‘Hybrid’ US climate legislation likely to back track on some environmental promise to throw big bones to industry

Publish date: February 22, 2010

Written by: Charles Digges

NEW YORK – For weeks following Predident Barack Obama’s State of the Union address, in which he more or less put at arms length or overturned some of the brighter climate promises he had made only a year before, his administration is spreading itself thin to come up with climate and energy legislation that will pass the Senate.

So scattered have become the problems of placating partisan interests that the climate legislation submitted to the Senate in October after its landmark passage by the House of Representatives is now being referred to wryly by some observers and American media as the “hybrid” energy bill.

But the toils faced by Obama both before the domestic and international community to come up with something to fulfil promises made in December’s UN climate talks, as well as satisfy an increasingly recalcitrant Senate, are exposing the dark underbelly of Washington deal making to the rest of the world.

In his first months in office, Obama moved quickly to put the climate at the forefront of his domestic and international agenda, which was already a welcome change from years of Bush-led stagnation.

Obama produced a landmark deal on automobile emissions, an Environmental Protection Agency (EPA) finding that greenhouse gases endanger public health and welfare, a virtual moratorium on oil drilling on public lands and House passage of a cap-and-trade bill.

Since then, in part because of the intense focus on the health care debate last year, action on environmental issues has slowed. The Senate has not yet begun debate on a comprehensive global warming bill, the US Interior Department is writing new rules to open some public lands and waters to oil drilling and the EPA is moving cautiously to apply the endangerment finding. Rhetoric about a US cap-and-trade bill has also been significantly toned down, leaving environmentalists to wonder if it is still part of the US climate debate.

The result has been a White House scramble to piece together an energy and climate change bill that has enough incentives for nuclear power, natural gas and the coal industry, in the form of carbon capture and storage, to muster the votes needed to pass it this year.

“If the Democrats are to pass climate change legislation this year, they will need to attract votes of some Republicans – a difficult challenge in the highly partisan atmosphere on Capitol Hill. Congress is focussed on passing legislation on health care and jobs, which doesn’t leave much time for other issues, so the supporters of climate change legislation will need to show how the proposal creates jobs while not adding to the federal deficit,” said Bellona USA Director Jonathan Temple. 

“Bellona USA supports measures to speed up the deployment of carbon capture and storage technology, and the continued expansion of renewable energy generation in the US, so we hope that these propoals remaain in any fnanl legislation that eventually emerges,” he said. 


A hybrid to suit everyone?

Fred Krupp, president of the Environmental Defense Fund, told CimateWire that both the White House and Republican Senator Lindsey Graham of South Carolina, along with some industry and environmental groups, are moving with a “sense of urgency” toward a “hybrid” energy-climate bill, as time for passing legislation is already growing short in an Congressional election year.

Graham has become the lead Republican deal-maker on such an approach. “Everyone realizes the window closes at some point,” Krupp said. “I think the package has to gel in the next couple of months for something to happen.”

Krupp said the ongoing efforts are aimed at a bill that is a “hybrid of ideas” that would attract enough votes from fence-sitting Democrats whose states are heavily reliant on coal and from Republican ranks to secure passage through the Senate.

Environmental community turns up the volume

Environmental advocates largely remained silent late last year as Obama all but abandoned his quest for sweeping climate change legislation and began to reach out to Republicans to enact less ambitious clean energy measures.

But green grumbling has grown louder in recent weeks as Obama has embraced nuclear power, offshore oil drilling as keystones of his energy policy. On a positive side, however, Obama charged an interagency task force with advancing five to 10 commercial demonstrations of carbon capture and sequestration (CCS) technology by 2016, a signature tactic supported by Bellona.
Yet, nuclear power and offshore drilling still remain elephants in the room. Some environmentalists have expressed concern that the president may be sacrificing too much to placate Republicans and the well-financed energy lobbies.

Statoil’s role in Obama’s compomise

One landmark in this turn of events has been a steady march of offshore drilling mergers. One such deal that has passed under the radar in the more upsetting general tone of placating Republicans is CononcoPhillips deal with Norway’s Statoil to work arctic oil deposits off of Alaska together.

The deal was signed two days prior to Obama’s State of the Union address, in which he endorsed loosening restricting in offshore drilling, among other headaches his speech caused the environmental community.

The Bellona Foundation has cried foul at this move by Norway’s state oil driller. But Statoil’s trade for some 25 of 50 of CononcoPhillips’ oil drilling leases in the area for some of its assets in the Gulf of Mexico, is to US environmentalists just one small issue in a sea of turning tides.

Indeed, Statoil had only in November agreed to pay $3.4 billion for a 32.5 percent stake in Chesapeake Energy’s assets in the Marcellus shale formation in the Appalachian region.

The result of Statoil’s steady flow of mergers with US corporations has been one of homespun American cynicism rather than environmental outcry.

Bernstein Research analysts, an investment research firm, quipped recently: “Frankly, you can virtually plan your gym sessions around these deals, they are becoming so regular. Thinking about it, isn’t it about time for another Statoil deal?”

Losing allies

Alongside offshore drilling, Obama has embraced nuclear power and put up billions a total in federal loan guarantees that will eventually reach $54 billion to help finance a new nuclear built-out in the United States, the first in more than 30 years. According to a Congressional Budget Office report, loan defaults on nuclear plant construction hovers around 50 to 60 percent.

Daniel Weiss of the left-leaning Centre for American Progress had been one of the most stalwart supporters of Obama’s energy policy – until his mention of backing nuclear in the State of the Union address.

“The president’s embrace of nuclear power was disappointing, and the wrong way to go about winning Republican votes,” he said, adding that. Obama should not be endorsing such a costly and potentially catastrophic energy alternative “as bait just to get talks started with pro-nuke senators.”

Erich Pica, president of Friends of the Earth, whose political arm endorsed Obama’s candidacy for president, said that Mr. Obama’s recent policy emphasis amounted to “unilateral disarmament.”

“We were hopeful last year; he was saying all the right things,” Pica said. “But now he has become a full-blown nuclear power proponent, a startling change over the last few months.”

But Bill Snape, senior counsel for the Centre for Biological Diversity is holding out a modicume of hope.

“I think we all had higher hopes,” said Snape. “We expected a lot in the first year, and everyone agrees they didn’t quite live up to it. But there is recognition that he and the whole administration will get another stab at it.”

The White House combinatory approach

Obama continues to call for a broad approach that wraps together energy and climate provisions.

In his latest public comments in a town hall meeting in Nevada last week, Obama stuck to his guns in explaining the need for an eventual price on industrial carbon emissions, though he made no mention of the House’s cap-and-trade legislation.

But Obama also pivoted toward traditional fuels. “It’s going to take some time. We’re still going to be getting our electricity from coal,” he said, adding that utilities will also continue to rely on nuclear power and natural gas.

Senator Graham and his negotiating partners on climate, Massachusetts Senator John Kerry, who co-authored the Senate climate bill, and Joe Lieberman, Connecticut’s Independent Senator, have all said some form of hybrid energy-climate bill has the best chance of passing the Senate.


The Copenhagen effect

Obama is beholden to an accord reached at the UN summit in Copenhagen in December that has the United States cutting greenhouse gas emissions by 17 percent below 2005 levels by 2020. The goal is just that, a nonbinding statement of US intentions, but Whitehouse spokesmen said Obama faces sharp international and domestic criticism if US energy initiatives appear too weak to meet even that modest emissions target.

But deep questions have arisen over the last week as to the Copenhagen accord’s effectivesness. Nearly 100 nations, including the United States, South Africa and Brazil, have endorsed the Copenhagen Accord. But China and India have yet to formally sign off on it, and sources close to Chinese officials say they are balking at sensitive points dealing with transparency and monitoring, even as they vow to press ahead with limits on the growth of their emissions in the next decade.

Yet pessimism that the accord will gain the necessary traction to produce anything close to an internationally binding emissions committment hit a new low last Thursday as as Yvo de Boer, the United Nations’ top climate official, resigned after struggling, and failing, for three and a half years to produce a binding legal treaty. He steps down on July 1st, according to his offices.