On Tuesday, President Obama unveiled a broad strategy for reducing the nation’s carbon emissions in a way that would move the United States toward a smarter energy future. Speaking at Georgetown University, he outlined a Climate Action Plan incorporating policies and programs to achieve significant economic and environmental benefits, including new energy efficiency standards, increased advanced energy deployment on public lands and in defense applications, and new performance standards for existing power plants and heavy-duty vehicles.
The Administration is putting its weight behind energy efficiency to save households money and increase U.S. economic competitiveness as well as reduce “carbon pollution,” as the President put it. The plan establishes several new sources of funding for energy efficiency towards the goal of doubling energy productivity by 2030. These include a $250 million loan program at the Department of Agriculture to finance efficiency investments by rural utilities and a $23 million fund at the Department of Housing and Urban Development to support new residential efficiency strategies for affordable housing providers. The strategy around energy efficiency also involves expanding the Department of Energy’s Better Buildings Challenge to multifamily housing, and raising standards for appliances and federal buildings.
The U.S. more than doubled generation of electricity from wind, solar and geothermal sources during the President’s first term. His speech calls for again doubling generation from these sources by 2020. The strategy includes permitting an additional 10 gigawatts of solar, wind and geothermal on public lands, encouraging the development of hydropower at existing dams, and committing the Department of Defense - the nation’s single largest energy consumer - to deploying 3 gigawatts of advanced energy generation on military installations by 2025. These goals complement a Presidential Memorandum signed earlier this month directing agencies to streamline the siting, permitting, and review process for transmission projects, critical to bringing advanced energy online and ensuring system reliability.
The President also called upon the Environmental Protection Agency to establish first-ever carbon emissions standards for both new and existing power plants. EPA proposed performance standards for new plants in April 2012 but has delayed issuance of a final rule. In a presidential memorandum release on the day of his speech, Obama directed the EPA to issue revised draft rules for new power plants by September 20, and draft regulations for existing power plants by June 20 of next year. Regarding existing plants, he directed the agency to “develop approaches that allow the use of market-based instruments, performance standards, and other regulatory flexibilities.” These actions, taken together, should accelerate the ongoing transformation of the U.S. energy market toward advanced energy technologies, products, and services. AEE CEO Graham Richard says they “will make the U.S. more of a leader in advanced energy.” See his full statement here.
In his speech, the President also addressed the Keystone XL pipeline controversy, making clear that the impact of the pipeline would have to be consistent with his Climate Action Plan in order to win approval. “Allowing the Keystone pipeline to be built requires a finding that doing so would be in our nation’s interest,” Obama declared, adding that “our national interest will be served only if this project does not significantly exacerbate the problem of carbon pollution.” This declaration allowed both sides to declare victory, with proponents pointing to the State Department’s initial environmental review, which found little net impact on carbon emissions, and opponents citing EPA criticism of the State Department’s review as inadequate on carbon. David Jacobson, outgoing U.S. Ambassador to Canada, predicted last week that the Administration will not reach a final decision on the pipeline until October or November.
On the Hill
The House Energy and Commerce Committee will begin a series of hearings today covering “government perspectives” on the renewable fuel standard. White papers issued recently by leaders of the full committee have highlighted highly contentious views of stakeholders both in defense and in condemnation of the policy, a federal mandate to blend 36 billion gallons of biofuels into the U.S. transport fuel supply by 2022. On a related note, the Supreme Court this week declined to hear a complaint filed against EPA which might have challenged upcoming EPA rules allowing E15 ethanol blends. The decision upholds the District of Columbia’s Circuit Court of Appeals’ ruling that the complainants lacked the legal basis to challenge the sale of E15.
House Republicans are expected to testify today in disapproval of a 2012 Department of Energy memorandum on the role of federal power marketing administrations in promoting advanced energy deployment and grid reliability. The memo calls on the Bonneville Power Administration, Western Area Power Administration, Southeastern Power Administration and Southwestern Power Administration to leverage partnerships, rate-making power and financing to upgrade power lines and boost reliability and access for renewable energy generation. Several Republican lawmakers as well as utility representatives are expected to deliver remarks before the House Natural Resources Subcommittee on Water and Power. Opposition voices have criticized DOE for pushing a “one size fits all” strategy and that the initiative undermines the historic role of the power administrations to provide cheap hydropower.
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