‘Gang of 10’ bill dead for now; tax credit extensions likely for renewable energy

(Photo of wind farm from Flickr and photographer lamusa/Jennifer)

Washington Report: The Gang of 10 bipartisan Senate energy package is over, at least until after the election. The 20 supporters apparently couldn’t reach agreement and pulled the bill Friday. Pressure to expand offshore drilling after a more generous Democrat bill passed the House, as well as a fast-tracked bipartisan bill to extend renewable energy tax credits contributed to the decision. The financial crisis also promised to bump an energy debate as a top priority. But it was unclear Friday whether the offshore drilling ban would be allowed to expire Sept. 30 or would be extended in a resolution to continue government spending till year’s end. Meanwhile the Finance Committee’s bill on tax credit extensions is likely to come up next week. That bill would, among other things:
• Extend production tax credits for wind 1 year.
• Extend investment tax credits for solar energy 8 years.
• Extend credits for energy efficient buildings for 1 year.
• Add credits for small residential wind turbines and geothermal pumps.
• Add credits for new advanced coal and coal gasification, and to industry for capture and storage of CO2
• Add consumer credits for plug-in vehicles
• Limit but not repeal tax breaks for oil companies.
A coalition of industry and environmentalists warned Thursday that failure to extend renewable tax credits could cost 100,000 jobs and billions in investments. (Sources: Greenwire, E&E PM, E&E Daily)

India’s climate plan includes renewable energy, efficiency, but no emissions target

(Photo of solar energy in rural India from Flickr and and the barefoot photographers of Tilinia)

News Update 3: India, whose economy is growing 8-9% a year, has unveiled its National Action Plan to deal with global warming. It will focus on renewable energy, efficiency and research on green technology. More specifically, the plan covers solar energy, water conservation and energy efficiency, as well as sustainable agriculture, the Himalayan ecosystem and habitat. But it does not set a target for curbing greenhouse gas emissions. India says it has a right to lift its people out of poverty, as industrial nations did while they poured GHG into the atmosphere -- and that it has low per-capita carbon emissions, at 1.2 tons, compared with the United States’ 20.6 tons (2004 data). India’s power is 60% generated by coal, with plans for new plants in the next 5 years that will generate 70,000 more megawatts. Emissions have been growing about 2-3% a year, though the country is responsible for only 4% of the world’s GHG. (Source: Thomson Reuters)

Florida sees surge of solar plants, passing up other states as FP&L unveils plans for 3 sites

(Photo of solar panels at Cape Kennedy from Flickr and photographer Marcin Wichary)

News Update 2: The Sunshine State is beginning to take advantage of its best-known natural resource. Florida Power and Light has unveiled plans for 110 megawatts of solar energy in the state, enough to power 35,000 homes, which will help Florida pass up Arizona, Nevada and other states in producing solar energy. The utility wants 3 installations, one to produce 10MW at a photovoltaic plant at Kennedy Space Center, another 25 MW in DeSoto County, and a third to make 75MW from solar thermal in Martin County. Regulators still have to approve the plans but FPL expects the plants to be up and running next year. FPL also operates the world’s largest solar thermal field, in California’s Mojave Desert. FPL’s CEO told Reuters the price of solar is coming down and is more competitive with conventional power pants. FPL also produces wind and has a wind goal of 8,000-10,000MW by 2012. The state of Florida has set a target for public utilities to produce 20% of its power from renewable sources by 2020. FPL may sell some of its new solar power to other utilities to help them meet their goals. Others are doing their part as well. The Orlando Utilities Commission is installing solar photovoltaic panels on the Orange County Convention Center, which will produce 1,500MW hours of power a year. Many credit new Republican Gov. Charlie Crist with spurring renewable activity in the state by setting goals. (Sources: Reuters PlanetArk, Greenwire)

IEA says global ‘energy revolution’ needed to cut greenhouse gases in half by 2050

(Photo of wind turbines in Italy from Flickr and photographer gorillaradio/Sebastiano Pitruzzello)

News Update 1: A worldwide “revolution” in the way we use energy is needed in the next 40 years, the International Energy Agency said last week. The cost will be $45 trillion, the agency said. But failure to act will result in an energy shortage and a slowdown in the global economy. Massive changes will be needed on a worldwide basis, including:
• Retrofitting 35 coal-fired plants and 20 natural gas plants each year to capture and store carbon dioxide.
• Building 32 nuclear plants a year.
• Installing 17,500 new wind turbines a year.
• Increasing solar energy and second-generation biofuels that won’t compete with food.
One of the most challenging changes will be to drastically reduce fossil fuel use for transport, at a time when auto and plane use is skyrocketing in developing nations. Oil demand needs to be cut to 27% of 2005 levels, said the agency, which advises 27 nations on energy policy. The task at hand is gargantuan, but without it oil demand will likely grow 70% and GHG emissions will increase 130% by mid-century, IEA said. The impact would be calamitous, with more severe droughts, famines, floods and rising seas that engulf coastal cities. IEA urged the G-8 to endorse the goal to reduce GHG in half by 2050 at its meeting in July. (Sources: Greenwire, New York Times)

Ten key Dem Senators had problems with global warming bill -- what happens next?

(Photo of Capitol Building from Flickr and photographer Gawnesco/Scott Gawne.)

Weekly Angst: Following a 48-36 vote (60 were needed) to end debate on the Climate Security Act Friday, 10 keys Dems, 9 of whom voted with the leadership, said they had problems with the bill that would have kept them from ultimately voting for it.

In a letter to Majority Leader Harry Reid (D-Nev.) and Environment Chair Barbara Boxer (D-Calif.), the 10 said their states would be the most adversely affected by the bill, as written. Sens. Debbie Stabenow and Carl Levin (Mich.), Jay Rockefeller (W.Va.), Jim Webb (Va.), Evan Bayh (Ind.), Blanche Lincoln and Mark Pryor (Ark.), Ben Nelson (Neb.), Claire McCaskill (Mo.), and Sherrod Brown (Ohio) said they favored a cap-and-trade bill but it must “ensure consumers and workers in all regions of the U.S. are protected from undue hardship.” The following issues need to be addressed, they said:
* Make sure there’s a short-term cushion to ensure technologies will be there to help meet early emissions targets.
* Fold state laws into the federal system.
* Expand agriculture and forestry offsets.
Advocates are now looking to a new President and new Congress to get a cap-and-trade bill passed. With Sen. John Warner (R-Va.) retiring, Sen. Joe Lieberman (I-Conn.) said he is looking for a new partner to continue working on the Climate Security Act.

Next on the Senate agenda
While the global warming bill may be dead for now, Senate leadership is moving on to other energy bills: the unfinished business of passing an extension of renewable tax credits (approved by the House) and a “windfall profits” bill to tax major oil companies and address “price gouging.”

The renewable tax credit extentions (HR6049) would continue wind farm production credits 1 year and solar energy investment credits 6 years, as well as continue credits for other renewable energy sources and efficiency. The credits are due to expire the end of this year and without them renewable projects face an uncertain future.

The windfall profits bill (S3044) will probably come up first and is intended to address high oil and gasoline prices. In addition to a new tax and the repeal of tax breaks for major oil companies, the bill has a price-gouging provision and also allows the Justice Department to bring anti-trust actions against OPEC. This one is unlikely to get the 60 votes needed to avoid a filibuster and President Bush has threatened a veto.

And across the way in the House
House Speaker Nancy Pelosi (D-Calif.) rejected a GOP challenge to debate global warming on the floor of the House before the 4th of July and said any activity this year will be in Energy Chair John Dingell (D-Mich.)’s committee. She indicated chances for passing a strong bill will be much better next year.

Dingell has announced his subcommittee on Energy and Air Quality, headed by Rep. Rick Boucher (D-Va.), will hold hearings on the bill that just died in the Senate, as well as the two strong bill introduced in the House by Reps. Henry Waxman (D-Calif.) and Ed Markey (D-Mass.) Waxman’s bill calls for an emissions cut of 80% by 2050, with 100% of the credits auctioned, and Markey mandates an 85% reduction, with 94% of credits auctioned. Dingell and Boucher are expected to produce their own bill at some point.
(Sources: E&E Daily, E&E News PM)

Newest effort to extend renewable tax credits is quick fix tied to housing bill in Senate

Congressional Round-up: The Senate is expected to approve any day an amendment to the housing bill that would extend tax credits for renewable energy and efficiency. The $6 billion amendment by Sens. Maria Cantwell (D-Wash.) and John Ensign (R-Nev.) is an effort to provide short-term extensions for the credits that will expire this year. The amendment provides:
• a 1-year extension of the renewable power production credit
• an 8-year extension of the solar energy investment tax credit
• 1- and 2-year extensions on credits for building efficiency and some energy-efficient appliances.
Because of opposition in the Senate to paying for the credits by repealing benefits on oil and gas, this amendment shows no balancing source of revenue. That could cause problems in the House, where Speaker Nancy Pelosi (D-Calif.) has said she wants to adhere to a pay-as-you-go rule. The House in February passed a much larger bill that included oil tax credit repeal, but it was narrowly rejected by the Senate and the White House threatened to veto it. A veto could be a problem here as well, because President Bush has problems with the housing bill to which it would be attached. In case this doesn’t work out, Senate Finance Chair Max Baucus (D-Mont.) is busy preparing yet another alternative energy tax package. Renewable energy companies have been lobbying hard, fearful that the tax breaks fueling their boom will go away. Renewables need all the help they can get to make a dent in the nation's dependency on carbon-emitting fossil fuels.(E&E News PM)

House OKs renewable energy tax credits

(Photo of windfarm from Flickr and photographer Alessandro Ronchi)

Congressional Round-up: The House voted 236-182 Wednesday to approve renewable energy tax credit extensions, funding them by eliminating tax breaks for 5 big oil companies. This is the fourth time they approved such a bill in the past year. Now comes the hard part. A similar bill has failed to get the 60 votes needed in the Senate to avoid a filibuster. That is likely again, though one tactic under discussion is to try to get some of the package included in the final budget reconciliation bill. The extensions are needed because current ones expire at the end of 2008, and already investment in renewables is slowing down. House Speaker Nancy Pelosi (D-Calif.) warned that a failure to extend the credits could cost the country 116,000 jobs. The Senate could bring up the bill as soon as next week. The House bill (H.R. 5351) provides:
• A 3-year extension on investment credits for wind, geothermal and other renewables.
• An 8-year extension of incentives for commercial solar energy and 6 years for residential, doubling the top credit for homeowners to $4,000.
• Incentives for plug-in hybrids, energy efficiency and installation of pumps for fuel with 85% ethanol.
The GOP and White House object to rescinding $13.6 billion in tax cuts for integrated oil companies. They say it will thwart exploration and raise prices for consumers. Dems said with oil over $100 a barrel, the 5 companies affected are making record profits and will lose less than 2% of those profits in the next 10 years. Call your Senators to approve this bill at (202)224-3121. Also, check to see how your Rep voted. (Sources: Washington Post, E&E Daily, E&E News PM, Sierra Club)

McCain nets zero on environment from Conservation Voters
Many see Sen. John McCain (R-Ariz.), the presumptive GOP nominee for president, as pro-environment. The League of Conservation Voters disagrees. McCain scored the lowest possible grade, a zero, on LCV’s 2007 Scorecard. Democratic contenders Sen. Hillary Clinton (D-N.Y.) came in at 73, and Sen. Barack Obama (D-Ill.) at 67. McCain, who introduced global warming legislation back before it was popular, has twice failed to show up for a vote on renewable tax credit extensions, where his vote could have made the difference. LCV says it’s a pattern and he missed all critical environmental votes last year. His lifetime score is 24. To see how your elected representatives scored, check the LCV scorecard. (Sources: Sierra Club, LCV)

New renewable tax-credit bill in House

Congressional Round-up: The House last week introduced a bill to extend production tax credits, funded in part by the repeal of oil tax benefits. The credits are due to expire at the end of the year, causing uncertainty for renewable energy industries. This bill is very similar to the one passed last summer by the House, but stifled in the Senate by 1 vote. It’s questionable whether the bill could pass the Senate in its current form. It includes:
• Extension of credits for wind, biomass, geothermal, small hydroelectric, landfill gas and trash combustion facilities through 2011, with a cap of 35% of the cost after 2009,
• Extension of solar energy and fuel cell investment tax credits for eight years,
• An end to deduction eligibility for the 5 larges oil companies,
• A 6% cap on benefits for smaller oil companies,
• A new credit for plug-in hybrid cars,
• Extension of tax credits for domestically produced cellulosic ethanol and biodiesel,
• A request that the National Academy of Sciences analyze current science on the production of biofuels and the domestic impact of a dramatic increase.

Proposal would allow power plants near national parks
Rep. Henry Waxman, (D-Calif.), chair of the House Oversight Committee, has urged the EPA to reject a proposal that would make it easier to build power plants near national parks. Waxman told EPA Administrator Stephen Johnson the proposed change in the New Source Review rules would violate the Clean Air Act. He said EPA technical experts acknowledged the change would allow “significant degradation” of the air in parks and national wilderness areas. He gave Johnson until March 5 to say why he ignored the advice of his staff. (Source: E&E News PM)

e-mailbag: Bob R. of Chicago writes, “Despite his admitted support and even sponsorship of environmental legislation, [John] McCain has too many constraints related to his conservative perception of reality to lead the nation effectively against the onslaught of global warming.”