Hill Heat

Are all biofuels equal in terms of their capacity to reduce greenhouse gas emissions relative to the use of gasoline? If not, what factors determine which biofuels have greater capacity to reduce greenhouse gas emissions? What is the most reliable method of measuring a biofuel’s effectiveness for reducing greenhouse gas emissions? What role does land conversion make in determining the effectiveness of biofuels in reducing greenhouse gas emissions? Which biofuels of the future are likely to result in maximal reductions in greenhouse gas emissions? How close are we to that future?

Moderator:

• Dr. Anthony Socci, Senior Science Fellow, American Meteorological Society

Speakers:

• Dr. Joseph E. Fargione, Regional Science Director, The Nature Conservancy, Central US Region, Minneapolis, MN
• Timothy Searchinger, Visiting Scholar and Lecturer in Public and International Affairs, Princeton University, Woodrow Wilson School, Princeton, NJ
• Dr. Daniel M. Kammen, Class of 1935 Distinguished Professor of Energy, Professor in the Energy and Resources Group Energy and Resources Group (ERG) , Professor of Public Policy in the Goldman School of Public Policy, Professor of Nuclear Engineering in the Department of Nuclear Engineering, and Co-Director, Berkeley Institute of the Environment, and Founding Director of the Renewable and Appropriate Energy Laboratory (RAEL), University of California, Berkeley, CA
• Dr. G. David Tilman, Regents’ Professor and McKnight Presidential Chair in Ecology, University of Minnesota, St. Paul, MN

Program Summary

Biofuels: Threats and Opportunities

• It is possible to make biofuels that reduce carbon emissions, but only if we ensure that they do not lead to additional land clearing.
• When land is cleared for agriculture, carbon that is locked up in the plants and soil is released through burning and decomposition. The carbon is released as carbon dioxide, which is an important greenhouse gas, and causes further global warming.
• Converting rainforests, peatlands, savannas, or grasslands to produce food crop–based biofuels in Brazil, Southeast Asia, and the United States creates a “biofuel carbon debt” by releasing 17 to 420 times more carbon dioxide than the annual greenhouse gas reductions that these biofuels would provide by displacing fossil fuels.
• Depending on future biofuel production, the effects of this clearing could be significant for climate change: globally, there is almost three times as much carbon locked up in the plants and soils of the Earth as there is in the air and 20% of global carbon dioxide emissions come from land use change.
• Global demand for food is expected to double in the next 50 years and is unlikely to be met entirely from yield increases, thus requiring significant land clearing. If existing cropland is insufficient to meet imminent food demands, then any dedicated biofuel crop production will necessarily create demand for additional cropland to be cleared.
• Several forms of biofuels do not cause land clearing, including biofuels made from algae, from waste biomass, or from biomass grown on degraded and abandoned agricultural lands planted with perennials.

Present Generation of Biofuels: Reducing or Enhancing Greenhouse Gas Emissions?

Previous studies have found that substituting biofuels for gasoline will reduce greenhouse gasses because growing the crops for biofuels sequesters takes carbon out of the air that burning only puts back, while gasoline takes carbon out of the ground and puts it into the air. These analyses have typically not taken into consideration carbon emissions that result from farmers worldwide converting forest or grassland to produce biofuels, or that result from farmers worldwide responding to higher prices and converting forest and grassland into new cropland to replace the grain (or cropland) diverted to biofuels. Our revised analysis suggests that greenhouse gas emissions from the land use changes described above, for most biofuels that use productive land, are likely to substantially increase over the next 30 years. Even advanced biofuels from biomass, if produced on good cropland, could have adverse greenhouse gas effects. At the same time, diverting productive land raises crop prices and reduces consumption among the 2.8 billion people who live on less than $2 per day.

Simply avoiding biofuels produced from new land conversion – as proposed by a draft European Union law – does not avoid these global warming emissions because the world’s farmers will replace existing crops or cropland used for biofuels by expanding into other lands. The key to avoiding greenhouse gas emissions and hunger from land use change is to use feedstocks that do not divert the existing productive capacity of land – whether that production stores carbon (as in forest and grassland) or generates food or wood products. Waste products, including municipal and slash forest waste from private lands, agricultural residues and cover crops provide promising opportunities. There may also be opportunities to use highly unproductive grasslands where biomass crops can be grown productively, but those opportunities must be explored carefully.

Biofuels and a Low-Carbon Economy

The low-carbon fuel standard is a concept and legal requirement in California and an expanding number of states that targets the amount of greenhouse gases produced per unit of energy delivered to the vehicle, or carbon intensity. In January 2007, California Gov. Arnold Schwarzenegger signed Executive Order S-1-07, which called for a 10-percent reduction in the carbon intensity of his state’s transportation fuels by 2020. A research team in which Dr. Kammen participated developed a technical analysis of low-carbon fuels that could be used to meet that mandate. That analysis employs a life-cycle, “cradle to grave” analysis of different fuel types, taking into consideration the ecological footprint of all activities included in the production, transport, storage, and use of the fuel.

Under a low-carbon fuel standard, fuel providers would track the “global warming intensity” (GWI) of their products and express it as a standardized unit of measure—the amount of carbon dioxide equivalent per amount of fuel delivered to the vehicle (gCO2e/MJ). This value measures vehicle emissions as well as other trade-offs, such as land-use changes that may result from biofuel production. For example, an analysis of ethanol shows that not all biofuels are created equal. While ethanol derived from corn but distilled in a coal-powered refinery is in fact worse on average than gasoline, some cellulosic-based biofuels – largely those with little or no impact on agricultural or pristine lands have the potential for a dramatically lower GWI.

Equipped with detailed measurements that relate directly to the objectives of a low-carbon fuel standard, policy makers are in a position to set standards for a state or nation, and then regulate the value down over time. The standard applies to the mix of fuels sold in a region, so aggressively pursuing cleaner fuels permits some percentage of more traditional, dirtier fuels to remain, a flexibility that can enhance the ability to introduce and enforce a new standard.

The most important conclusions from this analysis are that biofuels can play a role in sustainable energy future, but the opportunities for truly low-carbon biofuels may be far more limited than initially thought. Second, a low-carbon economy requires a holistic approach to energy sources – both clean supply options and demand management – where consistent metrics for actual carbon emissions and impacts are utilized to evaluate options. Third, land-use impacts of biofuel choices have global, not just local, impact, and a wider range of options, including, plug-in hybrid vehicles, dramatically improved land-use practices including sprawl management and curtailment, and greatly increased and improved public transport all have major roles to play.

Biofuels and Greenhouse Gas Emissions: A Better Path Forward

The recent controversy over biofuels notwithstanding, the US has the potential to meet the legislated 21 billion gallon biofuel goal with biofuels that, on average, exceed the targeted reduction in greenhouse gas release, but only if feedstocks are produced properly and biofuel facilities meet their energy demands with biomass.

A diversity of alternative feedstocks can offer great GHG benefits. The largest GHG benefits will come from dedicated perennial crops grown with low inputs of fertilizer on degraded lands, and especially from those crops that increase carbon storage in soil (e.g., switchgrass, mixed species prairie, and Miscanthus). These may offer 100% or perhaps greater reductions in GHG relative to gasoline. Agricultural and forestry residues, and dedicated woody crops, including hybrid poplar and traditional pulp-like operations, should achieve 50% GHG reductions.

In contrast, if biofuel production leads to direct or indirect land clearing, the resultant carbon debt can negate for decades or longer any greenhouse gas benefits a biofuel could otherwise provide. Current legislation, which is outcome based, has anticipated this problem by mandating GHG standards for current and next generation biofuels.

Biographies

Dr. Joseph E. Fargione is the Regional Science Director for The Nature Conservancy’s Central US Region. He received his doctorate in Ecology from the University of Minnesota in 2004. Prior to the joining The Nature Conservancy, he held positions as Assistant Research Faculty at the University of New Mexico (Biology Department), Assistant Professor at Purdue University (Departments of Biology and Forestry and Natural Resources), and Research Associate at the University of Minnesota (Departments of Applied Economics and Ecology, Evolution, and Behavior).

His work has focused on the benefits of biodiversity and the causes and consequences of its loss. Most recently, he has studied the effect of increasing demand for biofuels on land use, wildlife, and carbon emissions. He has authored 18 papers published in leading scientific journals, including Science, Proceedings of the National Academy of Sciences, Proceedings of the Royal Society, Ecology, and Ecology Letters, and he was a coordinating lead author for the Millennium Ecosystem Assessment chapter titled “Biodiversity and the regulation of ecosystem services.” His recent paper in Science, “Land clearing and the biofuel carbon debt” was covered in many national media outlets, including the New York Times, Washington Post, Wall Street Journal, National Public Radio, NBC Nightly News, and Time Magazine.

Timothy Searchinger is a Visiting Scholar and Lecturer in Public and International Affairs at Princeton University’s Woodrow Wilson School. He is also a Transatlantic Fellow of the German Marshall Fund of the United States, and a Senior Fellow at the Georgetown Environmental Law and Policy Institute. Trained as a lawyer, Dr. Searchinger now works primarily on interdisciplinary environmental issues related to agriculture.

Timothy Searchinger previously worked at the Environmental Defense Fund, where he co-founded the Center for Conservation Incentives, and supervised work on agricultural incentive and wetland protection programs. He was also a deputy General Counsel to Governor Robert P. Casey of Pennsylvania and a law clerk to Judge Edward R. Becker of the United States Court of Appeals for the Third Circuit. He is a graduate, summa cum laude, of Amherst College and holds a J.D. from Yale Law School where he was Senior Editor of the Yale Law Journal.

Timothy Searchinger first proposed the Conservation Reserve Enhancement Program to USDA and worked closely with state officials to develop programs that have now restored one million acres of riparian buffers and wetlands to protect important rivers and bays. Searchinger received a National Wetlands Protection Award from the Environmental Protection Agency in 1992 for a book about the functions of seasonal wetlands of which he was principal author. His most recent writings focus on the greenhouse gas emissions from biofuels, and agricultural conservation strategies to clean-up nutrient runoff. He is also presently writing a book on the effects of agriculture on the environment and ways to reduce them.

Dr. Daniel M. Kammen, Class of 1935 Distinguished Professor in the Energy and Resources Group (ERG), in the Goldman School of Public Policy and in the Department of Nuclear Engineering at the University of California, Berkeley. He is also the founding Director of the Renewable and Appropriate Energy Laboratory (RAEL) and Co-Director of the Berkeley Institute of the Environment.

Previously in his career, Dr. Kammen was an Assistant Professor of Public and International Affairs at Princeton University, and also played a key role in developing the interdisciplinary Science, Technology, and Environmental Policy (STEP) Program at Princeton as STEP Chair from 1997 – 1999. In July of 1998 Kammen joined ERG as an Associate Professor of Energy and Society.

Dr. Kammen received his undergraduate degree in physics from Cornell University (1984), and his masters and doctorate in physics from Harvard University (1986 & 1988) for work on theoretical solid state physics and computational biophysics. First at Caltech and then as a Lecturer in Physics and in the Kennedy School of Government at Harvard, Dr. Kammen developed a number of projects focused on renewable energy technologies and environmental resource management.

Dr. Kammen’s research interests include: the science, engineering, and policy of renewable energy systems; health and environmental impacts of energy generation and use; rural resource management, including issues of gender and ethnicity; international R&D policy, climate change; and energy forecasting and risk analysis. He is the author of over 200 peer-reviewed journal publications, a book on environmental, technological, and health risks, and numerous reports on renewable energy and development. He has also been a lead author for the Intergovernmental Panel on Climate Change that shared the 2007 Nobel Peace Prize.

Dr. G. David Tilman is Regents’ Professor and McKnight Presidential Chair in Ecology at the University of Minnesota. He is an elected member of the American Academy of Arts and Sciences and the National Academy of Sciences, and has served on editorial boards of nine scholarly journals, including Science. He serves on the Advisory Board for the Max Plank Institute for Biogeochemistry in Jena, Germany. He has received the Ecological Society of America’s Cooper Award and its MacArthur Award, the Botanical Society of America’s Centennial Award, the Princeton Environmental Prize and was named a J. S. Guggenheim Fellow. He has written two books, edited three books, and published more than 200 papers in the peer-reviewed literature, including more than 30 papers in Science, Nature and the Proceedings of the National Academy of Sciences USA. The Institute for Scientific Information recently designated him as the world’s most highly cited environmental scientist of the decade.

Dr. Tilman’s recent research explores how managed and natural ecosystems can sustainably meet human needs for food, energy and ecosystem services. A long-term focus of his research is on the causes, consequence and conservation of biological diversity, including using biodiversity as a tool for biofuel production and climate stabilization through carbon sequestration. His work on renewable energy examines the full environmental, energetic and economic costs and benefits of alternative biofuels and modes of their production.

The Environmental and Energy Study Institute (EESI) and the Urban Land Institute (ULI) invite you to a briefing that will examine the connection between transportation policy, urban development, land use planning, and the combined role they can play in reducing U.S. greenhouse gas (GHG) emissions. The briefing will address policy options to be considered as a component of any comprehensive GHG reduction strategy.

The briefing will focus, in particular, on trends in the distances and time that Americans spend driving each year due to changing land use patterns, limited alternatives, transportation policies, congestion, highway operations, and other factors. The Energy Information Administration (EIA) projects automobile and truck use (as measured by vehicle miles traveled or VMT) to increase 48 percent by 2030. Such trends would have major implications for traffic congestion and the capacity of the U.S. transportation system to efficiently move people and freight. Increases in GHG emissions due to these trends, if unaddressed, would outweigh GHG emission reductions expected from higher fuel-economy standards contained in the recently enacted Energy Independence and Security Act of 2007 (P.L.110-140). Goals to reduce U.S. reliance on foreign sources of oil would be more difficult to achieve under such trends.

ULI’s newly published book Growing Cooler: The Evidence on Urban Development and Climate Change surveys the best available research on the link between urban development trends, land use patterns, transportation alternatives, and greenhouse gas emissions, and identifies policy alternatives to promote more compact and energy-efficient development patterns and expand transportation choices including rail, transit, cycling, and walking. Representatives of transportation, real estate development, and local government interests will provide important perspectives on the challenges and feasibility of implementing such policies. Panelists include:

• Reid Ewing, Professor, University of Maryland, National Center for Smart Growth
• Steve Winkelman, Transportation Program Director, Center for Clean Air Policy
• Geoff Anderson, President, Smart Growth America
• John Horsley, Executive Director, American Association of State Highway and Transportation Officials
• Chris Zimmerman, Chair, Northern Virginia Transportation Authority; Member, Arlington County Board
• Tom Darden,CEO, Cherokee Investment Partners LLC

The briefing will address key questions such as:

• What transportation and land use policy options would be most effective in reducing GHG emissions?
• What role can and should each level of government play in advancing such policy options?
• What are the trade-offs among policy options in terms of mobility, quality of life, and consumer choice?
• What are the opportunities and barriers to diversifying transportation choices for individuals and businesses?

This briefing is free and open to the public. No RSVP required. Please forward this notice. For more information, contact Jan Mueller, 202-662-1883 or jmueller@eesi.org

NOTE: Rep. Ellen Tauscher (D-CA) will hold a companion briefing with some of the same panelists later the same day on the House side, 2:30-4:00 pm, 2253 Rayburn House Office Bldg. Contact Paul Schmid, 202-225-1880, for more information.

How other nations adapt to the impacts of climate change will affect critical U.S. security, economic, humanitarian, and environmental interests.

According to the Intergovernmental Panel on Climate Change, developing countries face water scarcity, severe weather events, declining agricultural productivity, and increased disease. The consequences will undermine international stability and security as migration and refugee crises, conflicts linked to natural resource scarcity, and economic destabilization all increase.

In order to protect vital U.S. interests, and to promote global economic development, many advocates and governments are urging that the United States and other developed countries assist developing countries so they can adapt to the climate challenge. These issues have recently risen to the forefront both in international negotiations and in Congressional legislation.

Oxfam America and the UN Foundation invite you to a roundtable discussion with foreign policy experts, economists, scientists, non-governmental organizations, and Congressional staff to discuss these critical issues.

Presenters

• Nigel Purvis (moderator), Former Deputy Assistant Secretary of State for Oceans, Environment & Science and senior U.S. climate change negotiator; Visiting scholar at Resources for the Future and non-resident scholar at The Brookings Institution
• Dr. Saleem Huq, Director of the Climate Change Group, International Institute for Environment and Development; Coordinating Lead Author of the Adaptation and Mitigation chapter in the Fourth Assessment Report of the Intergovernmental Panel on Climate Change (IPCC)
• Ambassador Angus Friday, Permanent Representative of Grenada to the United Nations; Chair of the Alliance of Small Island States
• Dr. William Cline, Senior Fellow, Center for Global Development and the Institute for International Economics
• Dr. Sharon Hrynkow, Associate Director, National Institute of Environmental Health Sciences

This event is in cooperation with the office of Congressman Donald Payne.

Please RSVP to Mike Helms at Oxfam America at (202) 471-3050 or mhelms@oxfamamerica.org

or Erica Fabo at the UN Foundation at 202-887-9040.

The Washington Conference will take place over two days. The first day will be an intensive expert workshop focusing on emissions from transport and biofuels use; this reflects concerns over the lack of action to address emissions from transport, rising concerns about expanded use of biofuels and pressure from some to include aviation, marine transport and road transport within cap and trade systems.

Day two will be a larger event designed to inform civil society more broadly about the differences and similarities between action in the EU and US, discuss best practice domestic solutions, demystify key policies such as the EU ETS etc. Discussions will predominantly focus on cap and trade, and the differing perceptions of actors on both sides of the Atlantic.

IEEP will be taking experts from the EU over to Washington for the event. European experts would take part in the workshop on day one, and potentially present ideas and concepts from a European perspective on day two.

If you would like to find out more about the conference please contact Sirini Withana (IEEP) or Melanie Nakagawa (NRDC).

For more information and background papers from previous T-PAGE discussions, visit the T-PAGE project website.

Location: 1616 P Street, NW, 1st Floor Conference Room
Resources for the Future building
Washington, DC 20036

Witnesses

• Peter R. Orszag, Director, Congressional Budget Office
• Robert Greenstein, Executive Director, Center on Budget and Policy Priorities
• Henry Derwent CB, President and CEO, International Emissions Trading Association

$119—a record price for a barrel of oil, reached today.

$3.51—today’s record price for an average gallon of gas in America.

70,000 barrels—the amount of oil the Bush administration buys daily at these record prices to continue filling the Strategic Petroleum Reserve (SPR).

In light of all of these factors, Chairman Edward J. Markey (D-Mass.) and the Select Committee on Energy Independence and Global Warming will hold a hearing this week to explore the effect of filling the reserve on the current spike in oil and gas prices and on America’s economy.

The hearing will feature representatives from the trucking industry, which has been hit particularly hard by high gas prices, a consumer advocate who will talk about how high gas prices are hitting all drivers and families in America, and several industry analysts to discuss the policies surrounding filling the SPR.

Chairman Markey has called for a three-point plan to reduce gas prices and oil dependence in the short and long term, which includes temporarily ceasing the purchase of oil for the SPR while it is currently at record prices. Chairman Markey says this will send a strong signal to oil speculators who are currently pushing prices to new heights.

“At $119 a barrel, taking significant quantities of oil off of the market to fill the Strategic Petroleum Reserve is like throwing chum into the feeding frenzy of speculation happening on trading floors across the world,” said Chairman Markey. “By continuing to purchase oil at these record prices, the Bush administration is aiding and abetting the highway robbery of American consumers at the pump.”

• Dr. Mark Cooper, Director of Research, Consumer Federation of America
• Dave Berry, Vice President, Swift Transportation Company, Inc., Chairman, Energy and Environment Policy Committee, American Trucking Association
• Frank Rusco, Acting Director, Natural Resources and Environment, GAO
• Melanie Kenderdine, Associate Director, Strategic Planning, MIT Energy Initiative
• Kevin Book, Senior Vice President, Senior Analyst, Energy Policy, Oil & Alternative Energy, Friedman, Billings, Ramsey & Company, Inc.

The Committee’s hearing will explore the potential for nuclear power to provide an increased proportion of electric generating capacity in the U.S. Nuclear power generation offers the opportunity for increasing electricity generation without associated increases in greenhouse gas emissions, however, challenges to this expansion remain including high costs, waste disposal, and concerns about nuclear proliferation issues. The hearing will also examine the Department of Energy’s programs to support and advance nuclear technologies and their potential to address the challenges associated with expansion of nuclear power generation.

_ Witnesses _

• Mr. Robert Fri is a Visiting Scholar at Resources for the Future, and the Chair of a recent study conducted by the National Academies on the Department of Energy’s nuclear research and development program. Mr. Fri will testify on the findings of this report.
• Mr. Jim Asselstine is a recently retired Managing Director at Lehman Brothers, and a former Commissioner of the Nuclear Regulatory Commission. Mr. Asselstine will testify on the current overall state of financing for new nuclear power plants.
• Dr. Thomas Cochran is a Senior Scientist in the Nuclear Program at the National Resources Defense Council (NRDC). Dr. Cochran will explain NRDC’s position on whether nuclear power merits additional federal support in comparison to other sources of energy.
• Mr. Robert Van Namen is the Senior Vice President of Uranium Enrichment at USEC. Mr. Van Namen will describe the current status of the domestic uranium enrichment industry, and provide background on advancement of uranium enrichment technologies.
• Ms. Marilyn Kray is the President of NuStart Energy, and also the Vice President of Project Development at Exelon Nuclear. Ms. Kray will provide the perspective of utilities on the ability for nuclear power to significantly increase its share of electric generating capacity in the U.S.
• Vice Admiral John Grossenbacher is the Director of Idaho National Laboratory. Mr. Grossenbacher will testify on DOE’s programs to support and advance nuclear energy.

• Background *

Nuclear power is derived from energy that is released when relatively large atoms are split in a series of controlled nuclear reactions. The resulting heat is used to boil water which drives a steam turbine to generate electricity. The process of splitting an atom is known as nuclear fission. Nuclear power represents approximately 20 percent of the total electric generating capacity in the U.S. with 104 nuclear plants currently operating. Because they are a low-carbon emitting source of energy in comparison to fossil fuels, increased use of nuclear power is being proposed by the Administration and several electric utilities as a way to mitigate climate change while meeting the nation’s growing energy needs.

• Nuclear Waste Storage *

There are, however, several drawbacks to the expanded use of nuclear power. Disposal of radioactive waste produced in nuclear power plants has been a significant issue for decades. While on-site storage has become a default interim solution, the Nuclear Waste Policy Act of 1982 (NWPA) called for disposal of spent nuclear fuel in a deep, underground geologic repository. In 1987, amendments to the NWPA restricted DOE’s repository site studies to Yucca Mountain in Nevada. Technical and legal challenges have since delayed its use until at least 2017. All operating nuclear power reactors are storing spent fuel in Nuclear Regulatory Commission (NRC)-licensed onsite spent fuel pools. Most reactors were not designed to store the full amount of the spent fuel generated during their operational life. Currently, there is over 50,000 metric tons of spent fuel stored in the United States. Earlier this year, the Administration proposed draft nuclear waste legislation repealing the 70,000 metric ton limit on the amount of waste that can be stored at the repository at Yucca Mountain. It is expected that the 70,000 metric ton limit would be exceeded by the waste generated from the nuclear plants currently operating in the U.S.

• Waste Reprocessing *

Reprocessing spent fuel could also eventually be necessary to meet nuclear fuel demands if worldwide growth meets projected targets. The Administration has proposed a multi-billion dollar federal program called the Global Nuclear Energy Partnership (GNEP) to foster the expansion of nuclear power internationally by having a select set of nations reprocess nuclear fuel for the rest of the world. GNEP expands upon the Department of Energy’s Advanced Fuel Cycle Initiative, which has conducted a program of research and development in spent fuel reprocessing since 2002. A second objective of the GNEP program is to reduce the amount of radioactive waste requiring disposal in a geologic repository. Technologies required to achieve the goals of the GNEP program are not yet fully developed and tested. Therefore further research is required before the facilities necessary to accomplish the intended goals of the program can be constructed and operated. GNEP includes the design and construction of advanced facilities for fuel treatment, fabrication, and an advanced reactor which raises concerns about the financial risks associated with the program. In addition, reprocessing spent fuel raises concerns about the potential for proliferation of weapons-grade nuclear materials because existing reprocessing technologies separate plutonium from the spent fuel. While the plutonium can be recycled into a new fuel for use in nuclear reactors, as is done in France, it can also be used to make nuclear weapons. DOE has yet to identify a proliferation-resistant method to achieve this goal.

• Nuclear Fuel Supply *

The nuclear fuel cycle begins with mining uranium ore, but naturally occurring uranium does not have enough fissionable uranium to make nuclear fuel for commercial light-water reactors. Therefore, the uranium is first converted to uranium hexafluoride before it is put through an enrichment process to increase the concentration of the fissionable uranium. Finally, the enriched uranium is fabricated into fuel appropriate for use in commercial light-water reactors. The United States’ primary uranium reserves are located in Arizona, Colorado, Nebraska, New Mexico, Texas, Utah, Washington and Wyoming. According to the Energy Information Administration, five underground mines and five in-situ mines were operating in the U.S. in 2006. Much of the world’s uranium supply comes from Canada and Australia. While the security of uranium supplies is a policy concern, over-production in the industry’s early years and the United States’ maintenance of military and civilian stockpiles of uranium have helped to provide confidence that uranium resources can meet projected demand for multiple decades. There is one conversion facility operating in the United States in Metropolis, IL. The expansion of the facility is expected to be completed this year. The United States Enrichment Corporation (USEC) operates the only uranium enrichment facility in the United States. Commercial enrichment services are also available in Europe, Russia, and Japan. Recently, four companies announced plans to develop enrichment capabilities in the U.S. According to March 5, 2008 testimony in the Senate Energy and Natural Resources Committee by the President of the Louisiana Energy Services, it is more than a year into construction of an advanced uranium enrichment plant in New Mexico. In addition, USEC is undertaking the development of advanced enrichment technology through the American Centrifuge Plant, which is U.S. technology originally developed by the Department of Energy.

There is an ongoing debate about the ability of the United States to ensure we maintain a reliable, domestic source of nuclear fuel. A major element of that debate is whether or not an agreement between Russia and the U.S., which limits Russian fuel imports, will be enforceable. If not, there is concern that Russian fuel would be imported without limit, potentially jeopardizing the domestic enrichment industry.

• Federal Programs to Support Nuclear Energy *

Another important issue with nuclear power is cost. The 2003 MIT Report The Future of Nuclear Power discusses nuclear power as an energy source which is not economically competitive because nuclear power requires significant government involvement to ensure that safety, proliferation, and waste management challenges meet policy objectives and regulatory requirements. In addition, the success of nuclear power depends on its ability to compete with other energy production technologies. However, the MIT report points out: “Nuclear does become more competitive by comparison if the social cost of carbon emissions is internalized, for example through a carbon tax or equivalent ‘cap and trade’ system.”

While high oil and gas prices are helping to revive interest in nuclear power and improve its economic viability, another factor adding to the interest in nuclear power is the improved performance of existing reactors. However, there is little doubt that the federal incentives included in the Energy Policy Act of 2005 for the nuclear power industry make the economics more attractive. The last order for a new nuclear plant came in 1973, and many in the industry have expressed that strong federal incentives are necessary to build new plants. Such incentives authorized within the last three years include: $18.5 billion in loan guarantee authority for new nuclear plants and $2 billion for uranium enrichment plants; cost-overrun support of up to $2 billion total for the first six new plants; a production tax credit of up to $125 million total per year, estimated at 1.8 cents/kWh during the first eight years of operation for the first 6 GW of generating capacity; and Nuclear Power 2010, a joint government-industry cost-shared program to help utilities prepare for a new licensing process. It is expected that currently authorized loan guarantees will only cover the first 4-6 new plants, depending on their size, and utilities will advocate for more federal loan guarantee authority before building additional plants. In all, nearly 30 applications for new plants are expected to be submitted to the Nuclear Regulatory Commission by the end of 2009 in order to meet the eligibility criteria for the production tax credit in addition to the other incentives.

The federal government provides other indirect financial support for the nuclear industry as well. While costs to develop the Yucca Mountain site are primarily covered by a fee on nuclear-generated electricity paid into the Nuclear Waste Fund, the government takes full responsibility for waste storage. Because the project is decades behind schedule, DOE estimates that the U.S. government has incurred a liability of approximately $7 billion for the department’s failure to begin accepting spent nuclear fuel from existing commercial plants. The nuclear industry is also given Price-Anderson liability protection for any accident involving operating reactors. This establishes a no fault insurance-type system in which the first $10 billion is industry-funded, and any claims above that level would be covered by the federal government. Furthermore, any accelerated development of reprocessing technology, such as GNEP, may cost the government tens of billions of dollars.

• Nuclear Workforce *

As advanced technologies transform the energy industry there will be an increased demand for an appropriately skilled workforce to meet its needs. As the energy sector of our economy changes and grows, the nuclear industry faces increasing competition for engineering talent. In addition to greater demand, the Nuclear Energy Institute’s 2007 nuclear workforce survey estimates that 39 percent of nuclear utility maintenance workers, 34 percent of radiation protection workers and 27 percent of operations staff may reach retirement eligibility within five years. There is a general concern that a revival in the nuclear power industry could be hampered by the availability of the necessary skilled, technical workforce. November 2007 testimony by the Assistant Secretary of Labor underscores the need for creative workforce solutions because energy industry workers are difficult to replace as training programs were reduced during the downturn of the industry in the late 1980s and early 1990s. She goes on to state that training programs have not expanded at the same rate at which the industry is rebounding. The MIT report The Future of Nuclear Power punctuates concerns about workforce development acknowledging that the nuclear workforce has been aging for more than a decade “due to lack of new plant orders and decline of industrial activity.”

The Commission’s Report, required pursuant to section 1909 of the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU, Public Law 109-59), was released January 15, 2008. The hearing will examine the Report’s recommendations relating to freight mobility; highway, auto, and truck safety; passenger and freight rail capacity and service development; intermodal transportation; and the integration of our surface, maritime, and aviation networks. Witnesses are expected to testify regarding the methodology used to analyze the nation’s long-term transportation system needs and the Report’s recommendations for financing short- and long-term capital investment in infrastructure improvements and expansions.

Witnesses

• Jack Schenendorf, Commission Vice Chair, Counsel
• Frank Busalacchi, Commission Member, Secretary, Wisconsin Department of Transportation
• Steve Heminger, Commission Member, Executive Director, Metropolitan Transportation Commission
• Matt Rose, Commission Member, Chairman, President, and Chief Executive Officer, BNSF Railway
• Patrick Quinn, Commission Member, Co-Chairman and President, U.S. Xpress Enterprises

Keynote Address:

• Representative Ed Perlmutter (D-CO)

Featured Panelists:

• Marshall Purnell, President, American Institute of Architects
• Gregory Melanson, Senior Vice President and Regional Community Development Executive, Bank of America
• Stockton Williams, Senior Vice President & Chief Strategy Officer, Enterprise Community Partners

Moderated by:

• Sarah Wartell, Executive Vice President for Management, Center for American Progress Action Fund

As economic growth in the U.S. slows, our country’s global warming gas emissions continue to rise. Meanwhile, consumers are being hit hard by the twin burdens of a sagging housing market and rising energy prices at home and at the gas pump. It’s time to invest wisely in protecting family budgets and revitalizing our built environment. With smart policy we can prioritize energy efficiency to ease the woes of consumers, lenders, financial markets, and our environment. Recognizing this opportunity to offer real solutions to pressing problems, Representative Ed Perlmutter (D-CO) plans to introduce legislation giving incentives to lenders and financial institutions to provide lower interest loans and other benefits to consumers who build, buy, or remodel their homes and businesses to improve their energy efficiency. This timely legislation reflects foresight and the considered input of a broad coalition of housing advocates, financial institutions, government leaders, developers, and the environmental community. Please join us to discuss how this critical intersection of policy concerns can respond to the needs of America’s communities and help lift our troubled economy to build a move vibrant, energy efficient, and low-carbon future.

Center for American Progress Action Fund 1333 H St. NW, 10th Floor Washington, DC 20005

RSVP for this event.

Senator Lugar’s Opening Statement

• Ambassador Stuart E. Eizenstat, Partner, Covington & Burling LLP
• Dr. Kevin Gurney, Associate Director, Purdue Climate Change Research Center(PCCRC), Purdue University

• Mr. David Hayes, Former Deputy Secretary, Department of the Interior
• Mr. Dirk Forrister, Managing Director, Natsource LLC