Senate energy panel members open to carbon plan

Wayne Barber | Nov 15, 2012

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A top Democrat and Republican on energy matters in the Senate left the door open to compromise on a potential carbon tax, but a top Republican House energy leader seemed less receptive during a Nov. 15 seminar in Washington, D.C.

The next chairman of the Senate Energy and Natural Resources Committee, Ron Wyden, D-Ore., and the ranking Republican on that panel, Sen. Lisa Murkowski of Alaska, both embraced compromise and at least left the door open for a carbon tax.

But Rep. Ed Whitfield, R-Ky, who chairs the Subcommittee on Energy and Power within the House Energy & Commerce Committee, was more cautious. Whitfield said most House GOP lawmakers won’t embrace a carbon tax “until we have a lot more details than what we know now,” Whitfield said.

The congressional leaders made their comments during a CQ/Roll Call seminar sponsored by the Nuclear Energy Institute (NEI). During the seminar, which was webcast, Whitfield appeared later than the senators and was not on hand to hear their comments.

Whitfield, did, however, note he is a former Washington, D.C., neighbor of Wyden and has collaborated with him on legislation in the past. Wyden is set to succeed Sen. Jeff Bingaman, D-N.M., as chairman of the Senate Energy and Natural Resources Committee. The New Mexico Democrat is retiring.

Whitfield said it makes little sense for energy-related panels to pass bills that have scant chance of gaining majority support in the opposite chamber.

Wyden, Murkowski ‘love-fest’ touted cooperation.

Some subsequent speakers in the two-hour seminar described the joint appearance by Wyden and Murkowski as something of a “love-fest” by the two veteran lawmakers.

“I am going to extend my hand because we are going to work together,” Murkowski said as she and Wyden shook hands.

Murkowski indicated that some type of carbon tax might be a more realistic way to address climate change than the unwieldy “cap-and-trade” proposals.

The Waxman-Markey “American Clean Energy and Security Act” featured cap-and-trade as its centerpiece. It passed the then Democrat-controlled House in 2009 but never passed the Senate.

Hurricane Sandy and the so-called “fiscal cliff” have sparked talk that a carbon tax could merit congressional consideration. But Murkowski noted that any carbon tax proposal must be considered mostly for “environmental responsibility” and not revenue generation.

As for the GOP: “We need to show a level of environmental responsibility that is in conjunction to where young people are coming from,” Murkowski said. At the same time, young people “also need a decent job,” Murkowski said.

Wyden agreed that any energy policy must strike a balance. “It’s not really an energy speech” unless lawmakers “say they say are for ‘all of the above’ at least four times,” Wyden said.

Wyden and Murkowski agreed that thousands of jobs could be at risk if there is not a short-term extension of the production tax credit that benefits wind. Both senators also said that a long-term, detailed review of energy subsidies is needed in the future.

For Wyden’s part, he suggested that traditional fossil fuels seem to currently get the bulk of the subsidies while more renewable energy sources receive “the crumbs.”

At the same time, Wyden realizes that resource-extraction areas of the country don’t want to turn into “ghost towns.”

Whitfield talks EPA regulation, Yucca Mountain

In the House, Whitfield said his panel’s biggest accomplishment in the just-concluding Congress has been putting the brakes on some U.S. Environmental Protection Agency rules.

“Not that we stopped a lot of them, but we delayed a lot of them,” Whitfield said. The Kentucky Republican said federal appeals court rejection of certain EPA standards proposed for coal plants indicate the extent of the EPA “over-reach” during the Obama administration.

Whitfield also said that the Obama administration erred by turning away from plans for the national nuclear waste repository at Nevada’s Yucca Mountain. “I personally believe we would be better off if we just go ahead and finish Yucca Mountain,” Whitfield said.

“That was one of the mistakes made by Sen. Harry Reid and others,” Whitfield said. Reid, D-Nev., is the Senate majority leader.

Nuclear energy came up again after all the lawmakers left the stage. Environmental Defense Fund Senior Director Elgie Holstein said much of the environmental community still has major concerns about nuclear power but is no longer “reflexively” opposed to it.

The EDF official indicated, however, that waste and financial concerns could keep nuclear from growing as a low-carbon option.

PSEG Power President and COO William Levis said he would have liked to see the lawmakers better define what they mean as “all of the above.” Over the years, the Public Service Enterprise Group (NYSE: PEG) subsidiary has seen its coal, gas and nuclear resources deemed “least cost” options at one time or another.

So Levis said he is skeptical that anybody can accurately predict the energy future. But all panelists were encouraged to see a recent International Energy Agency report that said the United States is on the brink of achieving energy independence.

Exelon (NYSE: EXC) Senior Vice President for Government Affairs David Brown said the weak economy has suppressed energy demand for power providers at the same time there has been a growing degree of subsidies for certain types of generation.

Wayne Barber is chief analyst for generation at GenerationHub, a unit of Energy Central

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Comments

Closing the Yucca Mountain Repository

Closing the Yucca Mountain Repository was more than a mistake.  It was a blatant violaiion of the Nuclear Waste Policy Act 1982 (amended),  It was costly, too.  $28B collected from customers through their electricity bill; initial funding of the NWPA preliminary search for sites collected in taxes; almost $1B taxpayer funded awards by the courts to five utilities (and 24 more suits have been filed) for the Fed's failure to pick up spent nuclear fuel starting in 1998; plus increased electricity bills to pay for additional SNF on-site storage.  And we are further now from closing the nuclear fuel cycle.  Impeachment, anyone...?

Another load of DC horsehockey

The federal government in general, including Congress, finds ways to abuse every tax they ever came up with.  Just look for instance at Social Security.  They started dipping into the Social Security and Medicare funds decades ago to pay for Welfare, AFDC, Medicaid and a host of other programs.  All they have succeeding in doing with that is to INCREASE poverty because it disincentived people from working their way out of poverty.  Anyone who insists there are no such things as 'welfare babies' is living in an alternate universe.  I can virtually assure the nation that if the carbon tax resulted in every single MWh being made by non-CO2 emitting technology, the feds and Congress would find a reason to continue any carbon tax.

Also, can they not see the impact that a carbon tax will have on small businesses and manufacturing trying to compete on the world market?

As for blaming Hurricane Sandy on global climate change, what was the excuse for the hurricanes that hit the eastern seaboard in other times in the past?  The amount of damage from Sandy was compounded by it and a nor'easter arriving at the same time and by the amount of coastal development since the previous storm events.  I read some governmentally compiled statistics that indicated population growth in the coastal areas has been occuring at roughly 4 times the rate of other areas of the US for many years.  And we also have a period of high solar storm activity presently.

As for the thousands of jobs in the wind industry, I read a post on one thread that pointed out that noone has really produced verifiable data about the number of jobs the wind industry has created or, more importantly, maintained.

A Dose of Reality

The President is talking carbon tax to reduce the deficit, which would violate his "promise" not to increase taxes on those earning less than $250,000 per year, since a carbon tax would increase the cost of everything purchased by everyone. I suspect Senator Wyden is in the "consumable" carbon tax camp.

Senator Murkowski appeared to be alluding to the possibility of a "refundable" carbon tax. I no longer believe in Santa Claus, The Easter Bunny, the Tooth Fairy or even the Great Pumpkin; and, I do not believe in the possibility, no less the likelihood, of a totally refundable tax. I believe our congresscritters are too rapacious to collect taxes and then refund them in total. Also, I believe they are too invested in redistribution to return the taxes collected to those who paid them, when there is an opportunity to buy votes instead.