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Washington Policy Report: April 2012

EXIT FOR BINGAMAN MAKES ENERGY LEGISLATION FUTURE UNCERTAIN
Early next year, for the first time in nearly 30 years, the U.S. Senate will reconvene without one of its strongest leaders, Sen. Jeff Bingaman (D-NM). Sen. Bingaman (D-NM) is retiring from the Senate, and has been a key influence, and broker, for numerous bipartisan bills; including the Energy Policy Act (P.L. 109-58), the Energy Independence and Security Act (P.L. 110-140), and the American Recovery and Reinvestment Act (P.L. 111-5). Sen. Bingaman provided leadership on both the America COMPETES Act (P.L. 110-69), as well as the America COMPETES Reauthorization Act (P.L. 111-358). He has consistently been a champion for basic scientific research, as well as federal research and development.

Since 2007, Sen. Bingaman has also been targeting a clean energy portfolio standard to mandate a certain percentage of electricity be generated by renewable energy sources; as well as a price for carbon dioxide. Although the Administration has redoubled their efforts to advance a “Clean Energy Standard” that would encompass new nuclear energy, and coal power that has carbon capture and sequestration capability, the likelihood of this proposal making its way to the desk of President Obama before the end of this year remains low. Rather, symbolic votes within the House have been frequent; measures seeking to highlight the bureaucratic inefficiency perceived by some lawmakers for agencies like the Environmental Protection Agency (EPA), as well as bills to drastically expand oil and gas exploration within and around the U.S. coastal waters.

Still, there are a few measures that could find their way into law during the “lame duck” portion of this session, where lawmakers seek to tie up loose ends before the session gavels to a close.

S. 1000
The “Energy Savings and Industrial Competitiveness Act of 2011,” passed the Senate Energy and Natural Resources Committee (ENR) last September on a bipartisan vote of 18-3 arguably holds the strongest chance for passage. This building efficiency bill remains one of those measures that could find itself escaping Congress on a last-minute vote to venture to the President’s desk for signature. This bill was introduced by Sen. Rob Portman (R-OH) and Jeanne Shaheen (D-NH). Recently the U.S. Chamber of Commerce called for the passage of this bill. The bill has strong bipartisan support within the Senate, and has also managed to secure endorsement from a large number of outside organizations.
In a letter from Bruce Josten, the chamber’s executive vice president for government affairs addressed to Senate Majority Leader Harry Reid (D-NV) and Senate Minority Leader Mitch McConnell (R-KY) the letter states "High energy prices are once again a priority issue for American voters. The Senate has spent much of the year pointing fingers and assigning blame. All the while, it has had in its lap a bill that enjoys strong bipartisan support and that would make a material difference in consumers' energy costs," Yet that bill, S. 1000, continues to sit on the sidelines."

HIGHWAY REAUTHORIZATION COULD REVIVE KEYSTONE PIPELINE
The Keystone pipeline issue has again resurfaced as lawmakers in the House sought their fourth vote on the issue in this session of Congress. The House, which is controlled by Republicans, would like to see the pipeline constructed, viewing it as a tremendous infrastructure project that will create thousands of jobs. Skeptics say that the job data is too rosy, and that the environmental costs would outweigh the economic benefits. The bill would seek to strip the President of his authority to rule on the Keystone project. The Administration already indicated that the President would veto the bill if it reached his desk. Language in the legislation, which would pay for highway, bridge and transit programs through this September, gives the Federal Energy Regulatory Commission 30 days to issue a permit for the pipeline. A vote may be scheduled on April 18.

Just before Easter recess, the Democratic-controlled Senate passed a 90-day extension for the highway reauthorization that did not contain any language on the Keystone pipeline. President Obama had rejected the earlier pipeline proposal last January, citing insufficient time to weigh the environmental risks of the project. He then suggested that he could support a rerouted pipeline, such as one that went through another part of the country, but has delayed any final decision under after the November election. Nebraska state officials had raised concerns over the passage of the proposed pipeline through their state because of its proximity to the Ogallala Aquifer, a massive water table beneath the Great Plains and one of the largest in the world that provides drinking water to eight states. Nebraskans also raised concerns over the tactics employed by TransCanada, the Calgary-based Corporation that is seeking to construct the 1,700 mile pipeline, to obtain easement rights to private landowners’ properties. To its credit, TransCanada submitted a new proposed series of routes recently to Nebraska state officials, which is conducting its own review independent on any federal action. The Nebraska state legislature has recently approved a bill that would allow the pipeline passage through its state, and that Nebraska Governor Dave Heineman has indicated he will sign, but that bill may be challenged by environmental activists in court.

ENERGY TAX CREDITS IN DANGER
The wind energy Production Tax Credit (PTC) has long been cited by the wind energy industry as vital to the growth of their industry. But Congress has been staring at trillion dollar budget deficits for three years now, and the days of littering the tax codes with subsidies like candy for rapacious trick-or-treaters may be numbered. The program provides an income tax credit of 2.2 cents per kilowatt-hour for electricity produced from utility-scale wind turbines. That is not to say that the PTC has not been effective, if not expensive. To date, wind represents three percent of all electricity generated in the U.S., and has achieved cost parody in some areas of the country. Wind also represents fewer permitting challenges then some other energy systems. Intermittency remains a challenge, and storage capability, other than Compressed Air, remains an elusive goal.

Still, the wind energy industry has likely observed closely the about-face by the biofuels industry last year that watched the expiration of their blender’s tax credit. Wind advocates would quickly point out, however, that while biofuels enjoyed a national fuels mandate, in addition to a tax credit, and a tariff on imported biofuels, the wind industry only has the tax credit. At a hearing by the Senate Appropriations Energy and Water Subcommittee earlier this year Energy Secretary Steven Chu seemed to open the door to the expiration for the tax credit to support wind energy. During the hearing, Secretary Chu was asked about the credit by Sen. Alexander (R-TN), who has opposed the PTC credit for years. Chu’s full quote can be read below:

“The representative of the wind industry said they just don’t want to see a cliff, they just don’t want to see it ended suddenly,” Chu told reporters after testifying on Capitol Hill yesterday. “So over a period of time, especially as — and no dates were discussed — but over a period of time, a road map of phasing out, you see where the prices are going and you can see” how to eliminate the credit.

Secretary Chu, of course, does not write tax policy, Congress does, and the wind industry still retains plenty of support within Congress. The call for Congress to pass HR 3307, the American Renewable Energy Production Tax Credit Extension Act, was made during a teleconference hosted by three members of Congress, the American Wind Energy Assn. and TPI Composites, a Newton, Iowa-based wind blade manufacturer.

HR 3307 is sponsored by Rep. Dave Reichert (R-Wash.). The bill has 93 co-sponsors.

BUDGET FIGURES FROM THE HOUSE SHOW TOUGH CHOICES BUT THE SENATE SHOULD COME OUT HIGHER
Last month we discussed the reception for the Department of Energy (DOE) budget by lawmakers within the House Appropriations Energy and Water Subcommittee. We also discussed the dismissal of the doubling path for funding to support the agencies named within the America COMPETES Act, which includes the DOE Office of Science and the Advanced Research projects Agency-Energy (ARPA-E). Therefore, it might come as little shock for many readers to learn that the figures released by the House Energy and Water Subcommittee reflect some of the difficult choices that the Committee members view they had to make regarding the support for the DOE.

Highlights from the markup include:

$4.8 billion to support the Office of Science, roughly flat compared to the fiscal year (FY) 2012 appropriated amount and $168 million less than the Administration’s FY 2013 request;
$765 million for the DOE Office of Nuclear Energy, which is $93 million less than the FY 2012 appropriated amount and $5 million less than the FY 2013 request;
$554 million to support the Office of Fossil Energy, which is $10 million less than the FY 2012 appropriated amount and $96 million less than the Administration’s FY 2013 request;
$200 million to support ARPA-E, which is $80 million less than the FY 2012 appropriated amount and $150 million less than the Administration’s FY 2013 request; and
$123 million to support the Office of Electricity Delivery and Energy Reliability, which is $16 million less than the FY 2012 appropriated amount and $20 million less than the Administration’s FY 2013 budget request.

In recent years, while the House has typically released lower figures to support the DOE’s main research programs, the Senate has tended to release larger figures, leaving lawmakers to meet somewhere in the middle. That is not to say that Senate Energy and Water Appropriations Subcommittee Chair Dianne Feinstein (D-CA) is wholly supportive of the DOE budget; as she asked Energy Secretary Chu some tough questions regarding the cuts proposed in FY 2013 for fusion energy sciences, as well as the utility of other program additions. It likely cannot hurt that the Ranking Member for the Senate Appropriations Subcommittee, Sen. Lamar Alexander (R-TN) is a staunch supporter for research concepts like the DOE Office of Science, ARPA-E, and the Innovation Hubs, which he endearingly referred to as “Mini-Manhattan projects” during the last DOE budget hearing.

MAJUMDAR STILL NOT CONFIRMED AS UNDER SECRETARY OF ENERGY AT DOE
By almost all accounts the ARPA-E program has been successful so far. The Director for the ARPA-E program, ASME Fellow Dr. Arun Majumdar, has a natural way of charming lawmakers and also espousing the virtues of ARPA-E to Congress. Dr. Majumdar was tapped for the position of Under Secretary of Energy last year, sailed through his confirmation hearing late last year, but has been idling at the desk of the Senate Clerk for this entire year. It is likely that politics, and not policy, is playing a role in this delay. Dr. Majumdar has been carrying the title of “Acting” Under Secretary of Energy as well as ARPA-E Director since last year, but will he be confirmed before August recess? It remains unclear right now but it is clear to many that Dr. Majumdar is being groomed for something beyond Under Secretary of Energy at DOE should Secretary Chu depart from the Administration after the November election.

ASME Position Statements:

ETP-5: What's involved in Carbon Capture and Sequestration
ID: PS12-12 Brief, 2-page document exploring the technical question related to Carbon Capture and Sequestration. Issued By: Energy Committee

Outside Witness Testimony for Department of Energy FY 2013 Budget Request
ID: PS12-07 EnComm position statement on FY 2013 DOE budget. Issued By: Energy Committee (EnComm)

Waste-to-Energy and Materials Recovery
ID: PS11-33 The case for the inclusion of waste-to-energy technology as part of a balanced fuel mix. Issued By: ASME Materials & Energy Recovery (MER) Division

ASME Comments on the report of the “Blue Ribbon Commission on America’s Energy Future.”
ID: PS11-31 This letter contains comments related to the Blue Ribbon Commission Report on America’s Nuclear Future. Issued By: ASME

Coalition letter urging Congress to Fund the “Promoting Electric Vehicles Act of 2011,” S. 948
ID: PS11-25 This letter outlines the need for federal support for the acceleration in the development of electric vehicles.

Energy Sciences Coalition (ESC) letter supporting the DOE FY 2012 budget for the Department of Energy Office of Science
ID: PS11-13 Statement supports the funding for DOE Office of Science outlined in the President's FY 2012 Budget

ASME Energy Committee Position Statement on the Department of Energy’s Fiscal Year 2012 Budget Request
ID: PS11-11 The ASME Energy Committee Position Statement on the President’s FY 2012 request to Congress. This document highlights programs that directly and indirectly impact mechanical engineering

Expanding Nuclear Power in the United States
ID: PS11-04 Issued By: Nuclear Engineering Division and Energy Committee, ASME Knowledge and Communities Sector

Securing America's Energy Future
ID: PS11-02 Securing America's Energy Future updated position statement addressing different sources of energy, the workforce and energy infrastructure.

Engineering Energy Policy Alliance coalition letter urging Congress to Fund the Advanced Research Projects Agency-Energy program.
ID: PS10-35 This letter recognizes the dire state of energy technology development within the U.S. as well as the ability of ARPA-E to catalyze this industry to improve the nation's energy future.

Engineering Energy Policy Alliance coalition letter urging Congress to Fund the "Promoting Electric Vehicles Act of 2010," S. 3495
ID: PS10-34 This letter outlines the need for federal support for the acceleration in the development of electric vehicles.

Letter from ASME MER urging Tennessee Valley Authority to Recognize WTE as a resource for electricity moving forward
ID: PS10-33 Letter from ASME MER urging Tennessee Valley Authority to revise Integrated Resource Plan (IRP) report to include WTE. Includes copy of NYT article as well as PS08-22.

Energy Sciences Coalition (ESC) letter to House Appropriations Committee expressing concern for FY 2011 appropriations figures for the DOE Office of Science.
ID: PS10-28 ESC Letter urging House Appropriations Committee members to Support higher funding for the DOE Office of Science to improve the Nation's energy future.

Coalition Letter Supporting the Gas Turbine Efficiency Act, S. 2900
ID: PS10-22 Letter to Senate Energy and Natural Resources Chairman and Ranking Member to ask for their support for The Gas Turbine Efficiency Act or S. 2900

Letter urging support for the America COMPETES Reauthorization Act of 2007
ID: PS10-21 Letter to Committee Chairs urging them to support the America COMPETES Act as passed by the Senate and urging specific support for DOE Programs: ARPA-E; Re-Energyse and Innovation Hubs

Reauthorization of the "America COMPETES Act."
ID: PS10-19 Letter expressing support for the reauthorization of the "America COMPETES Act," bipartisan legislation passed in 2007 and currently being considered for reauthorization by Congress.

Letter from ASME SWPD urging lawmakers to support Waste-to-Energy as part of any renewable energy standard.
ID: PS10-17 Letter to members of U.S. Senate requesting that WTE be added to the list of acceptable technologies for any renewable energy standard.

Reauthorization of the "America COMPETES Act."
ID: PS10-13 Letter expressing ASME's support for the reauthorization of the "America COMPETES Act," bipartisan legislation passed in 2007 and currently being considered for reauthorization by Congress.

Engineering Energy Policy Alliance letter urging fiscal support for DOE Innovation Hubs, ARPA-E, and the RE-ENERGYSE programs in the FY11 budget
ID: PS10-03 EEPA Requests funding to support the DOE Innovation Hubs, ARPA-E and RE-ENERGYSE

IGTI Letter Supporting the Gas Turbine Efficiency Act, S. 2900
ID: PS10-01 Letter requesting that the Senate Energy and Water Appropriations Committee Support the Administration's Request for the Advanced Turbine Research program

Energy Talking Points

ASME, the American Society of Mechanical Engineers, is a nonprofit, worldwide educational and technical society that enables collaboration, knowledge sharing, career enrichment, and skills development across all engineering disciplines. Founded in 1880, ASME now includes more than 120,000 members in over 140 countries. It conducts one of the world's largest technical publishing operations, holds more than 30 technical conferences and 200 professional development courses each year, and sets some 500 industrial and manufacturing standards, many of which are considered global technical standards.

Energy Talking Points (ETPs) are a product of the Energy Committee of ASME's Technical Communities comprises 40 members from 17 Divisions of ASME, representing approximately 40,000 of ASME's members.

Energy Talking Point (ETP) papers are produced and reviewed by the ASME Energy Committee to address fundamental questions that should be asked regarding the future of energy.

ETP-1: Three Signs the End of Oil Exports is Coming

ETP-2: US Energy Sources, Uses - Six Lessons Learned

ETP-3: $1B/Day- Our National Daily Fix- And No End in Sight!!

ETP-4: An Energy Resource for Thousands of Years

ASME Energy Briefings/Events:

The Road to the New Energy Economy
Biofuels (6/24/2011)
Electric Vehicles (3/23/2011)
Small Modular Reactors (9/30/2010)
Natural Gas and Turbine Technology (7/14/2010)
ARPA-E and the Energy Technology Revolution (7/7/2011)

Learn More

Current Energy Legislation

H.R. 2354/S. ___, The “House Energy and Water and Related Agencies Appropriations Act”
The Act would provide funding to support the Department of Energy, the Nuclear Regulatory Commission, the Federal Energy Regulatory Commission (FERC). http://thomas.loc.gov/cgi-bin/thomas

S.275/H.R.___ – The “Pipeline Infrastructure and Community Protection Act “/The “Pipeline Transportation Safety Improvement Act”
A bill to strengthen pipeline safety standards in an effort to enhance protections to the environment and public safety.

S. 421 – The “Powering America’s Lithium Production Act.”
A bill to amend the Energy Independence and Security Act of 2007 to require the Secretary of Energy to provide grants for lithium production research and development.

H.R. 1808/S. 512 – The “Nuclear Power 2021 Act”
The Act would provide funding for a program within the Department of Energy to develop three small modular reactors.

S. 629 – The “Hydropower Improvement Act”
The legislation would spur development of hydropower by increasing support for research and development; calling for better coordination on regulation and permitting processes; and establishing a grant program for hydropower projects.

S. 948 – The “Promoting Electric Vehicles Act”
A bill to promote the deployment of plug-in electric drive vehicles, and for other purposes.

S.1000 – The “Energy Savings and Industrial Competitiveness Act”
A bill to promote energy savings in residential and commercial buildings and industry, and for other purposes.

The “America COMPETES Reauthorization Act”
This bipartisan legislation is fundamental to ensuring America’s long-term economic competitiveness and our continued leadership in basic research and science and engineering education initiatives through the robust reauthorization of the National Science Foundation (NSF), the Department of Energy (DOE) Office of Science, and the National Institute of Standards and Technology (NIST).

For more detailed legislative bill information from the Library of Congress, please visit THOMAS http://thomas.loc.gov.