Just before leaving for the Thanksgiving holiday, policymakers prepared for the 17th annual Conference of Parties and international energy issues joined deficit reduction and the appropriations debate as the major areas of focus on the national scale.  

The Co-chairs of the Joint Select Committee on Deficit Reduction, Representative Jeb Hensarling (R-TX) and Patty Murray (D-WA) released a statement November 21 concluding that it would not be possible to reach any bipartisan agreement before the committee’s November 23 deadline to identify $1.2 trillion in deficit reduction. Numerous Republicans had urged the 12-member panel to reduce Department of Energy budgets for renewable energy, loan guarantees, and innovative research, but while the supercommitee’s deficit reduction attempt may have failed, it does not prevent all of those areas, and potentially others, to be downsized as the automatic cuts, which will take place over the next 10 years, go into effect in January 2013. About $109 will be cut annually through 2021, with half coming from defense and civilian accounts.  

In the wake of the supercommittee’s failure, the Senate may resume consideration of energy efficiency legislation introduced by Senators Jeanne Shaheen (D-NH) and Rob Portman (R-OH). Additionally, issues ranging from the Clean Energy Standard to various energy tax incentives are likely to garner some Congressional attention when lawmakers return after the Thanksgiving holiday. That said, the Senate will immediately resume work on the $600 billion Department of Defense authorization bill (S. 1867), and its more than 100 amendments. The House will likely consider the Regulatory Flexibility Improvements Act (H.R. 527), introduced by House Judiciary Committee Chairman Lamar Smith (R-TX), requiring all agencies to create small business regulatory panels for the purpose of analyzing the indirect economic costs of their rules. GOP leadership in the House will also bring up the Regulatory Accountability Act of 2011 (H.R. 3010) on December 1 or December 2, that would require the Environmental Protection Agency and other federal agencies to take into account indirectly affected industries and a broader suite of economic impacts from the proposal stage of each rule.  

Another principle area of focus will be on the semi-omnibus appropriations legislation when Representatives and Senators return to D.C. this week. Senate leaders had hoped to break the bills into a number of smaller minibuses, while House leaders had favored an omnibus approach. After passing three of the 2012 spending bills along with another continuing resolution that runs through December 16 late week before last, the remaining nine bills are now expected to be rolled together for consideration before the end of the year, with the Defense appropriations bill as the likely vehicle for the package. An extension of the payroll tax credit, a package of expiring tax provisions, unemployment insurance benefits, and the Medicare reimbursement rate are all possible pieces of legislation to be addressed this week. The extension of the tax provisions by December 31, 2011 – including many vitally important energy subsidies – is being sought by many businesses, but is sometimes done retroactively.  

On the international front, the 17th annual Conference of Parties to the U.N. Framework Convention on Climate Change will run November 28-December 9 in Durban, South Africa. Despite tempered expectations from U.N. officials and a virtual standoff between the world’s two largest emitters, the United States and China, some delegates contend that progress is still possible at the upcoming climate change summit. Though the chances of a binding agreement or comprehensive framework to succeed the soon to expire Kyoto Protocol are all but impossible, work on financing issues, forestry management, air and maritime transportation emissions regulation, flexibility mechanisms, carrying over emissions credits, and measurement and verification may take place. The United States delegation is expecting little progress in the negotiations, and continues to insist that rapidly developing nations commit to reductions under any global climate deal.  

The friction between the U.S. and China stems from a disagreement over how developing and developed countries address greenhouse gas targets. The U.S. supports the approach of the Ad-hoc Working Group on a Long-term Cooperative Action that insists that all countries, including large developing countries like China and India, should be required to take some type of binding action after 2012. China, on the other hand, supports the approach of the Ad-hoc Working Group on the Kyoto Protocol in calling for the three dozen industrialized countries required to reduce emissions under the protocol to take on commitments in the post-2012 period after the protocol’s commitments expire.  

The Chinese government issued a white paper November 22 reiterating its past positions on international climate change negotiations and the country’s efforts to address climate change. In advance of the annual Conference of Parties, which begins November 28 in South Africa, Ministry of Foreign Affairs’ special representative on climate change Li Yanduan stated again that the Chinese government supports “common but differentiated responsibilities” for developed and developing countries, as agreed to under the 2007 Bali Roadmap, and suggested that the nation still considers itself a developing country based on per-capita gross domestic product comparisons. At the same time, more than 50 House Democrats sent a letter to Secretary of State Hillary Clinton and Treasury Secretary Timothy Geithner asking that the U.S. take a strong position on emissions reductions during the talks.  

Executive Secretary Christiana Figueres said last week that the Durban talks will be an intermediate step toward some kind of binding agreement that will go into effect after the Kyoto Protocol’s 2008-2012 compliance period expires.