House Republicans Ask Waxman to Investigate EPA (Staff)
The WSJ’s Dana Mattioli reported yesterday afternoon on the latest development in congressional oversight of the EPA’s California waiver decision:
In a letter today, two senior Republicans on the House Committee on Oversight and Government Reform asked the panel’s chairman, Henry Waxman (D., Calif.), to investigate whether top EPA staffers either violated federal rules that restrict regulators from lobbying, or “misused their positions to surreptitiously influence” EPA’s decision on whether to allow California to regulate carbon-dioxide emissions from vehicles.
Reps. Tom Davis (R-VA) and Darrell Issa (R-CA) are mad at Margo Oge and Christopher Grundler, the senior EPA officials tasked with evaluating California’s waiver request and (unsuccessfully) telling Administrator Stephen Johnson that he had no choice but to grant it. Congressional oversight of that decision revealed that the pair subsequently provided former EPA Administrator William Reilly—at Reilly’s request—talking points with which to argue the waiver’s merits to Johnson.
Davis and Issa argue that this deserves the same level of scrutiny that Waxman devoted to a surreptitious plan to lobby Congress and governors against the waiver—Johnson may have also been a target, but he could not recall whether that was the case—deployed last summer by Secretary of Transportation Mary Peters, White House officials, and industry lobbyists.
This actually isn’t the first time that congressional Republicans have gone after Oge and Grundler. During a hearing that followed the revelation of the Reilly memo and other EPA documents, Senator James Inhofe (R-OK) asked Administrator Johnson whether his employees had violated the Hatch Act. Johnson defended their actions, saying that he has "always encouraged my staff to give me candid and open advice" (he just reserves the right to ignore it, even when phrased as a clear mandate and not simply advice, and the resulting fallout severely alienates staff unions).
Rep. Waxman responded to the letter by pledging to give it "careful consideration," while noting that the Committee had "found no evidence that EPA career staff lobbied members of Congress with respect to [California’s request]" (translation: the Davis-Issa analogy to his previous investigation is bunk). For his part, Reilly, who ran EPA under the first President Bush and granted California several waivers, has said that his communications with career staff who served under him were not unprecedented, let alone improper or illegal.
S. 1870, the Clean Water Restoration Act of 2007
- Carol M. Browner, Principal, The Albright Group, LLC, Former Administrator, U.S. Environmental Protection Agency
- Alexander B. Grannis, Commissioner, New York State Department of Environmental Conservation
- Joan Card, Water Quality Division Director, Arizona Department of Environmental Quality
- David P. Brand P.E., P.S., Sanitary Engineer, Madison County, State of Ohio
- Randall P. Smith, Smith 6-S Livestock
Pending legislation for Southwest water projects
The purpose of the hearing is to receive testimony on the following bills: S.2259/H.R. 813, to amend the Reclamation Wastewater and Groundwater Study and Facilities Act to authorize the Secretary of the Interior to participate in the Prado Basin Natural Treatment System Project, to authorize the Secretary to participate in the Lower Chino Dairy Area desalination demonstration and reclamation project, and for other purposes; H.R. 31, to amend the Reclamation Wastewater and Groundwater Study and Facilities Act to authorize the Secretary of the Interior to participate in the Elsinore Valley Municipal Water District Wildomar Service Area Recycled Water Distribution Facilities and Alberhill Wastewater Treatment and Reclamation Facility Projects; H.R. 716, to amend the Reclamation Wastewater and Groundwater Study and Facilities Act to authorize the Secretary of the Interior to participate in the Santa Rosa Urban Water Reuse Plan; H.R. 786, to amend the Reclamation Wastewater and Groundwater Study and Facilities Act to authorize the Secretary of the Interior to participate in the Los Angeles County Water Supply Augmentation Demonstration Project, and for other purposes; H.R. 1140, to authorize the Secretary, in cooperation with the City of San Juan Capistrano, California, to participate in the design, planning, and construction of an advanced water treatment plant facility and recycled water system, and for other purposes; H.R. 1503, to amend the Reclamation Wastewater and Groundwater Study and Facilities Act to authorize the Secretary of the Interior to participate in the Avra/Black Wash Reclamation and Riparian Restoration Project; H.R. 1725, to amend the Reclamation Wastewater and Groundwater Study and Facilities Act to authorize the Secretary of the Interior to participate in the Rancho California Water District Southern Riverside County Recycled/Non-Potable Distribution Facilities and Demineralization/Desalination Recycled Water Treatment and Reclamation Facility Project; H.R. 1737, to amend the Reclamation Wastewater and Groundwater Study and Facilities Act to authorize the Secretary of the Interior to participate in the design, planning, and construction of permanent facilities for the GREAT project to reclaim, reuse, and treat impaired waters in the area of Oxnard, California; and H.R. 2614, to amend the Reclamation Wastewater and Groundwater Study and Facilities Act to authorize the Secretary of the Interior to participate in certain water projects in California.
Witness- Mr. Kris Polly , Deputy Commissioner for External & Intergovernmental Affairs, Bureau of Reclamation, DOI
Renewable Tax Incentive Amendment to Housing Package Expected Today
The Senate is meeting this afternoon to resume consideration of Sen. Chris Dodd’s (D-Conn.) Foreclosure Prevention Act (S. Amdt 4387 to H.R. 3221).
On the docket for consideration today is the Ensign-Cantwell amendment (S.Amdt 4419), the latest attempt by Congress to continue renewable and energy efficiency tax incentives due to expire this year. The details of the package offered by Sen. John Ensign (R-Nev.) and Maria Cantwell (D-Wash.) were first reported by Hill Heat last week.
Also up for consideration is Sen. Lamar Alexander’s (R-Tenn.) and Jon Kyl’s (R-Ariz.) second-degree amendment (S. Amdt 4429), which would extend the tax credits from 2009 to 2011 and tweak the marine energy and trash combustion credits.
CQ reported that Sen. Dodd exploded on the floor last week in opposition to efforts to include extensions of the clean energy tax credits, saying “This is a housing bill! This isn’t a Christmas tree! It’s a housing bill! I’m going to oppose every one of these [unrelated amendments] from here on out.”
Dodd did not note the irony that the housing package is being considered as a completely unrelated replacement substitute to the House’s Renewable Energy and Energy Conservation Tax Act (H.R. 3221), which would have rolled back tax breaks for oil companies in order to pay for the renewable tax incentives (and has been blocked repeatedly in the Senate, most recently in February). The Ensign-Cantwell amendment does not provide any funding mechanism for the tax credit continuation, and would violate pay-go rules. The Alexander-Kyl amendment would exacerbate the funding problem.
Lieberman: We're Close to Sixty Votes; Reid: L-W Hits Floor in June
At the A&WMA conference yesterday, Sen. Joe Lieberman (I-CT) spoke optimistically about getting the sixty votes necessary to forestall any filibuster against his cap-and-trade bill, the Lieberman-Warner Climate Security Act (S. 2191). According to Darren Samuelson of E&E News, he told attendees that 45 senators are “heavily with us” and 15 more have a “heavy tilt in our direction, if we can do some small things.”
“We can find only 20 we can put in the category of hopeless, that is with regard to this particular bill.”
Because Sen. McCain (R-Ariz.) has criticized Lieberman-Warner’s lack of explicit nuclear subsidies, Sen. Lieberman acknowledged McCain is not an “aye” vote, saying “Just out of respect, I’d have to put him in the middle category. A heavy lean.”
Samuelson also reports:Senate Majority Leader Harry Reid (D-Nev.) has given Lieberman and his allies a green light to take the bill to the Senate floor during the week of June 2-6, the first week back from Congress’ Memorial Day recess, a Reid spokeswoman said today.
New Senate Renewable Tax Package Possible Today
According to a report in CQ Tuesday, the Senate deadlock on the renewable tax-credit package may have broken, led by efforts by Sen. Maria Cantwell (D-Wash.) and John Ensign (R-Nev.). Ensign told reporters he expects “a big announcement” on Thursday.
Details of the renewable incentives have been released, but not the full package, including revenue provisions (that is, is oil company tax breaks will be rolled back) and other elements that have been in previous iterations, such as benefits for the coal industry.
A summary:- The renewable energy production tax credit (PTC) is extended one year to 2009 and modified to include tidal power
- The solar and fuel cell investment tax credit (ITC) is extended 8 years to 2016
- The residential energy-efficient property credit is extended one year to 2009, and the $2,000 cap is removed
- Clean Renewable Energy Bonds (CREBs) are extended one year to 2009, with an additional $400 million authorized
- The 10% ITC for energy-efficiency improvements to existing homes is extended one year to 2009
- The contractor tax credit for energy-efficient new homes is extended two years to 2010
- The energy-efficient commercial buildings deduction is extended one year to 2009 and increases the $1.80/sqft max to $2.25/sqft
- The energy-efficient appliance credit is extended to 2010
The full language explaining the incentives is after the jump.
The Senate’s deadlock over tax breaks for renewable energy may be ending.Description of clean energy and energy effiency incentives in the Cantwell-Ensign package:Sen. John Ensign, R-Nev., said negotiators have made progress, and he expects a “big announcement” Thursday.
Ensign and Sen. Maria Cantwell, D-Wash., have been working on a package of tax incentives, including extensions of credits for producing electricity from wind and sunlight.
Senate Finance Chairman Max Baucus, D-Mont., also sounded upbeat.
“There is a very good chance, compared to before we broke for the break, that we are going to get a significant extenders package paid for,” Baucus said. “We’re working with both sides to get that done.”
Energy tax packages have failed repeatedly on the Senate floor, including a $22 billion version that fell one vote short of winning approval as an amendment to a broader energy bill (PL 110-140) in December.
Republicans have complained about the revenue-raising offsets in the Democratic proposals, which would hit the oil and gas industry. It’s unclear how any Cantwell-Ensign proposal would overcome that hurdle.
Industry sources were encouraged but cautious Tuesday, and they continue to worry about losing tax benefits that are scheduled to expire Dec. 31.
“It’s all about urgency,” said Greg Wetstone of the American Wind Energy Association. “We’re looking at an industry that’s been on a phenomenal growth path that is threatened now with tremendous policy uncertainty.”
Purpose: To provide for the limited continuation of clean energy production incentives and incentives to improve energy efficiency in order to prevent a downturn in these sectors that would result from a lapse in the tax law.Title I – Extension of Clean Energy Production Incentives
Section 101. Extension and modification of the renewable energy production tax credit (IRC Section 45). Under current law, an income tax credit is allowed for the production of electricity using renewable energy resources, like wind, biomass, geothermal, small irrigation power, landfill gas, trash combustion, and hydropower facilities. A taxpayer may generally claim a credit for 10 years, beginning on the date the qualified facility is placed in service. In order to qualify, however, facilities must be placed in service by December 31, 2008.
The bill extends the placed in service date for one year (through December 31, 2009). It also redefines small irrigation power to include marine and hydrokinetic energy, and enables the credit to help reduce the cost of renewable electricity that is ultimately sold to utility customers when the utility itself is also a part owner of the renewable facility.
Section 102. Extension and modification of the solar energy and fuel cell investment tax credit (“ITC”) (IRC Section 48). Under current law, taxpayers can claim a 30 percent business energy credit for purchases of qualified solar energy property and qualified fuel cell power plants. In addition, a 10 percent credit for purchase of qualifying stationary microturbine power plants is available. The credit for qualified fuel cell power plant property is capped at $500 per 0.5 kilowatt of capacity. Credits apply to periods after December 31, 2005 and before January 1, 2008.
The bill enables taxpayers to claim the 30 percent business credit for the purchase of fuel cell power plants and solar energy property and the 10 percent credit for stationary microturbines, through December 31, 2016. In addition, the bill repeals the $500 per .5 kilowatt of capacity cap for qualified fuel cell power plant property, and allows electric utilities to claim the ITC.
Section 103. Extension and modification of the residential energy-efficient property credit (IRC Section 25D). Under current law, taxpayers can claim a personal tax credit for the purchase of property that uses solar energy to generate electricity for use in a dwelling unit and qualified solar water heating property that is used exclusively for purposes other than heating swimming pools and hot tubs. The credit is equal to 30 percent of qualifying expenditures, with a maximum $2,000 credit for each of these systems of property. Section 25D also provides a 30 percent credit for the purchase of qualified fuel cell power plants. The credit for any fuel cell may not exceed $500 for each 0.5 kilowatt of capacity. The credit applies to property placed in service prior to January 1, 2009.
The bill extends the credit for residential solar property for one year (through December 31, 2009) and repeals the $2,000 credit cap for qualified solar electric property. The bill also allows the tax credit to offset Alternative Minimum Tax (“AMT”) liability.
Section 104. Clean Renewable Energy Bonds (“CREBs”) (IRC Section 54). Under current law, public power and consumer-owned utilities that cannot benefit from tax credits can issue Clean Renewable Energy Bonds (CREBs) to help them reduce the cost of renewable energy investments. Under current law, there is a national CREB limitation of $1.2 billion in bonding authority and CREBs must be issued before December 31, 2008.
This bill authorizes an additional $400 million of CREBs that may be issued and extends the authority to issue such bonds through December 31, 2009. In addition, the bill allocates 1/3 of the additional bonds for qualifying projects of State/local/tribal governments; 1/3 for qualifying projects of public power providers; and 1/3 for qualifying projects of electric cooperatives.
Section 105. Extension of the special rule to implement FERC restructuring policy (IRC section 451(i)).
The bill extends through December 31, 2009, the present-law deferral provision that enables qualified electric utilities to recognize gain from certain transmission transactions over an 8-year period.
Title II – Extension of Incentives to Improve Energy Efficiency
Section 201. Extension and modification of the credit for energy-efficiency improvements to existing homes (IRC section 25C). Current law provides a 10 percent investment tax credit for purchases of advanced main air circulating fans, natural gas, propane, or oil furnaces or hot water boilers, windows and other qualified energy-efficient property. The credit applies to property placed in service prior to January 1, 2008.
The bill extends the credit for one year (through December 31, 2009), and specifies that certain pellet stoves are included as qualified energy-efficient building property.
Section 202. Extension of the tax credit for energy-efficient new homes (IRC section 45L). Current law provides a tax credit to an eligible contractor equal to the aggregate adjusted bases of all energy-efficiency property installed in a qualified new energy-efficient home during construction.
The bill extends the energy-efficient new homes credit for two years (through December 31, 2010), and permits the eligible contractor to claim the credit on a home built for personal use as a residence.
Section 203. Extension of the energy-efficient commercial buildings deduction (IRC section 179D). Current law allows taxpayers to deduct the cost of installing energy-efficient improvements in a commercial building. The deduction equals the cost of energy-efficient property installed during construction, with a maximum deduction of $1.80 per square foot of the building. In addition, a partial deduction of 60 cents per square foot applies to certain subsystems. The deduction applies to property placed in service prior to January 1, 2009.
The bill extends the deduction to property placed in service through December 31, 2009, increases the maximum deduction to $2.25 per square foot, and allows a partial deduction of 75 cents per square foot for building subsystems.
Section 204. Modification and extension of the energy-efficient appliance credit (IRC section 45M). Current law provides a credit for the eligible production of certain energy-efficient dishwashers, clothes washers, and refrigerators. The credit for dishwashers applies to dishwashers produced in 2006 and 2007 that meet the Energy Star standards for 2007.
The bill extends the credit to appliances produced in 2008, 2009, and 2010 and updates the qualifying efficiency standards in accordance with the Energy Independence and Security Act of 2007.
The Auto Industry's New "Alliance"
Hybrid Living, passing along a local report from earlier this week, delivers the news that even as Minnesota Attorney General Lori Swanson defends the state’s authority to limit greenhouse gas emissions as a party to California’s lawsuit against the EPA, its proposed clean cars law has stalled—perhaps fatally for this session—in the state legislature. Lobbying by the auto industry is playing a part, but a novel assist apparently goes to corn growers and ethanol producers, who argued that the law may harm efforts to expand ethanol markets and impair the certification of "flex-fuel" cars and trucks that run on a blend of ethanol and gasoline.
But is it really that novel? Advocates from Clean Energy Minnesota fervently deny that there’s any real reason for concern, and assert that the group principally repsonsible for ginning up local opposition is essentially a mouthpiece for the auto industry:
[James Erkel of the Minnesota Center for Environmental Advocacy] said the concern is baseless, pointing to GMC’s 2008 Sierra 1500 pickup that runs on a rich blend of E-85 (85-percent ethanol and 15-percent gasoline) as well as similar vehicles that would meet the more stringent California standards. The ARB’s Dimitri Stanich said California air regulators have certified 300,000 flex fuel vehicles and suggested there will be more as soon as the state increases the number of pumps offering E-85 fuel, which California is now doing.
[...]
Erkel said that the auto industry is masquerading as an ethanol advocate as it enlists the corn growers and other farm groups to beat back legislation in Minnesota. The default "technical advisor" to the ethanol groups opposing the Marty and Hortman bills is the National Ethanol Vehicle Coalition, headquartered in Jefferson City, Mo. Its 16-member board of directors includes representatives of Chrysler, Ford, GMC and Nissan.
Obviously it’s not shocking that the auto industry would employ astroturf tactics and overwrought arguments to delay clean cars legislation (though it is noteworthy, in terms of looking at the industry’s credibility, to see a spokesman admit that the usual suspects "can’t stop this bill by ourselves"). The Minn Post also notes that when it asked the Minnesota Corn Growers and the Farm Bureau to explain their position, the silence was deafening and the apparent reliance on the aforementioned "technical advisors" clear:
Calls by MinnPost to the Corn Growers and the Farm Bureau ended with representatives saying they needed to check with their "technical people" for specific reasons for the groups’ opposition to the legislation. Neither group’s representatives called back with what they may have learned from their technical advisers.
Hybrid Living’s Sam Abuelsamid, agreeing that there’s nothing here to justify delaying the legislation other than a slight hypothetical concern, suggests that local opponents ought to look elsewhere for solutions to their concerns:
There doesn’t actually appear to be anything in the proposed legislation that would specifically harm the E85 market….It appears that the only way that this actually affects Team Ethanol is if the CO2 limits hurt sales of larger cars and full-size trucks which comprise the bulk of currently available flex-fuel vehicles. If truck sales are limited by de facto fuel economy requirements, than at least in the short term, E85-capable vehicle sales will suffer. Perhaps the ethanol side should be pushing the auto industry to make more of their vehicles E85 ready instead of fighting clean air rules.
Report Vindicates Sebelius: Coal’s Cost Puts Kansans 'At Significant Risk'
Originally posted at the Think Progress Wonk Room.
In October of last year, the administration of Kansas Gov. Kathleen Sebelius (D) denied permits for two new coal-fired plants in her state because the greenhouse gases such coal plants would emit constitute a threat to the environment and public health. Last Friday, she vetoed a legislative attempt to allow the plants to be built. Opponents of the veto claimed “the decision is costing the state jobs and economic investment” and warned of “higher electric bills for Western Kansas,” where the plants were proposed.
But a landmark report released yesterday by an esteemed financial research firm finds that, in fact, Sebelius has been acting in her state’s best economic interests.
Innovest Strategic Value Advisors finds that Sunflower Electric Power Corporation, the company whose proposal was denied, failed to account for the effects of the likely regulation of carbon dioxide on the cost of coal-fired electricity when it sought to build two 700 MW coal plants in Holcomb, Kansas:
Innovest examined the economics of the transaction and determined that under the most plausible regulatory scenarios the decision to build new coal generating capacity will put Sunflower Electric’s ratepayers – who in this particular case are the actual owners – at significant risk. The report concludes that Sunflower’s management has not adequately addressed the competitive and financial risks associated with climate change in deciding to pursue the expansion of its Holcomb Station power plant.
Sunflower was remiss in not considering that federal legislation that places a price on carbon emissions is extremely likely, considering the bipartisan support and strong international pressure for such action.
The report compares the economics of coal plants versus natural gas plants, which have a considerably smaller carbon footprint, and concludes:In general, this analysis demonstrate that gas is the more financially sound choice for the construction of baseload generating capacity in all scenarios except 100% free allocation [to power companies] of carbon allowances.
It is thus unsurprising that the coal lobby attacked the natural gas industry when the decision was made.
The report also notes that western Kansas has “among the nation’s most abundant wind resources” and that the cost of wind power has plummeted 80% in the last 20 years.
Kansas Governor Vetoes Attempt to Override Denial of Coal Plants
Originally posted at the Think Progress Wonk Room.
Last October, the Kansas Department of Health denied air quality permits to a proposed coal plant expansion near Holcomb, KS, because of the danger greenhouse gas emissions pose to the climate.
Today, Sebelius issued a long-expected veto of the legislature’s plan to not only approve the plant but also strip the Department of Health of its regulatory capacity. From her veto statement:
This decision not only preserves Kansans’ health and upholds our moral obligation to be good stewards of this beautiful land, but will also enhance our prospects for strong and sustainable economic growth throughout our state. Instead of building two new coal plants, which would produce 11 million new tons of carbon dioxide each year, I support pursuing other, more promising energy and economic development alternatives.
Industry opposition to the Sebelius administration has been intense. Following the air permit denial, Peabody Energy, one of the largest coal companies in the world, funded newspaper ads attacking the natural gas industry. Sunflower Electric Power Corporation, the rate-payer-owned company making the bid for the new plants – offered a quid pro quo to Kansas State University, promising millions of dollars to fund energy research if the coal plants were approved.