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Section 526 and the Anti-Accountability Movement

Brian Siu

Posted November 19, 2012

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Occasionally, I’ve written about Section 526 of the Energy Independence and Security Act of 2007. Like other contentious issues, the Section 526 debate is rife with misinformation.  This perennial topic will come up again, so it’s worth pausing to explain what Section 526 does and why efforts to repeal it amount to accountability dodging.

First, the basics. Section 526 disallows federal agencies from purchasing alternative fuels with higher carbon pollution than conventional fuels. It was enacted in response to the government’s attempts many years ago to commercialize a coal to liquids industry through purchase guarantees. Coal to liquids has extraordinarily high carbon emissions, posing substantial risk to the public.  The provision was designed to compel these projects to at least achieve emissions parity with conventional fuels before accessing public funds. Section 526 does not ban any technology as critics falsely claim. It is a simple accountability mechanism that prevents alternative fuel producers from receiving public support if they freely undermine public health. And that’s a fair thing to ask.

Section 526’s opponents fail to mention this because it exposes deep inconsistencies in their position.  The coal to liquids industry and its champions routinely claim that the technology can easily and cheaply sequester its emissions.  In June 2012, for instance, Dr. Richard Bajura of West Virginia University testified on coal to liquids technology before the House Energy and Power Subcommittee. His written testimony correctly states that minimizing carbon emissions will continue to be important.  It further states that the coal to liquids process inherently requires carbon dioxide extraction and that the cost to capture it is low.[i]

My goal is not to attack Dr. Bajura, who is absolutely entitled to his views. Rather it is to point out the glaring disconnect between what industry says and what politicians do. Supporters of coal to liquids state that it is important, easy and cheap to lower carbon emissions. Yet congressional members seize every opportunity to repeal a policy that simply reflects those statements. 

This contradiction is only explained if a politician holds at least one of three views. The first is that highly polluting projects should freely access public funds without making even minimal efforts to reduce their impact on the public.  This view rejects basic accountability amid historic water shortages in Texas, increasingly violent east coast storms, the hottest year on record, and a deep drought that threatens our nation’s food supply.  The second view treats climate change as a hoax that poses no risk whatsoever. This view is dangerously stubborn and misinformed, given overwhelming scientific consensus and mounting physical evidence. The final view holds that all of these things matter but anti-environmentalism matters more.  Each one of these views is marked by its unapologetic rejection of accountability.  Alternative fuel producers benefiting from taxpayer resources should not be accountable for their impacts on these taxpayers. Politicians given to anti-environmental fads should not be accountable to public health or objective science.

Ultimately, we do not believe that a coal to liquids industry has any place in a carbon-constrained world. Tomorrow’s fuels will need to perform at much lower levels of carbon pollution than they do today if climate change will be minimized.  Moreover, coal to liquids will never be able to avoid the pollution and biodiversity loss caused by the massive amounts of coal that it would require.  But Section 526 does not prohibit the purchase of coal to liquid fuels. Instead, it simply ensures that high-carbon alternative fuels reduce their impact to be comparable with convention fuels before receiving public funding. Unfortunately, that modest level of damage control is further than some policymakers are willing to go. 

Meanwhile Section 526 appears to be working out fine for the Defense Department (DoD), which is primarily in charge of implementing it. DoD, maintains that the provision has not impacted military readiness and opposes attempts to repeal it. Instead, Section 526 sends a market signal so that investors develop projects that balance the priorities of new fuel supply and public protection. And that is in everyone’s interest.

[i] Dr. Richard Bajura’s July 2012 testimony before the House Energy and Commerce Subcommittee on Energy and Power.

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