Thwarted Bingaman Still Eyeing Clean Energy Standard in Next Congress

WASHINGTON— Clearly, the mammoth tax-slicing package that President Obama signed into law Friday has its share of boosters and detractors on Capitol Hill.

Count Sen. Jeff Bingaman among the latter.

Before voting against the $858 billion measure, the New Mexico Democrat criticized his colleagues for allowing the wealthiest Americans to keep more of their money instead of maximizing incentives for energy efficiency.

That squandered opportunity means the chairman of the Senate Energy and Natural Resources Committee will redouble his efforts in the 112th Congress to collaborate with Maine Republican Sen. Olympia Snowe to advance fuel-saving provisions, Bingaman spokesman Bill Wicker told SolveClimate News in an interview.

Those include efforts to promote energy efficiency, clean technology manufacturing and energy independence, and reduce pollution. As well, Bingaman plans to continue pursuing his long-term goal of a coast-to-coast renewable electricity standard.

As chair of the Senate Finance Subcommittee on Energy, Natural Resources and Infrastructure, he is already mapping out next year’s hearings on clean energy.

“Failing to enhance this bill’s energy provisions will ensure that the 111th Congress will be recorded as one that failed to maximize its potential in using the tax code to promote advanced energy priorities,” Bingaman said in a floor speech.

“To be sure, the American Recovery and Reinvestment Act included many significant tax innovations that promote clean renewable energy and energy efficiency. But since ARRA’s enactment at the very beginning of this Congress, the Senate has failed to consider any legislation that would build off those innovations.”

What Bingaman and Snowe Envisioned

Back in late September, Bingaman and Snowe, a top Republican with the Finance Committee, introduced a bill known as the Advanced Energy Tax Incentives Act of 2010. Its central theme is enhancing energy efficiency, deploying renewable energy and rebuilding the country’s manufacturing base.

“For far too long our country’s energy strategy has prioritized the technologies of the past while our policy debate has languished in partisanship,” Snowe said when they rolled it out. “The world is moving ahead with bold action on innovative technologies and it is past time that we set a new course for how we use and think about energy.”

When the bipartisan measure didn’t progress as a stand-alone bill, they offered it as an amendment during the lame-duck session discussion of the gigantic tax package.

Five highlights of the amendment featured:

1. A performance-based tax credits for whole-home retrofits
2. $2.5 billion in tax credits designed for manufacturers of renewable energy or energy efficiency technologies for U.S. factories
3. $1 billion in energy efficiency tax credits for manufacturers to advance their competitiveness
4. A tax incentive for storage systems for wind and solar energy
5. A retooled tax credit for carbon capture and storage

But the amendment’s offerings evidently didn’t resonate with many senators. For instance, the whole-home retrofit measure was severely slashed and the others were left on the cutting room floor.

Ethanol Tax Credit a Boondoggle

Though Bingaman said he is slightly encouraged that Congress opted to extend the Treasury grant program to the renewable energy industry for one year, he denounced an additional year of corn ethanol subsidies as “disappointing.”

Statistics reveal that what’s called the Volumetric Ethanol Excise Tax Credit (VEETC) of 45 cents per gallon costs taxpayers about $6 billion annually when associated income tax deductions are included. He emphasized that the ethanol tax credit subsidizes production of a fuel already mandated by Congress via the renewable fuel standard.

As well, environmental organizations have noted that these subsidies are funneled toward oil companies that blend the ethanol with traditional fuel—not family corn farmers, agro-businesses or ethanol producers.

“The House was poised to reduce the credit to 36 cents, a level that I would support,” Bingaman said, pointing out that keeping the subsidy at 45 cents costs an extra $1 billion better spent on clean energy technologies not given the market protection that the renewable fuel standard offers.

“Particularly galling,” Bingaman said, “is that this obstruction occurred in a year that saw the worst environmental disaster in the history of this nation, one that resulted from our overdependence on fossil fuels.”

“Clean Coal,” Nuclear in Future National RES?

Once again, Congress seems to have thwarted Bingaman’s attempts to encourage growth in the wind, solar and other renewables sector via an all-encompassing renewable electricity standard. Agenda-setter and Senate Majority Leader Harry Reid of Nevada evidently decided the Renewable Electricity Promotion Act of 2010 didn’t have enough votes to pass.

In a nutshell, the bipartisan bill Bingaman introduced with outgoing Sen. Sam Brownback, R-Kansas, in September would have required utilities to deliver 15 percent of their power from renewables or by ramping up energy efficiency by 2021. The District of Columbia and 28 states, mostly in the Northeast, Midwest and far West, have already adopted varying degrees of individual renewable electricity standards.

As a renewable electricity standard is a piece of policy legislation, Wicker explained, it wasn’t a proper fit with the bill that extended the President George W. Bush tax cuts and incorporated other tax breaks to stimulate the economy.

“The renewable electricity standard has been around for many Congresses,” Wicker said. “We’ll certainly revisit it.”

One bone of contention for Bingaman is that Republicans are pushing to add nuclear power and “clean coal” to the list of qualifying renewables that covers wind, solar, ocean, geothermal, biomass, landfill gas, hydrokinetic, waste-to-energy and new hydropower at existing dams.

With the GOP gaining six seats during the November election, the Democratic caucus in the Senate will have just a 53-47 edge. And then there’s the Republican-majority House. The question is, how inclusive and flexible is Bingaman willing to be?

“My boss thinks it should include renewables only,” Wicker concluded. “But he’s also a pragmatic guy. And the face of the U.S. Senate is going to be changing next year.”