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Crunch Time on Energy
Editorial, NY Times
The Senate will tell us this week whether it really wants to do something about oil dependency and global warming or if it is just fooling around.
The first week of debate on an energy bill, which the Senate majority leader, Harry Reid, says he is determined to finish before the Fourth of July recess, produced a few satisfying moments — mainly involving bad ideas that were made to disappear. The days ahead will be more combative.
Here are important points of contention and some thoughts about how they should be resolved in a way that moves this country toward a cleaner, more sustainable energy future:
¶ Fuel Economy. The most effective energy efficiency policy ever adopted by the federal government is the Corporate Average Fuel Economy requirement of 1975. CAFE has saved billions of barrels of oil, but it has not been improved for decades. The bill before the Senate would bring fleetwide averages from roughly 25 miles per gallon to 35 miles per gallon by 2020, hardly an impossible target. This proposal should be approved, and a weaker compromise offered by industry allies should be defeated.
¶ Renewable Electricity. A provision championed by Senator Jeff Bingaman, the leading Democratic spokesman on energy issues, would require utilities to produce 15 percent of their power from wind, solar, biomass and other clean-energy sources by 2020 — reducing demand for fossil fuels as well as greenhouse gas emissions. Senior Republicans, complaining about the one-size-fits-all approach, are threatening a filibuster. Here again, though, the requirement does not seem insanely onerous. The Senate approved a 10 percent requirement two years ago, and the House is talking about 20 percent.
¶Coal-to-Liquids. A coalition of coal interests has been lobbying furiously for subsidies to build a new generation of coal-to-liquid power plants to produce diesel fuel. This could reduce our dependence on foreign oil, although marginally and at great cost. It would also be a disaster in terms of global warming unless ways are found to capture and store the carbon dioxide emissions from the refining process. Without such safeguards, coal-to-liquid plants cannot be allowed to proceed.
¶Renewable Fuels. Biofuels offer a far cleaner and more promising approach to oil dependency than coal-to-liquids. The bill would quintuple production, chiefly ethanol from sources other than corn. This is a generally popular provision that must be amended to make sure that the rush to ethanol does not destroy valuable forest and conservation lands.
Waiting in the wings is a tax bill that will eventually be married to the energy bill. On the whole, the tax bill favors renewable and other clean energy sources over the oil, natural gas, coal and nuclear interests that received top billing in the 2005 plan. In fact, the entire energy discussion this year is more forward-looking than it has been for some time. It will be up to the leadership to keep it that way.
(19 June 2007)
Daschle, Deutch, Wald, and Zoi discuss national security implications of energy and climate change (Video and transcript)
E&E TV
As Congress shifts its focus to energy policy and climate change, many in the national security field remain concerned about America’s role as a world leader in these to areas.
During today’s E&ETV Event Coverage of a recent panel discussion sponsored by the Center for American Progress, former Senate Majority Leader Tom Daschle, General Charles Wald (ret.), former director of the CIA John Deutch, and the Alliance for Climate Change’s Cathy Zoi, discuss the national security implications of energy and climate change.
They explain how the United States’ energy policy will affect other national security issues such as nuclear proliferation and immigration. The panelists also lay out the initial steps they believe should be taken on an international level to address climate change.
(20 June 2007)
The Real Price of Gasoline
Richard T. Stuebi, Cleantech Blog
.. In other words, I had the gall to claim that higher gasoline prices were actually good, not bad.
Of course, this was not exactly a popular position to take, and my quotes generated a bit of buzz across the state. A key element of my argument was that customers are prevented from facing the true cost of gasoline, as the expenditures on military protection of oil production, refining and transportation in and around the increasingly dangerous Middle East are not recovered through gasoline taxes, but rather through income taxes.
I recalled a presentation I had heard from last summer, suggesting that these subsidies were on the order of $10/gallon. ..
So, after the interviews and articles, I went back to find the study that was at the root of my recollection of a $10/gallon subsidy figure. The analysis belongs to Milton Copulos, the President of National Defense Council Foundation. Mr. Copulos apparently updated his work this past January, and he now suggests a subsidy of $8.35/gallon of gasoline refined from Persian Gulf oil. Since the Persian Gulf reflects roughly 40% of world oil production, this implies a $3.35/gallon subsidy when spread across all gallons of gasoline. That’s more in line with my expectations.
Again, a meaningful number. It means that gasoline prices should be, not $3/gallon, but on the order of $6/gallon, about what gasoline prices actually are in Europe. Moreover, this price level doesn’t include the environmental costs associated with burning gasoline. How much additional might this represent? ..
Richard T. Stuebi is the BP Fellow for Energy and Environmental Advancement at The Cleveland FOundation and is also the Founder and President of NextWave Energy Inc.
(18 June 2007)
