Technology outpacing climate-change legislation, lawmakers say

Nick Snow
OGJ Washington Editor

WASHINGTON, DC, Dec. 2 -- Technology is moving ahead more quickly than legislation to address global climate change, three federal lawmakers agreed on Dec. 1. Congress won’t be able to get back to work on the issue until 2010, they added.

Bills approved by the full US House and the Senate Environment and Public Works Committee haven’t answered significant questions, US Sen. Byron L. Dorgan (D-ND) and US Rep. Fred Upton (R-Mich.) said during a forum on US climate and energy policy cosponsored by Newsweek and the American Petroleum Institute. But US Rep. Edward J. Markey (D-Mass.), who cosponsored the House bill, said the measure was an important first step in a long process.

“The measure is analogous to what we did in telecommunications,” Markey said, noting that Congress passed bills in 1992, 1993, and 1996 that launched, respectively, the modern cable, wireless, and broadband systems while creating 2 million new jobs.

Emerging energy technologies could lead to a $2 trillion domestic industry if the US decided to actively support them, Markey said. “We have a choice. Right now, our energy strategy says ‘Made by [the Organization of Petroleum Exporting Countries].’ If we don’t act, our new strategy will be to use products made in China. We can decide to release our own entrepreneurial spirit instead,” he said.

The US Department of Energy has what effectively is the largest energy venture capital resource in history with federal economic stimulus funds it received to support new technology research and development, according to Dorgan. “I think there are unbelievably exciting things going on that we don’t fully understand yet, but that will help us a lot,” he said.

Outside government
The private sector is moving ahead too, other panelists said. US oil and gas companies collectively spend three times as much as the federal government in alternative and renewable energy R&D, API Pres. Jack N. Gerard said. US automakers plan to introduce new models in the next few years, including General Motors’ Chevy Volt, which could drastically advance electric hybrid technology late in 2010, Upton pointed out.

The two climate bills currently before Congress could jeopardize such efforts and harm other US industries during a significant economic recession, Gerard argued. “We need to reset the discussion. The bill which passed the House and the one which the Senate EPW committee approved kill jobs and penalize specific industries,” he said.

Upton said the bill that the House passed by seven votes on June 26 did not contain enough protections for businesses and consumers using electricity generated from coal. “I’m convinced that if we had the vote today, it would go down by 50 votes,” he said, adding that an energy bill which the Senate Energy and Natural Resources Committee approved by 15 to 8 votes on June 17 was more balanced because it was truly bipartisan.

The bill, the American Clean Energy Leadership Act (S. 1462), has not been brought to the floor, Dorgan confirmed, partly because of Senate Republicans’ efforts to block new legislation. “We’re not getting bipartisan support on anything. We have to file cloture motions on noncontroversial issues,” he said.

But Dorgan also questioned the heavy reliance on a carbon cap-and-trade program in the measures which have moved forward. “I’m not sure I’m comfortable with simply handing a new $1 trillion commodities market to Wall Street on Monday and hoping it will responsibly establish a price by Thursday,” he said. “There are more direct ways for government to reduce emissions such as a carbon tax and command-and-control measures.”

Senate hearing
Senate Energy and Natural Resources Committee leaders sent a similar signal as they opened a Dec. 2 hearing on greenhouse gas reduction policy options. Chairman Jeff Bingaman (D-NM) said that he has supported a cap-and-trade approach for some time, but added that carbon taxes, direct regulation, sector-specific approaches, and technological innovations may achieve the same results.

“It’s important to note that these policies are not mutually exclusive,” he continued. “In fact, it will more than likely be necessary to rely on a suite of these policies to ensure that we are effective in addressing global warming.”

“We need to dispense with the blind faith in cap-and-trade that has dominated the past year of debate, or at least question whether that loyalty is truly warranted,” said Lisa Murkowski (R-Alas.), the committee’s ranking minority member. “A more inclusive debate would allow us to examine which policies are actually capable of reducing emissions while protecting, or even strengthening, the economy.”

She said the Senate should explore other options, including pairing tax cuts with a price on emissions. Murkowski emphasized that she isn’t suggesting that any approach for reducing emissions not be considered or planning to reduce any tax reform legislation, but has become concerned that the congressional climate change debate has become too narrow.

At the Newsweek-API event, Gerard said the oil and gas industry should get an opportunity to explore more of the US Outer Continental Shelf following 25 years of congressional moratoriums and presidential withdrawals. “We really haven’t been given the opportunity to determine just how much oil and gas we have,” he said, noting that production at Prudhoe Bay, which originally was expected to be 9 billion bbl, has passed 15 billion bbl, and the Gulf of Mexico, which once was considered depleted, has produced 40 billion bbl “and we’ve just scratched the surface.”

Markey responded that the US can’t indefinitely continue consuming 25% of the world’s oil production while having only 2-3% of total global reserves. “I think we can be open-minded about more drilling, particularly for natural gas, but we need to change our overall approach,” he said. “Clearly, [US President Barack H. Obama] has put health care up front, but the energy bill and financial reform are both on deck.”

Contact Nick Snow at nicks@pennwell.com.

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