any of those things.
Clean energy standard means different things to different people, but
we look forward to working with the president, and we have a lot of
issues to face, there is so much uncertainty out there, particularly as
it relates to investment for utilities, and other industries.”

The subcommittee he leads is part of the Energy and Commerce Committee.

Graham lauds Obama’s energy push

Sen. Lindsey Graham (R-S.C.) told The Hill he found Obama’s plan
“encouraging.” But Graham cautioned that the 80 percent target — which
would more or less double current low-emissions power generation — might
be too high. (Graham has floated
a less aggressive plan in the past.)

“It really is an area for Republicans and Democrats to come together,”
he said. “I think it is maybe one of the areas where we can have a
breakthrough this year.” Graham said he plans to introduce energy
legislation this spring.

Spill panel seeks to clear up
misconceptions

National oil spill commission co-chairman William Reilly said Wednesday
night there is “significant confusion” among lawmakers about the
commission’s final
report.

Republicans criticized Reilly and the panel’s other co-chairman,
former Sen. Bob Graham (D-Fla.), for the administration’s deepwater
drilling moratorium.   Reilly stressed the commission has never
supported the moratorium, which has since been lifted.

“We have never been fans of the moratorium,” Reilly said, adding
that he hopes lawmakers will be able to separate the drilling ban from
the panel’s recommendations.   Reilly and Graham testified before the
House Natural Resources Committee and the Senate Energy and Natural
Resources Committee Wednesday.

Reid sends placeholder energy bill to Finance Committee

As The Hill reported Monday, Senate Majority Leader Harry Reid (D-Nev.) introduced placeholder energy legislation Tuesday. But the legislation was not referred to the Senate Energy and Natural Resources Committee. It was instead referred to the Finance Committee, according to the Congressional Record.

The placeholder energy bill was co-sponsored by the following Democrats: Sens. Jeff Bingaman (N.M.), Sherrod Brown (Ohio), Dick Durbin (Ill.), John Kerry (Mass.), Michael Bennet (Colo.), Kirsten Gillibrand (N.Y.), Chris Coons (Del.), Barbara Boxer (Calif.), Frank Lautenberg (N.J.), Jeanne Shaheen (N.H.) and Daniel Akaka (Hawaii).

EPA administrator going to Texas

Environmental Protection Agency Administrator Lisa Jackson is going to Texas on Thursday as part of her “environmental justice tour.” The visit comes as the EPA has moved to issue greenhouse-gas permits in the state because Texas officials have refused to comply with the agency’s climate rules.

Jackson will “highlight the agency’s work safeguarding Americans from health threats like toxic chemicals, contaminated water, and pollution in the air we breathe and to discuss how to ensure all Texans receive the same health and environmental protections,” according to an EPA statement.

Obama talks energy in Wisconsin

A day after his State of the Union address, President Obama underscored his energy policy commitments during remarks at a solar company in Manitowoc, Wis.

Via White House transcript:

“We need to get behind clean energy companies like Orion. We need to get behind innovation. That’s how we’ll meet the goal I set last night and make sure 80 percent of America’s electricity comes from clean energy sources by 2035. That is a goal that we can meet. That is a goal we must meet. That’s how we’ll make America the first country to have 1 million electric vehicles on the road by 2015. In five years, a million electric cars on the road. That’s how America will lead the world in clean energy. And as I’ve said before, the nation that leads the world in clean energy will lead the global economy in the 21st century.”

Boxer, Feinstein introduce legislation to limit chromium-6 in
drinking water

California Sens. Barbara Boxer and Dianne
Feinstein, both Democrats, introduced legislation Wednesday to
require the Environmental Protection Agency to set “an enforceable
drinking water safeguard” for Chromium-6. A recent study found
potentially unsafe levels of chromium-6, a likely carcinogen, in a
number of U.S. cities, including Washington, D.C.

ON TAP THURSDAY: Oil industry to call for increased reliance on
oil sands

The
American Petroleum Institute will hold a call Thursday morning to
underscore what they see as the economic benefits of Canadian oil
sands. The oil industry trade association will call for approval of a
major pending oil pipeline slated to stretch from Canada to Texas.

ON
TAP THURSDAY II: Bingaman to speak at nuclear science event

Senate
Energy
and Natural Resources Committee Chairman Jeff Bingaman (D-N.M.) will
speak Thursday at a National Nuclear Science Week event in the Capitol.
Other attendees at the event include: Nuclear Energy Industry President
Marvin Fertel and Audeen Fentiman, associate dean of engineering at
Purdue University

ON TAP THURSDAY III: Homeland security
panel holding hearing on ‘Gulf coast recovery’

The
Senate Homeland Security Committee will hold a hearing Thursday
afternoon titled, “Gulf Coast Recovery: An Examination of Claims and
Social Services in the Aftermath of the Deepwater Horizon Oil Spill.”

IN CASE YOU MISSED IT…

Here’s a quick roundup of E2’s reporting Wednesday:

Sens. Jay Rockefeller (D-W.Va.) and Tom Harkin (D-Iowa) introduced their mine safety bill; Sen. David Vitter (R-La.) introduced a bill to block EPA climate rules until China and India act to reduce their emissions; and Sen. Jeff Bingaman (D-N.M.) said he will work with the White House on President Obama’s “clean energy standard” proposal.

Meanwhile, EPA reached a $5.3 million Clean Air Act settlement with a major petroleum refiner; White House Press Secretary Robert Gibbs didn’t take the bait when asked about the future of Carol Browner’s office; House Democrats introduced oil spill legislation; and a House Republican compared the risks of drilling in the Gulf to those associated with driving a car or slipping on ice.