2.) Massachusetts Referendum: The June 27 Boston Globe reports that the Ballot Law Commission has ruled that the initiative launched by the Campaign for Fair Electric Rates to repeal utility deregulation should be on the November ballot. But the Associated Industries of Massachusetts and other industry groups have vowed to appeal the matter again to the Supreme Judicial Court. The opponents are challenging the petition forms used due to some alterations made and claiming that the initiative addresses appropriations issues which are not proper subjects for ballot questions.
3.) Forbes/Stranded Costs: The current issue of Forbes Magazine includes a 2-page editorial by Steven Forbes on the subject of stranded costs and utility deregulation. Noting efforts by utilities "to recover multibillion-dollar investments in cost-inefficient nuclear power plants [and] technologically obsolete plants," he states that "it's silly and harmful to overcharge commercial and residential customers because of bad decisions made decades ago. Companies should largely write off these investments as unrecoverable sunk costs." Let us know if you would like to see a copy of the editorial.
CLIMATE CHANGE
1.) Clinton in China #1: In his speech to students at Beijing University, President Clinton noted that "in the near future, if present energy use patterns persist, China will overtake the United States as the world's largest emitter of greenhouse gases ... If the nations of the world do not reduce the gases which are causing global warming, sometime in the next century there is a serious risk of dramatic changes in climate which will change the way we live and the way we work, which could literally bury some island nations under mountains of water and undermine the economic and social fabric of nations. ... President Jiang and I are working together on ways to bring American clean energy technology to help improve air quality and grow the Chinese economy at the same time. ... [I]t must be addressed at the university level, because political leaders will never be willing to adopt environmental measure if they believe it will lead to large-scale unemployment or more poverty. The evidence is clear that does not have to happen. You will actually have more rapid economic growth and better paying jobs, leading to higher levels of education and technology if we do this the proper way."
2.) Clinton in China #2: In remarks to leaders of the Shanghai business community, President Clinton noted that "China is about to assume the unfortunate distinction of replacing the United States as the largest emitter of greenhouse gases that are dangerously warming our planet. ... Climate change is a real and growing issue. The five hottest years recorded on the planet since 1400 have all occurred in the 1990s. If present trends continue, 1998 will be the hottest year ever recorded. Now unfortunately, it is still the dominant opinion in virtually all developing countries -- and I might add, in many sectors of the United States, including among many in the Congress -- that there is an iron, unbreakable link between economic growth and industrial age energy practices. ... It is simply not true. We have example after example after example of countries whose economies are doing well as they adopt more sensible environmental and energy practices, and companies in the United States who are making a significant share of their profits through conservation and the implementation of new technologies -- everything from simple initiatives, like using more natural gas, using better lighting and insulation material, use of waste heat from power generation facilities to provide heating, cooling, and lighting, and about to be widely available, fuel injection engines which will cut pollution from automobiles by 80 percent." Let us know if you would like us to fax you a copy of the complete 2-page statement.
3.) China/World Bank/CO2: The Environmental Media Center (Jon Coifman: 202-463-6670) and Institute for Policy Studies (Daphne Wysham: 202-234-9382; ext.208) report that the World Bank has granted China $330 million for a pair of massive new coal-fired power plants in the Hunan province. The plants will produce 208 million tons of CO2 over 20 years. The U.S. controls 17% of the Bank's voting shares -- the largest bloc in the group -- and last year contributed $850 million to the International Development Association, the Bank's low-interest lending arm. Last year, the World Bank spent nearly $3.84 billion on fossil fuel projects in developing countries and economies in transition; it has spent $12 billion since 1992. These projects will eventually add 36 billion tons of carbon dioxide to the atmosphere -- about one and half times ALL global fossil fuel emissions for ALL the world's countries in 1995.
4.) Power Plants/PIRG: The U.S. Public Interest Research Group has released a new report charging that power plants are a major air polluter because Congress exempted aging power plants from pollution control requirement in the Clean Air Act; the exemption triples utility emissions. The report said 559 power plants in 44 states -- mostly burning coal -- each emitted at least 20 tons of pollution above limits newer plants must meet. Requiring those plants to meet federal standards would cut 4 million tons from power plants' annual 6.1 million tons of NOx emission and more than 10 million tons from 13.5 million tons of SO2 emissions. In the increasingly competitive electricity market, operating plants that burn low-priced coal with fewer pollution controls is more lucrative. For details, call Rebecca Stanfield ( U.S. PIRG) at 202-546-9707.
5.) APPA/Kyoto: During opening statements at the House Government Reform Subcommittee hearing on the Kyoto Protocol on June 24, Ranking Subcommittee Minority Member Tierney (D-MA) highlighted the American Public Power Association's new global climate resolution as an example of a utility organization offering a positive perspective on the issue.
MISCELLANEOUS
1.) U.S. Energy Review/1997: According to the Energy Information Administration's new "Annual Energy Review 1997" the nation's economy expanded by almost four percent in 1997 while energy consumption grew by less than one percent -- the lowest year-to-year growth in six years. Weather was the major cause; a warm winter and a very cool summer compared to last year resulted in lower than expected energy consumption. The report also noted that because domestic energy production in 1997 did not keep pace with consumption, energy net imports rose to an all-time high; in particular, imports of petroleum -- which exceeded domestic production for the first time in 1993, reached an all-time high in 1997. Furthermore, coal production and consumption rose to all-time highs in 1997; nearly 90% of coal consumption was for electricity generation. Nonutility power producers, who rely heavily on natural gas, now account for 12% of the nation's electric power production. Finally, the report notes that number of operable commercial nuclear power units, which had peaked at 112 in 1990, is now down to 107 units. It adds that 124 nuclear plants were ordered but canceled prior to construction between 1953 and 1997 while another 25 were shutdown within the same period. The full report can be found at 2.) Waste/Richardson Opposition: In a 1-page, June 18 news release, Sen. Larry Craig (R-ID) announced his plans to oppose Bill Richardson as the next DOE Secretary. The statement reads, in full: "I've known Bill Richardson for a long time. We worked together frequently when we were both serving in the House. I can say without hesitation that Bill Richardson is a fine individual and certainly qualified to serve as Secretary of Energy. However, there's a much broader point that urgently needs to be made here. The White House needs to understand that it's utter failure so far to tackle the problem of nuclear waste is unacceptable -- unconscionable, in fact. For that reason, I will aggressively oppose the nomination of Mr. Richardson -- or any other person -- until the Clinton administration gives the Secretary of Energy the authority to negotiate a solution to the problem of nuclear waste. So far, the administration's refused to grant that authority. I'll see to it that they face the consequences of that refusal." Richardson's ties to the Monica Lewinsky affair may also be used to slow down Richardson's nomination.
3.) Elizabeth Moler: There are unconfirmed reports that DOE Deputy Secretary Elizabeth Moler may be looking to leave DOE since she has once again been passed over for the post of Secretary.
4.) Rep. Wilson: Rep. Heather Wilson (R-NM), who won a special election to the U.S. House of Representatives on June 23, reportedly will request seats on the House Commerce and Science committees. The Science Committee has jurisdiction over the national labs that are a large presence in her states. Wilson is replacing the late Steven Schiff who also served on the Science Committee and was a member of the House Renewable Energy Caucus. Wilson won because the Green Party pulled 15% of the vote -- probably mostly away from her Democratic opponent; it is unclear whether that will make her more sensitive to environmental issues.
FEDERAL ENERGY BUDGET & TAXES 1.) House Interior: On June 25, the House Appropriations Committee voted for major cuts in the energy efficiency programs funded through the U.S. Department of Energy. The Interior Appropriations bill cuts funding $25 million below 1998 levels and nearly $200 million below the President's FY'99 request. Members of the Sustainable Energy Coalition have warned that the cuts proposed by the Committee will hamper many of DOE's cooperative energy-saving research programs with the private sector and will slash the number of low-income residences that will be weatherized in the coming year. (We have received a 5-page line-by-line break-down of the House Interior Appropriations Subcommittee's mark for efficiency and fossil fuel programs; let us know if you would like us to fax you a copy.)
In response, Rep. Jon Fox (R-PA) is preparing to offer an amendment to the FY'99 Interior Appropriations bill when the bill comes to the House floor in mid-July. A bipartisan group of House members {Boehlert (R-NY), Davis (R-VA), Roemer (D-IN), and Gutierez (D-IL)} have joined Fox in a 1-page "Dear Colleague" letter to fellow Members of the House stressing the importance of energy efficiency for meeting environmental and economic goals, and expressing support for a floor amendment. (Let us know if you would like us to fax you a copy.) Rep. David Skaggs (D-CO), a member of the Appropriations Committee, has also voiced this objections to these reductions and is considering joining the effort to amend the bill.
Sponsors are formulating an amendment that would eliminate reductions from FY'98 levels and add significant additional funds to expand the most promising energy efficiency efforts. Funding on the order of $70 -$75 million is being considered for the amendment. The $70 million figure breaks down approximately: $18 million for transportation programs, $12 million for industrial programs, $14.5 million for buildings programs, and $25 million for weatherization and state grants. No decision has yet been made on the "offsets" to pay for the amendment although members of the Sustainable Energy Coalition have suggested targeting several of the fossil fuel programs, including "clean coal," as well as one or two environmentally-unsound programs in the U.S. Department of Interior. A vote could come in the House as early as July 16.
2.) House Interior/Veto: On June 24, Acting OMB Director Jacob J. Lew sent a 7-page letter to Rep. Bob Livingston which warns that the "President's senior advisors [would] recommend a veto if the bill were presented to the President in its current form" although the cuts in energy conservation do not appear to be the basis for a potential veto. The letter does, however, note that "the Administration strongly objects to the Subcommittee's severe reduction to [DOE's] energy conservation program. ... The Administration would like to work with the Congress to restore funding to these important DOE programs as the bill moves through the process." The letter details a number of specific concerns with the efficiency budget cuts. Let us know if you would like us to fax you a copy of the letter.
3.) Senate Interior/Veto: The energy efficiency programs received a net increase of about $30 million over FY'98 in the Senate Interior Appropriations bill. Nonetheless, on June 25, Jacob Lew (OMB Acting Director) sent a 4-page letter to Sen. Ted Stevens warning that "based on preliminary information, due to inadequate funding levels for priority programs and unacceptable language riders, the Secretaries of the Interior, Agriculture, and Energy would recommend that the President veto the [Interior Appropriations] bill if it were presented to him as approved by the Subcommittee." The letter notes that "The Senate Subcommittee's funding level represents a very objectionable $161 million reduction to the President's request for Energy Conservation. The Subcommittee mark would be particularly damaging to the Partnership for a New Generation of Vehicles and to new efforts to develop clean diesel engines for light trucks. It would also impede valuable cooperation with industry on improved industrial energy efficiency." Let us know if you would like us to fax you a copy of the letter.
4.) Jeffords-Roth/cont.: The June 22 issue of Environment & Energy Weekly newsletter reports that the additional $70 million provided for DOE's renewable energy programs by the Jeffords-Roth amendment to the House Energy & Water (E&W) Appropriations bill actually translates into "roughly $58 million" because "the offset ... came from reducing funds for non-water programs and the solar and renewable energy programs fall under this category." However, this figure is not yet formally confirmed and may be incorrect. The new line item figures are: solar buildings ($3.8 million), photovoltaics ($72 million), solar thermal ($21 million), biomass/energy ($35 million), biofuels/transportation ($41 million), wind ($38 million), and geothermal ($31 million).
5.) E&W/Nuclear: On June 22, the House of Representatives rejected by a vote of 147-261 the Foley-Miller-Markey-Kucinich amendment to cut the remaining $5 million in the E&W appropriations bill for the Nuclear Energy Research Initiative.
6.) E&W/Funds Restrictions: The American Wind Energy Association has prepared a 1-page side-by-side comparison of the language in the House and Senate E&W Appropriations bills on "inappropriate use of appropriations" which could restrict federal funding of renewable energy trade associations. Let us know if you would like us to fax you a copy.
7.) Knollenberg Gag Rule: Rep. Joe Knollenberg (R-MI) offered both an amendment and committee report language to the VA/HUD appropriations bill voted on June 25 by the full Appropriations Committee. Knollenberg's amendment says that none of EPA's funds "shall be used to develop, propose, or issue rules, regulations, decrees, or orders for the purpose of implementation, or in contemplation of implementation, of the Kyoto Protocol." The proposed report language states that until the Kyoto Protocol is ratified by the Senate, "the Committee directs the Agency to refrain from conducting educational outreach or informational seminars on policies underlying the Kyoto Protocol." Combined, these provisions could gag EPA from educating the public about the impacts and solutions of global climate change. During the Appropriations Committee hearing, Reps. David Skaggs (D-CO) and Vic Fazio (D-CA) offered a "strike" amendment to remove the Knollenberg language. However, the Skaggs-Fazio amendment was rejected by a vote of 18-27. Let us know if you would like us to fax you a copy of a 2-page list of those voting in favor or against. We have received an unconfirmed report that a White House letter was delivered threatening a veto of the bill because of the Knollenberg language.
8.) HUD/VA: We received a 4-page summary of a portion of the House HUD/VA appropriations bill. Among other things, it provides that "climate change research is funded at $26,951,000, an increase of $10,000,000 over the 1998 level. Let us know if you would like us to fax you a copy.
9.) Poll/Green Taxes: Friends of the Earth has released a survey of 500+ registered voters, conducted May 29 - June 2 by International Communications Research, which found that more than 70 percent of respondents -- representing a cross-section of Republican, Democratic, and Independent voters -- supported an increase in taxes on energy sources that pollute the environment, using those revenues to reduce existing taxes on payrolls and income. Respondents also supported a tax on air and water pollution, voicing slightly more support for this type of environmental "sin tax" than for taxes on cigarettes or liquor. For details, contact Brian Dunkiel at 802-862-1706 (bdunkiel@foe.org).
ELECTRIC UTILITY RESTRUCTURING 1.) Schaefer/Restructuring: On June 24, Reps. Thomas Bliley (R-VA) and Dan Schaefer (R-CO) released a draft of a new restructuring bill that would mandate nationwide restructuring of the electric power industry by Jan. 1, 2001 while "grandfathering" the restructuring plans of states that already have acted by then. The new bill includes Schaefer's old Renewable Portfolio Standard (RPS) provisions (i.e., 4% renewables by 2010) but with a new sunset date of Dec. 31, 2015. It also include a requirement that electric power companies inform customers about the source of their electric power and how much it costs per kilowatt-hour. It would repeal both PURPA and PUHCA by January 1, 2001. Decisions about "stranded costs" would be left to the states. A 3-page Dow Jones story (June 24), a 3-page article from Congress Daily (June 25), a 2-page article from Environment & Energy Weekly newsletter, and a 2-page summary of the key provisions in the bill from Inside Energy provide more details on the bill. Let us know if you would like us to fax you a copy of any of these stories. The full text is expected to be on the House Commerce Committee's web site www.house.gov/commerce shortly.
2.) Administration/Restructuring: On June 26, the White House transmitted its electricity restructuring bill to Congress. The bill is essentially the same as the utility deregulation principles released on March 25, except it now is clothed in legislative language. The Renewable Portfolio Standard still calls for 5.5% of electricity to come from renewables by 2010 but now includes a $3 billion cost cap. It also provides for $3 billion public benefits fund to support low-income assistance and energy-efficiency programs, labeling information on prices and sources of electricity generation, and repeal of PURPA and PUHCA. The new bill also omitted the issue of tax-exempt bonds used to finance municipal and state-owned utilities.
3.) California Referendum: Reuters (June 25) reports that the initiative intended to overturn parts of California's 1996 electricity deregulation law and reduce electricity rates has qualified for the November ballot according to state officials. The proposed referendum calls for doubling the 10% rate cut, in place since January 1, to 20% and it would prohibit the utilities from recovering costs for nuclear power and prevent them from placing surcharges on bills. However, a coalition of California's investor-owned utilities and business groups have filed a lawsuit to block the initiative, which they said would destroy the state's emerging competitive electric system.
4.) Massachusetts Referendum: The June 25 Boston Globe reports that the campaign to repeal utility deregulation in Massachusetts was dealt a serious blow the day before when the Supreme Judicial Court ruled against some of the signature-collection practices of the organization behind the ballot drive. While the Committee for Fair Electric Rates collected more than enough signatures to win a spot on the ballot, the state's highest court said volunteers erred when they altered petition sheets with a highlighter pen and placed the group's name with a return address on others. Because of the ruling, more than 10,000 signatures of the 44,136 collected will be rejected, leaving the campaign with about 100 signatures over the number needed to keep the issue on the ballot in November. But that number could drop below the threshold amount.
5.) Pennsylvania/Renewables: The Energy Coordinating Agency of Philadelphia released a survey on June 19 which found that 78% of Pennsylvania electric customers feel it is important for their supplier to generate with renewable energy and 68% of customers, regardless of their income, are willing to pay more for clean energy. "In fact, Pennsylvanians of modest means -- who comprise the bulk of our population -- were five times more willing to pay for cleaner energy and cleaner air than the wealthy." The group warned that the state's existing electric companies could lose much of their customer base unless they begin providing cleaner power to compete with greener electric companies poised to enter the market. For further information, contact Jeanne K. Clark with the Pennsylvania Campaign for Clean Affordable Energy at 412-421-6072.
6.) Restructuring Web Sites: A summary of federal utility restructuring proposals can be found at www.naruc.org/Congressional/restructuringmatrix.htm. A very detailed presentation of the Administration's restructuring proposal, complete with charts and tables, can be found at www.hr.doe.gov/electric/cecp.htm.
MISCELLANEOUS
1.) Caucuses Grow: Rep. Chaka Fattah (D-PA) has joined the House Renewable Energy Caucus bringing Caucus membership up to 132 persons (61 R's, 70 D's, 1 I.). In addition, Senators Patty Murray (D-WA) and Jay Rockefeller (D-WV) have joined the Senate Renewables & Efficiency Caucus bringing its membership up to 10 (4 R's, 6 D's). Let us know if you would like us to fax you a copy of the complete membership of each group.
2.) Renewables/20% by 2020: The American Solar Energy Society has issued an 8-page "Policy Statement on Federal Research, Development and Deployment: A Call for a National Mission Toward a Renewable Energy Future" which suggests that sustainable energy sources can supply 10% of U.S. energy supply by 2010 and 20% by 2020. ASES outlines 32 specific suggestions for federal solar, wind, and biomass RD&D. The paper appears to exclude hydroelectric and geothermal options and provides only limited detail on how renewables can provide 20% of the energy used in the transportation and other non-electric sectors. A copy can be requested from Susan LeFever (ASES) at 303-443-3130.
3.) Renewables/States: The North Carolina Solar Center has issued the "National Summary Report on State Programs and Regulatory Policies for Renewable Energy". Among the issues addressed include green pricing, net metering, portfolio standards, solar easements, and state-funded research. The $25 study can be requested by calling 919-515-3480.
4.) Renewables/Indians: The Renewable Energy Policy Project has released a new 18-page "issue brief" entitled "Renewable Energy in Indian Country: Options for Tribal Governments" by Dean B. Suagee. The intro notes that "America's tribal lands enjoy abundant renewable energy resources. Development of these resources can meet several needs, including rural electrification, economic development, and compatibility with a deeply held commitment to balance relationships among human beings and the natural world. While renewable energy development can gain from appropriate federal and state action, there remain many measures that tribes can undertake for themselves." For a copy contact REPP at 202-293-2833 (attn: J. Bernard Moore) or Micoft@aol.com.
5.) Cooperative Wind: The Renewable Energy Policy Project has also released a new 16-page policy report, "Cooperative Wind: How Co-ops and Advocates Expanded Wind Power in Minnesota." It discusses how a group of rural electric cooperative in Minnesota began a unique collaboration with local environmental and renewable energy advocates to offer renewable energy to their members. To obtain a copy, contact REPP at 202-293-0542.
6.) Nuclear Ad Campaign: The Safe Energy Communication Council has issued a 4-page memo "Fighting the Renewed Nuclear Ad Blitz" outlining its plans to rebut the Nuclear Energy Institute's PR campaign to position nuclear power as the only appropriate "clean energy option to air pollution and global warming. SECC's memo provides a background on taxpayers' subsidies for nuclear power and the status of the domestic nuclear industry. Let us know if you would like us to fax you a copy.
7.) Fuel Cells: On June 17, Plug Power demonstrated the first residential fuel cell to successfully power a home. A Plug Power statement prepared for release at the demonstration said the venture expects to introduce a commercial system for home power generation by the year 2000. While the prototype demonstrated at Plug Power's Latham, N.Y. facilities was hydrogen-based, commercial units will run on natural gas, propane, or methanol. Plug Power predicts that home fuel cell systems will reduce current electric rates by about 20 percent upon their introduction due primarily to lower operating costs and higher efficiencies.
8.) Richardson Nomination: In his remarks (4 pages) on the nomination of Bill Richardson to be DOE Secretary, President Clinton noted that "for 14 years representing New Mexico, an energy-rich state that is home to two of our national Department of Energy labs, and his long service as an active member of the House Energy and Commerce Committee, he has gotten extensive first-hand experience in issues ranging from deregulating the oil and gas industries, to promoting alternative sources of energy, to ensuring that energy development meets tough standard of environmental safety. ... With Congress' support, Bill Richardson will do his part now to secure our energy future, at a time when that is inextricably bound up with our obligation as Americans to do our part to deal with the problem of climate change, and our obligations as Americans to build a secure future for our country that allows economic growth and protection of the planet." In a separate news release, the Alliance to Save Energy commented that "President Clinton made a very smart pick of Bill Richardson [who] has just what is takes to be a great Energy Secretary." Let us know if you would like us to fax you a copy of either news release.
June 29,98
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