Nathanael Greene's Blog
House Dems strike deal on CAFE, RES, and RFS
December 1, 2007
Posted by Nathanael Greene in Moving Beyond Oil , Solving Global Warming , U.S. Law and Policy
The big news out of the US House of Representatives last night is that the Democrats including most importantly Speaker Pelosi and Rep Dingell on a comprehensive energy bill that includes a historic increase in vehicle fuel economy, an all new renewable electric standard, and a major increase in the renewable fuel standard. (See here for the New York Times story and here for the Washington Post story.) No bills are ever perfect, but if this one is ultimately signed into law, it will make a serious down payment on US reductions in global warming pollution and set a new direction on energy policy.
The schedule from here is for floor debate in the House probably on Tuesday and a vote on Wednesday if things stay on track. Of course in the strange process (a.k.a. "ping-pong") that is being used to reconcile the House and Senate energy bills, getting a new version adopted by the House is not necessarily mean that the bill will be just a Senate vote away from landing on the President's desk.
Because the Republicans wouldn't agree to a conference, the Democratic leadership have been negotiating the bill's language in an informal process. Ultimately, the House and the Senate have to adopt the exact same language and this means that Senate Majority Leader Reid needs the House bill through a Senate vote intact. And of course the Senate process being what it is, this means that the bill needs a filibuster proof, 60 vote majority.
The signs are good with both Reid and Michigan Senator Levin and Senator Stabenow apparently signaling their support last night. But there has been plenty of speculation that Reid would have trouble lining up the same 60 votes for an energy bill with a CAFE increase and a renewable electric standard.
Watch this space for more details. I'm sure NRDC will have press releases and my colleagues that know more about CAFE and RES than I do will post on the nitty-gritty over the next few days.
On the RFS, what I know now and can share is that the energy bill will require 36 billion gallons of renewable fuel by 2022 and will set lifecycle greenhouse gas emissions thresholds for renewable fuels. Once enacted, this will be a major first--both in using GHGs as a standard and shifting our biofuels policies to focus on performance rather than feedstock or technology. There are also important land-use, air, and other environmental safeguards. Of course we'll have see the final language from the House and then from the Senate, but I'm confident that this bill would go a long way towards getting biofuels right.
David Roberts over at Grist has it right when he says:
1. Love him or hate him, this bill is possible because Dingell hashed out a CAFE compromise he could accept, and brought a whole passel of lawmakers with him.
2. Everyone I've talked to that's in or around the process says the same thing: Nancy Pelosi is a hero on this bill. She gets this stuff in her gut. It's in large part her work and persistence that have made it happen.
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Comments
Ken Donnelly — Dec 2 2007 01:19 AM
Thanks Nathaniel for a very informative posting. It's more than “amazing” if in fact CAFE standards, renewable electricity and some RFS standards that finally focus on how ethanol is made are enacted. There should be great and full credit to the changed legislature. It's unfortunate that this major accomplishment will not necessarily be fully appreciated by the wide majority.
The very bad perception of the current Senate and House for doing “nothing” in some cases really means they are addressing very complex issues in a real, thoughtful and effective way. And with a major opposing “business as usual” rear guard, who passed the original RFS (very much primarily a crop support initiative, guised as an environmental and energy action), this takes time and patience, something people in today’s world seem to have little of.
As described, this potential bill is something Americans could actually finally be proud of (not the false pride claimed earlier) in these areas and what should have been done much earlier. It's also unlikely that the fact this administration has absolutely nothing to do with, and should take no credit for, this accomplishment will be widely appreciated.
Ken Donnelly — Dec 2 2007 01:28 AM
Appreciating much of this possibly not fully clear and also some of it maybe more than is possible realistically, some more deailed questions on the likely revised RFS standard:
1. What is the expected compromise position on blending mandates, related lifecycle benefit requirements, and treatment of existing capacity? Will the sad grandfathering of existing poor ethanol capacity, much of it coal fired and clearly energy and environmentally weak to negative in lifecycle terms, continue, as opposed to some transitional period re-mediation with some assistance?
2. The major weakness in the existing incentives ($ 0.51 a gallon) and regulation, such as it is, has been the failure to consider how ethanol is made as opposed to just production in a “cost effective” way, a euphemism for a poor to negative energy and environmental result masquerading as an environmental benefit initiative, with the EPA facilitating this.
The subsidies could be substantially better if given to the ethanol producers directly (to effectively combat the gatekeeper oil industry) and only if they met lifecycle targets for energy/environmental benefit (a ratio of 2 and at least 30 % GHG reduction for example) on a total operation basis. If economically producers want to make DDGS instead of biomass energy (and use the cheapest coal energy), they can make that economic decision, but they should not be subsidized to do so; helping and incentivizing those who do achieve a better result is much more logical if energy and environmental benefit is the goal.
3. Will there be an increased blending mandate over RFS in the short term (2008-2009)? If there are lifecycle requirements, some re-mediation plan for existing capacity and some changes in the subsidy approach this would be fine and in some respects desirable versus the initial House plan for study and delay, but again there must be some substantial benefit thresholds.
4. Similarly once targets are in place in key lifecycle areas the real capacity of corn as an ethanol source (10-15 billion annual gallons) will be clearer and the possibility of some food/fuel balance restored. If subsidies only went to virtuous US ethanol directly and some broader world inclusive policy was adopted (phase out the trade protection and possibly set volume limits and lifecycle requirements on imports), the possibility of the US actually assuming world leadership in renewable fuels would present itself. Ok this last one maybe over optimism but certainly more hope if we finally make our program about energy/environmental benefit and not just money.
Ken Donnelly
Ken Donnelly — Dec 3 2007 05:05 AM
Nathaniel
I am overseas and actually just found this site, so excuse the number of posted comments. I looked at some of the material on your site, especially the NRDC statement to the Senate and the Climate Facts "Getting Biofuels Right". The material is excellent, too bad that wasn't the basis being applied in full in the current RFS change.
I still believe the overall changes are a major accomplishment and look forward to your or other clarifications on the RFS changes. But unless there is some real teeth to the GHG reduction thresholds, particularly for conventional renewable fuel (corn ethanol) and re-mediation for some of the very bad existing corn ethanol I am not so sure how it would "go a long way towards getting biofuels right". The advanced biofuels requirement with potential higher benfits only starts in 2016 and 15 billion gallons of conventional renewable (corn) comes first. It seems like the advanced material is something of a continually delayed promise (earlier to start in 2013 even if small) to obscure or make us (not Mother Nature) feel somewhat better about the base really mediocre program we have compared to what it could be and what some others are doing.