"WEEKLY UPDATE"
July 11, 1999
Contents
FEDERAL ENERGY BUDGET AND TAXES
1.) House to Take Up Interior Appropriations Bill This Week
2.) Efforts Underway to Remove Cochran Rider
3.) Coalition Urges Clinton to Veto Appropriations Bills
4.) Rep. Matsui Introduces Climate Change Tax Bill
ELECTRIC UTILITY RESTRUCTURING
1.) Murkowski Opposes Renewables Provisions in Restructuring Bill
2.) Oregon Approves Utility Restructuring Bill
3.) Wind Is No. 1 Choice for Green Power Buyers
4.) Wind Power Web Site Set Up
CLIMATE CHANGE
1.) Climate Change Threatens Coral Reefs
2.) "New York Times" Details Evidence of Climate Change
MISCELLANEOUS
1.) Wind Farms Dedicated in Wisconsin and Texas
2.) Clinton Advocates Wind at Rosebud Sioux Reservation
3.) EIA Issues 50-Year Energy Review
4.) Honda To Introduce 80 mpg Hybrid Vehicle
5.) Fuel Cell Use Growing Rapidly
6.) General Motors to Make Military SUVs
7.) Study Examines Efficiency v. New Power Plants
FEDERAL ENERGY BUDGET AND TAXES
1.) House to Take Up Interior Appropriations Bill This Week:
The "Environment & Energy Weekly Update" (July 5) notes that a floor vote
on the House Interior Appropriations bill (which funds DOE's energy efficiency and fossil fuel programs) is expected the week of July 12. A
target date is not yet set for a floor vote on the Senate Interior Appropriations
bill. "The House floor debate is expected to resurrect the issue of budgetary
caps that has been raised by conservative Republicans during past
appropriations bill action. Rep. Tom Coburn's (R-OK) office verified that he
is looking to divert some funds from earlier bills, including Interior, to ensure
funding for other FY'00 measures such as Labor/HHS/ Education, and
VA/HUD. Sources on and off Capitol Hill have heard the possibility of cuts
of up to $200 million, but Coburn's aide said it is too early to give specific
figures and 'a lot can happen' before the bill goes to the floor."
2.) Efforts Underway to Remove Cochran Rider:
Senator Thad Cochran (R-MS) recently attached a rider to the Senate
Interior Appropriations bill that would stop the Administration from
implementing its new executive order mandating energy efficiency
improvements in federal buildings. It would also preclude spending a large
portion of the federal funds appropriated for energy efficiency R&D. The
National Environmental Trust reports that industry groups provided the rider
language to Cochran, and the Senator didn't really realize how bad the
language was. When other Senators and others protested, he realized the
situation and it appears he is looking for a graceful way out. Senator
Bingaman's (D-NM) office is reportedly negotiating with Cochran to get the
language out of the bill.
3.) Coalition Urges Clinton to Veto Appropriations Bills:
On July 8, 23 member groups of the Sustainable Energy Coalition sent a 2-
page letter to President Clinton urging him "to veto the Fiscal Year 2000
Energy & Water Appropriations bill as well as the Interior Appropriations bill
if the cuts recently approved in both [the U.S. Senate and U.S. House of
Representatives] in the U.S. Department of Energy's (DOE) renewable
energy and energy efficiency programs are not reversed." Let us know if you
would like us to fax you a copy of the letter.
4.) Rep. Matsui Introduces Climate Change Tax Bill:
U.S. Newswire (June 29) reports that Rep. Robert Matsui (D-CA) has
introduced the Administration's climate change tax package. It notes that the
five-year, $3.6 billion package will provide incentives for consumers to buy
more energy-efficient homes, cars, and other selected products, such as high-
efficiency water heaters and rooftop solar systems. It will also encourage
more production of renewable energy, such as wind power and power from
farm and forestry resources. V.P. Gore commented: "All those who helped
make this bill responsive to the needs of our environment and our economy
deserve our thanks and appreciation, including General Motors, Ford, and
DaimlerChrysler, who helped develop the incentives for qualifying electric and
hybrid vehicles."
ELECTRIC UTILITY RESTRUCTURING
1.) Murkowski Opposes Renewables Provisions in Restructuring Bill:
The "Utility Restructuring Weekly Update" (July 6) reports that Senator
Frank Murkowski (R-AK), at a June 29 meeting of the Senate Committee on
Energy & Natural Resources which he chairs, noted that he was staunchly
opposed to the public benefits funds (PBF) and renewable portfolio standard
(RPS) provisions in the Administration's utility restructuring bill. He called the
PBF a "three billion dollar tax." According to the Stenographers Transcripts
of Hearings (Committee on Energy and Natural Resources, U.S. Senate,
Tuesday, June 29, 1999, Alderson Reporting Co. p. 67) Murkowski further
criticized the RPS because "...this is a pretty ambitious mandate, to go from 5
to 7.5 [percent] when we are less than one-tenth of one percent dependent on
renewables now." In fact, non-hydro renewables (i.e., solar, wind,
geothermal, and biomass) presently account for about 2.1% of the nation's
electricity; hydro accounts for another 10-11% of U.S. electricity supply.
Hydro and other renewables combined account for 8% of the nation's energy
consumption (i.e., electricity, transportation, space heating & cooling,
industrial processes) and 10% of its domestic production.
2.) Oregon Approves Utility Restructuring Bill:
The "Oregonian" (July 3) reports that the Oregon House of Representatives
has voted 37-22 for a bill that would allow most business and industrial
consumers to buy their electricity from competing suppliers. It is expected to
be passed in the state Senate and signed by Governor John Kitzhaber.
However, unlike almost all of the 22 other states that have moved toward
deregulation, the Oregon bill would allow residential customers to continue
receiving price- controlled power from their local utility. Residential users,
though, face a 3% surcharge to support energy conservation, renewable
R&D, and low-income assistance programs. The bill also allows public utilities
which cover about 25% of the state, to opt out of deregulation. Let us know if
you would like us to fax you a copy of the 5-page article.
3.) Wind Is No. 1 Choice for Green Power Buyers:
A new report, "Wind Energy, Green Marketing and Global Climate Change"
from the Center for Energy Efficiency and Renewable Technologies finds
that wind power is the number one choice of consumers who want to help
reduce global warming. For details, contact CEERT at 916-442-7785.
4.) Wind Power Web Site Set Up:
The Land and Water Fund of the Rockies reports that it has set up a new
website that deals with wind power in Colorado and gives people the
opportunity to sign up for wind power online if their utility has that as an
option. The site is at https://www.cogreenpower.org.
CLIMATE CHANGE
1.) Climate Change Threatens Coral Reefs:
On July 6, Greenpeace released a new report, "Climate Change, Coral
Bleaching, and the Future of the World's Coral Reefs" which concludes that
continued greenhouse gas pollution will result in coral bleaching that will
devastate reefs from the Florida Keys to the Australian Great Barrier Reef to
the Indian Ocean. Coral bleaching can seriously damage to kill entire reef
systems which, in turn, provide large sources of income for the tourism and
fishing industries, ingredients for new drugs, and coastal protection from
extreme weather events. Their loss could potentially cost trillions of dollars.
The study can be found at https://www.greenpeaceusa.org/media/publications/coral_bleaching.htm.
2.) "New York Times" Details Evidence of Climate Change:
The "New York Times" (June 29) included a 6-page article by William
Stevens entitled "Human Imprint on Climate Change Grows Clearer" which
reviews a range of recent studies on the subject and concludes that "evidence
of warming and its effects continues to mount." Let us know if you would
like us to fax you a copy.
MISCELLANEOUS
1.) Wind Farms Dedicated in Wisconsin and Texas:
The "Wisconsin State Journal" (June 30) reports that Madison Gas & Electric
Co. had a ribbon-cutting last week for a $15 million, 17 wind turbine project in
Kewaunee County in northeastern Wisconsin capable of supplying the annual
electricity needs of 4,400 homes. The utility says it is the largest wind farm
east of the Mississippi. Meanwhile, Alliant Energy Corp. of Madison, WI
launched a 55-turbine wind farm in north-central Iowa, with 42 MW of
capacity. Separately, PRNewswire (July 1) reports that FPL Energy Inc.
along with participants Central & South West Corporation and NEG Micon
USA have dedicated the largest wind energy facility in Texas with 107 wind
turbines at the Southwest Mesa Wind Project that will generate 75 MW.
2.) Clinton Advocates Wind at Rosebud Sioux Reservation:
When he was in South Dakota recently speaking at the Rosebud Sioux
reservation, President Clinton observed: "As you can see in this big sky
country it is rather warm and it gets windy from time to time as the natives
will attest. The Department of Energy will help harness the power and profits
of wind and solar energy to save money and make money." Reportedly,
Clinton brought up the issue of Wind Powering America with DOE Secretary
Richardson before Richardson even had the opportunity to broach the issue
with the President.
3.) EIA Issues 50-Year Energy Review:
The 1998 edition of the "Annual Energy Review" from the Energy
Information Administration chronicles changes in U.S. energy use since 1949.
It notes that per-capita energy use increased by 62% over the past half-
century while the amount of energy required to produce a dollar's worth of
goods and services fell by 42%. The U.S. petroleum industry evolved from
one of near self-sufficiency to one now dependent on 10 million barrels/day of
imports; U.S. oil production peaked at 11 million barrels/day in 1970 but has
dropped to 8 million barrels/day in 1998. Petroleum domination of the
transportation sector rose from 77% of all resources used in the sector in
1949 to 97% in 1998. Nuclear power, which did not exist until 1957, reached a
peak of 112 operable reactors in 1990 but has fallen to 104 in 1998. The
report can be found at https://www.eia.doe.gov/emeu/aer.
4.) Honda To Introduce 80 mpg Hybrid Vehicle:
MSNBC (July 7) reports that Honda has announced plans to sell an 80 mpg
car in U.S. showrooms by December. The two-seat "Insight" coupe will be
the world's most fuel-efficient, gasoline-powered, mass-production vehicle
and it will cost under $20,000 even with standard antilock brakes, electric-
power steering, duel air bags and anti-theft system." It will be America's first
mass-marketed hybrid vehicle , combining a traditional gas engine with a small
electric motor. However, it will come equipped only with a manual
transmission. Preliminary Environmental Protection Agency estimates
released by Honda indicate the car will get more than 70 mpg in combined
city and highway driving and close to 80 mpg on the highway. Further details
can be found at https://www.hondahybrid.com.
5.) Fuel Cell Use Growing Rapidly:
Knight Ridder (July 7) reports that the Central Park police station in New
York city has installed a $1 million, fuel cell power plant and cut itself off the
New York's power grid. The station now has enough juice to run high-tech
gadgetry, charge four electric police cars, and light up a nearby summer sage
where the Metropolitan Opera performs. This installation will be followed by
private homes with hundreds of test residential generators scheduled for
installation starting in August. Plug Power LLC of Latham, NY hopes to
begin selling dishwasher-sized fuel cells for the home for less than $4,000 in
just 18 months and sees an initial market of 25 million homes. Separately,
Dow Jones (June 22) reports that Texas' Hunt family expects to break
ground this summer at their Sharyland Plantation and to offer the 35,000
expected residents of the development the option to power their homes with
fuel cells, rather than rely on electricity from traditional utilities in the area.
6.) General Motors to Make Military SUVs:
Reuters reports that General Motors, in the latest move by automakers
making ever-larger sport utility vehicles, announced that it has acquired the
rights to the "Hummer" brand name and will start marketing the military-
derived vehicles in 2000.
7.) Study Examines Efficiency v. New Power Plants:
The "Milwaukee Journal Sentinel" (June 30) reports that a new study by
Wisconsin's Environmental Decade Institute contends that energy efficiency
programs are less-costly options for increasing the reliability of the electricity
supply than building new power plants and transmission lines. For details, call 608-251-7020.
July 4, 1999
Contents
FEDERAL ENERGY BUDGET AND TAXES
1.) House Committee Approves Energy Efficiency Budget
2.) House Expected to Slash Renewables Funding by Half
3.) Rep. Thomas Introduces Tax Incentives for Efficient Homes
ELECTRIC UTILITY RESTRUCTURING
1.) Rep. Bliley Anticipates a Restructuring Bill in August
2.) Congressmen Introduce Bill to Repeal PUHCA
3.) Paper Assesses Effectiveness of Green-e Certification
4.) Study Finds Market Abuses Caused by Deregulation
5.) Study Notes Benefits of Green Power Price Insurance
CLIMATE CHANGE
1.) Researchers Warn That Global Warming Is Accelerating
2.) EIA Says CO2 Emissions Up Slightly in the U.S. in 1998
3.) Researchers Predict Global Warming Will Lead to More Insects
4.) Knollenberg Adds Anti-Kyoto Proviso to House Interior Bill
5.) EPA Reorganizing Climate Change Staff
MISCELLANEOUS
1.) Justice Department Appeals Court Ruling on Smog Rules
2.) Rep. Towns Introduces Hydro Licensing Reform Bill
FEDERAL ENERGY BUDGET AND TAXES
1.) House Committee Approves Energy Efficiency Budget:
The current issue of the "Environment & Energy Email Update" reports:
"The House Appropriations Interior Subcommittee approved a $13.520 billion
bill for Interior and related agencies for FY '00, which approaches the
Senate's level of funding. [The measure is expected to go to the House floor
during the week of July 12.]
"Programs under the Department of Energy fared reasonably well, with
energy conservation getting $693.8 million and fossil energy R&D receiving
$335.2 million. Overall, the increase for energy conservation programs is $26
million over the current level, but the total budget does not come anywhere
close to the $812.5 million requested by the administration.
"The breakouts for energy conservation line items are: building, $250.4 million,
up by $2 million; industry, $193.5 million; transportation, $208.4 million; and
the federal energy management program, $23.9 million.
"Appropriators did some shuffling, moving the turbine program, now in the
fossil account, to energy conservation, thus reducing the fossil energy budget
to $335.2 million. The bill doles out $27 million to natural gas, $44.5 million to
fuel cells and $54 million to oil technology. The Strategic Petroleum Reserve
received the $159 million requested by the administration, while the clean coal
technology deferral was $190 million.
"A subcommittee aide said funding for energy conservation amounting to $25
million and fossil energy totaling $24 million were offset by the biomass
energy development account. An off-the-Hill source explained that the
biomass account was not being used anymore. The source said everything is
flat funded in the energy conservation account with no big cuts or increases.
"Another renewable industry source said weatherization and state grants
programs in the building account, which is down $13 million below the FY '99
level, may be marked for increase through a floor amendment."
Separately, we have received a 3-page summary of the energy efficiency
provisions of the House Interior Subcommittee's mark-up of its FY'00
appropriations bill. It proposes a FY'00 funding level of $693,822,000
compared to a FY'99 appropriation of $691,701,000 and an Administration
request of $812,515,000. Let us know if you would like us to fax you a copy.
2.) House Expected to Slash Renewables Funding by Half:
While the allocation for House Interior was recently increased, the allocation
for House Energy and Water (which funds DOE's renewable energy and
nuclear power programs) has been cut by $101 million. This may result in a
50% cut below FY'99 appropriated levels for DOE's renewable energy
programs for FY'00. In a separate e-mail, Bob notes that DOE Secretary
Richardson is likely to be pre-occupied with the nuclear labs reorganization
issue for the next several months so it is unclear how much attention he will
give to the assault on the renewable energy budget.
3.) Rep. Thomas Introduces Tax Incentives for Efficient Homes:
The Alliance to Save Energy issued a 2-page news release June 23 to
coincide with ASE testimony before the House Committee on Ways &
Means in support of H.R.1358, introduced by Rep. Bill Thomas (R-CA). The
bill provides a $2,000 tax credit to homebuilders for constructing energy-
efficient homes that exceed the 1998 International Energy Conservation Code
by 30% or more. The tax credit would also apply to the nation's 100 million
existing homes, where homeowners would be eligible for a tax credit for 20%
of the cost of improvement (up to $2,000) on any section of their home
brought up to current code. However, a 2-page June 25 letter from Taxpayers
for Common Sense urges the Committee on Ways & Means to reject the bill
because, "despite good intentions, this bill would simply fail to reliably deliver
the promised benefits due to inadequate certification. Amazingly, the bill
would in many cases allow homebuilders to self-certify their work. The IRS
should not hand out tax credits for unverifiable benefits." Let us know if you
would like us to fax you a copy of either document.
ELECTRIC UTILITY RESTRUCTURING
1.) Rep. Bliley Anticipates a Restructuring Bill in August:
A 1-page Reuters story (June 29) reported that Rep. Tom Bliley (R-VA) told
the National Association of Manufacturers (NAM) that he hopes to finalize a
comprehensive electricity deregulation bill before Congress breaks for its
August recess. A subsequent 4-page story that includes the text of the
prepared remarks that Bliley delivered to NAM. Bliley notes that his priorities
are to strengthen the reliability of the U.S. power grid, repeal PUHCA and
PURPA, and to make sure consumers benefit from fair competition.
However, Bliley makes no mention of the environment or an RPS. Let us
know if you would like us to fax you a copy of either article.
2.) Congressmen Introduce Bill to Repeal PUHCA:
Energy Central (June 25) reports that Reps. Billy Tauzin (R-LA), Edolphus
Towns (D-NY), and 21 co-sponsors have introduced H.R.2363 to repeal the
Public Utility Holding Company Act of 1935 (PUHCA). The bill is a
companion to S.313 introduced earlier by Sens. Richard Shelby (R-AL) and
Paul Sarbanes (D-MD) and approved by the Senate Banking Committee.
3.) Paper Assesses Effectiveness of Green-e Certification:
The Center for Resource Solutions (San Francisco, CA) has issued a 2-page
assessment of its Green-e Renewable Electricity Certification Program at the
end of its first year of operation. It concludes that California's green power
market is spurring the development of new renewables with over 500 MW of
new renewable resources planned for construction under the California
Energy Commission's $160 million first-round grant program. It also says that
99% of the total electricity purchased by retail green power companies for
customers of Green-e Certified Products was supplied by renewable
resources even though 7 of 13 Green-e certified products were marketed as
having just 50-75% renewable energy. Let us know if you would like us to fax
you the paper.
4.) Study Finds Market Abuses Caused by Deregulation:
On June 21, Consumers Union and the Consumer Federation of America
released a study, "Electricity Restructuring and the Price Spikes of 1998: A
Need for More Vigorous Effort to Protect Consumers." It concludes that
new policies are needed to promote competition in the electric industry and
protect consumers from abuse in restructured electricity markets. It
advocates open access to transmission, policies to prevent affiliate abuse and
excessive market concentration, transparent pricing for all transactions as
well as enforceable terms and conditions. The report can be found at
https://www.consumerfed.org/spike/pdf.
5.) Study Notes Benefits of Green Power Price Insurance:
A new report from the Renewable Energy Policy Project concludes that price
insurance offers the potential to stimulate the market for renewables at an
acceptable level of financial risk to the federal and state agencies that provide
seed money. Furthermore, it would provide security for the project developer
to enter into long-term contracts with green power marketers whose
customers traditionally sign only short-term contracts. The 18-page paper,
"Evaluation of a Proposal for Green Power Price Insurance" by Robert
Means can be found at .
CLIMATE CHANGE
1.) Researchers Warn That Global Warming Is Accelerating:
The Associated Press (June 29) reports that the rate of global warming and
sea level rise may be slightly higher than predicted during the next century
based on new information gathered by the Intergovernmental Panel on
Climate Change. Over the next century, the mean warming of the globe's
surface is now projected to be 2.3 to 7.3 degrees Fahrenheit higher compared
to earlier estimates of 1.4 to 6.3 degrees F. Estimates sea level rise also
would be higher from a mean global range of 5 to 37 inches to a range of 7 to
39 inches. The new numbers are based on new emission scenarios developed
by the IPCC that include revised lower estimates on the impact of sulfur
dioxide releases which tend to cool the atmosphere.
2.) EIA Says CO2 Emissions Up Slightly in the U.S. in 1998:
Preliminary estimates by the Energy Information Administration suggest that
CO2 emissions from the combustion of fossil fuels rose only 0.4% in 1998 --
the smallest increase since 1991 -- despite economic growth of 3.9%. Notably
estimated industrial emissions in 1998 declined by 1.2%while emissions in the
transportation sector increased by 1.8%. Overall emissions resulting from
increased electricity consumption during the hotter-than-normal summer were
more than offset by a much warmer than normal winter which reduced
consumption of heating fuels.
3.) Researchers Predict Global Warming Will Lead to More Insects:
Reuters (June 25) reports that a world made hotter by global warming could
also have more insects which would be bad news for farmers according to
Smithsonian Institution researchers writing in the journal "Science." Based on
studies of fossilized plants, the writers note that there was more insect
damage to leaves during earlier warming periods.
4.) Knollenberg Adds Anti-Kyoto Proviso to House Interior Bill:
The House Appropriations Committee has concluded its markup of the
Interior Appropriations bill for FY 2000. No 'Cochran-like' amendment was
offered. An amendment was offered by Rep. Joe Knollenberg (R-Mich.) and
accepted by voice vote that was similar to his anti-Kyoto language of last
year. The amendment reads as follows: 'None of the funds appropriated by
this Act shall be used to propose or issue rules, regulations, decrees or orders
for the purpose of implementation or in preparation for implementation of the
Kyoto Protocol.' This language references orders, unlike some of his
previous amendments, but it is highly unlikely that the Executive Order could
be incorporated into this definition of implementation of the Kyoto Protocol.
5.) EPA Reorganizing Climate Change Staff:
A July 1 memo from EPA Administrator Carol Browner to agency staff
notes: "Given that our efforts to better understand and address the challenges
of climate change have significantly matured over the last several years, a
realignment of the Agency's functions to achieve even greater success in this
area is appropriate. I have asked Bob Parciasepe to assume the Agency's
lead position on climate issues given David Gardiner's departure. I have
asked Rick Farrell and Bob along with Sallvanna Harper and Reid Wilson to
look at climate change efforts across the agency and to provide a proposal for
reorganizing and integrating these functions. The proposal is to be submitted
to me by August 31. This review will include dialogue with Office of Policy
staff, Office of Air and Radiation staff, and other stakeholders involved with
climate change policy."
MISCELLANEOUS
1.) Justice Department Appeals Court Ruling on Smog Rules:
The Associated Press (June 29) reports that the U.S. Department of Justice
has formally petitioned a full appeals court to reconsider a May 14 decision by
a three-judge panel of the U.S. Court of Appeals that overturned EPA's
proposed tougher ozone and particulates standards in a 2-1 decision. The
EPA rules would have limited ozone to 0.08 parts per million, instead of 0.12
ppm; and for the first time, they required states to regulate microscopic
particulates from power plants, cars, and other sources down to 2.5 microns
(i.e. 28 times smaller than the width of a human hair). EPA Administrator
Carol Browner stated: "By striking down the new clean air standards, 125
million Americans, including 35 million children, will breathe air that doesn't
meet health standards based on modern science. One million of those people
will suffer serious respiratory illnesses each year, and 15,000 will ultimately
suffer premature death."
2.) Rep. Towns Introduces Hydro Licensing Reform Bill:
In a June 24 news release, the National Hydropower Association reported
that Rep. Edolphus Towns (D-NY) and five other members introduced
H.R.2335 which "would establish a more disciplined licensing process, ensure
that decisions are based on sound science, allow for the fullest consideration
of all relevant issues and provide a process to resolve disputes before they
come to litigation. The bill does not remove or weaken a resource agency's
right to place mandatory conditions on a hydroelectric license." The bill
mirrors S.740 earlier introduced by Sen. Larry Craig in the Senate. Let us
know if you would like us to fax you a copy of the 2-page release.
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