With the summer driving season upon us and gasoline prices on the rise again for almost 50 consecutive days, Members of Congress continue to hear from constituents — whether single parents, small-business owners, or farmers and ranchers — who are struggling to pay growing energy costs. These concerns often spur piecemeal approaches to energy reform in Congress, but we must enact comprehensive and responsible solutions that address our energy needs today and in the long term.
President Barack Obama has established national goals to end our addiction to foreign oil, invest in clean renewable energy and transition to a low-carbon economy, all of which are laudable goals I wholeheartedly support. The success of any major domestic energy or environmental reforms, however, lies not only on the public policy goals themselves but on the potential cost of action — or inaction — of the policy on consumers, businesses and the overall economy.
Who pays for reforming our national energy policy, and how, are questions to which the American public deserves straight answers.
The Democratic Congress has made climate change its top energy priority. Those who question the necessity of climate legislation ignore the Supreme Court’s ruling in Massachusetts v. EPA, which confirmed the Environmental Protection Agency’s authority to regulate mobile source emissions and, potentially, stationary sources. The question is not whether we should or should not regulate greenhouse gas emissions, but rather how to regulate emissions with the least disruption to our economy.
No one doubts that instituting a cap on nationwide greenhouse gas emissions will raise the price of energy for consumers and businesses alike. Electricity, natural gas, gasoline and energy-intensive goods will begin to incorporate the cost of carbon into their price structure. A carefully crafted climate proposal, however, can help minimize any price impacts and provide transitional assistance as we move toward a clean energy future.
I voted to support H.R. 2454, the American Clean Energy and Security Act, in the Energy and Commerce Committee because I believe it protects consumers from most climate-related energy price increases by providing almost 60 percent of allowances for their benefit. Thirty-two percent of allowances are provided to electric Local Distribution Companies to reduce electricity rates for consumers; 9 percent to natural gas LDCs to lower natural gas prices; 1.6 percent for home heating oil assistance; and 15 percent for rebates or tax credits to low- and moderate-income families. In addition, the American Council for an Energy-Efficient Economy estimates the bill’s energy efficiency provisions could save $3,900 per household by 2030.
H.R. 2454 also provides 15 percent of allowances to all U.S. energy-intensive, trade-exposed industries. Additionally it allotted 2 percent to help refiners protect their jobs from foreign competitors and to promote improvements in energy efficiency. I believe more discussion is needed on the impact to refiners under a climate program, and ultimately more transitional assistance, but I believe this is critical first step.
The legislation is not perfect, but I will continue to work with Energy and Commerce Chairman Henry Waxman (D-Calif.) and Subcommittee on Energy and Environment Chairman Ed Markey (D-Mass.) to improve the legislation as the bill moves through the legislative process.
Major energy reform should not stop with climate change. I believe America needs a national energy policy that recognizes the role that all forms of domestic energy can play — from wind and solar to natural gas and oil — in order to provide reliable and affordable supplies of energy to American consumers and businesses.
The U.S. Energy Information Administration projects that from 2007 to 2030, U.S. demand for energy will grow 9 percent with oil and natural gas accounting for more than half of this increase in demand. We cannot drill our way out of our energy needs, but we cannot ignore the benefits America gains with responsible domestic production: reduced reliance on foreign imports, increased economic growth, new high-paying jobs, additional federal and state revenues and an improved ability to meet our clean energy goals.
Increased domestic energy production will not increase overall U.S. emissions under a climate program and can produce the natural gas needed to address global climate change. Demand for natural gas will grow as additional natural gas power plants are brought online to produce low carbon electricity. Natural gas is also required to make energy-efficient products, wind turbine blades and solar panels, as well as to provide backup power to renewable energy projects and to run biomass facilities.
Development of U.S. resources could also provide the federal funding required to develop the next generation of clean energy technologies. In 2008 alone, almost $24 billion was collected and distributed to the federal government and to the states from domestic production. With sensible safeguards, we can responsibly produce our energy resources and direct a substantial portion of these revenues into a national clean energy fund to invest in energy efficiency, conservation, renewable energy technologies or other climate-related endeavors.
Less than one year ago, the House of Representatives approved legislation — introduced by my colleagues Reps. Nick Rahall (D-W.Va.), George Miller (D-Calif.) and John Dingell (D-Mich.) and me — to allow for the production of domestic conventional and renewable energy supplies. Congress ultimately lifted the decades-old moratorium on offshore drilling, but recent court rulings and uncertainty regarding future administrative and Congressional action on domestic access has delayed critical investments.
The administration and Congress have an opportunity to develop a comprehensive energy policy that addresses both climate change and our ability to safely utilize all domestic resources to provide affordable energy supplies to consumers and businesses. If we make it more expensive or difficult to produce energy — either through punitive tax measures or unsubstantiated regulations — it will hinder our ability to meet our clean energy goals while also increasing energy prices for all Americans. If we fail to find the appropriate balance when reforming our national energy policies, we will all pay the price.
Rep. Gene Green (D-Texas) is a member of the House Energy and Commerce Committee.