May 22, 2009

On May 21, the House Energy and Commerce Committee completed a weeklong markup of the American Clean Energy and Security Act (HR 2454), approving it by a vote of 33 to 25.

A number of matters have yet to be decided:

• Transmission line siting: Representative Jay Inslee (D-WA) offered and withdrew an amendment to give federal regulators more authority in siting transmission lines when states cannot reach an agreement. Committee Chairman Henry Waxman (D-CA) expressed plans to address the issue before the floor debate, and said a hearing is in the works.
• Acceptable sources of biomass: The statute lacks complete guidelines for the kinds of biomass that can be used to meet renewable energy mandates. This has been a particularly contentious issue—for more information see the March 5 edition of the ESA Policy News at: www.esa.org/pao/policyNews/pn2009/03052009.php
• Emissions allocations for refineries: Representative Jim Matheson (D-UT), one of the four committee Democrats to oppose the bill, offered and withdrew an amendment to increase the proportion of free allowances provided to domestic refiners, and to ensure that the additional amount would go toward small refiners.
• Gas, power, and carbon markets: Representative Bart Stupak (D-MI) introduced language to give the Federal Energy Regulatory Commission (FERC) “cease and desist” powers to halt manipulation (or suspected manipulation) in gas, power, and carbon markets—this added authority would allow FERC to temporarily freeze the assets of parties suspected of violation. Representative Gene Green (D-TX) has been urging Stupak to modify the provisions so that if FERC errs, impacted parties will be ensured quick judicial relief.

The committee already approved a number of amendments, including ones establishing a federal “clean energy” bank, which would provide financial assistance for clean energy projects, and a “cash for clunkers” program, which would provide consumers with up to $4,500 toward replacing gas-guzzling cars with more efficient models.

In addition, the committee voted down GOP amendments to add nuclear and hydroelectric power to the renewable electricity standard, as well as ones to provide a means for terminating the cap-and-trade program in the event of increased job loss or energy prices.

Majority Leader Steny Hoyer said he expects a possible floor debate in late June or early July, following another month of fast-paced committee action. Climate legislation is now sharing the stage with health care reform, however, which may slow its progress in some cases, particularly in the Ways and Means Committee, where Chairman Charles Rangel (D-NY) plans to shift gears in June. “Maybe at some point we can do both at the same time,” he said. “But health being first is a priority.”

The Agriculture Committee may also delay the bill—Chairman Collin Peterson (D-MN) has threatened that between 40 and 45 House Democrats will vote join him in voting against the bill if it does not include significant concessions for farm-state lawmakers.

Still, House leadership expects the legislation to move quickly through most committees and remains hopeful that Congress will send President Obama a climate bill in time for international negotiations in Copenhagen this December. 

Senate Energy and Natural Resources Chairman Jeff Bingaman (D-NM) appears to have gathered the twelve votes necessary to move forward with a renewable energy standard (RES) measure in the chamber’s massive energy bill. The RES has been one of the more contentious issues during the Senate energy talks, with several Democrats withholding their votes due to the potential negative impacts a strict standard could have on industry. In recent days, however, Bingaman has been able to shore up the support of Democrats Debbie Stabenow (D-MI) and Blanche Lincoln (D-AR), and Republican Sam Brownback (D-KS). Nine Democrats had already expressed their support for the measure.

The current RES language would require utilities to supply 15 percent of their electricity from renewable sources by 2021, allowing companies to cover roughly a fourth of the target with efficiency offsets. Committee members are still debating the specifics, however, and could mark up as many as 49 amendments next month.

Calls for change are coming from both sides of the issue. Some Democrats say that the RES should become even stricter in years to come—Senator Mark Udall (D-CO) wants to increase the standard to 25 percent by 2025— while many GOP lawmakers, such as ranking member Lisa Murkowski (R-AK), want to see nuclear power, hydroelectric power, and “clean coal” among the qualifying sources of energy.

Of central concern to Bingaman was an amendment from Jeff Sessions (R-AL) to strike the entire RES title. The committee voted the measure down 13-9 on May 21—those who voted in favor of the amendment pointed to the standard’s omission of nuclear power, a resource they say will be critical to meeting America’s energy needs while reducing emissions.

Meanwhile, the climate and energy bill in the House includes an RES of 15 percent by 2020—the target would drop to 12 percent in states where the governor determined utilities were unable to meet the mandate. These figures represent a compromise similar to the one in the Senate, and are raising some objections from environmental groups, who say that many utilities are already set to generate almost 10 percent of their power from renewable sources by 2020. Liberal Democrats are much more supportive of the compromise, however, stressing the importance of moving forward with the legislation.

The Obama administration’s 2010 budget request includes $18.6 million for “catch-share” programs, new fisheries management programs that take a cap-and-trade-style approach to regulating catches. Under the traditional system, managers set a limit to the fishery’s total catch, and boats compete to bring in as many fish as possible before the fishery hits its limit. The resulting “race for fish” is, according to several studies, a major contributor to fishery decline and collapse. Catch-share programs are designed to incentivize more sustainable practices by guaranteeing all fishers a fixed number of shares from the total catch, a limit that is set annually by scientists. These shares, which can be bought and sold, increase in value when the fish population, and thus the total allowable catch, increases. It is therefore in the financial interest of each shareholder to work toward increasing the long-term health of the fishery. Recent studies have shown that catch-share programs can cut the collapse rate for fisheries in half.

There are currently 12 such programs in operation; the requested funds would go toward developing additional ones. The Bush administration also worked to advance catch-shares, which have gained momentum in recent years, and Jane Lubchenco, the administrator for the National Oceanic and Atmospheric Administration, has also expressed her support. In spite of this broad backing, however, the process has raised some concern that, without proper design, it could hurt smaller fisheries and encourage fishers to throw out more fish in order to bring in the best specimens while staying under catch limits.

On May 14, House Agriculture Committee leadership introduced a bill to counter some of the provisions outlined in the 2007 expansion of the national biofuels mandate. Chairman Collin Peterson (D-MN) and ranking member Frank Lucas (R-OK) have been critical of the draft rule recently released by the Environmental Protection Agency (EPA) to implement the expansion; the leaders’ bill would modify language dealing with lifecycle emissions and renewable biomass.

Lifecycle emissions: The EPA draft rule states that the agency will seek peer review to determine if and how indirect land-use change—the clearing of land to accommodate the agricultural demands of biofuels— should be factored into a fuel’s lifecycle emissions. The new bill would exclude indirect changes in land-use from emissions calculations on the grounds that the science remains to crude to make such calculations accurately and fairly.

Renewable biomass: The 2007 bill’s definition of “renewable biomass” excludes crops from lands cleared after the enactment of the law, as well as slash and thinning from federal forests. The new bill would replace this definition with the less restrictive one used in the 2008 farm bill, significantly expanding acceptable sources of biomass.

For more information on the EPA draft rule, see the May 7 issue of the ESA Policy News at: www.esa.org/pao/policyNews/pn2009/05072009.php

The new bill would also place the Energy and Agriculture departments, rather than EPA, in charge of assessing lifecycle emissions. Peterson recently stated that he would not vote for the much discussed Waxman-Markey climate bill, claiming he did not trust EPA enough to carry the measure out. He previously attempted to raise his concerns with Waxman and Markey, but said that the talks were unsuccessful. Unless his new legislation passes, Peterson says he will be unwilling to negotiate his current stance on the climate bill.

On May 18, President Obama unveiled new proposed corporate average fuel economy (CAFE) standards, the first-ever national greenhouse gas emissions standard for cars and trucks.

The proposed rulemaking will mandate a 5-percent annual increase in fuel economy for automobiles manufactured between 2012 and 2016. It will also increase corporate average fuel economy (CAFE) standards to an average of 35.5 miles per gallon by 2016, which is four years ahead of the schedule set by Congress in 2007.

The proposal involves two high-profile emissions issues:

EPA Endangerment Finding: In 2007, the Supreme Court granted EPA legal authority to regulate greenhouse gas emissions under the Clean Air Act, if the emissions were found to endanger human health. Last month, EPA released a proposed endangerment finding which, if finalized, would obligate the agency to issue far-reaching emissions regulations. Some have accused the White House of prejudging the outcome of the proposed finding, which is still in the midst of its public comment period.

California Waiver: EPA is currently reviewing a waiver request from California, which, if granted, would allow the state to set stricter limits on tailpipe emissions. EPA’s decision will determine the extent to which states can regulate air pollution under the Clean Air Act; 17 additional states—representing roughly half the auto market— have indicated that they would adopt California’s stricter standards if the waiver is granted. The prospect of having to contend with the resulting patchwork of often stricter emissions standards has prompted the auto industry, which initially resisted nationwide standards, to praise the new CAFE proposal. According to the White House, California will defer to the national standard through 2016, even if the EPA grants the waiver.

Oil spill prevention: S 685, introduced by Senator Frank Lautenberg (D-NJ), would require cargo ships to reinforce their fuel tanks to reduce the risk of oil spills resulting from accidents. Lautenberg introduced similar legislation last year, but it did not make it to the floor.

Marine sanctuaries expansion:

• S 212, cosponsored by Democratic Senators Barbara Boxer (CA) and Dianne Feinstein (CA), would add over 1,000 square nautical miles to the network of marine sanctuaries off the coast of northern California. The protected area is popular nesting ground for elephant seals and sea lions, and hosts more than a third of the world’s whale and dolphin species. It is also home to the largest concentration of blue whales.
• S 380 would expand Lake Huron’s Thunder Bay National Marine Sanctuary to eight times its current size. The sanctuary is largely known for its numerous well-preserved shipwrecks, and the expansion is aimed at protecting an additional 178 wrecks. But the designation would also bar a variety of development, preserving ecosystems in the area. The “sanctuary” designation does not typically ban commercial fishing.

Marine mammal rescue grants: Washington Senator Maria Cantell (D) introduced S 859, which would expand a program that provides grants to groups working to recover, treat, and research stranded whales and other marine mammals. In March, the House approved the companion bill, which was introduced by Representative Don Young (R-AK).

Severe weather and climate event research: S 601, sponsored by Senator Kay Bailey Hutchison, would establish a Weather Mitigation Research Office within the National Science Foundation. The office would conduct a research and development program to improve mitigation efforts in response to severe weather events. The bill would provide $25 million per year for the next four years, some of which would go to the National Oceanic and Atmospheric Agency.