Category: Climate & Energy

Last week in an address to the Business Roundtable (a trade association for CEOs), President Obama seemed to back away (See transcript, below) from his recent budget proposal to auction 100% of the permits in a cap-and-trade system.

Carbon Control News reported this morning that Senate budget Committee Chairman Kent Conrad (D-ND) stated that a 100% auction system is not politically doable, a sentiment also held by Senate Energy and Natural Resources Committee Chairman Jeff Bingaman (D-NM).

Text of President Obama’s Remarks on Cap-and-Trade to the Business Roundtable (March 12, 2009)

THE PRESIDENT: Well, let me start by saying this. I said during the campaign we were looking at a hundred percent auction. We are not going to be able to move this in an effective way without partnership with the business community. But we just — we can’t get it done. And for businesses like yours that are committed to the concept and the idea, we’re going to work to make sure that it works for you.

Now, the experience of a cap and trade system thus far is that if you’re giving away carbon permits for free, then basically you’re not really pricing the thing and it doesn’t work, or people can game the system in so many ways that it’s not creating the incentive structures that we’re looking for. The flip side is, you’re right, if it’s so onerous that people can’t meet it, then it defeats the purpose — and politically we can’t get it done anyway.

So we’re going to have to find a structure that arrives at that right balance. We want to create a price structure. Keep in mind that the reason that I’m interested in a cap and trade approach is precisely because I think the market makes decisions about these technologies better than we do. You know, for those who are concerned about some heavy-handed command and control regulations coming down the pike, cap and trade is designed to say, you know what, here’s a target, here’s a price, you guys go figure it out and if you can make money on it, all the better.

So that’s the — that’s our goal. That’s what we want. And how that pricing mechanism works most effectively to actually influence incentives, but also be sufficiently realistic that industries are thriving as opposed to groaning under the weight of it, I think is going to be the trick. I’m confident that we can do it. We’ve done it before.

I mean, keep in mind that when — I’m trying to remember, this was back in the ’70s or early ’80s — I’m getting old enough now where I can’t remember — but, you know, the issue of acid rain was around. Everybody thought all your trees were going to be dying; you couldn’t make any paper. And we put in an auction system and a trading mechanism and, lo and behold, American ingenuity and American entrepreneurship and inventiveness created options that ended up being much cheaper than anybody had imagined — much cheaper than anybody had imagined.

Now, in the meantime, I just — I was talking to some members of Congress just yesterday, you know, who were concerned about this, because I’m sure they’re hearing from industries and, you know, what does this mean economically, et cetera. I just want to point out, you know, anybody who has been to Las Vegas recently and looked at Lake Mead; or who is familiar with what’s happening in agriculture in California right now; or go down to Atlanta, which may not have any water soon, because of what’s happening in terms of changing weather patterns; or talk to Kevin Rudd in Australia — that’s going to cost us money too. It’s just not — it’s not priced.

And I’m not somebody who — I’ve never bought into these Malthusian — woe — Chicken Little, the earth is falling — I tend to be pretty optimistic. I wouldn’t be here if I weren’t pretty optimistic. But I think this is — the science is overwhelming. This is a real problem. It will have severe economic consequences, as well as political and national security and environmental consequences.

And I’m confident that if we do it smart, if we’re talking to you guys, if we’re talking to industries, if our projections don’t end up being wildly unrealistic, then I think we can handle this problem.

AT&T announced that it will spend $565 million over 10 years buying 8,000 natural gas-powered vehicles and repairing/replacing 7,100 hybrids.

The company said it would pay, on average, $29,000 more per vehicle, costs which it “hopes” will be offset by lower fuel costs in six-to-10 years, according to a report in the Wall Street Journal.

No doubt the purchase of natural gas vehicles will make T. Boone Pickens happy as he owns the largest supplier of natural gas for vehicles.

The CEOs of FedEx, ExxonMobil and the American Trucking Association, however, have a different view on natural gas vehicles.

As to the value of a hybrid corporate fleet, FedEx CEO Fred Smith told his shareholders at the 2006 annual meeting that hybrids did not make economic sense. Smith blamed politics and the the “cult” of environmentalism for making people do things they otherwise wouldn’t.

The Financial Times reported today that Michigan Gov. Jennifer Granholm wants to,

transform Michigan from one of the Rust Belt’s bleakest corners to a mecca for green industries as the state loses tens of thousands of jobs in the car industry.

But Granholm acknowledges that alternative industries will only create about 109,000 jobs, compared to the 400,000 jobs lost in carmaking.

Wayne State University professor Jack Lessenberry observed,

“Windpower… will never employ people in the numbers needed.”

Maybe Granholm should lobby for expanding the supply of cheap gasoline so that people go back to buying Michigan’s most profitable product: the SUV.

A green-supported bill to put another 2 million acres in nine states off limits to energy production failed in the House yesterday by two votes. House Republicans, noting that the move would cost up to $10 billion and block oil and gas development on millions of acres of federal property, prevented Democrats from getting the necessary two-thirds vote.

The lands are located in Oregon, Virginia, California, Colorado, Idaho, Michigan, New Mexico, Utah and West Virginia.

The Washington Post reported today that House Democrats pan to bring the bill up again, but the timing is unclear.

The Senate passed the bill (S. 22) in January.

From the Majority Tracker blog:

Rep. S. 22 is being considered under a special suspension process that suspends all House rules. This process is reserved for noncontroversial bills, limits debate to only 40 minutes and does not allow any amendments. So essentially, members were forced to vote yay or nay without the bill undergoing the scrutiny of the normal legislative process.

Take action:

Here’s who-voted-how in the House.

Tell your congressman to oppose the S.22 land-grab because we need to “Drill here, Drill now.”

The San Francisco Chronicle reported today that,

Bay Area environmental activist and author Van Jones will join the Obama administration as adviser for green jobs, enterprise and innovation, the White House Council on Environmental Quality announced Tuesday.

Jones is touted as having “rock-star status with the green jobs movement” for advocating “greening the ghetto.”

Check out what Rich Sweeney had to say about “greening the ghetto” at the Common Tragedies blog.

In the wake of President Obama’s decision to kill the Yucca Mountain project for spent nuclear fuel, the Washington Post questioned the credibility of Obama’s plans for clean energy. In a March 8 editorial, the Post wrote,

By stripping the funding for the nuclear repository at Nevada’s Yucca Mountain, President Obama has succeeded in killing the contentious project that remains unfinished 22 years after Congress selected the site. He compounds the error by not offering an alternative. If the president’s vision for a clean energy future is to be believed or is to come to fruition, nuclear energy must be a part of the mix, and the safe disposal of its radioactive waste must be given more serious consideration. [Emphasis added]

Perhaps it’s dawning on the Post that President Obama is not really a well-intentioned liberal so much as he is a hardcore green intent on causing energy chaos and establishing total government control over the energy supply. Obama owes his national political career to greens. He is one of them.

Regardless of the lip service he pays to domestic drilling, nuclear energy and “clean coal,” Obama’s actions — including canceling oil/gas drilling leases in Utah, ending Yucca Mountain and pursuing draconian anti-coal climate legislation — speak louder than words.

Steve Milloy’s new book, Green Hell: How Environmentalists Plan to Control Your Life and What You Can Do to Stop Them describes how President Obama plans to green America, whether you like it or not.

Massachusetts’ Secretary of Energy and Environmental Affairs pretty much ruled out the alternative energy plans of T. Boone Pickens in a March 7 a New York Times op-ed.

Ian Bowles recommended that,

… lawmakers should resist calls to add an extensive and costly new transmission system that would carry electricity from remote areas like Texas, the Great Plains and Eastern Canada to places with high energy demands like Boston, Chicago and New York…

Unlike our federal highway system, which is needed to transport goods across the country, or the “information superhighway” of the Internet, which is the fastest way to carry information around the world, long-distance transmission lines have no inherent value. On the contrary, the farther electricity is transported, the more of it is dissipated. “Line loss,” as this is called, gobbles up an estimated 2 percent to 3 percent of electricity nationally.

Long distance transmissions lines of course are what T. Boone Pickens is counting on to transmit electricity from his planned “world’s largest windfarm” in the Texas panhandle to the rest of us.

Perhaps Pickens — who apparently has abandoned every conservative principle he ever had in order to sell his wind farm nonsense — will now team up with Ted Kennedy, who has also been “wronged” by the Massachusetts bureaucrat.

Bowles, after all, supports the Kennedy-hated Cape Cod wind farm that would be within sight of the family’s Hyannis Port compound.

You can read about the green strategy to cause energy chaos in America in Steve Milloy’s new book, Green Hell: How Environmentalists Plan to Control Your Life and What You Can Do to Stop Them.”