Climate: Chairman Dingell Opposes Carbon Tax, Promotes Cap-and-Trade At a meeting in Detroit on Monday May 14, Chairman of the House Energy and Commerce Committee, John Dingell (D-MI), rejected suggestions to advance a carbon tax, and said he would continue to work from the political center and, instead, craft an economy-wide, cap-and-trade proposal to curb global warming.
The Chairman also described climate change as the "most singularly difficult task I've confronted in all my years in Congress." According to press accounts from the hometown meeting, he then identified interest groups on both sides of the debate that he said are working to stop progress.
"I'm just a simple Polish lawyer from Detroit who is trying to craft a climate change bill in a bipartisan manner that will pass the House, pass the Senate and be signed into law by the president," Dingell said. He said he does not yet have a detailed bill, but he did indicate his bill would protect domestic coal supplies and encourage broad international participation.
Markey Advances Global Warming Provision on Defense Bill
Later this week, the House will debate the 2008 Fiscal Year Department of Defense (DOD) authorization bill, H.R. 1585. Included within the measure is a provision developed by Chairman of the Select Committee on Energy Independence and Global Warming, Ed Markey (D-MA), and Rep. Roscoe Bartlett (R-MD), and supported by 11 former Pentagon officials, to study how climate change affects the U.S. military. Specifically, DOD would have to assess what role climate change plays on its "facilities, capabilities, and missions."
Markey and Bartlett said they are advancing the provision to get a better understanding of how climate change-related flooding and sea-level rise could lead to the destruction of military and intelligence operations in low-lying areas, including U.S. Naval bases and shipyards. However, Republicans plan to try to strip out the climate change language during debate on the defense bill.
Senate Energy Holds Re-nomination Hearing on FERC Chairman Kelliher
On May 10, the Senate Energy and Natural Resources (ENR) Committee held a re-nomination hearing for Joseph Kelliher, Chairman of the Federal Energy Regulatory Commission (FERC). Chairman Jeff Bingaman (D-NM) and Ranking Member Pete Domenici (R-NM), along with Sens. Larry Craig (R-ID), Ken Salazar (D-CO), Craig Thomas (R-WY), Ron Wyden (D-OR), Jon Tester (D-MT), Robert Menendez (D-NJ) and Richard Burr (R-NC), questioned the Chairman and expressed various opinions on his tenure at FERC.
Republican Sens. Domenici, Craig, Thomas, and Burr expressed respect and support for Kelliher's "exemplary" service. Democrats expressed concerns on a number of issues, including deregulation, merger review, capacity markets, gas supply, and the siting of LNG facilities.
Kelliher's current term ends June 30, 2007. If the Democrat-controlled Committee does not re-confirm him by that date, the President could do so by a "recess appointment" when Congress is not in session. A recess appointment, however, would only extend his term until the end of the 110th Congress. This scenario would allow a new President to appoint a new FERC Chairman in early 2009. Given that Democrats are in the Majority, and would prefer to advance their own candidate for Chairman, this scenario is certainly possible.
Kerry Joins Cantwell and Smith to Introduce Energy Incentive Bill, with 5-year CREB Extension
On May 11, Sens. Maria Cantwell (D-WA), Gordon Smith (R-OR) and John Kerry (D-MA) introduced, S. 1370, a comprehensive energy tax incentives bill, entitled the "Clean Energy Incentive Assurance Act," to advance development of renewable energy and energy efficiency efforts. The bill includes, among other things, a five-year extension of the Clean Renewable Energy Bond (CREB) program, with an annual volume cap of $5 billion. Morgan Meguire, on behalf of NEPPA, contacted Sen. Kerry's office to encourage him to become an original co-sponsor of the bill.
Sen. Thune Introduces 4-year CREB Extension, Modifies Volume Cap Allocations
On May 4, Sen. John Thune (R-SD), introduced S. 1291, the "Wind Energy Development Act of 2007," a bill that would extend for four years the (Section 45) production tax credit for eligible renewable energy resources and the (Section 54) Clean Renewable Energy Bond (CREB) program for consumer owner utilities, and others incentives. His bill also provides an annual volume cap of $2.25 billion for CREBs, with the following delineations:
- $750 million for public power systems (with an obligation to serve);
- $750 million for rural electric cooperatives;
- $500 million for governmental entities, other than public power systems and tribes; and
- $250 million for Indian tribes.
Climate Change Coalition Adds Members
The USCAP Coalition, started several months ago by BP, GE, DuPont, several investor-owned utilities and environmental groups, recently announced it would add 14 members to its ranks. The American International Group, Boston Scientific Corp, ConocoPhillips, Dow Chemical Co., Johnson & Johnson, Royal Dutch Shell, the Nature Conservancy and the National Wildlife Federation and several others joined the group which has called on Congress to enact legislation that would curb carbon dioxide emissions from all sectors of the economy over the next 50 years.
DOE Issues Draft National Interest Electric Transmission Designations
On April 26, the Department of Energy (DOE) released two draft National Interest Electric Transmission Corridors ("NIETC") designations. The two DOE-designated areas are in regions of the country where consumers are negatively affected by lack of transmission capacity or congestion. The first proposed corridor is for the Mid-Atlantic region and includes parts of Ohio, West Virginia, Pennsylvania, New York, Maryland, Virginia, New Jersey, Delaware and the District of Columbia. The proposed Southwest Corridor includes counties in California, Arizona and Nevada.
DOE was granted the authority to issue corridor designations in Section 1221 of the Energy Policy Act of 2005, which directed the Secretary of Energy to conduct a nationwide study of electric transmission congestion. Based on the study, the Secretary was granted authority to designate any geographic area "experiencing electric energy transmission capacity constraints or congestion that adversely affects consumers" as a NIETC.
Sec. 1221 also gave FERC significant new authority to site transmission facilities in a NIETC area, after making findings relating to a state's failure or inability to site such facilities. This federal siting authority provision was controversial when included in EPAct 2005 and the recent NIETC designations have sparked that controversy anew.
More Public Meetings Announced
On May 10, DOE announced four additional public meetings, to be held during the 60-day comment period, on the proposed NIETC corridors. The comment period closes on July 6. Meetings will be held in Phoenix, Las Vegas, Pittsburgh and Rochester. The other three public meetings will be held in Arlington (VA), San Diego and New York.
Opposition to the designations is emerging in the Senate, with Sens. John Warner (R-VA) and James Webb (D-VA) circulating a joint signature letter to DOE that would call for an additional 30-day public comment period. The draft letter also asks DOE to hold public meetings in every congressional district that would be affected by the transmission designations.
PJM Predicts Enough Power for Summer Peak
Yesterday, the PJM Interconnection announced it expects to have enough power to keep the lights on this summer. PJM expects summer electricity demand to peak at 136,961 MW, down from last year's record peak of 144,644 MW. The organization expects to have 160,680 MW of firmly committed capacity available, with an additional 3,600 MW of additional capacity for peak demand. That brings the region's reserve margin to 18.8 percent for committed capacity and 21.4 percent for total capacity, both of which exceed the required reserve margin of 15 percent. In the PJM region, demand for electricity typically peaks in the summer because of high air conditioning use.
PJM also says its reliability-pricing model, in which generators of power commit to PJM for a full year, will begin June 1. Previously, generators could decide daily whether to make their generation available to PJM and to sell it elsewhere. This, PJM officials say, helps ensure the system will meet peak consumer demand.
Last summer, extreme temperatures and humidity across the entire PJM region drove customers' use of electricity to 144,644 MW. PJM says those extraordinary weather conditions were a once-in-35-years event. PJM operates and monitors the grid that serves 51 million people in all or parts of Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia, and the District of Columbia.