There was a lot of anticipation this summer about the scope of the energy bill coming out of the U.S. Senate. Would the Senate try and tackle climate change? Would it develop a national renewable portfolio standard?
The bill was released yesterday and the answer was "no" on both accounts.
The White House kept a glimmer of hope that climate change provisions- Cap & Trade- could be added back in at a later date. This from Reuters:
But the White House indicated on Tuesday that climate provisions could be added back into a bill once negotiators from the Senate and the House of Representatives hammer out differences between their respective versions during "conference" talks.
The House bill, passed last year, includes climate provisions to cut greenhouse gas emissions.
White House spokesman Robert Gibbs, when asked whether the administration would seek to do a separate climate bill later after getting a narrow energy-focused bill first, said: "No, I think the process is you get an energy bill through the Senate then you can conference that legislation with the House."
Also absent from the bill was a proposed national renewable energy standard (RES) that would have mandated 15% of electric generation from renewable sources. Some Democrats claimed there were 62 votes in favor of an RES. They pointed to the urgency of restoring incentives for construction of renewable energy sources noting wind development dropped 72% in the first half of 2010 compared to last year. This from the N.Y. Times:
Many see an RES as an achievable goal that could spark construction of manufacturing plants for wind turbines and drive the development of clean energy. Several senators, including Mark Udall (D-Colo.) and Byron Dorgan (D-N.D.), said yesterday that support for a modest RES that requires utilities to find 15 percent of their power by 2020 exists in the Senate.
"It seems to me that would be logical to include that [RES] in the energy bill that was going to be brought to the floor," said Dorgan, whose state stands to be a key generator of wind power. "I hope maybe there’s a way to be found to do that."
Udall said there are about 62 senators who would support the 15 percent standard.
EPA and States Maintain Center Stage
The prospects for cap & trade and an RES diminish rapidly. It seems hard to imagine the Democrats trying to cram such major provisions through reconciliation. Though it appears that is being left open as an option.
What has become clear is that EPA’s greenhouse gas regulations are center stage. EPA’s Tailoring Rule will kick in at the end of 2010 on new sources. Mandatory monitoring and reporting already exists for other sources. With legislation seemingly forever stalled in the Senate, pressure will mount on EPA to adopt more climate change regulations.
As to renewable energy standards, the states’ have been on center stage for several years. Thirty-seven states have adopted some form of a renewable or alternative energy standard. Some are stronger than others, but there are strong incentives at the state level for development of alternative sources of power.
However, there is inconsistency among the states in defining renewable sources, the % required, and marketability of production credits. A federal bill could have addressed these inconsistencies.
However, the price of addressing those inconsistencies in mandating renewable energy generation in every state, including the Southwest which has resisted the standards. Southern states don’t feel there is a much opportunities for renewable energy development.
Like cap & trade, prospects have dimmed for a national RES. Incentives for development will be left primarily to the states.
(For more information on each states specific programs, click on the map above)