Hill Heat

The WSJ’s Dana Mattioli reported yesterday afternoon on the latest development in congressional oversight of the EPA’s California waiver decision:

In a letter today, two senior Republicans on the House Committee on Oversight and Government Reform asked the panel’s chairman, Henry Waxman (D., Calif.), to investigate whether top EPA staffers either violated federal rules that restrict regulators from lobbying, or “misused their positions to surreptitiously influence” EPA’s decision on whether to allow California to regulate carbon-dioxide emissions from vehicles.

Reps. Tom Davis (R-VA) and Darrell Issa (R-CA) are mad at Margo Oge and Christopher Grundler, the senior EPA officials tasked with evaluating California’s waiver request and (unsuccessfully) telling Administrator Stephen Johnson that he had no choice but to grant it. Congressional oversight of that decision revealed that the pair subsequently provided former EPA Administrator William Reilly—at Reilly’s request—talking points with which to argue the waiver’s merits to Johnson.

Davis and Issa argue that this deserves the same level of scrutiny that Waxman devoted to a surreptitious plan to lobby Congress and governors against the waiver—Johnson may have also been a target, but he could not recall whether that was the case—deployed last summer by Secretary of Transportation Mary Peters, White House officials, and industry lobbyists.

This actually isn’t the first time that congressional Republicans have gone after Oge and Grundler. During a hearing that followed the revelation of the Reilly memo and other EPA documents, Senator James Inhofe (R-OK) asked Administrator Johnson whether his employees had violated the Hatch Act. Johnson defended their actions, saying that he has "always encouraged my staff to give me candid and open advice" (he just reserves the right to ignore it, even when phrased as a clear mandate and not simply advice, and the resulting fallout severely alienates staff unions).

Rep. Waxman responded to the letter by pledging to give it "careful consideration," while noting that the Committee had "found no evidence that EPA career staff lobbied members of Congress with respect to [California’s request]" (translation: the Davis-Issa analogy to his previous investigation is bunk). For his part, Reilly, who ran EPA under the first President Bush and granted California several waivers, has said that his communications with career staff who served under him were not unprecedented, let alone improper or illegal.

The Senate is meeting this afternoon to resume consideration of Sen. Chris Dodd’s (D-Conn.) Foreclosure Prevention Act (S. Amdt 4387 to H.R. 3221).

On the docket for consideration today is the Ensign-Cantwell amendment (S.Amdt 4419), the latest attempt by Congress to continue renewable and energy efficiency tax incentives due to expire this year. The details of the package offered by Sen. John Ensign (R-Nev.) and Maria Cantwell (D-Wash.) were first reported by Hill Heat last week.

Also up for consideration is Sen. Lamar Alexander’s (R-Tenn.) and Jon Kyl’s (R-Ariz.) second-degree amendment (S. Amdt 4429), which would extend the tax credits from 2009 to 2011 and tweak the marine energy and trash combustion credits.

CQ reported that Sen. Dodd exploded on the floor last week in opposition to efforts to include extensions of the clean energy tax credits, saying “This is a housing bill! This isn’t a Christmas tree! It’s a housing bill! I’m going to oppose every one of these [unrelated amendments] from here on out.”

Dodd did not note the irony that the housing package is being considered as a completely unrelated replacement substitute to the House’s Renewable Energy and Energy Conservation Tax Act (H.R. 3221), which would have rolled back tax breaks for oil companies in order to pay for the renewable tax incentives (and has been blocked repeatedly in the Senate, most recently in February). The Ensign-Cantwell amendment does not provide any funding mechanism for the tax credit continuation, and would violate pay-go rules. The Alexander-Kyl amendment would exacerbate the funding problem.

Reports from Kansas this morning indicated that today, state legislators would attempt to overturn October’s denial of construction permits for two coal-fired power plants by the administration of Governor Kathleen Sebelius—which has cited concern over global warming impacts and a desire to move instead toward clean energy solutions. (UPDATE: Literally just as we were publishing this post, the bill fell short of a veto-proof majority by a single vote.) Sebelius recently vetoed similar legislation, which would also significantly amend state anti-pollution law to strip regulators of the ability to factor in CO2 emissions, instead tethering their authority to the federal government’s position on GHG-related harm. Legislative supporters have laden their efforts with a handful of green-friendly provisions in order to greenwash their intentions dub the bill a "compromise," and claimed to have finally lined up enough support to override the governor, "unless someone lied to [House Speaker Melvin Neufeld]."

It’s painfully ironic that Kansas might move the ball into the EPA’s court, given the past week’s news, and considering that state officials recently told Congress that the Bush administration’s intransigence has helped bring about this fiasco. Our earlier favorable comparison between KS environmental honcho Roderick Bremby and EPA Administrator Stephen Johnson is also amplified by their divergent reactions to the hot seat: the former has publicly defended his decision, while the latter has infamously decided to dodge congressional testimony and subpoenas in Australia.

Finally, it bears mention that the full might of the anti-climate-regulation/denialist machine has been brought to bear on this issue (who can forget the infamous Ahmadiejad/Chavez/Putin ads?). An overwrought editorial in today’s Wall Street Journal—not that there’s any other kind from them on this topic, as Solve Climate has assiduously documented—accuses Sebelius of acting as though she were opposing "crimes against humanity" for daring to mention the moral implications of climate change (much in the same way the Supreme Court has). The current legislation was also greeted by an onslaught of Washington lobbyists testifying on its behalf, including former EPA official turned "Dirty Rotten Scoundrel" Bill Wehrum and born-again consumer-safety advocate Grover Norquist.

Originally posted at the Think Progress Wonk Room.

Bank of America CEO Kenneth D. Lewis received two utterly different awards from environmental groups on Tuesday, April 1—the Energy Action Coalition and Rainforest Action Network (RAN) voted him the “Fossil Fool of the Year,” while the Natural Resources Defense Council (NRDC) honored him at their annual fundraising gala as a “Force for Nature.”

Rebecca Tarbotton of RAN said, “Ken Lewis faced a who’s who list of polluters, but voters deemed him the worst of a very deserving crop.”

Frances Beinecke of NRDC said, “We have the know-how to beat global warming. What we need is the leadership to make it happen, and Ken Lewis is providing that leadership.”

Climate and environmental activists celebrated “Fossil Fools Day” yesterday, April 1, with actions across the globe protesting the fossil fuel industry. Heeding Al Gore’s call for “young people to engage in peaceful protests to block major new carbon sources,” they blockaded coal mines, coal plants, and energy company headquarters.

As part of the day of action, the Energy Action Coalition dedicated the Fossil Fools Awards to “the world’s biggest contributors to our global addiction to fossil fuels.” Kenneth Lewis won top honors for facilitating “nearly $1 billion in loans to Massey Energy and Arch Coal, two of the largest companies involved in the environmentally devastating process of mountaintop removal coal mining” in the last few years. Bank of America also made several billion dollars in loans and facilitated stock offerings in 2006 for Peabody Energy, the world’s largest private coal company.

NRDC’s tenth annual “Forces for Nature” $1000-a-plate fundraising gala feted Ken Lewis and NYC mayor Michael Bloomberg at Cipriani 42nd Street.

NRDC honored Lewis for Bank of America’s ten-year, $20 billion environmental initiative which “addresses climate change by championing sustainable business practices through innovative lending and investing strategies, new financial products and services and operations.” The initiative was launched last year. The new Bank of America Tower in New York City, when completed in 2009, will be one of the most environmentally friendly and efficient office buildings in the world.

At the NRDC gala, Lewis made the major announcement that Bank of America would adopt the Carbon Principles, “a set of guidelines that help advisors and lenders to power companies evaluate and address carbon risks in the financing of projects” drafted in January by Citigroup Inc., J.P. Morgan Chase & Co., and Morgan Stanley. According to the Wall Street Journal, “the ‘Principles’ push utilities to explore other alternatives to regular coal plants . . . Still, the banks make clear they won’t stop funding all conventional coal plants—they’ll simply want assurances higher rates will cover likely costs of carbon.”

At the A&WMA conference yesterday, Sen. Joe Lieberman (I-CT) spoke optimistically about getting the sixty votes necessary to forestall any filibuster against his cap-and-trade bill, the Lieberman-Warner Climate Security Act (S. 2191). According to Darren Samuelson of E&E News, he told attendees that 45 senators are “heavily with us” and 15 more have a “heavy tilt in our direction, if we can do some small things.”

“We can find only 20 we can put in the category of hopeless, that is with regard to this particular bill.”

Because Sen. McCain (R-Ariz.) has criticized Lieberman-Warner’s lack of explicit nuclear subsidies, Sen. Lieberman acknowledged McCain is not an “aye” vote, saying “Just out of respect, I’d have to put him in the middle category. A heavy lean.”

Samuelson also reports:

Senate Majority Leader Harry Reid (D-Nev.) has given Lieberman and his allies a green light to take the bill to the Senate floor during the week of June 2-6, the first week back from Congress’ Memorial Day recess, a Reid spokeswoman said today.

Originally posted at the Think Progress Wonk Room.

One year ago today, the Supreme Court handed down an epochal decision in the global warming case Massachusetts vs. the Environmental Protection Agency, stating that the EPA had the responsibility to determine how to regulate carbon dioxide for its contribution to global warming. The EPA, led by administrator Stephen L. Johnson, has utterly failed to do so, prompting a series of Congressional investigations and new lawsuits.

Johnson’s adversaries marked the anniversary of the Supreme Court decision today by continuing to press their case. Officials of 18 states filed suit against the EPA for its continued inaction—their petition “asks the U.S. Court of Appeals for the District of Columbia Circuit to require the EPA to act within 60 days.” By a unanimous vote, the House Global Warming Committee issued subpoenas “for EPA documents showing the Agency’s progress in making the ‘endangerment’ finding and proposing national emissions standards.”

The Supreme Court decision mandated that the EPA:

• Declare whether greenhouse gases pose a threat to human health and need to be regulated;
• Make a decision on California’s Clean Air Act petition to regulate motor vehicle greenhouse gas emissions;
• Propose federal regulations for motor vehicle greenhouse emissions.

In the past year, EPA Administrator Stephen L. Johnson has only completed one of those tasks, by denying California’s waiver petition following the signing of the 2007 Energy Act in December.

According to a report in CQ Tuesday, the Senate deadlock on the renewable tax-credit package may have broken, led by efforts by Sen. Maria Cantwell (D-Wash.) and John Ensign (R-Nev.). Ensign told reporters he expects “a big announcement” on Thursday.

Details of the renewable incentives have been released, but not the full package, including revenue provisions (that is, is oil company tax breaks will be rolled back) and other elements that have been in previous iterations, such as benefits for the coal industry.

A summary:

• The renewable energy production tax credit (PTC) is extended one year to 2009 and modified to include tidal power
• The solar and fuel cell investment tax credit (ITC) is extended 8 years to 2016
• The residential energy-efficient property credit is extended one year to 2009, and the $2,000 cap is removed
• Clean Renewable Energy Bonds (CREBs) are extended one year to 2009, with an additional $400 million authorized
• The 10% ITC for energy-efficiency improvements to existing homes is extended one year to 2009
• The contractor tax credit for energy-efficient new homes is extended two years to 2010
• The energy-efficient commercial buildings deduction is extended one year to 2009 and increases the $1.80/sqft max to $2.25/sqft
• The energy-efficient appliance credit is extended to 2010

The full language explaining the incentives is after the jump.

Hybrid Living, passing along a local report from earlier this week, delivers the news that even as Minnesota Attorney General Lori Swanson defends the state’s authority to limit greenhouse gas emissions as a party to California’s lawsuit against the EPA, its proposed clean cars law has stalled—perhaps fatally for this session—in the state legislature. Lobbying by the auto industry is playing a part, but a novel assist apparently goes to corn growers and ethanol producers, who argued that the law may harm efforts to expand ethanol markets and impair the certification of "flex-fuel" cars and trucks that run on a blend of ethanol and gasoline.

But is it really that novel? Advocates from Clean Energy Minnesota fervently deny that there’s any real reason for concern, and assert that the group principally repsonsible for ginning up local opposition is essentially a mouthpiece for the auto industry:

[James Erkel of the Minnesota Center for Environmental Advocacy] said the concern is baseless, pointing to GMC’s 2008 Sierra 1500 pickup that runs on a rich blend of E-85 (85-percent ethanol and 15-percent gasoline) as well as similar vehicles that would meet the more stringent California standards.  The ARB’s Dimitri Stanich said California air regulators have certified 300,000 flex fuel vehicles and suggested there will be more as soon as the state increases the number of pumps offering E-85 fuel, which California is now doing.   

[...]

Erkel said that the auto industry is masquerading as an ethanol advocate as it enlists the corn growers and other farm groups to beat back legislation in Minnesota. The default "technical advisor" to the ethanol groups opposing the Marty and Hortman bills is the National Ethanol Vehicle Coalition, headquartered in Jefferson City, Mo. Its 16-member board of directors includes representatives of Chrysler, Ford, GMC and Nissan.

Obviously it’s not shocking that the auto industry would employ astroturf tactics and overwrought arguments to delay clean cars legislation (though it is noteworthy, in terms of looking at the industry’s credibility, to see a spokesman admit that the usual suspects "can’t stop this bill by ourselves"). The Minn Post also notes that when it asked the Minnesota Corn Growers and the Farm Bureau to explain their position, the silence was deafening and the apparent reliance on the aforementioned "technical advisors" clear:    

Originally posted at the Think Progress Wonk Room.

In October of last year, the administration of Kansas Gov. Kathleen Sebelius (D) denied permits for two new coal-fired plants in her state because the greenhouse gases such coal plants would emit constitute a threat to the environment and public health. Last Friday, she vetoed a legislative attempt to allow the plants to be built. Opponents of the veto claimed “the decision is costing the state jobs and economic investment” and warned of “higher electric bills for Western Kansas,” where the plants were proposed.

But a landmark report released yesterday by an esteemed financial research firm finds that, in fact, Sebelius has been acting in her state’s best economic interests.

Innovest Strategic Value Advisors finds that Sunflower Electric Power Corporation, the company whose proposal was denied, failed to account for the effects of the likely regulation of carbon dioxide on the cost of coal-fired electricity when it sought to build two 700 MW coal plants in Holcomb, Kansas:

Innovest examined the economics of the transaction and determined that under the most plausible regulatory scenarios the decision to build new coal generating capacity will put Sunflower Electric’s ratepayers – who in this particular case are the actual owners – at significant risk. The report concludes that Sunflower’s management has not adequately addressed the competitive and financial risks associated with climate change in deciding to pursue the expansion of its Holcomb Station power plant.

Sunflower was remiss in not considering that federal legislation that places a price on carbon emissions is extremely likely, considering the bipartisan support and strong international pressure for such action.

The report compares the economics of coal plants versus natural gas plants, which have a considerably smaller carbon footprint, and concludes:

In general, this analysis demonstrate that gas is the more financially sound choice for the construction of baseload generating capacity in all scenarios except 100% free allocation [to power companies] of carbon allowances.

It is thus unsurprising that the coal lobby attacked the natural gas industry when the decision was made.

The report also notes that western Kansas has “among the nation’s most abundant wind resources” and that the cost of wind power has plummeted 80% in the last 20 years.

In an interview with Darren Samuelson of E&E News last Thursday, Douglas Holtz-Eakin lays down significant markers for Sen. John McCain’s (R-Ariz.) climate policy.

On policies such as a low-carbon fuel standard or renewable portfolio standard:

“The basic idea is if you go with a cap and trade and do it right with appropriate implementation, you don’t need technology-specific and sectoral policies that are on the books and that others are proposing simultaneously.”

On the rise in CAFE standards in the 2007 energy act:

“He’s not proposing to eliminate those. He simply wants to check as time goes on if they become completely irrelevant. You might want to take them off the books, but we’re not there yet.”

On McCain-Lieberman:

“When he introduced that bill, the floor statement was pretty clear that this was an ongoing process. He wasn’t so much committed to the bill as to an issue.”

On Lieberman-Warner:

“The Lieberman-Warner is a good bill. It’s not his intention to suggest anything different. . . We don’t take positions on Senate legislation given it will change. He’s going to realistically need to have time to study the bill. It’s premature.”

On nuclear subsidies:

“He wants to see the use of nukes. The ultimate policy proposal will be designed to make sure that’s true.”

Holtz-Eakin, director of the Congressional Budget Office from 2003-2005 and chief economist for President Bush 2001-2002, is the top economic advisor for Sen. John McCain’s 2008 presidential campaign.