Editor's note: This is a follow-up to an article posted Sunday, Dec. 13, 2009
Lugar Joins Senators Who Introduce Bill to Stimulate Clean Energy Manufacturing
December 16, 2009
http://detnews.com/article/20091216/BIZ/912160323
Senate effort to double incentive available for advanced manufacturing
DAVID SHEPARDSON
Detroit News Washington Bureau
Washington -- The White House expects today to announce its support of an effort to more than triple, to $7.3 billion, tax credits for advanced energy manufacturing.
In February, Congress passed a $2.3 billion tax credit giving businesses a 30 percent tax credit to produce high-tech batteries, electric vehicles, wind turbines, solar panels and renewable fuels, among other technologies aimed at reducing greenhouse gas emissions.
But due to an unexpectedly high number of applicants, the program will run out of money by mid-January.
Vice President Joe Biden today will reaffirm the administration's commitment to a "strong manufacturing sector as a vital part of both the American economy and the rebuilding of the American middle class."
As part of that support, the White House is expected to endorse a $5 billion expansion of the tax credit, to $7.3 billion.
That's double the $2.5 billion sought in a bill last week by four bipartisan senators: Debbie Stabenow, D-Lansing; Orrin Hatch, R-Utah; Jeff Bingaman, D-N.M.; and Richard Lugar, R-Ind. They wanted to attach the money in a jobs bill that Congress will take up in the coming weeks.
Stabenow said the White House has been very supportive of the tax credit increase.
"We have a long line of manufacturers who have applied for the credit," Stabenow said Wednesday. "We have more people in Michigan that are going to be able to create jobs" if the 30 percent credit is expanded.
President Barack Obama praised the idea last week.
"With additional resources, in areas like advanced manufacturing of wind turbines and solar panels, for instance, we can help turn good ideas into good private-sector jobs," Obama said.
Automakers support the efforts to extend the credit.
"Sen. Stabenow and her colleagues should be commended for helping put American manufacturing on a competitive footing in the fight for new, green technologies," said General Motors Co. spokesman Greg Martin.
But money-losing automakers aren't expected to benefit immediately, since they have no taxes to offset.
Some, however, have applied so they can use credits when they again are profitable.
Manufacturing has been hit hard since the recession began in December 2007, losing 2.1 million factory jobs.
Manufacturing now accounts for less than 9 percent of U.S. employment.
That's its lowest percentage since before World War II.
Michigan Gov. Jennifer Granholm has lobbied the Obama administration for more funding for the tax credit, noting that the state has attracted a number of new advanced manufacturing developments in solar panels, wind turbines and batteries.
"I have asked them to take the cap off, so that there's a significant investment effort," she said. In September, Michigan announced it was helping fund a $725 million transformation of Ford Motor Co.'s shuttered Wixom plant.
Companies at the redeveloped site plan to build solar panels and utility-scale batteries for generating renewable power.
Michigan has the nation's highest unemployment rate at 15.2 percent, in part because the state's shed a quarter of its factory jobs over the last year.
Biden came to Detroit in August to unveil $2.4 billion in battery and electric vehicle research grants.
Michigan received more than half of the funds.
The administration has a multipronged effort aimed at creating tens of thousands of green jobs.
dshepardson@detnews.com
(202) 662-8735
This article brought to you by the Indiana Renewable Energy Association.
Showing posts with label Sen. Richard Lugar. Show all posts
Showing posts with label Sen. Richard Lugar. Show all posts
Wednesday, December 16, 2009
Sunday, December 13, 2009
Lugar Joins Senators Who Introduce Bill to Stimulate Clean Energy Manufacturing
FOR IMMEDIATE RELEASE: Thursday, December 10, 2009
CONTACTS:
Jude McCartin/Bingaman (202) 224-1804
Mark Eddington/ Hatch (202)-224-5251
Matt Williams/Stabenow (202) 224-1437
Mark Hayes/Lugar (202) 224-8370
WASHINGTON – U.S. Senators Jeff Bingaman (D-NM), Orrin G. Hatch (R-UT), Debbie Stabenow (D-MI) and Richard Lugar (R-IN) have introduced legislation that would create jobs by encouraging the manufacture of renewable energy technologies in the United States.
The senators’ American Clean Technology Manufacturing Leadership Act extends the life of a successful tax credit that allows companies to write off 30 percent of the cost of creating, expanding, or re-equipping facilities to manufacture renewable energy technologies, like solar panels, wind turbines, and advanced batteries.
The legislation expands an innovative tax incentive first created at Bingaman’s urging in the American Recovery and Reinvestment Act. The Act authorized the Departments of Energy and the Treasury to award up to $2.3 billion in tax credits. But due to an unexpectedly high number of applicants, that program will run out of funds by mid-January. The senators’ American Clean Technology Manufacturing Leadership Act (S. 2857) would provide an additional $2.5 billion in tax credits, enough to leverage $8.33 billion in new domestic investment.
“This tax incentive has been so successful that President Obama himself called on Congress to extend it, so that more companies can take advantage of it and create jobs,” Bingaman said. “Currently, the United States runs an annual ‘green trade deficit’ of almost $9 billion. But the United States should be the world’s No. 1 manufacturer of clean energy technology. This tax incentive will help us move toward that goal.”
“With all the talk about green jobs these days, it can be confusing to figure out just what a green job is. Well, this legislation promotes green jobs where they matter the most, in the domestic advanced energy manufacturing sector. Renewable energy is a rapidly growing field, and we’re joining together today to ensure that the United States maintains leadership in the development and manufacture of the best energy technologies, while keeping our nation on the competitive cutting edge,” Hatch said.
“In order to turn our economy around and create jobs, we need to build the clean energy technology of the future here in America. Otherwise, we will lose the race with other countries and see those jobs go overseas,” said Stabenow. “This manufacturing tax credit, which I co-authored in the recovery act, has already spurred interest to invest in advanced energy projects such as wind, solar, geothermal, and other renewable resources across the country. It has also set aside critical funding for companies manufacturing technologies for the next generation of advanced vehicles. This initiative is central to any jobs package, and I am pleased to partner with my Senate colleagues to introduce legislation that will help put our economy back on track.”
“With one in ten Hoosiers unemployed and many more underemployed, job creation must be a first priority. Extending the Advanced Manufacturing Tax Credit is a fiscally-responsible way of helping American workers and businesses use our manufacturing expertise to lead in new energy technology production,” Lugar said.
Until ARRA was enacted in February, all domestic tax incentives focused exclusively on business and consumer tax credits to encourage the use of such technology as solar panels. The 30 percent tax credit – created first in ARRA and proposed for expansion through the American Clean Technology Manufacturing Leadership Act -- for the first time incentivized companies to manufacture clean technologies in the United States.
The American Clean Technology Manufacturing Leadership Act was referred to the Senate Finance Committee. Bingaman, Hatch and Stabenow are members of that committee. Bingaman also chairs the Finance Subcommittee on Energy, Natural Resources & Infrastructure, and plans to convene a hearing in 2010 on tax incentives for energy manufacturing.
CONTACTS:
Jude McCartin/Bingaman (202) 224-1804
Mark Eddington/ Hatch (202)-224-5251
Matt Williams/Stabenow (202) 224-1437
Mark Hayes/Lugar (202) 224-8370
WASHINGTON – U.S. Senators Jeff Bingaman (D-NM), Orrin G. Hatch (R-UT), Debbie Stabenow (D-MI) and Richard Lugar (R-IN) have introduced legislation that would create jobs by encouraging the manufacture of renewable energy technologies in the United States.
The senators’ American Clean Technology Manufacturing Leadership Act extends the life of a successful tax credit that allows companies to write off 30 percent of the cost of creating, expanding, or re-equipping facilities to manufacture renewable energy technologies, like solar panels, wind turbines, and advanced batteries.
The legislation expands an innovative tax incentive first created at Bingaman’s urging in the American Recovery and Reinvestment Act. The Act authorized the Departments of Energy and the Treasury to award up to $2.3 billion in tax credits. But due to an unexpectedly high number of applicants, that program will run out of funds by mid-January. The senators’ American Clean Technology Manufacturing Leadership Act (S. 2857) would provide an additional $2.5 billion in tax credits, enough to leverage $8.33 billion in new domestic investment.
“This tax incentive has been so successful that President Obama himself called on Congress to extend it, so that more companies can take advantage of it and create jobs,” Bingaman said. “Currently, the United States runs an annual ‘green trade deficit’ of almost $9 billion. But the United States should be the world’s No. 1 manufacturer of clean energy technology. This tax incentive will help us move toward that goal.”
“With all the talk about green jobs these days, it can be confusing to figure out just what a green job is. Well, this legislation promotes green jobs where they matter the most, in the domestic advanced energy manufacturing sector. Renewable energy is a rapidly growing field, and we’re joining together today to ensure that the United States maintains leadership in the development and manufacture of the best energy technologies, while keeping our nation on the competitive cutting edge,” Hatch said.
“In order to turn our economy around and create jobs, we need to build the clean energy technology of the future here in America. Otherwise, we will lose the race with other countries and see those jobs go overseas,” said Stabenow. “This manufacturing tax credit, which I co-authored in the recovery act, has already spurred interest to invest in advanced energy projects such as wind, solar, geothermal, and other renewable resources across the country. It has also set aside critical funding for companies manufacturing technologies for the next generation of advanced vehicles. This initiative is central to any jobs package, and I am pleased to partner with my Senate colleagues to introduce legislation that will help put our economy back on track.”
“With one in ten Hoosiers unemployed and many more underemployed, job creation must be a first priority. Extending the Advanced Manufacturing Tax Credit is a fiscally-responsible way of helping American workers and businesses use our manufacturing expertise to lead in new energy technology production,” Lugar said.
Until ARRA was enacted in February, all domestic tax incentives focused exclusively on business and consumer tax credits to encourage the use of such technology as solar panels. The 30 percent tax credit – created first in ARRA and proposed for expansion through the American Clean Technology Manufacturing Leadership Act -- for the first time incentivized companies to manufacture clean technologies in the United States.
The American Clean Technology Manufacturing Leadership Act was referred to the Senate Finance Committee. Bingaman, Hatch and Stabenow are members of that committee. Bingaman also chairs the Finance Subcommittee on Energy, Natural Resources & Infrastructure, and plans to convene a hearing in 2010 on tax incentives for energy manufacturing.
Thursday, October 22, 2009
Sullivan Takes Issue with Hershman on position Lugar & Bayh should take on pending federal climate change legislation
Editor's note: State Rep. Mary Ann Sullivan (D-Indianapolis) responded to State Sen. Brandt Hershman's Letter to the Editor urging that Hoosiers contact Sens. Lugar and Bayh to oppose climate change or cap and trade legislation pending before the U.S. Congress. We urge everyone to educate themselves on this important issue and communicate your views to Sens. Lugar and Bayh.
For our health, jobs, we must pass climate legislation
Indianapolis Star, October 22, 2009
http://www.indystar.com/apps/pbcs.dll/article?AID=2009910220378
While I agree with my colleague, state Sen. Brandt Hershman, that hearing from constituents is important (Letters, Oct. 4), I take issue with his comments regarding how U.S. Sens. Richard Lugar and Evan Bayh should vote on economy-boosting climate legislation.
The Senate clearly has an opportunity not just to cut carbon emissions that endanger our health and the health of our children and grandchildren, but also to grow jobs in Indiana.
The non-partisan Congressional Budget Office estimates that the cost of implementing the elements of a federal climate bill would add up to the equivalent of a postage stamp a day per family, with low-income families realizing a $40 benefit by 2020. By 2030, the American Council for an Energy Efficient Economy estimates an average saving of nearly $4,000 per U.S. household through the energy efficiency provisions alone.
Legislation that creates jobs, saves consumers money and reduces our dependence on foreign oil makes sense for Indiana and the country. I join millions of my fellow Americans in encouraging Lugar and Bayh to vote for this crucial bill, and help put Hoosiers back to work.
State Rep. Mary Ann Sullivan
House District 97
Indianapolis
--------------------------------------
Cap-and-trade disadvantages outweigh any potential good
Indianapolis Star, October 4, 2009
http://www.indystar.com/apps/pbcs.dll/article?AID=2009910040328
As an elected official, I know the power of contact by constituents. Therefore, I encourage you to join me in writing, calling or e-mailing U.S. Sens. Richard Lugar and Evan Bayh and urging them to vote against the Waxman-Markey cap-and-trade legislation now pending in the U.S. Senate.
This is dangerous legislation that will harm the U.S. economy far more than it will help the world's ecological condition.
According to the U.S. Chamber of Commerce, some estimates show the cost of living for a typical Hoosier household could rise by as much as $1,600 per year if this proposal becomes law. Others say this is a conservative inflationary figure and Indiana residents might pay substantially more.
One study conducted by the National Manufacturers Association revealed this legislation could cost Indiana nearly 60,000 jobs over the next two decades. Other estimates assert as many as 3 million American jobs could be lost by 2030.
And for what noble purpose? Ecologically, some say the impact will be minimal, at best, if the U.S. is the only participant. Two of our biggest global economic partners, China and India, have no plans to enact cap-and-trade legislation of their own. Their factories will keep on humming, putting pollutants in the air, money in their own bank accounts and, likely, more Americans out of work.
Cap-and-trade could be called a job killer and a massive new tax on energy. Congress should wait until there is an international agreement on carbon dioxide emissions that includes other industrial powers like India and China before committing to painful and perhaps futile reductions at home.
Brandt Hershman
Indiana State Senator, Senate District 7
For more information visit http://www.indianarenew.org.
For our health, jobs, we must pass climate legislation
Indianapolis Star, October 22, 2009
http://www.indystar.com/apps/pbcs.dll/article?AID=2009910220378
While I agree with my colleague, state Sen. Brandt Hershman, that hearing from constituents is important (Letters, Oct. 4), I take issue with his comments regarding how U.S. Sens. Richard Lugar and Evan Bayh should vote on economy-boosting climate legislation.
The Senate clearly has an opportunity not just to cut carbon emissions that endanger our health and the health of our children and grandchildren, but also to grow jobs in Indiana.
The non-partisan Congressional Budget Office estimates that the cost of implementing the elements of a federal climate bill would add up to the equivalent of a postage stamp a day per family, with low-income families realizing a $40 benefit by 2020. By 2030, the American Council for an Energy Efficient Economy estimates an average saving of nearly $4,000 per U.S. household through the energy efficiency provisions alone.
Legislation that creates jobs, saves consumers money and reduces our dependence on foreign oil makes sense for Indiana and the country. I join millions of my fellow Americans in encouraging Lugar and Bayh to vote for this crucial bill, and help put Hoosiers back to work.
State Rep. Mary Ann Sullivan
House District 97
Indianapolis
--------------------------------------
Cap-and-trade disadvantages outweigh any potential good
Indianapolis Star, October 4, 2009
http://www.indystar.com/apps/pbcs.dll/article?AID=2009910040328
As an elected official, I know the power of contact by constituents. Therefore, I encourage you to join me in writing, calling or e-mailing U.S. Sens. Richard Lugar and Evan Bayh and urging them to vote against the Waxman-Markey cap-and-trade legislation now pending in the U.S. Senate.
This is dangerous legislation that will harm the U.S. economy far more than it will help the world's ecological condition.
According to the U.S. Chamber of Commerce, some estimates show the cost of living for a typical Hoosier household could rise by as much as $1,600 per year if this proposal becomes law. Others say this is a conservative inflationary figure and Indiana residents might pay substantially more.
One study conducted by the National Manufacturers Association revealed this legislation could cost Indiana nearly 60,000 jobs over the next two decades. Other estimates assert as many as 3 million American jobs could be lost by 2030.
And for what noble purpose? Ecologically, some say the impact will be minimal, at best, if the U.S. is the only participant. Two of our biggest global economic partners, China and India, have no plans to enact cap-and-trade legislation of their own. Their factories will keep on humming, putting pollutants in the air, money in their own bank accounts and, likely, more Americans out of work.
Cap-and-trade could be called a job killer and a massive new tax on energy. Congress should wait until there is an international agreement on carbon dioxide emissions that includes other industrial powers like India and China before committing to painful and perhaps futile reductions at home.
Brandt Hershman
Indiana State Senator, Senate District 7
For more information visit http://www.indianarenew.org.
Wednesday, October 21, 2009
CLIMATE: On road to 60, Senate swells with fence sitters
NOTE: Both U.S. Senator Richard Lugar (R-Indiana) and U.S. Senator Evan Bayh (D-Indiana) are listed as "fence sitters" on the proposed comprehensive climate and energy legislation. See paragraphs below in red.
E&E Daily - 10/20/09
by Darren Samuelsohn, E&E senior reporter
The fence is getting a bit more crowded.
Despite two significant moves over the last month -- a bill introduction and the emergence of a possible bipartisan partnership -- the number of senators unwilling to commit to voting for comprehensive climate and energy legislation continues to grow.
According to E&E's latest analysis, 24 senators now belong in the "fence sitter" category that leaves them up for grabs headed into the winter push for 60 votes that sponsors will need to overcome an expected Republican filibuster.
Here's the good news for climate advocates: E&E now finds that at least 67 senators are in play on the issue, enough not only to pass the climate bill but also to ratify an international treaty should sponsors actually run the boards and not lose a single member.
For starters, the bill's lead sponsors, Sens. John Kerry (D-Mass.) and Barbara Boxer (D-Calif.), can safely rely on 31 "yes" votes as they work on building their coalition. That list includes Ben Cardin of Maryland, Jeanne Shaheen of New Hampshire and Tom Udall of New Mexico. All appeared at a Capitol Hill campaign-style rally last month during the public unveiling of the legislation, S. 1733.
Another 12 senators fall into the "probably yes" camp, from Michael Bennet of Colorado to Al Franken of Minnesota and Mark Warner of Virginia. Bennet and Warner are not slam dunks given the fossil fuel interests in their home states, while Franken dropped off the "yes" list when he signed a letter with nine other Democrats in August that raised concerns about President Obama's stance against trade sanctions on carbon-intensive goods from developing countries that do not have strong enough climate policies (E&ENews PM, Aug. 6).
As for the fence sitters, the list continues to swell from both directions as key senators hedge their bets.
For example, Sens. Max Baucus (D-Mont.) and Maria Cantwell (D-Wash.) no longer reside in the "probably yes" camp given their recent statements on allocations and oversight of the carbon markets, respectively. Baucus may drive the hardest bargain as chairman of the Finance Committee, where he is sure to negotiate on behalf of coal-state Democrats who think the House-passed bill unfairly favors electric utilities that service the East and West coasts.
Two senators have recently been upgraded to the fence from the "probably no" camp are Sens. Robert Byrd (D-W.Va.) and George Voinovich (R-Ohio). Byrd has long questioned action to curb emissions but has taken a lead role on carbon sequestration language that Kerry and Boxer are trying to wrap into their proposal. Voinovich has a reputation for bipartisan consensus building, and recent signals supporting the nuclear power industry are raising hopes in some sectors that the retiring senator should still be considered in play.
"If you engage in a very proactive way to get a bill done, he will negotiate and compromise," said a former Senate Republican aide.
E&E's analysis is based on interviews with senators, plus dozens of Democratic and Republican sources, industry and environmental groups.
Counting Republicans
GOP interest is significant for the climate bill's overall prospects given that Democrats are unlikely to carry all 60 of their own votes on the floor.
In all, E&E now lists eight Republicans as "fence sitters" on the climate bill, with the two from Maine -- Susan Collins and Olympia Snowe -- holding firm as "probably yes" votes given their past efforts on the issue. Collins and Snowe are likely to compensate for the loss of Sens. Mary Landrieu of Louisiana and Ben Nelson of Nebraska, the only Democrats listed among 11 "probably no" votes given their many comments questioning the environmental agenda of the Obama administration and Senate leaders.
Elsewhere, sponsors got their biggest boost when Kerry went public with Sen. Lindsey Graham (R-S.C.) on a partnership that they had been quietly working on since the summer. The senators pledged in an Oct. 11 New York Times op-ed that they would try to find compromise on several key areas, including nuclear power, offshore drilling and a border tax on items produced in countries that avoid high environmental standards.
"I can see a way to get to 60 votes, and so can he, if we pull the right folks to the table and do this in the right way," Kerry said last week. "And that's what we're going to do."
Climate advocates are urging Kerry and Graham to turn their broad principles into legislation.
"It's still right now just a possibility," said Manik Roy of the Pew Center on Global Climate Change. "We need to operationalize that."
Graham's support also may be key for other Republicans.
Jason Grumet, a former Obama presidential campaign adviser and the president of the Bipartisan Policy Center, counts as many as 10 Republicans who have been engaged in past climate debates "who are certainly poised to come back if the Graham beachhead becomes more secured."
Sen. Lisa Murkowski (R-Alaska) stands out as one leading GOP candidate to get behind a climate bill. The two-term senator co-sponsored climate legislation last year with Energy and Natural Resources Chairman Jeff Bingaman (D-N.M.) in part because of provisions designed to protect against high energy prices, as well as financial aid to Alaska for adaptation to rising seas and melting permafrost.
So far this year, Murkowski has questioned Democrats' desires to push for a vote on the climate bill before a major U.N. climate conference this December in Copenhagen. At the same time, she said Sunday on C-SPAN that Graham's emergence opens the door further to a number of supply-side provisions she supports, including efforts to expand nuclear power, natural gas and oil production.
"Count me as one of those who will keep my mind open as we move forward in looking at all aspects of this," Murkowski said.
Other fence-sitting Republicans include Sen. Richard Lugar, the six-term senator who has tamped down his optimism this year in part because of unemployment in Indiana that continues to hover near double digits. Lugar said last month in an interview he remains engaged but does not like the approach taken earlier this year with H.R. 2454, the House-passed climate bill.
"I don't know that we've pulled back," Lugar said. "It's just the formulation from the House I find objectionable on many grounds. Without jumping up and down any further, I think more constructive ways of fighting climate change can be found and I'll be working to find it."
Senate Budget Committee ranking member Judd Gregg (R-N.H.) also remains in play, with nuclear power and fiscal issues atop his list of demands. Asked last week about how the Kerry-Graham partnership could influence his vote, Gregg replied, "If nuclear comes under that and has proper incentives, that could be a major step forward."
The party's 2008 presidential nominee, Sen. John McCain (R-Ariz.), poses a big challenge for climate bill advocates (E&E Daily, July 16). While McCain appears to be making headway in his demand for greater incentives for nuclear power, he is in direct conflict with manufacturing state Democrats and Graham, one of his close allies in last year's White House campaign, over the border tax issue.
"I know that I'd never agree to tariffs on the borders for countries that don't comply with our requirements," McCain said last week.
Other big questions revolve around Florida's new GOP senator, George LeMieux. Gov. Charlie Crist (R) appointed LeMieux, his former chief of staff, to be a caretaker to the Senate seat he hopes to win in the 2010 elections.
But Crist must succeed in a Republican primary slated for next August that so far has forced him to distance himself from past progressive views on the climate issue. Already, Crist's opponent, Florida House Speaker Marco Rubio, has garnered the endorsement of Sen. James Inhofe (R-Okla.), an outspoken opponent of global warming legislation. LeMieux's vote will be seen as a critical test for Crist among the state's Republican base (Greenwire, Aug. 17).
Fence-sitting Democrats
The fence also includes moderate Democrats from all corners of the country, some more actively engaged in the climate debate than others.
Sen. Sherrod Brown of Ohio, for example, is crafting language to help manufacturers (E&E Daily, Oct. 14). Michigan's Debbie Stabenow hopes to release long-awaited agriculture ideas. And Sen. Arlen Specter of Pennsylvania will be forced to take a stand as early as next month when Boxer's Environment and Public Works Committee holds a markup on its bill.
Other influential Democratic fence sitters include Michigan Sen. Carl Levin, who said last week that he expects to push at least four issues once the bill nears the floor.
Levin said he will be seeking a national greenhouse gas emission standard and repeal of state-specific standards. Like Franken, he said a border tax adjustment needs to be part of the bill. And Levin said he wants a "fail-safe provision in case the technologies don't advance as quickly as some people think they will."
"And you've got to fairly proportion the burden," Levin added.
Agriculture Chairwoman Blanche Lincoln (D-Ark.) also remains on the fence. The two-term senator said last week that she wants to get a better grip on the effect that a climate bill would have on farmers and in the cost of food to consumers.
"I don't disagree with the objective, and I hope we'll stay focused on the objective, which is to lower our greenhouse gases and emissions and our carbon output," Lincoln said.
Lincoln in past years has cosponsored efforts to address the cost fluctuations in climate legislation. Environmental groups are banking on her and Sen. Mark Pryor (D-Ark.) as key votes that get them to across the 60-vote threshold.
But an industry source tracking the climate debate doubts that Lincoln can sign off on climate legislation as she heads into a heated re-election battle next November. "No amount of National Wildlife Federation polling is going to help her in the delta," the source said. "She has an issue."
Election-year politics also may influence several other Democrats. Specter faces a primary challenge from his left in Rep. Joe Sestak, a campaign that has put an even larger spotlight on his vote (E&E Daily, Oct. 6).
Sen. Evan Bayh (D-Ind.) faces the same unemployment concerns as Lugar but with the added pressure of a 2010 re-election campaign. So far, Bayh has not drawn a significant challenger and political analyst Charlie Cook ranked the race earlier this month as "solid D" for the incumbent. But political observers still see Bayh as vulnerable to home-state concerns.
Other Democrats on the fence include a number of senators representing either coal-consuming or coal-producing states, including Claire McCaskill of Missouri, North Dakota Sens. Kent Conrad and Byron Dorgan, Jay Rockefeller of West Virginia, Jon Tester of Montana and Jim Webb of Virginia. Conrad and Dorgan may be among the most difficult fence sitters to win over. Both have insisted for months that Senate leaders should start with energy-only legislation and save the big climate change measure for later.
Debating floor strategy
Senate Majority Leader Harry Reid (D-Nev.) has so far left open the door on a possible floor debate before the end of the year on the climate bill, but time is running short for the five committees still charged with filling in key details (E&E Daily, Oct. 16).
Committee leaders do not have any deadlines, leaving many to speculate the bill will most likely wait until early 2010 to see any floor action despite Boxer's plans for markup in November. Boxer has said she is waiting for U.S. EPA analysis of her legislation, something agency spokeswoman Betsaida Alcantara said should be finished by Friday.
Environmentalists have not stopped pushing for action. While several green groups have warned of the international consequences if the Senate rejected climate legislation before the Copenhagen negotiations, advocates still want to see a floor vote that forces senators to take a stand one way or another.
"People have to understand this vote is going to happen sooner rather than later," said David Goldston, director of government operations at the Natural Resources Defense Council.
Inhofe, the ranking member of the Environment and Public Works Committee, predicts that Democrats will max out around 35 "yes" votes.
"They're going to try to fence off people," said Inhofe, one of 22 Republican senators E&E lists as a sure "no" on the climate bill. "We understand that. And they'll be counting votes as they do it. But I think it's a moving target."
For any group that signs up for the bill, Inhofe said he thinks they are just as likely to back out. "For example," Inhofe said, "when they tried to fence off the wheat growers, they bought into it for a short period of time, and then they said, 'Wait a minute, this is going to be just as hard on us and somebody else.'"
Dan Weiss, a senior fellow at the left-leaning Center for American Progress, has a much bigger target in mind as Democratic leaders gear up for the floor. He said Reid and company should try to have a big enough cushion that they do not need to give in to every demand of every fence-sitting senator.
"Senate leaders obviously want to have more than 60 votes in play," Weiss said.
Bit by bit, advocates for the climate bill expect a winning combination to come together. Asked for the recipe, Goldston said he does not think one compromise will do it. Instead, he said he is watching for coalitions to form on individual issues, with several degrees of overlap.
"There's not one simple way where you get person X and you automatically get everyone else," Goldston said. "The work still has to be done member by member."
Climate bill supporters also say that the senators just need to be reminded that they've been debating many of these unresolved issues -- on everything from cost containment to emission allocations, greenhouse gas targets, offsets, technological availability and international competition -- dating back to the George W. Bush administration.
"The good news is the path to 60 is not particularly mysterious," Grumet said. "The issues have been quite well defined for the last year or so."
And that means that some of the key compromises already reached in the House may just need to be renegotiated, with some state-specific tweaks here and there.
"Everything's been said," Weiss added. "But not everybody's said it."
http://www.eenews.net/EEDaily/2009/10/20/1/
E&E Daily - 10/20/09
by Darren Samuelsohn, E&E senior reporter
The fence is getting a bit more crowded.
Despite two significant moves over the last month -- a bill introduction and the emergence of a possible bipartisan partnership -- the number of senators unwilling to commit to voting for comprehensive climate and energy legislation continues to grow.
According to E&E's latest analysis, 24 senators now belong in the "fence sitter" category that leaves them up for grabs headed into the winter push for 60 votes that sponsors will need to overcome an expected Republican filibuster.
Here's the good news for climate advocates: E&E now finds that at least 67 senators are in play on the issue, enough not only to pass the climate bill but also to ratify an international treaty should sponsors actually run the boards and not lose a single member.
For starters, the bill's lead sponsors, Sens. John Kerry (D-Mass.) and Barbara Boxer (D-Calif.), can safely rely on 31 "yes" votes as they work on building their coalition. That list includes Ben Cardin of Maryland, Jeanne Shaheen of New Hampshire and Tom Udall of New Mexico. All appeared at a Capitol Hill campaign-style rally last month during the public unveiling of the legislation, S. 1733.
Another 12 senators fall into the "probably yes" camp, from Michael Bennet of Colorado to Al Franken of Minnesota and Mark Warner of Virginia. Bennet and Warner are not slam dunks given the fossil fuel interests in their home states, while Franken dropped off the "yes" list when he signed a letter with nine other Democrats in August that raised concerns about President Obama's stance against trade sanctions on carbon-intensive goods from developing countries that do not have strong enough climate policies (E&ENews PM, Aug. 6).
As for the fence sitters, the list continues to swell from both directions as key senators hedge their bets.
For example, Sens. Max Baucus (D-Mont.) and Maria Cantwell (D-Wash.) no longer reside in the "probably yes" camp given their recent statements on allocations and oversight of the carbon markets, respectively. Baucus may drive the hardest bargain as chairman of the Finance Committee, where he is sure to negotiate on behalf of coal-state Democrats who think the House-passed bill unfairly favors electric utilities that service the East and West coasts.
Two senators have recently been upgraded to the fence from the "probably no" camp are Sens. Robert Byrd (D-W.Va.) and George Voinovich (R-Ohio). Byrd has long questioned action to curb emissions but has taken a lead role on carbon sequestration language that Kerry and Boxer are trying to wrap into their proposal. Voinovich has a reputation for bipartisan consensus building, and recent signals supporting the nuclear power industry are raising hopes in some sectors that the retiring senator should still be considered in play.
"If you engage in a very proactive way to get a bill done, he will negotiate and compromise," said a former Senate Republican aide.
E&E's analysis is based on interviews with senators, plus dozens of Democratic and Republican sources, industry and environmental groups.
Counting Republicans
GOP interest is significant for the climate bill's overall prospects given that Democrats are unlikely to carry all 60 of their own votes on the floor.
In all, E&E now lists eight Republicans as "fence sitters" on the climate bill, with the two from Maine -- Susan Collins and Olympia Snowe -- holding firm as "probably yes" votes given their past efforts on the issue. Collins and Snowe are likely to compensate for the loss of Sens. Mary Landrieu of Louisiana and Ben Nelson of Nebraska, the only Democrats listed among 11 "probably no" votes given their many comments questioning the environmental agenda of the Obama administration and Senate leaders.
Elsewhere, sponsors got their biggest boost when Kerry went public with Sen. Lindsey Graham (R-S.C.) on a partnership that they had been quietly working on since the summer. The senators pledged in an Oct. 11 New York Times op-ed that they would try to find compromise on several key areas, including nuclear power, offshore drilling and a border tax on items produced in countries that avoid high environmental standards.
"I can see a way to get to 60 votes, and so can he, if we pull the right folks to the table and do this in the right way," Kerry said last week. "And that's what we're going to do."
Climate advocates are urging Kerry and Graham to turn their broad principles into legislation.
"It's still right now just a possibility," said Manik Roy of the Pew Center on Global Climate Change. "We need to operationalize that."
Graham's support also may be key for other Republicans.
Jason Grumet, a former Obama presidential campaign adviser and the president of the Bipartisan Policy Center, counts as many as 10 Republicans who have been engaged in past climate debates "who are certainly poised to come back if the Graham beachhead becomes more secured."
Sen. Lisa Murkowski (R-Alaska) stands out as one leading GOP candidate to get behind a climate bill. The two-term senator co-sponsored climate legislation last year with Energy and Natural Resources Chairman Jeff Bingaman (D-N.M.) in part because of provisions designed to protect against high energy prices, as well as financial aid to Alaska for adaptation to rising seas and melting permafrost.
So far this year, Murkowski has questioned Democrats' desires to push for a vote on the climate bill before a major U.N. climate conference this December in Copenhagen. At the same time, she said Sunday on C-SPAN that Graham's emergence opens the door further to a number of supply-side provisions she supports, including efforts to expand nuclear power, natural gas and oil production.
"Count me as one of those who will keep my mind open as we move forward in looking at all aspects of this," Murkowski said.
Other fence-sitting Republicans include Sen. Richard Lugar, the six-term senator who has tamped down his optimism this year in part because of unemployment in Indiana that continues to hover near double digits. Lugar said last month in an interview he remains engaged but does not like the approach taken earlier this year with H.R. 2454, the House-passed climate bill.
"I don't know that we've pulled back," Lugar said. "It's just the formulation from the House I find objectionable on many grounds. Without jumping up and down any further, I think more constructive ways of fighting climate change can be found and I'll be working to find it."
Senate Budget Committee ranking member Judd Gregg (R-N.H.) also remains in play, with nuclear power and fiscal issues atop his list of demands. Asked last week about how the Kerry-Graham partnership could influence his vote, Gregg replied, "If nuclear comes under that and has proper incentives, that could be a major step forward."
The party's 2008 presidential nominee, Sen. John McCain (R-Ariz.), poses a big challenge for climate bill advocates (E&E Daily, July 16). While McCain appears to be making headway in his demand for greater incentives for nuclear power, he is in direct conflict with manufacturing state Democrats and Graham, one of his close allies in last year's White House campaign, over the border tax issue.
"I know that I'd never agree to tariffs on the borders for countries that don't comply with our requirements," McCain said last week.
Other big questions revolve around Florida's new GOP senator, George LeMieux. Gov. Charlie Crist (R) appointed LeMieux, his former chief of staff, to be a caretaker to the Senate seat he hopes to win in the 2010 elections.
But Crist must succeed in a Republican primary slated for next August that so far has forced him to distance himself from past progressive views on the climate issue. Already, Crist's opponent, Florida House Speaker Marco Rubio, has garnered the endorsement of Sen. James Inhofe (R-Okla.), an outspoken opponent of global warming legislation. LeMieux's vote will be seen as a critical test for Crist among the state's Republican base (Greenwire, Aug. 17).
Fence-sitting Democrats
The fence also includes moderate Democrats from all corners of the country, some more actively engaged in the climate debate than others.
Sen. Sherrod Brown of Ohio, for example, is crafting language to help manufacturers (E&E Daily, Oct. 14). Michigan's Debbie Stabenow hopes to release long-awaited agriculture ideas. And Sen. Arlen Specter of Pennsylvania will be forced to take a stand as early as next month when Boxer's Environment and Public Works Committee holds a markup on its bill.
Other influential Democratic fence sitters include Michigan Sen. Carl Levin, who said last week that he expects to push at least four issues once the bill nears the floor.
Levin said he will be seeking a national greenhouse gas emission standard and repeal of state-specific standards. Like Franken, he said a border tax adjustment needs to be part of the bill. And Levin said he wants a "fail-safe provision in case the technologies don't advance as quickly as some people think they will."
"And you've got to fairly proportion the burden," Levin added.
Agriculture Chairwoman Blanche Lincoln (D-Ark.) also remains on the fence. The two-term senator said last week that she wants to get a better grip on the effect that a climate bill would have on farmers and in the cost of food to consumers.
"I don't disagree with the objective, and I hope we'll stay focused on the objective, which is to lower our greenhouse gases and emissions and our carbon output," Lincoln said.
Lincoln in past years has cosponsored efforts to address the cost fluctuations in climate legislation. Environmental groups are banking on her and Sen. Mark Pryor (D-Ark.) as key votes that get them to across the 60-vote threshold.
But an industry source tracking the climate debate doubts that Lincoln can sign off on climate legislation as she heads into a heated re-election battle next November. "No amount of National Wildlife Federation polling is going to help her in the delta," the source said. "She has an issue."
Election-year politics also may influence several other Democrats. Specter faces a primary challenge from his left in Rep. Joe Sestak, a campaign that has put an even larger spotlight on his vote (E&E Daily, Oct. 6).
Sen. Evan Bayh (D-Ind.) faces the same unemployment concerns as Lugar but with the added pressure of a 2010 re-election campaign. So far, Bayh has not drawn a significant challenger and political analyst Charlie Cook ranked the race earlier this month as "solid D" for the incumbent. But political observers still see Bayh as vulnerable to home-state concerns.
Other Democrats on the fence include a number of senators representing either coal-consuming or coal-producing states, including Claire McCaskill of Missouri, North Dakota Sens. Kent Conrad and Byron Dorgan, Jay Rockefeller of West Virginia, Jon Tester of Montana and Jim Webb of Virginia. Conrad and Dorgan may be among the most difficult fence sitters to win over. Both have insisted for months that Senate leaders should start with energy-only legislation and save the big climate change measure for later.
Debating floor strategy
Senate Majority Leader Harry Reid (D-Nev.) has so far left open the door on a possible floor debate before the end of the year on the climate bill, but time is running short for the five committees still charged with filling in key details (E&E Daily, Oct. 16).
Committee leaders do not have any deadlines, leaving many to speculate the bill will most likely wait until early 2010 to see any floor action despite Boxer's plans for markup in November. Boxer has said she is waiting for U.S. EPA analysis of her legislation, something agency spokeswoman Betsaida Alcantara said should be finished by Friday.
Environmentalists have not stopped pushing for action. While several green groups have warned of the international consequences if the Senate rejected climate legislation before the Copenhagen negotiations, advocates still want to see a floor vote that forces senators to take a stand one way or another.
"People have to understand this vote is going to happen sooner rather than later," said David Goldston, director of government operations at the Natural Resources Defense Council.
Inhofe, the ranking member of the Environment and Public Works Committee, predicts that Democrats will max out around 35 "yes" votes.
"They're going to try to fence off people," said Inhofe, one of 22 Republican senators E&E lists as a sure "no" on the climate bill. "We understand that. And they'll be counting votes as they do it. But I think it's a moving target."
For any group that signs up for the bill, Inhofe said he thinks they are just as likely to back out. "For example," Inhofe said, "when they tried to fence off the wheat growers, they bought into it for a short period of time, and then they said, 'Wait a minute, this is going to be just as hard on us and somebody else.'"
Dan Weiss, a senior fellow at the left-leaning Center for American Progress, has a much bigger target in mind as Democratic leaders gear up for the floor. He said Reid and company should try to have a big enough cushion that they do not need to give in to every demand of every fence-sitting senator.
"Senate leaders obviously want to have more than 60 votes in play," Weiss said.
Bit by bit, advocates for the climate bill expect a winning combination to come together. Asked for the recipe, Goldston said he does not think one compromise will do it. Instead, he said he is watching for coalitions to form on individual issues, with several degrees of overlap.
"There's not one simple way where you get person X and you automatically get everyone else," Goldston said. "The work still has to be done member by member."
Climate bill supporters also say that the senators just need to be reminded that they've been debating many of these unresolved issues -- on everything from cost containment to emission allocations, greenhouse gas targets, offsets, technological availability and international competition -- dating back to the George W. Bush administration.
"The good news is the path to 60 is not particularly mysterious," Grumet said. "The issues have been quite well defined for the last year or so."
And that means that some of the key compromises already reached in the House may just need to be renegotiated, with some state-specific tweaks here and there.
"Everything's been said," Weiss added. "But not everybody's said it."
http://www.eenews.net/EEDaily/2009/10/20/1/
Tuesday, September 22, 2009
Lugar speech on energy security and climate change
Dick Lugar
U.S. Senator for Indiana
Date: 09/21/2009 • http://lugar.senate.gov
Contact: Andy Fisher • 202-224-2079 • andy_fisher@lugar.senate.gov
________________________________________
Following is the text of a speech by U.S. Sen. Dick Lugar this morning at the Energy Security as National and Economic Security forum sponsored by IUPUI’s Lugar Center for Renewable Energy and the Pew Environmental Group in Indianapolis, Indiana. Today is the first day of Global Climate Week.
Thank you, Mayor Ballard, for your kind introduction and for your important leadership on energy issues in Indianapolis. I also want to thank Chancellor Charles Bantz, Dr. Andrew Hsu, and the entire team at the Lugar Center for Renewable Energy for hosting us today. The Lugar Center is at the forefront of research and education on energy issues. It is a catalyst for the ground-breaking collaboration of Hoosier universities, private industry, government, and our national labs.
The work of the Lugar Center and other energy research endeavors is vital because the United States is confronted by a cluster of national security threats that arise from our economic and cultural reliance on fossil fuels.
First, our immediate dependence on oil, a large percentage of which is controlled by hostile or unstable regimes concentrated in the volatile Middle East, increases our vulnerability to natural disasters, wars, and terrorist attacks that can disrupt the lifeblood of the international economy. It also means that we are sending hundreds of billions of dollars each year to authoritarian regimes. This revenue stream emboldens oil-rich governments and enables them to entrench corruption, fund anti-Western demagogic appeals, and support terrorism.
Second, we face the prospect of manipulation of oil and natural gas supplies by producers seeking political leverage. Vulnerability to such leverage has strained our alliances and poses a persistent threat to the global economy. Moreover, nations experiencing a cutoff of energy supplies, or even the threat of a cutoff, may become desperate, increasing the chances of armed conflict, terrorism, and economic collapse.
Third, we face longer term prospects of increased competition for finite resources, most notably, oil. At some point – even with vigorous exploration and development efforts – global demand for oil will exceed supply. As we approach the point when the world's oil-hungry economies are competing for insufficient supplies of energy, oil will become an even stronger magnet for conflict. Although the current recession has softened demand for oil, it has also led to falling investment in the energy sector. The International Energy Agency projects that global investment in oil and natural gas production will fall by $100 billion this year. These cuts come at a time when more investment is needed to counteract high oil field decline rates. This increases the possibility of extreme oil scarcity in the relatively near future.
And fourth, a concern at the center of public debate today is the series of international crises that may arise out of drought, food shortages, rising seas, and other manifestations of climate change.
This list does not necessarily exhaust the consequences we may face. But it underscores one of the dilemmas for policymakers, namely, that the multiple threats related to fossil fuel dependence are not identical. They each have a unique time horizon and threat intensity.
Some actions we might take, such as developing renewable fuels, may be useful in addressing the entire cluster of threats. But some steps that might be beneficial for reducing oil dependence, such as powering new vehicles with electricity generated by conventional coal technologies, may aggravate greenhouse gas emissions. Still other steps that might be beneficial for climate change may worsen other threats in the cluster. For example, EPA regulations on land-use changes could stunt biofuels production, or carbon regulation at home could increase import dependence on refined petroleum products.
Even as we work for a conversion from a fossil fuel dominated economy to one that depends much more on renewable resources, failure to maintain reliable supplies of oil and natural gas in the interim could be debilitating to our economy and our national security. Therefore, as we seek to reduce carbon output, we cannot afford to be complacent in the development of domestic oil and gas supplies, nor can we neglect bilateral relationships with key energy producers around the world or fail to reinforce multilateral energy cooperation.
Our task is not just to anticipate all possible national security threats that might emerge in the future due to our current energy portfolio. We have to develop timelines that compare the relative immediacy of these threats, and prioritize accordingly. Then we have to make rational choices about where and how to apply limited resources.
Heightened public understanding of the scope of our energy challenge has led to considerable progress on embracing an “all of the above” approach to energy policy. Development of renewables, expanded oil and natural gas production, improved use of coal, a revival of nuclear power, and efficiency improvements are all on the table, as they should be. Similarly, a growing consensus is emerging on the need for progress in building out the transmission grid, reforming utilities regulation to allow for dispersed generation and rate decoupling, and using smart meters. With coal generating more than half of the energy we use, carbon capture, storage, and recycling technologies are essential.
Economic Recovery and Climate Change
U.S. Senator for Indiana
Date: 09/21/2009 • http://lugar.senate.gov
Contact: Andy Fisher • 202-224-2079 • andy_fisher@lugar.senate.gov
________________________________________
Following is the text of a speech by U.S. Sen. Dick Lugar this morning at the Energy Security as National and Economic Security forum sponsored by IUPUI’s Lugar Center for Renewable Energy and the Pew Environmental Group in Indianapolis, Indiana. Today is the first day of Global Climate Week.
Thank you, Mayor Ballard, for your kind introduction and for your important leadership on energy issues in Indianapolis. I also want to thank Chancellor Charles Bantz, Dr. Andrew Hsu, and the entire team at the Lugar Center for Renewable Energy for hosting us today. The Lugar Center is at the forefront of research and education on energy issues. It is a catalyst for the ground-breaking collaboration of Hoosier universities, private industry, government, and our national labs.
The work of the Lugar Center and other energy research endeavors is vital because the United States is confronted by a cluster of national security threats that arise from our economic and cultural reliance on fossil fuels.
First, our immediate dependence on oil, a large percentage of which is controlled by hostile or unstable regimes concentrated in the volatile Middle East, increases our vulnerability to natural disasters, wars, and terrorist attacks that can disrupt the lifeblood of the international economy. It also means that we are sending hundreds of billions of dollars each year to authoritarian regimes. This revenue stream emboldens oil-rich governments and enables them to entrench corruption, fund anti-Western demagogic appeals, and support terrorism.
Second, we face the prospect of manipulation of oil and natural gas supplies by producers seeking political leverage. Vulnerability to such leverage has strained our alliances and poses a persistent threat to the global economy. Moreover, nations experiencing a cutoff of energy supplies, or even the threat of a cutoff, may become desperate, increasing the chances of armed conflict, terrorism, and economic collapse.
Third, we face longer term prospects of increased competition for finite resources, most notably, oil. At some point – even with vigorous exploration and development efforts – global demand for oil will exceed supply. As we approach the point when the world's oil-hungry economies are competing for insufficient supplies of energy, oil will become an even stronger magnet for conflict. Although the current recession has softened demand for oil, it has also led to falling investment in the energy sector. The International Energy Agency projects that global investment in oil and natural gas production will fall by $100 billion this year. These cuts come at a time when more investment is needed to counteract high oil field decline rates. This increases the possibility of extreme oil scarcity in the relatively near future.
And fourth, a concern at the center of public debate today is the series of international crises that may arise out of drought, food shortages, rising seas, and other manifestations of climate change.
This list does not necessarily exhaust the consequences we may face. But it underscores one of the dilemmas for policymakers, namely, that the multiple threats related to fossil fuel dependence are not identical. They each have a unique time horizon and threat intensity.
Some actions we might take, such as developing renewable fuels, may be useful in addressing the entire cluster of threats. But some steps that might be beneficial for reducing oil dependence, such as powering new vehicles with electricity generated by conventional coal technologies, may aggravate greenhouse gas emissions. Still other steps that might be beneficial for climate change may worsen other threats in the cluster. For example, EPA regulations on land-use changes could stunt biofuels production, or carbon regulation at home could increase import dependence on refined petroleum products.
Even as we work for a conversion from a fossil fuel dominated economy to one that depends much more on renewable resources, failure to maintain reliable supplies of oil and natural gas in the interim could be debilitating to our economy and our national security. Therefore, as we seek to reduce carbon output, we cannot afford to be complacent in the development of domestic oil and gas supplies, nor can we neglect bilateral relationships with key energy producers around the world or fail to reinforce multilateral energy cooperation.
Our task is not just to anticipate all possible national security threats that might emerge in the future due to our current energy portfolio. We have to develop timelines that compare the relative immediacy of these threats, and prioritize accordingly. Then we have to make rational choices about where and how to apply limited resources.
Heightened public understanding of the scope of our energy challenge has led to considerable progress on embracing an “all of the above” approach to energy policy. Development of renewables, expanded oil and natural gas production, improved use of coal, a revival of nuclear power, and efficiency improvements are all on the table, as they should be. Similarly, a growing consensus is emerging on the need for progress in building out the transmission grid, reforming utilities regulation to allow for dispersed generation and rate decoupling, and using smart meters. With coal generating more than half of the energy we use, carbon capture, storage, and recycling technologies are essential.
Economic Recovery and Climate Change
As we work to address energy-driven security threats, we also must take stock of what individual policies would mean for the economic vitality of our country. Solutions to our energy problems do not exist in isolation from the global economy. The global economic downturn has reduced energy demand, bringing greater flexibility to markets. Yet, when major economies start to recover, energy demand will rebound, causing markets to tighten and prices to rise. Under such conditions, markets will be highly susceptible to vulnerabilities that can produce severe supply shocks. In the near term, if we fail to address these vulnerabilities, the prospects for economic recovery could be seriously imperiled. An oil price shock that hits just as a recovery is beginning and demand for energy is increasing would likely generate inflation, undermine market confidence, and increase the risks of conflict.
Individual Americans and the national budget both face extraordinary economic challenges. While some economic indicators have shown signs of incremental improvement in recent weeks, a number of areas continue to cause concern. This is especially true with regard to unemployment.
Although the pace of job loss may finally be abating, overall unemployment continues to rise. The national unemployment rate now hovers just below 10 percent. In Indiana, we reached the 10 percent threshold six months ago, with a half dozen of our counties contending with unemployment rates above 15 percent. Even more troubling is the presence of greater long term unemployment in this recession compared to previous downturns.
It is within this economic context that the Senate may consider a cap and trade program. The cap and trade mechanism has become a central focus of the energy and climate debate in Washington.
I believe that the U.S. must attempt to reduce greenhouse gas emissions. To be successful, we must study, carefully, economic and political realities.
Some observers optimistically estimate that the loss in per capita U.S. GDP resulting from the Waxman-Markey cap and trade approach adopted by the House of Representatives would be between one and two percent. But even that level of reduced national growth is far from benign. Economic growth is the engine through which jobs are created, innovation is spurred, and entrepreneurship is launched – including innovation in the green economy that we are striving to nurture. In the absence of economic revival and sustained economic growth in the United States, it is unrealistic to expect that the American public will maintain support for such a massively expensive carbon control program. In the absence of economic stability worldwide, developing countries are unlikely to make the investments necessary to convert the world to a less carbon intensive existence.
Similarly, public support for steps to reduce carbon would likely be undercut if we experience intense shocks to the American way of life stemming from our dependence on oil. For example, if peak oil scenarios, politically motivated embargos, wars, or natural disasters result in a sustained and severe curtailment of the availability of gasoline and heating oil before we have developed an alternative system, all bets are off for policies directed at mitigating climate change. If the American public and economy are rendered immobile by a sustained oil shock of a severity we have yet to experience, it is almost inconceivable that they would tolerate government imposed sacrifices focused on climate change that add to their burdens and slow the economy further. In this context, breaking our oil dependence, with all the national security, economic, and environmental benefits that would come with such a victory, must be our top energy priority. This does not mean that overcoming oil dependence and addressing climate concerns cannot be pursued simultaneously. They must be. But climate efforts must not cause us to lose focus on the immediate risks presented by our oil dependence, and preference should be given to steps in the climate arena that also have utility in mitigating oil dependence.
Due to our state’s heavy reliance on coal for electricity, jobs tied to energy intensive manufacturing sectors, and broad agricultural base, GDP losses under the Waxman-Markey bill would be disproportionately felt by Hoosiers. Concessions made in the Waxman-Markey bill to appease a broad host of interests, including allocations made to power producers, may have made this worse by shifting some transition funds from the Midwest to coastal consumers.
Congress should continue to examine options for establishing policies that provide consistent signals to guide markets toward long-term energy transformation and continual innovation. Cap and trade, in a variety of formats, is one among several policy alternatives that the United States Senate will discuss in an effort to solve the most basic energy policy challenge before us, which is that many consumption decisions being made in the United States do not account for the basket of security costs posed by our current energy portfolio. The same can be said of the long-term costs of greenhouse gas emissions on our environment. In such cases, classic economics indicates that one of the most efficient solutions would be to enact policies that price our energy consumption decisions as accurately and transparently as possible.
Externality pricing alone, however, is not a cure-all for our energy security problems. In some cases, targeted interventions are justified to correct specific market failures and can bring achievable results in the near term. For example, many readily available and cost-effective energy efficiency upgrades exist for new homes, yet they are not widely used. Improved home and building energy efficiency codes, which automatically increase over time, would overcome inefficiencies and encourage manufacturers and developers to find new and cheaper ways to save energy, and, thus, save money for home owners and building managers.
It is prudent to act on policies to guard against climatic change and adapt to changes already likely to occur. But we should also give priority to steps that would simultaneously yield benefits for other U.S. priorities, such as bolstering energy independence, strengthening our economy, generating export markets for high technology industries, developing our rural economy and improving air quality. In other words, economic sacrifices undertaken by the American people in pursuit of energy and environmental security must deliver far more than just a reduction of U.S.-produced carbon.
Achieving Energy and Climate Gains
Notwithstanding my caution on the Waxman-Markey cap and trade formula, we should act quickly on a number of measures that would reduce our dependence on foreign oil, help limit the foreign policy risks of global hydrocarbon dependence, support economic growth, and cut greenhouse gas emissions.
Relatively quick progress on cutting oil dependence and slashing carbon emissions can be achieved from biofuels usage, even as we also transition to a more electrified transportation system. Efficiencies in buildings, homes, appliances, and manufacturing facilities are easy wins for our economy and the environment. Innovation is already happening, but we need fiscally-prudent and tactically-focused programs to jumpstart such actions to scale. To this end, Senator Merkley and I recently introduced a bill that would facilitate loans for homeowners and small businesses to make energy saving renovations.
Our main oil savings will come from the transportation sector, which contributes about a third of our greenhouse gas emissions. If current federal goals are met, biofuels produced in the United States would equal 20 percent of our current fuel needs and reduce greenhouse gas emissions by 90 percent compared to the fuel they replace. Although we have passed an expansive renewable fuels mandate, the mandate alone does not ensure that the necessary technological breakthroughs and infrastructure enhancements will occur.
Urgent attention should be given to improving the mix of feedstocks that can be turned into fuel. We should transition out of the current static biofuels subsidy programs, which, in my judgment, will become more difficult to extend as the cost rises and therefore will become less effective at encouraging investment. Instead, we should embrace market assurances tied directly to the price of petroleum, creating more reliable incentives and adopting a more taxpayer friendly approach. And finally, we must ensure that all new vehicles can employ multiple fuel sources, giving choice to consumers and spreading the reach of biofuels at low cost.
Similar focus and policy coherence needs to be given to accelerating advanced vehicle technologies and the batteries necessary to make them practical – areas in which Hoosier companies and workers excel. The potential of electric vehicle technology is tremendous. Since most commutes are less than 40 miles a day, a vehicle with a 40-mile battery range could eliminate daily gasoline needs for most Americans. Automotive innovation can help give new economic life to communities that have struggled because of the auto industry’s woes. We have seen new entrepreneurial companies like Bright Automotive and Carbon Motors choose to locate in Indiana. Federal government programs meant to foster research and leverage private investment must be geared toward true innovation, spurring transition in our existing infrastructure and ensuring that programs are suitably calibrated to support new entrepreneurial companies at the cutting edge of innovation.
Innovative technologies like those being developed at the Lugar Center and in the labs and companies represented by many of you today are the key to achieving security and environmental gains without sacrificing economic growth. If we are to succeed, we must have consistent research support and prevent innovative technologies from being lost in the so-called ‘valley of death’ between R&D phases and commercialization due to lack of affordable credit – a situation that has worsened with the recession.
Tools such as loan guarantees can help new technologies prove their commercial viability. However, the Department of Energy completed the first such loan guarantee just two weeks ago – four years after the program was authorized. This inconceivable delay underscores the need for a far more focused effort. Recently I joined with Senators Bingaman and Murkowski to offer legislation that would establish a Clean Energy Deployment Administration with the mission to help new technologies prove themselves commercially and facilitate wide-scale deployment over a limited period of time. Such assistance needs to be fiscally responsible and careful to energize private investment, not crowd it out.
Finally, governments at the federal, state, and local levels should ensure that their own substantial procurement funds are promoting innovative materials that save energy – and save taxpayers’ money. Federal facilities should use the most energy efficient building materials available and can serve as test beds to demonstrate new products. Our vehicle fleets should use hybrids and electric vehicles, and they should be flex-fuel capable of using high-blends of biofuels. Even as the procurement power of the government enlivens markets for innovation, it will also help demonstrate to Americans that cost-effective energy and climate solutions exist today.
A Global Challenge
The challenge of deploying clean energy technologies is not limited to our domestic efforts. The energy choices being made around the world impact our own security, economy, and environment. The scale of the challenge dwarfs our own transition. Emerging economies far outpace us in energy demand growth. For many people in impoverished countries, this growth is a matter of survival, not luxury, so we should not be surprised when countries pursue the lowest-cost power options such as coal and firewood. Yet, many countries in the developing world are also the most susceptible to variations in energy markets, manipulation of energy supplies, and possible impacts of climatic change.
We have a common interest in finding cleaner and affordable energy solutions soon, and deploying them as quickly as possible on a global scale. The United Nations recently estimated that the cost of such a transition in the developing world will be $500 to $600 billion annually over the next decade. Bridging this gap will depend on innovative programs that leverage large-scale private investment in developing nations. We also must have mechanisms for assisting other countries to develop inexpensive energy saving and producing technologies and techniques. U.S. leadership now would help capture blossoming market opportunities for American products and services.
Freer trade in clean energy technologies can help boost competition, find efficiencies of scale, and open valuable markets for U.S. companies. Yet, global trade barriers on such technologies are substantial. Considering that a central goal of climate change advocates is to spread clean energy technologies, it is ironic that climate change is being used as a foil for protectionism. For example, the Waxman-Markey bill would raise tariffs, threatening to set off trade confrontations with those countries we most need to adopt new energy technologies – and buy our government bonds.
More fundamentally, we must integrate energy concerns at the top of our diplomatic and foreign assistance agenda. As we seek to find ways to spread innovative energy technologies and techniques around the world, we must bear in mind that they will only be effective at scale with underlying policy frameworks reinforced with improved governance and political support in place. In other words, addressing energy security and climate change is an issue of governance and development, and we must integrate those into our ongoing dialogues around the world, not separate them. The advancement of the rule of law and transparency in partner nations is critical to ensuring that energy investments are efficient and productive.
The United States should demonstrate its leadership by adopting the pro-energy security and pro-climate change steps I have elaborated here today, and many more that I have not had time to detail. Complex treaty negotiations are not a pre-condition for implementing a pro-growth campaign of initiatives that would have an immediate and direct impact on the entire cluster of problems associated with our fossil fuel dependency.
Conclusion
We have a common interest in finding cleaner and affordable energy solutions soon, and deploying them as quickly as possible on a global scale. The United Nations recently estimated that the cost of such a transition in the developing world will be $500 to $600 billion annually over the next decade. Bridging this gap will depend on innovative programs that leverage large-scale private investment in developing nations. We also must have mechanisms for assisting other countries to develop inexpensive energy saving and producing technologies and techniques. U.S. leadership now would help capture blossoming market opportunities for American products and services.
Freer trade in clean energy technologies can help boost competition, find efficiencies of scale, and open valuable markets for U.S. companies. Yet, global trade barriers on such technologies are substantial. Considering that a central goal of climate change advocates is to spread clean energy technologies, it is ironic that climate change is being used as a foil for protectionism. For example, the Waxman-Markey bill would raise tariffs, threatening to set off trade confrontations with those countries we most need to adopt new energy technologies – and buy our government bonds.
More fundamentally, we must integrate energy concerns at the top of our diplomatic and foreign assistance agenda. As we seek to find ways to spread innovative energy technologies and techniques around the world, we must bear in mind that they will only be effective at scale with underlying policy frameworks reinforced with improved governance and political support in place. In other words, addressing energy security and climate change is an issue of governance and development, and we must integrate those into our ongoing dialogues around the world, not separate them. The advancement of the rule of law and transparency in partner nations is critical to ensuring that energy investments are efficient and productive.
The United States should demonstrate its leadership by adopting the pro-energy security and pro-climate change steps I have elaborated here today, and many more that I have not had time to detail. Complex treaty negotiations are not a pre-condition for implementing a pro-growth campaign of initiatives that would have an immediate and direct impact on the entire cluster of problems associated with our fossil fuel dependency.
Conclusion
I conclude with this thought. Energy is at the root of multiple threats to our country. Some of those threats we see today and feel personally, others may develop in the more distant future. As we endeavor to act on climate change, we should favor and accelerate policies that strengthen America against other threats that also are derived by how we generate and use energy. We are fortunate that many win-win policy options are achievable today. Energy security improvements and greenhouse gas reductions demonstrate commitment to our security, to working with global partners on common threats and, most importantly, commitment to future generations.
Thank you.
###
Thursday, April 3, 2008
Business & Environmental Groups Urge Sen. Lugar to Support Tax Incentives for Renewable Energy
3 April 2008
SENT VIA E-MAIL
The Honorable Richard Lugar
U.S. Senate
306 Hart Senate Building
Washington, DC 20510-1401
Dear Senator Lugar:
As a coalition of businesses and environmental organizations, we urge you to pass bipartisan legislation as soon as possible that extends federal tax incentives for energy efficiency and renewable energy technologies and consumer purchases of energy efficient products. These critically important incentives have expired or will expire at the end of this year and must be extended immediately to avoid significant harm to the developing clean energy industries in the United States.
We urge extension of incentives for renewable energy production, energy efficiency in commercial buildings, investment in solar electric systems, use of efficient home heating and cooling equipment, production of efficient home appliances, construction of efficient new homes, efficiency retrofits to existing homes, and consumer purchases of energy efficient products. The technologies produced by these industries play a vital role in reducing global warming pollution, creating new high-wage American jobs, spurring economic growth and saving consumers and businesses money on their energy bills.
It is essential for the development of clean technology industries that extensions of the efficiency and renewable energy tax incentives remain effective for multiple years. Congress has historically extended the clean energy incentives in one or two-year increments, which creates a boom-bust cycle for the technologies covered by the incentives. This cycle undermines the efficient development of the clean energy technology industries into mature industries.
It is critical for the sustained development of the clean energy technology industries that efficiency and renewable energy tax incentives be promptly extended. The delay in extending these provisions is already discouraging investment decisions today for clean energy projects that will be completed in 2009 or later. According to a recent study by Navigant Consulting, failure to promptly extend renewable energy tax incentives places at risk 116,000 jobs in the wind and solar industries and more than $19 billion in clean energy investment.
America is on the cusp of a new, clean energy economy. Extending efficiency and renewable energy tax incentives is critical to promoting the transition to this economy. They will help get us started on solving the global warming problem, reduce energy prices for consumers and create new high-wage jobs. We urge you to do everything you can to ensure prompt passage of legislation with significant bipartisan support that adopts long-term extensions of the efficiency and renewable energy tax incentives and can be enacted into law this spring.
Sincerely,
Laura Ann Arnold, President
Indiana Renewable Energy Association
3M
AIA Indiana Chapter
American Council for an Energy-Efficient Economy
American Solar Energy Society
BOSCH
Bright Idea Energy Services, Evansville, IN
Dow Chemical Company
Duke Energy
ECI Wind & Solar, Fairmount, IN
Green Way Supply, Indianapolis, IN
Home & Mobile Energy, Middlebury, IN
Hoosier Chapter of the Sierra Club
Hoosier Environmental Council
Horizon Wind
Indiana Wildlife Federation
Indy Solar Works, LLC, Indianapolis, IN
Inovateus Development, South Bend, IN
Inverde, Fishers, IN
Johnson Controls
Kyocera
Macy's
Morton Energy, Evansville, IN
National Association of State Energy Officials
National Small Business Association
Oerlikon
Polyisocyanurate Insulation Manufacturers Association
PPG Industries
Reinforcing Services, Markle, IN
Solar Systems of Indiana, Bloomington, IN
SPI Industries, South Bend, IN
Spirax Sarco, Inc
Sun Rise Solar, St. John, IN
Sun Wind Power Inc., Floyds Knobs, IN
Sunvention, Greencastle, IN
US Green Building Council - Indiana Chapter
USA Solar & Wind Inc.
WaterFurnace
If you agree with us, please send your own letter to Sen. Richard Lugar.
senator.lugar@lugar.senate.gov
SENT VIA E-MAIL
The Honorable Richard Lugar
U.S. Senate
306 Hart Senate Building
Washington, DC 20510-1401
Dear Senator Lugar:
As a coalition of businesses and environmental organizations, we urge you to pass bipartisan legislation as soon as possible that extends federal tax incentives for energy efficiency and renewable energy technologies and consumer purchases of energy efficient products. These critically important incentives have expired or will expire at the end of this year and must be extended immediately to avoid significant harm to the developing clean energy industries in the United States.
We urge extension of incentives for renewable energy production, energy efficiency in commercial buildings, investment in solar electric systems, use of efficient home heating and cooling equipment, production of efficient home appliances, construction of efficient new homes, efficiency retrofits to existing homes, and consumer purchases of energy efficient products. The technologies produced by these industries play a vital role in reducing global warming pollution, creating new high-wage American jobs, spurring economic growth and saving consumers and businesses money on their energy bills.
It is essential for the development of clean technology industries that extensions of the efficiency and renewable energy tax incentives remain effective for multiple years. Congress has historically extended the clean energy incentives in one or two-year increments, which creates a boom-bust cycle for the technologies covered by the incentives. This cycle undermines the efficient development of the clean energy technology industries into mature industries.
It is critical for the sustained development of the clean energy technology industries that efficiency and renewable energy tax incentives be promptly extended. The delay in extending these provisions is already discouraging investment decisions today for clean energy projects that will be completed in 2009 or later. According to a recent study by Navigant Consulting, failure to promptly extend renewable energy tax incentives places at risk 116,000 jobs in the wind and solar industries and more than $19 billion in clean energy investment.
America is on the cusp of a new, clean energy economy. Extending efficiency and renewable energy tax incentives is critical to promoting the transition to this economy. They will help get us started on solving the global warming problem, reduce energy prices for consumers and create new high-wage jobs. We urge you to do everything you can to ensure prompt passage of legislation with significant bipartisan support that adopts long-term extensions of the efficiency and renewable energy tax incentives and can be enacted into law this spring.
Sincerely,
Laura Ann Arnold, President
Indiana Renewable Energy Association
3M
AIA Indiana Chapter
American Council for an Energy-Efficient Economy
American Solar Energy Society
BOSCH
Bright Idea Energy Services, Evansville, IN
Dow Chemical Company
Duke Energy
ECI Wind & Solar, Fairmount, IN
Green Way Supply, Indianapolis, IN
Home & Mobile Energy, Middlebury, IN
Hoosier Chapter of the Sierra Club
Hoosier Environmental Council
Horizon Wind
Indiana Wildlife Federation
Indy Solar Works, LLC, Indianapolis, IN
Inovateus Development, South Bend, IN
Inverde, Fishers, IN
Johnson Controls
Kyocera
Macy's
Morton Energy, Evansville, IN
National Association of State Energy Officials
National Small Business Association
Oerlikon
Polyisocyanurate Insulation Manufacturers Association
PPG Industries
Reinforcing Services, Markle, IN
Solar Systems of Indiana, Bloomington, IN
SPI Industries, South Bend, IN
Spirax Sarco, Inc
Sun Rise Solar, St. John, IN
Sun Wind Power Inc., Floyds Knobs, IN
Sunvention, Greencastle, IN
US Green Building Council - Indiana Chapter
USA Solar & Wind Inc.
WaterFurnace
If you agree with us, please send your own letter to Sen. Richard Lugar.
senator.lugar@lugar.senate.gov
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