E2-Wire

OVERNIGHT ENERGY: GOP gas price claims under fire ahead of climate vote

by Ben Geman and Andrew Restuccia - 03/10/11 12:25 AM ET

Senior House Republicans have tailored their political messaging on the
bill to focus more heavily on gasoline prices.

But their claims about the degree to which prices will rise are rooted in
an industry-commissioned study of cap-and-trade legislation that died
in the last Congress — not an analysis of rules that EPA is moving ahead
with under its existing powers.

The claims are not sitting well with Rep. Henry Waxman (D-Calif.), the top
Democrat on the energy panel who co-authored the sweeping climate bill
that passed the House in 2009 but stalled in the Senate.

He said it’s wrong to compare that 2009 bill to EPA’s greenhouse-gas rules that began phasing in earlier this year.

“It is laughable to claim that EPA’s modest energy-efficiency
requirements for a small number of new power plants and other large
facilities are identical to H.R. 2454, the comprehensive energy bill
passed by the House in the last Congress,” Waxman said in a statement
Wednesday.

That bill mandated steep emissions cuts, while EPA regulations lack binding reduction targets.

Republicans — including the office of House Speaker Boehner — are
circulating press releases touting Upton’s block-EPA bill that note,
“Previous congressional efforts to regulate and put a price on
greenhouse-gas emissions were estimated to increase the price of a
gallon of gasoline by 19 cents in 2015 and 95 cents in 2050.”

They add that while estimates are not available “for the full cost of
the litany of regulations being proposed and contemplated by the EPA,”
greenhouse-gas rules are expected to impose greater costs.

According to a GOP Energy and Commerce Committee aide, the estimates of
cap-and-trade’s effects are based on a study by the consulting firm CRA
International, which was conducted for the National Black Chamber of
Commerce. CRA has also done work for trade groups including the American
Petroleum Institute and the National Mining Association.

House Energy and Commerce Committee GOP aides say it’s appropriate to
extrapolate the effects of plant-specific regulation based on the study
of the cap-and-trade bill, which would have instead created a
market-based system of tradeable pollution permits.

“One of the larger concerns you have heard throughout this debate is
that EPA actually did not do the economic analysis, so I think there is
some missing information, but I think it is very clear that these
regulations are designed to achieve the same ends as cap-and-trade,” a
GOP committee aide said Tuesday.

Waxman, however, notes the comparisons are far from
apples-to-apples.

“H.R. 2454 required an economy-wide 80 percent reduction in emissions, and oil
companies were required to hold emission allowances for the gasoline
they sold. Still, gasoline prices were only expected to increase less
than 2 cents per year. EPA’s modest energy-efficiency requirements
simply don’t apply to existing refineries that aren’t making major
capital investments and increasing their pollution, and for the few
facilities they cover, they may well produce cost savings,” he said.

But the GOP aide said it’s “very fair” to assume the effects of
regulation will be “the same if not worse,” while another GOP aide notes the cap-and-trade legislation contained provisions to hold down
costs that are not available under EPA rules.

In addition to the greenhouse-gas permitting rules that EPA is beginning
to phase in, the agency is planning to craft and implement other
climate rules in future years, including emissions standards for power plants and refineries.

GOP aides are pointing to a 2009 comment by EPA Administrator Lisa Jackson —
back when cap-and-trade legislation was still alive — who was quoted by
Hearst Newspapers stating that legislation would provide the “least
costly” way to deal with carbon pollution.

But the claims about blocking EPA climate rules to prevent gasoline price hikes isn’t sitting well with EPA.

“Under the Clean Air Act, EPA is developing a standard for currently unchecked carbon pollution from the largest polluting smokestacks. This standard does not impact vehicles, and would have no impact on gasoline prices. EPA is working closely with stakeholders, including industry, to develop this standard, with nothing scheduled to be in place until 2012,” an EPA aide said.

Inslee, a member of the Energy and Power subcommittee that is voting on Upton’s bill Thursday, is honing his lines of attack.

“The number one economic development tool we have today to drive new technologies is the enforcement of the Clean Air Act,” Inslee said. “We have always had success with the Clean Air Act because our innovators have created new technologies. We should not give up that American tradition.”

NEWS BITES:

Hutchison, Landrieu introduce bill to extend oil leases

Sens.
Mary Landrieu (D-La.) and Kay Bailey Hutchison (R-Texas) introduced
legislation Wednesday that would extend Gulf of Mexico exploratory
leases by one year.

The lawmakers said the extension was
necessary to make up for exploration time lost as a result of a temporary
moratorium on deepwater drilling in the Gulf and a slow-down in issuing
shallow and deepwater permits.

“Though the moratoria have been
lifted, there have been few permits issued,” Hutchison said in a
statement. “We are trying to restore the time that energy producers lost
during the moratoria, at no fault of their own.”

The moratorium,
which was imposed last May shortly after the Gulf oil spill, was lifted
in October. But Republicans have criticized the Interior Department for
the slowdown in permits.

The Interior Department says it is
working diligently to issue permits, but companies must prove they can
contain well blowouts.

House Democrats to call for release of
strategic oil reserves

House Democrats, citing rising oil and
gasoline prices, will lay out a plan Thursday to tap into the country’s
oil reserves.

The lawmakers will outline “a new strategy to
deploy and enhance the nation’s Strategic Petroleum Reserve to provide
short-term relief from high prices, and long-term security for the
nation’s oil reserve,” according to an advisory.

Reps. Edward
Markey (D-Mass.), Lois Capps (D-Calif.) and Peter Welch (D-Vt.) authored
the plan.

It’s the latest effort by Democrats to call for tapping
into the Strategic Petroleum Reserve, a 727-million barrel
emergency supply of oil. Obama administration officials have been cool
to the proposal, and experts have said it is unnecessary and unwise
to tap the reserve.

Boxer, public health officials to slam
Republican spending bill

Senate Environment and Public
Works Committee Chairwoman Barbara Boxer (D-Calif.) and a slew of other
Democrats will decry the potential adverse public health effects of a
Republican spending bill that would slash the EPA’s budget and prohibit
funding for a series of energy and environmental regulations.

The
lawmakers will be joined by officials from the American Academy of
Pediatrics, the American Lung Association, the American Public Health
Association and the American Nurses Association.

ON TAP
THURSDAY:

Boehner, Upton, Hastings to talk gas prices

House Speaker John Boehner (R-Ohio) is slated to hold a press conference Thursday on rising gas prices. He’ll be joined by House Energy and Commerce Committee Chairman Fred Upton (R-Mich.) and House Natural Resources Committee Chairman Doc Hastings (R-Wash.). The press conference comes as Republicans are using rising energy prices to intensify attacks on administration offshore drilling restrictions and other energy policies.

Jackson to testify on effect of EPA rules on
farmers

EPA Administrator Lisa Jackson will testify Thursday before the
House Agriculture Committee on the effect of the agency’s
regulations on agriculture. Republicans have raised concerns that the
agency’s pending regulations will pose a huge economic burden on
farmers, but Jackson has said the effects will be minimal.

Senate
Energy panel to consider lightbulb bill

The Senate Energy and
Natural Resources Committee will hold a hearing Thursday on a bill that
would roll back lightbulb-efficiency standards. For more, see Stephen
Colbert’s report
on the issue.

Chamber to release energy report

The
U.S. Chamber of Commerce will release a report Thursday “that identifies
the economic impact and jobs that could be created in 49 states if the
regulatory red tape and permitting delays were removed from stalled
energy projects.”

AROUND THE WEB:

The Gulf oil
spill: The Movie

The Guardian reports: “Hollywood has
picked up the rights to a New York Times article published in December,
Deepwater Horizon’s Final Hours, which evoked the ‘raw emotion’
experienced by those on board prior to the explosion which caused the
spill.”

IN CASE YOU MISSED IT…

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

– New Republicans signed
on to a bill to block EPA climate regulations
– Lawmakers
introduced a bill to end
ethanol tax credits
– The White House and House Republicans butted
heads over a federal report on U.S. oil production
– Democrats
may
not offer any amendments Thursday to the GOP bill to eliminate
EPA’s climate authority
– A House Democrat is crafting
a compromise bill to delay EPA climate rules
– And Sen. James
Inhofe is ‘almost
certain’ Sen. Ben Nelson (D-Neb.) will support his bill to
block EPA climate rules