Monday, August 27, 2007

U.S. House Energy Bill: Rhetoric Over Reality by Robert Bryce

U.S. House Energy Bill: Rhetoric Over Reality

When it comes to energy issues, Americans are far more interested in rhetoric than pragmatism.

For proof of that, look no further than the massive energy bill passed by the House last month. House Speaker Nancy Pelosi heralded the passage of the 780-page bill, known as "A New Direction for Energy Independence, National Security, and Consumer Protection," declaring, “Energy independence is a national security issue, an environmental and health issue, an economic issue, and a moral issue.” (What? No mention of male-pattern baldness?)
The bill does nothing to increase energy supplies. It won’t cut oil imports, it won’t strengthen America’s creaky electricity grid, nor make America energy independent. Other than that, it’s great legislation.

Perhaps the most significant – and most controversial – element of the House bill is its requirement that by 2020, publicly traded power companies must get 15 percent of all their electricity from renewable sources like wind and solar.

Let’s put that in perspective.

In mid-2007 electricity demand was growing by 2.7 percent annually, and if it continues at that rate, electricity consumption in the U.S. will double in about 26 years. In late 2006 the North American Electric Reliability Council warned that this growing demand is not being met by increasing supply, and the U.S. may have a generating capacity shortfall of 81,000 megawatts by 2015. Just for perspective, the Three Mile Island Generating Station in Pennsylvania operates one 850-megawatt reactor. So the looming electricity shortfall in the U.S. is equal to the output of 95 reactors.

But keep in mind that those reactors are reliable sources of base load power. Wind turbines and solar panels are not. In fact, due to the intermittence of wind and sunlight, virtually every new megawatt of renewable energy must be backed up by conventional power plants. Thus, all of the new renewable sources will have little effect on overall emissions of carbon dioxide.

Nor will the new renewable electricity requirement do anything for “energy independence” because only a marginal amount of domestic electricity (about 2 percent) is generated by oil-fired power plants.

The House bill does nothing to decrease energy imports because it doesn’t allow any increases in domestic production of oil and gas. Regions known to contain billions of barrels of hydrocarbons, like the eastern Gulf of Mexico or the Arctic National Wildlife Refuge, continue to be off-limits to prospectors.

But perhaps it’s wrong to expect the House to come up with any meaningful energy policy. After all, it is only responding to the whims of the American populace. A March survey by Yale University’s Center for Environmental Law and Policy found that 93 percent questioned said imported oil is a serious problem, and 70 percent said it was “very” serious. An April poll by CBS News and the New York Times found overwhelming support – 92 percent! – for laws requiring automakers to produce more efficient cars. But when asked if they would support a tax on gasoline in order to “cut down on energy consumption and reduce global warming,” 58 percent of respondents said no.

In other words, Americans still crave a free lunch when it comes to energy. They want lots of cheap gasoline, but they hate the oil companies. They say they are concerned about imported oil, but they don’t want to pay more for any of the energy they use.

Congress has responded to this muddle by passing two monster energy bills that are long on rhetoric but woefully short on substance. In June, the Senate passed a bill that could require the production of 36 billion gallons of ethanol and other biofuels by 2022. Now, the House and the Senate will have to work on a compromise bill that will be palatable to George W. Bush, who is already threatening a veto.

A veto may be the best possible outcome. Democrats can express their outrage, Bush can bash an unpopular Congress (a mid-August Gallup poll found 76 percent of Americans disapprove of the job it’s doing) and better still, Washington ends up abiding by the Hippocratic oath: first, do no harm. And when it comes to energy issues, that may be the most pragmatic move of all.

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