Democrats Press Plan to Channel Billions in Oil Subsidies to Renewable Fuels
By EDMUND L. ANDREWS
New York Times
WASHINGTON, June 16 — Senate Democrats are seeking a major reversal of energy tax policies that would take billions of dollars in tax breaks and other benefits from the oil industry to underwrite renewable fuels.
The tax increases would reverse incentives passed as recently as three years ago to increase domestic exploration and production of oil and gas. The change reflects a shift from the Republican focus on expanding oil production to the Democratic concern about reducing global warming.
On Tuesday, the Senate Finance Committee will take up a bill that would raise about $14 billion from oil companies over 10 years and would give about the same amount of money on new incentives for solar power, wind power, cellulosic ethanol and numerous other renewable energy sources. The bill is one of the signature issues this year for Democrats, along with immigration and the war in Iraq, and one in which they hope to clearly distinguish themselves from the Republicans.
But Senate Democrats are expected to go beyond the $14 billion in tax changes in the draft bill. Democratic officials said the committee is all but certain to adopt a proposal by Senator Jeff Bingaman of New Mexico that would raise $10 billion from companies that drill for oil and gas in federal waters but do not currently pay royalties to the government.
(Continued here.)
New York Times
WASHINGTON, June 16 — Senate Democrats are seeking a major reversal of energy tax policies that would take billions of dollars in tax breaks and other benefits from the oil industry to underwrite renewable fuels.
The tax increases would reverse incentives passed as recently as three years ago to increase domestic exploration and production of oil and gas. The change reflects a shift from the Republican focus on expanding oil production to the Democratic concern about reducing global warming.
On Tuesday, the Senate Finance Committee will take up a bill that would raise about $14 billion from oil companies over 10 years and would give about the same amount of money on new incentives for solar power, wind power, cellulosic ethanol and numerous other renewable energy sources. The bill is one of the signature issues this year for Democrats, along with immigration and the war in Iraq, and one in which they hope to clearly distinguish themselves from the Republicans.
But Senate Democrats are expected to go beyond the $14 billion in tax changes in the draft bill. Democratic officials said the committee is all but certain to adopt a proposal by Senator Jeff Bingaman of New Mexico that would raise $10 billion from companies that drill for oil and gas in federal waters but do not currently pay royalties to the government.
(Continued here.)
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RECOMMENDED READING : Sunday's Tom Friedman column in which he sees legislation that is extremely weak ; citing for example, the inability for the Republicans to accept Senate Amendments 1573 and 1577 offered by Sen. Klobuchar that encouraged a renewable portfolio standard and to establish a national greenhouse gas registry. {Great strategy, I guess if we don't measure greenhouse gases, it must mean that they do not exist.}
Friedman is on target. The Federal legislation is entirely achievable since other countries are already achieving those CAFE standards ... what a joke ...much like Pawlenty's energy bill that required loose timeframes that industry was already planning to achieve (The Star-Tribune reported that Michael Noble, executive director of Fresh Energy, a nonprofit environmental coalition assessed that Minnesota should be able to reach an aggregate 25 percent of renewable power by 2020 although the Minnesota bill does not require that until 2025.)
Since the NYT has a firewall, here are some of the highlights :
When you watch a baby being born, after a difficult pregnancy, it is so painful and bloody for the mother it is always hard to tell the truth and say, “Gosh, that baby is really ugly.” But that’s how I feel about the energy legislation passed (and not passed) by the Senate last week.
The whole Senate energy effort only reinforced my feelings that we’re in a green bubble — a festival of hot air by the news media, corporate America and presidential candidates about green this and green that, but, when it comes to actually doing something hard to bring about a green revolution at scale — and if you don’t have scale on this you have nothing — we wimp out. Climate change is not a hoax. The hoax is that we are really doing something about it.
No question, it’s great news that the Democrat-led Senate finally stood up to the automakers, and to the Michigan senators, and said, “No more — no more assisted suicide of the U.S. auto industry by the U.S. Congress. We’re passing the first bill since 1975 that mandates an increase in fuel economy.” If the Senate bill, which now has to go through the House, becomes law, automakers will have to boost the average mileage of new cars and light trucks to 35 miles per gallon by 2020, compared with about 25 miles per gallon today.
But before you celebrate, pay attention to some fine print in the Senate bill. If the Transportation Department determines that the fuel economy goal for any given year is not “cost-effective” — that is, too expensive for the car companies to meet — it can ease the standard. That loophole has to be tightened by the House, which takes up this legislation next week.
But even this new mileage standard is not exactly world leading. The European Union is today where we want to be in 2020, around 35 miles per gallon, and it is committed to going well over 40 m.p.g. by 2012. Ditto Japan.
There are other things that make the Senate energy effort ugly. Senate Republicans killed a proposed national renewable electricity mandate that would have required utilities to produce 15 percent of their power from wind, solar, biomass and other clean-energy sources by 2020. Twenty-three states already have such mandates. No matter. Making it national was too much for the Republicans.
And the Senate, thanks again to the Republicans, also squashed a Democratic proposal to boost taxes on oil and gas companies that would have raised some $32 billion for alternative fuel projects.
Despite all the new research on climate change, the Senate didn’t even touch the idea of either a cap-and-trade system or a carbon tax to limit carbon dioxide emissions. An effort by Senator Amy Klobuchar of Minnesota to legislate a national reporting (“carbon counter”) system to simply measure all sources of greenhouse gas emissions, which would enable a cap-and-trade system to work if we ever passed one, also got killed by Republicans. We can’t cap and trade something we can’t measure.
Here is the truth: the core of our energy crisis is in Washington. We have all the technology we need right now to make huge inroads in becoming more energy efficient and energy independent, with drastically lower emissions. We have all the capital we need as well. But because of the unique nature of the energy and climate-change issues — which require incentives and regulations to build alternatives to dirty, but cheap, fossil fuels — you need public policy to connect the energy and capital the right way. That is what has been missing.
“We have to work to ensure that the House will at least toughen the provisions that the Senate passed,” said Dan Becker, director of the Sierra Club’s Global Warming Program.
The public wants it. But energy policy gets shaped in the halls of Congress — where wily lobbyists, legacy industries and politicians greedy for campaign contributions regularly sell out the country’s interests for their own. Only when the public really rises up — as it has finally done against the auto companies — do we even get moderate change. Don’t look to the Bush team to lead the revolution.
[SNIP]
Folks, we’re home alone. So call your House member — especially the Republicans. If you don’t, some lobbyist will.
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