Tuesday, July 29, 2014

Wyden's Natural Gas Concerns May Preview Agenda As Energy Panel Chair

Posted: November 9, 2012

Democratic Sen. Ron Wyden's (OR) likely move to chair of the Energy and Natural Resources Committee next year may signal an increased focus by the panel on limiting natural gas exports in order to preserve domestic supplies of the fuel, which Wyden says needs federal oversight but is the "cleanest of the fossil fuels."

Wyden's ascension to panel chairman in the 113th Congress -- current Chairman Sen. Jeff Bingaman (D-NM) is retiring -- is also expected to ensure a major committee focus on ways to promote cleaner, renewable energy sources such as wind, solar and biomass rather than what the senator has called "dirty" fossil fuels such as oil and coal. Wyden has echoed Bingaman in calling for clean energy innovation and low carbon energy, but has also been sharper in his critique of fossil fuel industry tax breaks.

And wielding the panel chairmanship could boost his efforts to replace EPA's renewable fuel standard (RFS) with a low-carbon fuel standard (LCFS), an idea he pitched in legislation that failed to move earlier this year.

Assuming Wyden also retains his seat on the Senate Finance Committee, it would put him at the center of possible debate next year over repealing or rewriting energy tax incentives, as well as possible consideration of a carbon tax on industries. "He is going to have a big, big say, if not the biggest say, on all things energy coming out of the [finance] committee," says one lobbyist.

Some Republicans strongly oppose taxing carbon emissions or other steps to curb global warming, but it is unclear how, if at all, energy panel ranking member Sen. Lisa Murkowski (R-AK) will address the issue of a carbon tax in her energy policy blueprint for the 113th Congress, which press reports say she may release in January.

Following the Nov. 6 elections, Democrats expanded their Senate majority by two seats to 55, compared to 45 Republicans. That all but guarantees Wyden will become chair of the Energy and Natural Resources Committee as, after Bingaman, he has the most seniority on the panel -- the next most senior member after Wyden is Sen. Tim Johnson (D-SD).

The lobbyist says there is some uncertainty about Wyden's direction as chair, as the senator has proven unpredictable on some energy issues in the past. "He can surprise his own members. he can come up with an amendment the night before a markup. You don't know always know what you are getting," the source says.

Scott Segal, a partner with Bracewell & Guiliani, said on a Nov. 7 webinar assessing the election that, "Those who have worked closely with Wyden find him to do deep dives on complex issues. . . . He likes to move bipartisan legislation with a focus on fixing real problems."

Natural Gas Exports

Wyden in a Nov. 2 statement appeared to suggest that criticism of natural gas exports will be a key focus on the energy panel. He said that Natural Gas Act provisions providing for quick approval of U.S. gas exports to free trade nations needs "reconsideration."

He raised concern over trade negotiations on a new Trans-Pacific Partnership, which he said should not bar the United States from "reshaping its energy policy, which may include new treatment of natural gas exports." Wyden said the default approval of exports was created "before newly-accessible shale gas became a strategic asset for the U.S. This policy needs reconsideration. . . . It could harm the nation's ability to achieve energy independence, combat pollution and preserve the environment, and improve the economic competitiveness of American manufacturers."

Wyden's statement on the possible free trade deal also comes with the Department of Energy (DOE) reviewing numerous proposals for natural gas exports to non-free trade countries, and with a DOE report pending on the economic impact of such exports. In an Oct. 23 letter to DOE Secretary Steven Chu, Wyden asked for an explanation of criteria that the department is using in pending and future decisions on export applications.

The lobbyist says Wyden's natural gas statement underscores broader questions about how Wyden's own regional interests, current energy trends and other issues will affect the energy panel's agenda. Wyden's web site notes that he was the first senator to request a Federal Energy Regulatory Commission investigation of Enron, the now defunct and disgraced energy trading company that manipulated energy prices on the West Coast. The website also notes his efforts to investigate oil company's efforts to "constrain domestic supplies." In recent statements, Wyden has suggested that businesses, consumers and homeowners should be at the center of the debate over energy exports.

While Wyden is raising concerns over natural gas operations, he has suggested a need to ensure ongoing domestic gas production -- albeit with a "technological fix" to ensure adequate oversight. "This is what I tell environmental folks: Natural gas is really important to a lot of renewables, solar and wind, ensuring that option is out there. . . . Natural gas is the cleanest of the fossil fuels, so you start with that as your basic proposition," Wyden has said.

Renewable Energy Focus

It is unclear how large the 113th Congress' focus will be on energy issues, and sources have said the House GOP leadership has no interest in moving a massive energy bill next year -- a position that is seen as hindering efforts by opponents of the RFS for lawmakers to either overhaul or entirely dismantle the agency's embattled program.

Even before the elections, the Senate Energy and Natural Resources Committee under Bingaman's leadership approved several energy bills, only to see most of them fail in gridlock ahead of the elections.

But climate could be an issue for the panel, as President Obama in his victory speech Nov. 6 issued a general pledge to work toward reduced dependence on foreign oil and reiterated concerns about global warming.

And Senate Majority Leader Harry Reid (D-NV) in Nov. 7 remarks expressed general concern about climate change but did not go into detail on a possible energy agenda, which in the short term is likely to include discussion, but not necessarily agreement, over extension of wind and other energy tax credits.

The White House prior to the election called for a Clean Energy Standard (CES) but prospects for action on the measure remain unclear. Wyden at a May 17 hearing on a proposed CES bill floated by Bingaman said he supported the "basic proposition" of Bingaman's bill. However, he added that he is concerned about energy prices and regional differences in the energy sector, and floated the possibility of a "state waiver" process under the CES.

Wyden's Senate website says that he "has continued to push for a national energy policy that focuses on domestic production, renewability, carbon reduction and protections for energy consumers."

Wyden's Fuels Policies

On fuels issues, Wyden in the last Congress floated legislation to replace EPA's RFS with an LCFS, which would incentivize fuels with low greenhouse gases. But the bill -- which would also be subject to the Senate Environment and Public Works Committee's jurisdiction -- could be an uphill battle, as biofuels groups are vowing to make a strong defense of the RFS in 2013 rather than work on measures to amend the standard.

However, it also comes as the RFS has been criticized as a factor in boosting food prices and a heavy reliance on corn-derived ethanol. And sources says that biofuel groups have begun discussions with lawmakers' offices and are making initial outreach to EPA on policy options to supplant the RFS by creating a national LCFS.

Meanwhile, Wyden, with timber interests in his state, also has a "pragmatic" focus to timber questions, according to the lobbyist, who says Wyden would work to preserve crediting of biomass in renewable energy standards.

Another one of Wyden's priorities is energy storage. Wyden, along with Bingaman and Sen. Susan Collins (R-ME) sponsored legislation, S. 1845 to create a storage investment tax credit -- a priority for renewable that generate power only when the sun shines or wind blows.

Wyden along with Sen. Debbie Stabenow (D-MI) also backed, S. 1001, legislation to expand federal support for alternative fuel vehicles and investment in natural gas, propane, electricity, biofuels and hydrogen fuel infrastructure.

That legislation approved by the Senate in 2011, included loan guarantee provisions, and it remains to be seen how quickly lawmakers, particularly in the House will venture into such issues after the loans to the failed solar firm Solyndra became a point of harsh criticism in the presidential campaign. -- Doug Obey (This e-mail address is being protected from spambots. You need JavaScript enabled to view it )

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