On Hill, Oil Independence Still Far Off
As the Democrats step up to the plate this week for their chance to take a whack at federal energy policy, don't expect a home run for the environment or for oil independence. Forces are at work to put their own spin on the sprawling legislation, and their goal is to brush back the "bold steps and big ideas" that Senate Majority Leader Harry Reid has promised on energy. Here's a quick primer to the battles expected to shape the major legislation the Senate is determined to pass before its July 4 recess.
What's a renewable fuel, anyway? It would seem to be a pretty simple matter to pass the renewable fuels standard that has long been sought by Senate Energy Committee Chairman Jeff Bingaman, a New Mexico Democrat. After all, even the Republican-controlled Senate passed essentially the same measure two years ago, requiring that major electric utilities produce 15 percent of their power from wind and other clean energy sources by 2020. More than 20 states already have such laws and a new analysis by the Energy Information Administration said it would raise energy prices less than 1 percent while dramatically increasing solar energy and reducing greenhouse gas growth. But expect fellow New Mexican Pete Domenici, dean of the Republicans on energy matters, to spearhead a drive to have the standard include all "alternative" fuels, such as his long-favored nuclear power and "clean" coal technologies.
Better fuel economy for cars soon, or much later? Arguably the most important element of the bill is a move to increase auto fuel economy standards for the first time in 18 years, bringing the fleet up to a 35 miles per gallon average by 2020. That's still not as good as the mileage the Toyota Prius gets today, but it is about a 40 percent improvement over the current average. But it's all moving too fast for the U.S. auto industry, which prefers the ponderous pace set by the National Highway Traffic Safety Administration. Expect a strong push to have authority stay with that agency—as opposed to Congress—with nods to the bureaucrats' wisdom and expertise. The two Democratic senators from Michigan, Carl Levin and Debbie Stabenow, are expected to take up their home state industry's cause, while supporting higher fuel standards all the way to around 32.5 mpg by 2025, as long as NHTSA has authority to set lower standards if need be.
Why use oil when there's liquid gold (in the form of coal)? Among the hundreds of amendments that interest groups are working to tag onto the legislation is an effort to provide a host of subsidies to spur a new U.S. industry of making diesel fuel out of coal. The technology works and had its heyday in Nazi Germany and in apartheid South Africa, two regimes that desperately needed alternate sources of fuels and didn't hesitate to produce them at very high cost. Now, a well-funded coalition of coal interests is pushing for the U.S. to take up coal-to-liquids as a matter of national security. It also would happen to secure a new market for high-sulfur eastern coal, which has fallen out of favor for use in power plants that have found they can meet acid rain regulations easily by using low-sulfur coal from Wyoming. But the impact on water and carbon emissions has some environmentalists viewing this as the biggest threat in the bill. Kentucky Republican Jim Bunning is expected to lead the charge, but plenty of coal state Democrats may join in. Earlier this year, Illinois Sen. Barack Obama cosponsored a coal-to-liquids measure with Bunning; everyone's wondering where the presidential candidate stands now.
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