Hill Heat

From the Wonk Room.

The coal-industry public relations group, American Coalition for Clean Coal Electricity (ACCCE), is celebrating the Senate’s insertion of billions of dollars of coal R&D funds in the recovery plan in an email to supporters. The Senate plan added $2.2 billion to the House’s allocation of $2.4 billion for the development of “carbon capture and sequestration technologies.” ACCCE heralded the ”$4.6 billion in clean coal technology funding” in the message, claiming the “funding is important because”:

• It contributes to energy independence, allowing us to use coal that is right here in America
• It stimulates the economy and could create almost 7 million job-years of employment and over $1 trillion in sales
• It will help fight climate change and aid other environmental goals by promoting technologies to reduce carbon dioxide and major air pollutants

It is not the case that $4.6 billion for coal technology could “create almost 7 million job-years of employment and over $1 trillion in sales.” The “7 million job-years” figure comes from “Employment and Other Economic Benefits from Advanced Coal Electric Generation with Carbon Capture and Storage,” a BBC Research report commissioned by ACCCE. The report says that the construction of 100 gigawatts of advanced coal plants - about 200 plants over a fifteen-year span - would generate that much job activity. The construction expenditures for a single plant with CCS is estimated at “approximately $2.0 to $2.1 billion.” So the $4.6 billion in the Senate plan is enough for the construction of only two plants and about 6,000 construction and manufacturing jobs. Two hundred plants would cost a $393 billion. The ACCCE email “is a bit confused,” Doug Jeavons, the author of the BBC report tells the Wonk Room:

The nearly 7 million job-years estimate is associated with full scale development of about 100 gigawatts of advanced coal CCS capacity, not just the proposed $4.6 billion in the stimulus plan.

Furthermore, the technology to build such plants does not yet exist. As NV Energy announced when they indefinitely postponed the construction of a coal-fired plant in Ely, Nevada:

The company will not move forward with construction of the coal plant until the technologies that will capture and store greenhouse gasses are commercially feasible, which is not likely before the end of the next decade.

To make CCS technology commercially viable, the Center for American Progress recommends, there should be a federal greenhouse emissions performance standard put in place for new plants, and a cap-and-trade system to make polluters pay for their emissions.

From the Wonk Room.

Announcing that “the time for reform has arrived,” Secretary of the Interior Ken Salazar set aside the Bush administration’s “midnight timetable” for offshore drilling. “On Friday, January 16, its last business day in office,” Salazar explained in his Feburary 10th press conference, “the Bush Administration proposed a new five year plan for offshore oil and gas leasing.” The Bush plan called for the completion of meetings and hearings by March 23. Salazar decried this “broken process”:

It was a headlong rush of the worst kind. It was a process rigged to force hurried decisions based on bad information. It was a process tilted toward the usual energy players while renewable energy companies and the interests of American consumers and taxpayers were overlooked.

Salazar announced he “will extend the public comment period by 180 days, get a report on offshore energy resources, hold regional conferences and expedite rulemaking for offshore renewable energy resources.”

Salazar made it clear that his definition of “energy independence” does not mean a “drill only” future. He rebuked the “oil and gas or nothing” approach of the Bush administration, who ignored the Energy Policy Act of 2005’s mandate to develop regulations for offshore renewables:

I intend to do what the Bush Administration refused to do: build a framework for offshore renewable energy development, so that we incorporate the great potential for wind, wave, and ocean current energy into our offshore energy strategy. The Bush Administration was so intent on opening new areas for oil and gas offshore that it torpedoed offshore renewable energy efforts.

On Tuesday, Sen. Barbara Boxer (D-CA) stood with fellow Democratic members of the Senate Committee on Environment and Public Works to introduce principles for climate legislation, saying “We know that we have to act, and we intend to act.” David Axelrod, one of President Obama’s senior advisers, told E&E News that the effort by Congress to construct legislation to fight global warming is more than welcome:

We think that it’s healthy that there’s so much momentum in Congress to address this problem. It’s long overdue.

Boxer admitted that December is her working deadline for getting a bill “out of committee.” Other Senate chairs, including Energy and Natural Resources Chairman Jeff Bingman (D-NM) and Finance Chairman Max Baucus (D-MT) intend to weigh in on any legislation. “All of those committees,” Majority Leader Harry Reid (D-NV) told E&E News, “especially my old committee, EPW, have an important role to play for the Senate to produce a sound cap-and-trade bill that meets the president’s emission reductions objectives.”

At Climate Progress, Joe Romm therefore doubts climate legislation will be passed before 2010: “So this has to get through multiple Senate committees, pass the full Senate, be reconciled with whatever comes out of the House, and then pass both House and Senate again, and finally end up on Barack Obama’s desk.”

Meanwhile, President Obama continues to build a green-powered administration, with the selection of Robert Sussman and Lisa Heinzerling as senior EPA policy advisers, Todd Stern as the State Department climate envoy, climate justice leader Ron Sims as deputy secretary for the Department of Housing and Urban Development, and even new assistant White House chef Sam Kass, a strong supporter of local, sustainable, and healthy food.

On February 4th, the EPA and Department of Justice restarted a “national initiative, targeting electric utilities whose coal-fired power plants violate the law,” with a lawsuit against a Kansas utility whose coal-fired power plant has been in violation of the Clean Air Act for more than ten years. The case against Westar Energy had been held up by the Bush administration since 2003. A memo from Stephen Johnson’s deputy Marcus Peacock practically shut down all enforcement activity in 2005.

From the Wonk Room.

In a speech at the Department of Energy today, President Obama announced he was signing a memorandum to direct the department to issue new energy efficiency standards for common household appliances – something Secretary Steven Chu has highlighted in the past as a top priority. He also responded to critics who “ridiculed our notion that we should use part of the money to modernize the entire fleet of federal vehicles,” asking, “Are these folks serious?”

This is what they call “pork.” You know the truth. . . . So when you hear these attacks deriding something of such obvious importance as this, you have to ask yourself, “Are these folks serious?” Is there any wonder we haven’t had a real energy policy in this country?

Watch it:

Conservatives have attacked numerous efficiency initiatives in the recovery plan:

• $600 million to buy hybrid vehicles for federal employees
• $200 million in funding for the lease of alternative energy vehicles for use on military installations
• $5.5 million for “energy efficiency initiatives” at the Department of Veterans Affairs National Cemetery Administration
• $6 billion to turn federal buildings into “green” buildings

As President Obama explained, federal fleet modernization “will not only save the federal government significant money over time, it will not only create manufacturing jobs for folks who are making these cars, it will set a standard for private industry to match.” This is as true for the green building efforts and other efficiency initiatives. Speaking to an audience of Department of Energy scientists, he concluded:

For the last few years, I talked about these issues with Americans from one end of this country to another. Washington may not be ready to get serious about energy independence, but I am and so are you and so are the American people.

Inaction is not an option that’s acceptable to me and it’s certainly not acceptable to the American people, not on energy, not on the economy, not at this critical moment.

In Obama’s words, it’s time for Congress “to rise to this moment.”

From the Wonk Room.

The Washington Post’s Al Kamen reports Center for American Progress senior fellow Robert Sussman “is returning to the Environmental Protection Agency” as “senior policy counsel to EPA Administrator Lisa P. Jackson, advising her on climate and environmental issues across the agency.” An official announcement is expected shortly. Before joining the Center for American Progress, Sussman was the Deputy Administrator during the Clinton administration, serving under Carol Browner, now President Obama’s White House energy and environment adviser.

Sussman was a regular blogger for CAP’s Wonk Room, writing on the Mary Gade scandal, the Bush administration, and climate legislation. Sussman challenged the argument that laws like the Clean Air Act, the National Environmental Policy Act, and the Endangered Species Act are not applicable to the threat of global warming:

The truth is that our environmental laws were not written to be static. They are flexible tools to address unanticipated or emerging problems that science identifies over time.

Sussman’s work for the Center for American Progress highlighted that approach. He crafted recommendations for regulatory and funding mechanisms to spur the development of carbon capture and sequestration technology for coal plants, “to reconcile reliance on coal for electricity with the need to reduce the threat of global warming.”

From the Wonk Room.

In his first interview as Secretary of Energy, Steven Chu “offered some of the starkest comments yet on how seriously President Obama’s cabinet views the threat of climate change, along with a detailed assessment of the administration’s plans to combat it.” Secretary Chu told the Los Angeles Times that the nation is like a family buying an old house and being told by an inspector that it must pay a hefty sum to rewire it or risk an electrical fire that could burn everything down>

I’m hoping that the American people will wake up.

Chu also worried the nation doesn’t yet recognize how great a threat global warming represents:

I don’t think the American public has gripped in its gut what could happen.

One danger Chu highlighted in the interview was rising drought throughout the West, with major declines in the snowpack that waters California. In the worst case, Chu said:

We’re looking at a scenario where there’s no more agriculture in California. I don’t actually see how they can keep their cities going.

Chu described “public education as a key part of the administration’s strategy to fight global warming” – in addition to clean energy research, infrastructure, a national renewable electricity standard, and a greenhouse gas cap-and-trade system.

From the Wonk Room.

Recognizing the new era of “energy transformation,” a Montana electric utility has decided to “scrap its plans for a $900 million coal-fired power plant east of Great Falls and turn instead to renewable energy to meet the needs of its 65,000 Montana customers.”

Years ago, the Southern Montana Generation and Transmission Cooperative introduced plans to build the Highwood Generating coal-fired plant to satisfy the electricity needs of Great Falls, Montana. Today, CEO Tim Gregori announced “they are changing construction plans from a coal-fired facility to a natural gas and high wind producing plant.” This switch will dramatically reduce the pollution footprint of the facility, from soot to greenhouse gases, and will take less time to get up and running. Montana Environmental Information Center Program Director, Anne Hedges, announced, “This is a relief”:

It’s a relief to the land owners adjacent to the plant. It is a relief to people across the state and across the nation who are concerned about the direction of our climate.

MEIC, Citizens for Clean Energy, Earthjustice, and Sierra Club’s Move Beyond Coal campaign worked together for years to challenge the Highwood plant on its environmental impact, including its mercury and particulate matter pollution. The utility also recognized that the global warming emissions of coal give the fuel an “aura of uncertainty”—in other words, a large economic risk, as has been pointed out repeatedly by economic analysts. It no longer makes environmental nor economic sense to rely on 19th-century technology to power a 21st-century America.

From the Wonk Room.

The influential Washington publication National Journal has dedicated its cover story to Carol Browner, President Obama’s incoming climate and energy adviser. The EPA administrator under President Clinton and a former board member of the Center for American Progress, Browner is a leading voice in progressive environmental policy. As former transition chief and current CAP president John Podesta explains, Browner’s selection reflects President Obama’s goal to change business in Washington:

If people want to continue in practices that were more appropriate in the 1950s than today, then I think that they’re going to have to understand that Obama campaigned on a promise of energy transformation. And he intends to fulfill it.

Obama’s ambitious campaign goals include five million green-collar jobs, “the implementation of an economy-wide cap-and-trade system to reduce carbon emissions by the amount scientists say is necessary,” and a “whole new electricity grid.” With less than two weeks in office, his administration has already made major commitments toward the creation of a smart grid and the green collar jobs in the economic recovery package. The focus of the first meeting of Vice President Joe Biden’s middle-class task force will be green jobs. And Obama has signed directives to the EPA to begin the process of complying with the Supreme Court mandate to regulate greenhouse gases—hopefully spurring Congressional action to develop a cap and trade system.

Just as critically, Obama has already put in place a powerful team with the likes of Browner, EPA administrator Lisa Jackson, Council of Environmental Quality head Nancy Sutley, and top scientists Secretary of Energy Steven Chu, NOAA Director Jane Lubchenco, and White House science adviser John Holdren. These experts on climate policy will have to work with the other members of Obama’s Cabinet to achieve that “promise of energy transformation.”

And that’s where Browner comes in. One “industry lobbyist” who is wary of Browner described her in ways that make her sound remarkably like Dick Cheney, who controlled energy policy across agency lines in the previous administration:

Browner is the epitome of how to work this city. She knows every organization. She knows who to leak information to. She knows how to kill information, and she knows that she doesn’t want a paper trail. That is frightening.

It remains to be seen how Browner will operate, but time will tell if anonymous industry lobbyists’ fears are more accurate than Obama’s promises of transparency, accountability, and change. What the lobbyists more likely fear is that environmental policy will become effective and science-based. As Podesta explained, Carol Browner will fill a crucial role in the Obama administration:

When you have problems that really cut across a swath of agencies, it’s very important to have a strong central place within the White House where people can work on the same strategy and [make sure] that actions are keyed up and accountability exists. That has proven to be an effective way of doing business in the federal government on security policy, on economic policy. And now we’ll see it on environmental policy.

From the Wonk Room.

The Obama economic recovery plan makes a major investment in the modernization of our electricity infrastructure, in order to transform an often-overwhelmed patchwork of balkanized regional networks into a national “smart grid” based on Internet-like technology. Repower America, Al Gore’s campaign to have America use 100% renewable electricity in ten years, argues that a national smart grid “will save money, increase reliability and protect consumers from outages, and make possible a clean electricity system.”

Building a smart grid requires both new technology and regulatory policy. In addition to a $20 billion investment in smart grid deployment, the recovery plan offers $2 billion in grants to promote a subtle but key shift in electric utility regulatory policy:

Policies that ensure that a utility’s recovery of prudent fixed costs of service is timely and independent of its retail sales, without in the process shifting prudent costs from variable to fixed charges.

Traditional electricity utility pricing discourages utilities from promoting conservation and efficiency—instead, the more wasteful their consumers are, the better. So demand goes up, utilities build new power plants, and still costs rise. Utility shareholders’ interests are pitted against the rest of society.

Therefore, several states have implemented policies that decouple profitability (“recovery of prudent fixed costs of service”) from demand (“retail sales”), by using public funds and rate adjustments to guarantee an expected annual profit for the utility company and to subsidize investment in energy efficiency.

Obama’s economic recovery package contains $2 billion in state-level block grants that will be released “only if the governor of the recipient State notifies the Secretary of Energy that the governor will seek, to the extent of his or her authority, to ensure” that decoupling and energy efficiency incentive programs will occur.

Because our electrical infrastructure is a vital public resource, the profits of utility executives and shareholders must not be put above the public good. As Public Citizen warns, decoupling for unregulated utilities can lead to “windfall profits for the industry.” The California electricity debacle exposed the great failure of the experiment of utility deregulation, and the recovery package does not go far enough to bring utilities back under control.

President Obama, Secretary of Energy Steven Chu, and legislators like Sen. Jeff Bingaman (D-NM) have stated that our entire nation needs to move to a low-carbon economy as rapidly as possible, highlighting transformation of the electricity grid as a key component.

Full decoupling language in the House-passed economic recovery package (HR 1):

From the Wonk Room.

On Wednesday, the Senate Appropriations Committee voted to increase “clean energy” loan guarantees by $50 billion in the economic recovery package (S. 336). This sum “would more than double the current loan guarantee cap of $38 billion” for “clean energy” technology:

TITLE 17—INNOVATIVE TECHNOLOGY LOAN GUARANTEE PROGRAM

The Committee also recommends an additional $50,000,000,000 to support the deployment of eligible technologies under the Section 1702(b)(2) of EPACT 2005 that will contribute to transforming the energy sector. This funding will add to the existing loan guarantee authority provided in other appropriations bills to support self-financed loan guarantees. The Committee is aware of the strong interest in the program and the large number of pending applications.

In contrast, the committee allocated only $9.5 billion exclusively for “standard renewable energy projects.” Although the loan guarantee program covers nuclear technology, carbon capture and sequestration for coal plants, coal-to-liquids projects, and renewable energy, the vast bulk of requested loans – $122 billion – are for new nuclear power plants. This $50 billion nuclear line item nearly matches the total allocation for genuinely clean energy in the House version of the stimulus package: only $52 billion in total for smart grid, renewable energy, and energy efficiency investments.

Unlike renewable energy and energy efficiency technology, investments in the nuclear industry generate few jobs or economic growth. The nuclear industry has developed through massive federal subsidization from research to deployment over decades. Such a massive expenditure of nuclear pork has no place in the economic recovery bill, according Brent Blackwelder of Friends of the Earth, who discovered the expenditure. Blackwelder called the appropriations “unconscionable”:

Now is not the time for another bailout boondoggle. Nuclear power is the most expensive form of energy there is. It takes 10 years or more to build a reactor, so it is impossible to claim with a straight face that this preemptive bailout has anything to do with creating jobs. Senate appropriators’ decision to include such wasteful spending in the stimulus is an example of Washington at its worst.