Dramatic shifts in the public mood and a spate of retirements in Congress have put energy legislation in a kind of political limbo in 2010. The short-term outlook for bills addressing energy development and climate change is increasingly cloudy, and the long-term prospects are largely dependent on two major factors that are difficult to predict—economic conditions and the midterm elections.
In just the first three weeks of the year, one of the key players on energy policy, Sen. Byron Dorgan, D-N.D., has announced his retirement and the special election to replace the late Sen. Edward Kennedy, D-Mass., has sent shock waves through the Democratic Party.
Republican state Sen. Scott Brown’s stunning victory over Democrat Martha Coakley not only takes away the Democrats’ 60-vote majority in the Senate, it puts a chill on major initiatives in this Congress. The unexpected result in the bluest of blue states sent a strong message against the current direction in Washington and is likely to make Democrats very nervous about enacting any new big government programs like a cap-and-trade law.
The retirement announcements by Dorgan, chairman of the Senate Appropriations Subcommittee on Energy and Water Development; Sen. Christopher Dodd, chairman of the Senate Banking Committee; and a half dozen Democrats in the House, including Science and Technology Committee Chairman Bart Gordon, D-Tenn., and Rep. Brian Baird, D-Wash., chairman of the Science and Technology Subcommittee on Energy and Environment, have added to a sense of turmoil in the Democrat majority.
Dorgan’s decision not to seek a fourth term in the Senate this year is especially unsettling for energy policy. Dorgan, a House member for 12 years and a senator for 18, was among the top candidates for Energy Secretary at the start of the Obama administration. In his retirement announcement, Dorgan said that after Congress he would “like to work on energy policy in the private sector.” The odds are it would be for the coal industry, since North Dakota is a major coal state. That makes it even more likely Dorgan will oppose a cap-and-trade system to control greenhouse gas emissions, which would be costly for coal-fired power plants.
Dorgan has already come out against an emission-trading system run by the financial markets. “I want to find ways to protect our environment and I support reducing carbon,” he said in a recent op-ed for North Dakota newspapers. “But it makes no sense to me to hand Wall Street a new trillion-dollar carbon securities market so they can engage in the kind of speculation that steered our economy into the ditch.”
Opposition from key Democrats like Dorgan makes one thing crystal clear: Climate-and-energy legislation passed by the House last summer is a non-starter in the Senate. Even some House Democrats who voted for the bill, including Agriculture Committee Chairman Collin Peterson, D-Minn., now say they would oppose the measure if it comes back for final action.
Senate Energy and Natural Resources Committee Chairman Jeff Bingaman, D-N.M., has acknowledged there is little chance of the Senate approving the kind of cap-and-trade program included in the House bill. “I do think opponents of cap-and-trade legislation have done a pretty effective job of portraying the proposal as a tax on energy use,” Bingaman told New Mexico reporters on Jan. 11.
“My own sense is at this time that we have strong support in the Senate to do something significant to move toward more use of renewable energy and more efficient use of energy,” Bingaman said. “I don’t know that we have the votes for any cap-and-trade proposal that I have seen floated here in the Senate.”
Bingaman and Dorgan want the Senate to at least move forward on the bill approved by the Energy and Natural Resources Committee last June, with provisions for more alternative energy, grid development, carbon-storage technology and conservation. Dorgan also added a section to expand drilling in the eastern Gulf of Mexico, which geologists say includes at least 21 trillion cubic feet of natural gas and 3.7 billion barrels of oil.
Of course, many Democrats are still advocating for a broader approach that includes some effort to tackle climate change. Sen. John Kerry, D-Mass., a chief sponsor of the bill approved in November without Republican participation by the Senate Environment and Public Works Committee, acknowledges it will be difficult to move the measure, largely modeled after the House-passed bill. But Kerry argues that the pressure for an international agreement on climate change—even the minimal goals outlined in Copenhagen in December—“can be a catalyzing moment” for the Senate.
Environmentalists like Daniel Weiss, a former Sierra Club lobbyist now with the Center for American Progress, note that China and India made their first real commitments in Copenhagen to reduce rates of pollution growth relative to their economies, which should help convince skeptics that the United States needs to show leadership, too. Weiss also said on the environmental news Web site Grist that with the EPA poised to act on greenhouse gases if Congress does not, there is a “sword of Damocles hanging over the Senate should it fail to act.”
Sen. Lisa Murkowski, R-Alaska, the ranking member of the Energy and Natural Resources Committee, has pledged to bring a bill to the Senate floor soon aimed at blocking EPA regulation of greenhouse gases for at least a year. Murkowski appears to have some support from Democrats who prefer that Congress act first, but even if her measure passes it would be difficult for both the House and Senate to muster the two-thirds majority needed to overcome a certain veto by President Obama.
But the biggest obstacle to climate legislation is probably the struggling economy. After the wrenching and divisive debate on health care, it is unlikely many Democrats have the stomach for another bruising battle in which they would be accused of killing jobs and hindering economic growth.
The anxiety will only intensify in the buildup to the November elections. Democrats know that the party in the White House historically loses congressional seats in midterm elections, and political analyst Charlie Cook says Democrats hold 40 of the 50 most competitive House districts at the start of the 2010 campaign season.
In the Senate, Majority Leader Harry Reid is well down in the polls as he seeks a fifth term in Nevada. And several strong GOP candidates—former Hewlett Packard CEO Carly Fiorina, state Sen. Chuck DeVore and former U.S. Rep. Tom Campbell—are vying to take on Sen. Barbara Boxer, D-Calif., leader of the Environment and Public Works Committee.
While Republicans have worries of their own in the Senate with six announced retirements, none of them are game-changers on the climate change legislation. The six retirements are Sens. George LeMieux of Florida, Sam Brownback of Kansas, Jim Bunning of Kentucky, Kit Bond of Missouri, Judd Gregg of New Hampshire and George Voinovich of Ohio.
What spells more trouble for climate change proponents are recent and continuing developments at the state level. The election of Republican Gov. Bob McDonnell in Virginia signals the kind of changes that may be in store for the states, as well. McDonnell pledged in his Jan. 16, 2010, inaugural speech to open more offshore areas to drilling in his administration.
And California Gov. Arnold Schwarzenegger, a Republican who has made action on climate change a hallmark of his administration, is on his way out this year after opting not to seek another term. He won a special recall election in 2003 and a full term in 2006. During his tenure Schwarzenegger pushed through a law capping the state’s greenhouse gas emissions at 1990 levels by 2020, with a goal of cutting emissions to 80 percent below 1990 levels in 2050.
Critics say the climate effort is one reason California has an unemployment rate over 12 percent, but it remains to be seen whether state leaders will try to backtrack on climate regulations once Schwarzenegger leaves office.
With an uncertain electoral future ahead, Democrat leaders are still clinging to the notion that a climate bill can be passed by this spring. The Abraham Energy Report believes it is unlikely as the election heats up in states that have been hit hard by the economic crisis and that are still powered by heavy industry.
The more likely scenario is that the renewable and other clean energy provisions pushed through Bingaman’s Senate Energy and Natural Resources Committee will pass as a stand-alone bill or be attached to the Senate “jobs” stimulus bill, which is currently being assembled by Majority Whip Dick Durbin and Dorgan. Without such an innovative compromise, energy legislation—and most certainly a climate bill—will be on hold until 2011 at the earliest.