Divided Government = No Large-Scale Legislation?
Once again, our Nation has divided government and, given the difficulties Democrats had in passing even conventional appropriations bills when they controlled both Houses of Congress and the White House, the conventional wisdom says that both parties will certainly have trouble enacting any legislation deemed "controversial." Climate change and certain aspects of energy policy (e.g., a national renewable electricity standard (RES)) are widely seen as being just that — controversial. So, the midterm election means no action on climate change and energy legislation — end of story, right?
There is another point of view which has on its side some historical precedent. Conflicts over energy and environmental legislation tend to be more regional than partisan. One of the ways to resolve regional differences — say between renewable "have" and "have-not" states — is to have a conference between the two Houses of Congress to resolve difficult topics. That's the way the last major amendment to the Clean Air Act, back in 1990, passed both Houses by almost unanimous margins.
Bases for Incremental Action on Energy and Environment
Having the two Houses next year with different political leadership might just force the Congress to return to the conferencing process - and to move away from the more recent style of Congressional leadership just writing the bills and cramming them down the throats of the minority (and of dissenters in their own party, for that matter). What does this mean for energy legislation?
- Cap-and-trade legislation might still be a bridge too far.
- National RES is likely the new focus of President Obama and Democrats. If a RES were to be run through a conferencing process, you could expect the outcome to include a more generous definition of what counts as renewable or clean (e.g., energy conservation, nuclear, clean coal, geothermal heat pumps, etc.), and a more realistic timetable for compliance.
- Consumer-focused efficiency initiatives such as: the Home Star consumer rebate program, the Building Star rebate program for large buildings, and an expansion of the Energy Star program.
- In addition, there is some serious bipartisan Congressional movement for restricting EPA authority to regulate greenhouse gases.
All of these efforts together constitute actions consistent with the expressed desire of President Obama to continue to focus on energy, but to do so in "chunks" as opposed to a comprehensive bill. Because past efforts at passing climate or energy legislation were "perceived as reducing job growth," President Obama said shortly before the election that it is no longer "realistic to expect that we have another big, omnibus, comprehensive, one-size-fits-all energy bill." However, the President said he believed more modest energy legislation could be advanced that "would have the side benefit of dealing with climate change."
Said the President: "So my approach to Republicans would be to say, 'Regardless of what you think about climate change, here are a bunch of things that are smart to do. It will save consumers money, it will save the country as much money going into foreign oil imports, so let's concentrate on things that we just know are smart to do.' If we do that, we can probably get a quarter of the way there in terms of where we need to be in terms of carbon emissions."
As he did a month earlier, the President embraced a "series of more bite-sized pieces that have to do with renewable energy standards, that continue to build on the good work we've done to improve fuel efficiency in cars, energy efficiency in buildings."
Will the newly elected Republican leaders reach across the aisle on energy? Contrary to election year characterizations, Republican leadership has articulated several energy initiatives that could be part of the iterative process suggested above. Consider the following quote from soon-to-be Speaker of the House John Boehner:
"I am committed to a comprehensive energy reform policy that will boost supplies of all forms of energy right here at home to reduce our dependence on foreign sources of energy, protect us against blackmail by foreign dictators, create American jobs and grow our economy."
Both House and Senate Republicans have supported exploration and production of next-generation oil, natural gas and coal in environmentally-sound ways. They have supported cellulosic ethanol and coal-to-liquids programs. Also, advanced nuclear and cleaner coal combustion technology are favored. The energy efficiency measures discussed above have also had some Republican support.
Areas of Focus for House Republicans
To say there could be consensus on some legislative items relating to energy is not to say that Republicans have no limitations in these areas. The following will be major areas of focus for the new House majority:
- Insistence that major large increases in discretionary spending, even on favored areas such as energy development, be accompanied by spending reductions elsewhere.
- Opposition to regulations that have effectively imposed a construction moratorium for sectors economy-wide. This will surely include a strong push to limit the authority of EPA to regulate carbon dioxide as a pollutant under the Clean Air Act.
- Substantial oversight regarding regulatory developments and governance issues, such as the role of White House officials (e.g., Energy and Climate Czar Carol Browner) in setting EPA agenda items.
- Substantial oversight regarding costly environmental regulation, including efforts to reassess the National Ambient Air Quality Standards, new air toxics standards, cooling intake rules, and coal ash standards.
- Discretionary spending limitations may undermine the case for subsidies or new spending in the energy sector.
This election cycle has already confounded the typical beltway prognosticators. The post-election period could produce more of the same as it relates to Congressional action on energy policy. There will be significant battles surrounding increased EPA regulation and climate policy to be sure. However, the record suggests that Republicans have their own brand of energy proposals that focus on technology, efficiency, and domestic production. These smaller, but still significant, proposals could form the basis of some bipartisan movement on energy policy as we (already) set our sights on the 2012 election.