In the aftermath of the mid-term elections, it’s unlikely that Washington can overcome the crippling gridlock in Congress. Yet one critical opportunity for bipartisan compromise stands out among the rest: energy policy.

Addressing the country the day after elections, President Obama signaled a clear opening by pressing the reset button on cap and trade and calling for a new agenda. “I don’t think there’s anybody in America who thinks that we’ve got an energy policy that works the way it needs to, that thinks that we shouldn’t be working on energy independence,” he declared. “And that gives opportunities for Democrats and Republicans to come together and think about… how do we move forward on that agenda.”

Senator Minority Leader Mitch McConnell (R-KY) quickly agreed. “I think energy is an area where there is potential for a bipartisan accomplishment of some consequence,” Senator McConnell told the Wall Street Journal. “There are a variety of other things there could be pretty broad agreement on… Nobody thinks it is a bad idea to reduce carbon emissions, the question is how do you do it.”

President Obama and Senator McConnell both cited electric vehicles and nuclear power as areas for compromise, and indeed these are both important areas to support. But electric vehicles and nuclear power are only two pieces of a much larger puzzle, and without a larger framework, Congress risks taking a small-bore approach and missing a larger opportunity to achieve energy independence.

So what’s the fresh new idea that Democrats and Republicans alike can embrace? A growing number of experts have endorsed one approach, summed up on Sunday in a prominent piece by the Washington Post editorial board:

“Where can President Obama and ascendant House Republicans find compromise? … The American Energy Innovation Council, a group of business leaders that includes Bill Gates, hopes that the parties might yet be able to agree on a more ambitious and cohesive policy. It recommends a $16 billion annual investment in clean energy innovation, including research and support for getting new technologies to market. An ideologically diverse group of think tankers from the Breakthrough Institute, the American Enterprise Institute and the Brookings Institution agrees and argues that Congress should supplement that investment with subsidies that lower the price of new energy sources.”

The Brookings/AEI/Breakthrough report, “Post-Partisan Power,” was released just before the election and has since received a wide variety of endorsements. The heart of the plan is to overhaul the U.S. energy innovation system with strategic federal investments in clean energy, on the scale of $25 billion annually, to drive down the cost of low-carbon energy technologies for deployment in the U.S. and abroad. It would also support energy science and engineering education, similar to the National Energy Education Act my colleague and I proposed with Breakthrough Institute back in 2008.

Of course, even with such fertile ground for compromise on a critical national issue, the current anti-investment and deficit-centric mentality in Washington doesn’t add up to hopeful prospects for the next Congress, as the Post editorial recognized. Not that there's any shortage of smart revenue streams for such strategic federal investments, which eventually would easily pay for themselves. But as Andrew Revkin noted at New York Times Dot Earth, “This election almost guarantees an end to the brief stimulus-driven period of increased investment in advancing energy technologies that could supplant finite fossil fuels.”

In the near-term, then, the measure of success for this new energy innovation agenda should not be whether it can immediately advance in lame-duck session or the next Congress -- although advancing specific pieces is an urgent cause. Rather, the measure of near-term success should be whether this approach can continue building support among thought leaders, advocates, reporters, and a group of committed policymakers. As one prominent economist once wrote, "That, I believe, is our basic function: to develop alternatives to existing policies, to keep them alive and available until the politically impossible becomes the politically inevitable."

But in the absence of growing momentum behind this approach, it is hard to see how any large and cohesive clean energy agenda can develop in the aftermath of cap and trade for the foreseeable future. There is simply no clear or viable alternative. In the meantime, the United States will continue falling behind in a major strategic growth sector, shipping hundreds of billions of dollars overseas annually to pay for foreign oil, and damaging the conditions for a livable global climate system. Given the enormous stakes, the leaders capable of breaking the energy stalemate will no doubt be counted among the great legislators of the early 21st century – if only they will step up and seize this opportunity.

In reflecting on last week’s mid-term elections, we at the Alliance to Save Energy heard a clear message from American voters: They want a “back to basics” approach to national policy and a rejuvenation of the American economy.

More specifically, we heard voters clamoring for policies that promote self-sufficiency and independence while curbing waste, creating good jobs and enhancing national security. And most importantly, they seek policies that leave more money in their pockets – not take more out.

We heard them, and we believe Congress can meet those demands as it crafts needed energy policies. We believe that voters’ message was not, “Do nothing.” Rather, voters were crying out for real leadership – including in the energy arena – from those they send to Washington to represent them.

Much has been made about the policies that returning and newly-elected members of Congress disagree on. But let’s focus on what they can agree on.

From our perspective, no policy meets the expectations and demands of American voters better than energy efficiency. As ever, it’s the quickest, cheapest, cleanest way to save energy and money. It’s our most abundant energy resource, and it’s “Made in the USA.” In short, it offers viable, cost-effective, bipartisan solutions.

With that said, climate change proved to be an astoundingly polarizing issue over the past two years – much more polarizing than we could have ever imagined. With candidates of both parties using climate change as a political punching bag, Congress became paralyzed, unable to pass smart national policies that could effectively address our nation’s energy and environmental challenges.

But we need not see the discontent of American voters as the death knell for efforts to improve our environment. The fact is, energy efficiency policies move us towards a cleaner environment and a sustainable future, even if we don’t tout it as such. We all know that any energy saved is pollution avoided, too!

So as the next Congress gets underway, we call on our elected leaders to show that they “got it” by joining forces on national energy efficiency policies that work for everyone.

On November 2^nd, the American people sent a strong message to their government: enough is enough. Obamacare, Wall Street bailouts, industry takeovers, and out of control federal spending has led to an unprecedented encroachment of government into our everyday lives. Fortunately, the Administration and Congress were unsuccessful in passing what would have amounted to the single largest tax increase in American history – cap-and-trade. And while the election may have resulted in a slight change in tone at the White House, there is no evidence that suggests this administration intends to back down from its destructive energy agenda, even in the face of strong public opposition. The President said it best – there is more than one way to skin a cat.

On the regulatory front, the administration has been waging war on affordable energy by cancelling oil and gas leases, imposing mountains of new paperwork, and creating new regulations designed to stop the domestic production of traditional energy sources and increase the cost of energy for American families and businesses. And with respect to legislation, that national energy tax may be dead (for now), but other harmful legislation waits in the wings. The renewable energy mandate (called a renewable energy standard by its proponents) is one example of legislation that both Democrats and some Republicans have expressed willingness to “compromise” on. They shouldn’t.

Renewable energy mandates, already enacted in 29 states, would be anything but a compromise. In fact, a federal REM could be one of the most expensive methods for cutting carbon dioxide emissions currently on the table. According to the California Air Resources Board, it costs $133 per ton of carbon dioxide abated through a renewable electricity mandate. An internal Obama administration memo on subsidies for renewables states that carbon dioxide emissions “would have to be valued at nearly $130 per ton for CO2 for the climate benefits to equal the subsidies.” To put these numbers in perspective, it currently costs less than $15 a ton to purchase a certified carbon dioxide allowance traded on the European Climate Exchange.

And while most of the 29 states with renewable electricity mandates are not on track to accomplish their goals, their electricity rates are already 40 percent higher than the 21 states without REMs. The Heritage Foundation recently found that a national REM would raise electricity rates 36 percent for households, 60 percent for industry, and could kill 1,000,000 jobs.

A federal renewable mandate compromises on nothing but the American people’s ability to foster economic growth and prosperity. These mandates lead to higher electricity prices and reduce our ability to compete with other countries. The President and some in Congress might like to call this compromise and impose a renewable electricity mandate on the American people, but it’s a compromise we can ill afford.

There should be no coalescing around policies like the renewable energy mandate or any other component of an agenda that restricts energy production, kills energy jobs, increases the role of the government in energy markets, and imposes unnecessary energy costs on American families and businesses.

America’s natural gas utilities agree with President Obama that natural gas represents an opportunity for common ground between Republicans and Democrats.

We have long argued that one of the best ways to grow American jobs, combat the effects of climate change and provide for the energy security of our country is to use the tools, technologies and resources already available. Natural gas is clearly one of those tools. It is abundant, affordable, domestic and the cleanest fossil fuel. It’s ready – right here, right now.

There are a number of steps the administration and Congress can take to move forward on this important issue, the first of which is to increase U.S. production of natural gas. Increased production is critical to America’s energy future; we need federal and state policies in place to permit environmentally responsible natural gas production and infrastructure development.

Natural gas should also be a central part of any energy policy that the 112^th Congress considers. If Congress moves forward on a renewable or clean electricity standard, natural gas generation should be included as a compliance option.

America’s natural gas utilities and their customers have long led the way in reducing carbon emissions. While the number of residential households using natural gas increased from 38 million in 1970 to nearly 65 million today — an increase of more than 70 percent — overall residential consumption over that time has remained essentially flat. That is because residential natural gas users have cut their natural gas use, per household, by about 40 percent.

This decline in residential gas usage per household is due to better insulated homes, more efficient appliances and conservation/efficiency programs that are supported by natural gas utilities. Future policies should take these facts into consideration when developing goals to increase the efficiency of buildings and appliances, and reduce vehicle emissions.

Natural gas contributes to America’s economy too, from the hundreds of thousands of jobs held by those who work for local utilities or in America’s manufacturing industry, to those who are responsible for finding it and bringing it to market, to those who ensure the infrastructure is in place to make it all happen. Utilities also contribute significant revenue to local tax bases and provide historically solid dividend income to shareholders, who are often customers of the local utility in which they invest.

Whatever approach the president or Congress takes to address our country’s mounting energy issues, natural gas clearly must have a seat at the table.

When President Bush signed into law the Energy Independence and Security Act of 2007, it marked the largest initiative on energy that the nation had taken since the 1970s. At the time, he stated, “We make a major step toward reducing our dependence on oil, confronting global climate change, expanding production of renewable fuels and giving future generations a nation that is stronger, cleaner and more secure.” If there is anything we learned during that debate, it’s that Democrats and Republicans can work together to pass meaningful energy legislation. The bill was supported by an overwhelming majority of Republicans and Democrats in both the House and Senate.

When it comes to issues that matter to much of our country—namely, protecting national security, spurring innovation, reducing dependence on foreign oil, reviving the economy and creating jobs—we should be talking partnership not partisanship. Americans, and the Democrats and Republicans who represent us in Congress, can no longer prolong this energy stalemate.

If we do, the U.S. will continue to lag behind other countries in the global clean energy market. The clean energy industry has grown 230 percent since 2005. For the first time, in 2009, China took the top spot in attracting private clean energy investments while the U.S. became a distant second. We can’t afford to let our G-20 competitors seize the innovation advantage, not when there are billions of dollars and whole new industries and jobs at stake. We need a predictable energy policy that incentivizes energy efficiency and supports emerging technologies, such as electric vehicles, wind and solar.

And, we must do something about our appetite for foreign oil. It sends a billion dollars a day out of our economy—some of it to regimes that do not share our values or our national security interests. Now, more than ever, we need to find sustainable solutions to meet our own increasing demands.

The mid-term elections did more than give Republicans control of the U.S. House of Representatives; they opened the door for Congress to work in a bipartisan manner with President Obama to pass federal policies that will make the transportation sector cleaner, help industry become more efficient and drive clean energy innovation. If these policies pass, they’ll create new jobs and industries, make America more competitive and enhance our national security. The Democrat-controlled House and Senate did it in 2007 with President Bush. This new Congress can and should do it now.

Phyllis Cuttino

Director, Climate and Energy Program, Pew Environment Group

PewEnvironment.org

Americans want Washington to work harder to create jobs and get our economy back on track. While there will be opportunities for Democrats and Republicans to come together on energy policy in the new Congress, let’s not forget that we still have some time in the 111^th Congress for bipartisan action. To do that, the Congressional leaders should look to the solar industry during the lameduck session as an example of an industry that is investing in our economy.

In the midst of an economic recession, solar power is growing. We’ve recently had the groundbreaking of the first utility-scale solar power plant on public land and we’re on track to install more than 1GW of clean solar energy in 2010, enough to power 200,000 homes. Solar now employs 93,000 Americans in all 50 states, double our employment in 2009, and most solar companies expect to hire more employees in the next year. You can read some of their stories here.

The Section 1603 Program has been a major contributor to solar’s robust growth over the past year. It creates financing flexibility for solar and other renewable energy project developers by allowing them to convert the solar investment tax credit to a direct reimbursement payment. This program has been very successful, helping to create tens of thousands of good-paying, domestic jobs from manufacturing to electricians and plumbers to sales and accounting positions while expanding safe, reliable and cost-competitive solar energy in more than 40 states. It has translated into projects big and small and it’s a powerful reminder that solar works in every region of our country.

The progress of the past year and a half will be stopped dead in its tracks if Congress doesn’t act to extend the job-creating tax credit before it expires at the end of the year. Failure to extend the program will mean more than a million households won’t get access to clean, safe solar energy and tens of thousands of jobs will not be created.

While public support for Congress may be low, support for solar energy is way up. In a recent independent poll, 94 percent of Americans want the U.S. to develop and use more solar – the third consecutive year solar has received that level of support. And this support cuts across party lines. The American people have spoken. And before the 112^th Congress begins debating a new energy bill, it is time for the 111^th to make a last effort to protect American jobs.

When our President was first elected, he vowed to usher in a comprehensive energy agenda, including a price on carbon. But the political landscape has turned out to be more complicated than originally forecast and many pundits have suggested that comprehensive energy reform will be more 'piecemeal' than originally intended. Despite this new reality, most of our federal leaders-- regardless of the side of the aisle on which they stand -- believe America must find a way to address the challenge of ensuring access to economically and environmentally sustainable energy.

This sentiment is echoed by the American Association of Blacks in Energy (AABE), whose members are already working to develop and deliver cleaner fuels and more efficient technologies. While some of our number are exploring ways to produce and distribute more sustainable forms of energy -- including biofuels, solar and wind power, and nuclear energy -- others are working to perfect processes like carbon capture and storage and other clean coal technologies to strip hazardous emissions from traditional fuels.

Just one specific example of an energy source both chambers of Congress and the administration may coalesce around is natural gas. The President seems more on board than ever, as indicated during his statement on his recent trip to India, where he hinted at his next move to export America’s shale gas revolution globally. Although this announcement took many by surprise, the promotion of carefully managed hydraulic fracturing is the inevitable outgrowth of America’s shift towards cleaner power generation, greater industrial efficiency, greater domestic capacity, greater waste reduction, and greater cost effectiveness.

Natural gas is good for America because it has the ability to increase the carbon efficiency of the energy we use in our homes, our vehicles and in our manufacturing facilities without resorting to significant public subsidies. It is already widely use in heating more than half of U.S. homes and in generating 20 percent of America’s electric power. It is also a significant boon to the economy, providing nearly three million jobs and contributing $300 billion annually to the domestic economy. However, to appropriately exploit this resource, our engineers need to continue to improve hydraulic fracturing techniques since the much of America’s natural gas is locked in rock formations like the Marcellus shale.

Expanded use of natural gas in the United States is one example of an issue that is neither red-or-blue; it is red, white, and blue. Energy policy does not need to be a choice between traditional energy and alternative energy; West Virginia and California; Republican and Democrat. If our objectives are truly cleaner power generation, domestic job creation, and improved national security, there is much in the way of energy policy that we can agree on.

Americans will be watching closely to see if Congress got the message that cutting the deficit and ending wasteful government spending are top priorities. Eliminating ethanol subsidies and trade protection would be a good way for lawmakers to: 1) acknowledge that they heard voters loud and clear on election day; 2) forgo partisan differences to benefit the public interest; and 3) quickly begin implementing solutions that benefit taxpayers’ pocketbooks by lowering fuel prices.

Democrats and Republicans have vowed to work together on this issue. Everyone from fiscal conservatives such as Rep. Jeff Flake (R-AZ), Sen. John McCain (R-AZ), Sen. Tom Coburn (R-OK) and Sen. Saxby Chambliss (R-GA), to progressives like Sen. Dianne Feinstein (D-CA) and Rep. Joe Crowley (D-NY), have expressed objections to ethanol’s current mix of tax credits and trade barriers.

Voters are dissatisfied with the federal government and want to see elected officials find common ground on pocket-book issues that can improve their daily lives. Several recent editorials pointed to trade policy as one area where both parties could work together.

Sen. Charles Grassley (R-IA) is one who recognizes this opportunity, having pointed to trade as an area where farmers and ranchers might benefit from coming changes in Washington. In a recent interview with Agriculture.com, Grassley thinks Republican control of the House will make it easier for President Obama to push for free trade, saying: “We export more than a third of our ag products. I think there is going to be more encouragement to the president, who I think down in his heart, is a free trader.”

That same enthusiasm for free trade should also apply to ending the ethanol import tariff, especially given recent research conducted in Sen. Grassley’s backyard – the heart of corn country. Dr. Bruce Babcock, a leading agricultural economist at Iowa State University, found that “U.S. ethanol production and the demand for corn will continue to grow with or without the tax credit and tariff. U.S. drivers and taxpayers stand to benefit if they are allowed to lapse.”

Common ground has its benefits, particularly when there is little risk to industry and voters will benefit. By allowing the subsidy and tariff to expire on December 31, congressional Democrats and Republicans would show Americans that they’re serious about cutting costly and unnecessary spending, lowering fuel prices, creating greater energy diversity and providing access to cleaner alternatives like sugarcane ethanol.

Yes, there are areas of common ground between the President and the Congress. Both strongly support increased energy efficiency in the manufacturing and power sector. Increasing energy efficiency in the manufacturing sector has the added benefit of increased global competitiveness and jobs.

President Obama and all members of Congress want the country to stop wasting energy. There is broad support for increasing energy efficiency through utilization of industrial combined heat and power and waste heat recovery that converts waste heat to electric power or as useful thermal or mechanical energy. Power produced this way can be 70-80 percent energy efficient versus the 32 percent efficiency of a base load electric utility facility.

Both support increasing the energy efficiency of electric utility generation. According to the Energy Information Administration more than two-thirds of the fuel used to generate power in the U.S. is lost as waste heat. This is more than the total energy use of Japan. That is a lot of energy waste!

Last Tuesday’s election dramatically changed the political landscape in Washington, DC. With the Democrats clinging to a significantly smaller majority in the Senate and the Republicans making unprecedented gains in the House, both parties are actively searching for their identities heading into the 112th Congress. The Democrats must redefine their focus and reconnect with a disenchanted base. Republicans need to show that they can lead if they hope to make a run at bigger gains in 2012. With exit polls showing that more than 60% of voters cited the economy as their top concern and unemployment remaining above 9%, we can be sure that both parties will focus a significant part of their respective agendas on economic growth and job creation.

Energy provides one possible opportunity for the parties to work together for bipartisan solutions. Policymakers on both sides of the isle should recognize the crucial role innovation and new technology play in economic recovery and job growth. Earlier this year, the Kauffman Foundation showed that, on the whole, small and new businesses generate 3 million jobs per year while existing firms eliminate 1 million jobs. New members of the 112th Congress and veterans of the 111th Congress should put their trust in these businesses and enact policies that will enable them to grow. A new energy policy will do exactly that.

The Clean Economy Network is confident the next Congress can address our national energy problem, but the hyper-partisanship of the past two years must come to an end. We believe Republicans in the House of Representatives have an unprecedented opportunity to lead the country toward a new energy future while simultaneously ensuring government’s proper role in the marketplace and reducing the national debt.

In the short term, there are a variety of policy solutions—many of which enjoy bipartisan support—that remain on the cutting room floor of the 111th Congress. For example, the federal government recently jeopardized Property Assessed Clean Energy (PACE) programs passed by local governments in 23 states. Congress should act to protect the rights of state and local government to provide much needed financing to clean economy companies and let consumers choose to make their homes more efficient. Also, the America COMPETES Act, which contains vital science, research, and deployment programs, has not yet been reauthorized. Tax incentives and loan guarantee programs, such as Treasury Grant Program 1603 and the 48C clean energy manufacturing credit, will lose funding if they are not reauthorized, despite the fact that they have created thousands of jobs and put clean energy projects in the ground across the country.

If proposals are to gain sufficient support to pass into law, the new political landscape will likely require new policy approaches and open-mindedness by those on all sides. One such policy is a Clean Energy Standard (CES), which has garnered attention across party lines and is one proposal that could bring key Republicans and Democrats to the negotiating table. If designed correctly, a CES could help jump start clean energy development, strengthen the economy, and create new jobs here at home.

Members of the 112th Congress can and should come together to pass common sense policies that will bring America’s energy policy into the 21st century and make America the Saudi Arabia of clean energy. The American people rejected the intense partisanship of Washington, DC last Tuesday—it’s time for elected officials to work across the aisle to get America back on track.

When President Obama took to the podium <http://www.whitehouse.gov/the-press-office/2010/11/03/press-conference-president> last week to talk about a bipartisan path forward, it should come as no surprise that he underscored the broad appeal of natural gas across the political spectrum.

"We've got, I think, broad agreement that we've got terrific natural gas resources in this country," President Obama said. "Are we doing everything we can to develop those?" It’s the right question to be asking right now.

President Obama isn’t the only leader to view natural gas as a key component of a pragmatic, bipartisan approach to U.S. energy policy. Republicans and Democrats alike note that clean, abundant natural gas can create jobs and bring economic prosperity to regions of the country that are struggling right now. And both parties agree that this homegrown resource can play an important role in reducing America's dependence on foreign energy sources.

It is clear that in the future we will need all forms of energy, and we should pursue their safe and responsible development. The President rightly points to natural gas as one fuel that is ready now to help our nation meet economic, energy security and environmental goals on a large-scale.

With its broad appeal, natural gas can help bridge the partisan gap, while setting America on a path toward a cleaner, more secure and prosperous future. America’s Natural Gas Alliance looks forward to being a resource for both parties as this important discussion about our nation’s energy future moves forward.

Making the necessary transition from fossil fuels to a clean energy economy is incredibly important, and it will require some major changes in the way we do business. This means cutting fossil fuel use, electrifying our automobile fleet, and building up clean energy production. While comprehensive legislation would be the best outcome, there are some good examples of energy initiatives that have bipartisan support.

A bipartisan bill in the Senate would stimulate development of clean energy to replace fossil fuels, and create lasting American jobs. Senators Carper, Snowe, Brown, and Collins have introduced an important bill to provide critical financial incentives for the investment and production of offshore wind energy. This bill extends tax credits for offshore wind facilities through 2020, sending a clear signal to companies and investors that wind has continued federal support.

Making offshore wind development a priority would create hundreds of thousands of permanent jobs in the fields of research & development, manufacturing, construction, installation, and maintenance, just to name a few. Good paying, sustainable jobs right here in America.

Not only will this help to reduce our debt, it will also help us regain our footing in the global economy and reclaim our position as makers instead of takers. Even if we weren’t worried about replacing fossil fuels, building this industry on American soil is good for America.

The rest of the world is moving on without us. As we sit paralyzed by debates about continued drilling for oil, Europe and China are leading the way in the global renewable energy market. The longer we wait, the tougher it will be to catch up.

We can end our addiction to fossil fuels. Offshore wind and other renewable energy sources like land-based wind and solar can generate enough power and electricity to replace fossil fuels over time. Offshore wind power is clean and abundant and it won't run out. It will also never spill, make us sick, or contribute to the disastrous effects of global climate change.

The good news is that we are making some strides. Secretary Salazar recently signed the first lease for commercial offshore wind energy, which would make Cape Wind the first wind farm on the Outer Continental Shelf. Another handful of offshore wind projects are being considered off the coasts of Delaware, Rhode Island, New Jersey, Maine, and even Ohio, in Lake Erie. These projects need to be done right and fill undergo full environmental reviews. They should be sited in appropriate areas to minimize disturbance to wildlife, but we believe this is achievable.

Google recently announced it would help to finance a sub-sea cable network on the Atlantic coast, which will help offshore wind developers bring power to the population centers that need it most.

With strong bipartisan support for the Carper bill, and others like it, we can send a strong signal to companies and investors that this growing industry is stable and will have continued federal support.

Energy should be an area for bipartisan action, and extending or making permanent tax incentives for clean energy technologies should be top on the agenda.

Energy issues continue to present serious economic and national security issues for the nation. The hold-up might be disagreement about how to proceed on the related issue of climate change.

But, when Congress wants to, it can look past differences and focus on areas of agreement, which is what Congress achieved in both 2005 and 2007 on energy. With Republicans in charge, the Senate passed energy legislation in 2005 with a bipartisan vote of 74-26. Just two years later, a democratically controlled Senate passed additional energy legislation. The final vote on that bill was an even stronger 86-8!

At the start of this recent period of bipartisan support for energy legislation, the Western Governors Association initiated a process to take a hard look at the potential of clean energy technologies. That effort was focused on a group known as the Clean Diversified Energy Advisory Committee, or CDEAC.

The 2006 CDEAC report found: " there are proven energy efficiency measures, abundant renewable resources, and emerging advanced fossil fuel technologies that can not only help the West achieve the Governors’ ambitious energy goals for the region, but also exceed them in an environmentally responsible way." And, the Committee's report also prominently pointed out, "A strong, overarching theme of all the reports is the need for stable, long-term policies at both the federal and state levels to achieve the stated objectives."

The CDEAC effort put the focus for federal policies on tax incentives. That is one area where there has been strong bipartisan support in the House and Senate, and should be a prime area for bipartisan agreement in the future.

One result of the recent period of bipartisan support for clean energy policy has been that since 2005, every major renewable energy technology has witnessed continued growth. The bipartisanship is paying off!

As both parties prepare for the coming 112th Congress, the reasons for finding common ground are clear. These technologies can make a significant difference for our economy, national security and the environment, if federal and state policies continue to support them.

Energy policy was off the radar screen as a mid-term election issue, and nothing dramatic is likely to occur in the next Congress. Still, the Republican leadership may be amenable to collaborating with Democrats on policies designed to enhance domestic energy supplies. Soon-to-be Speaker of the House John Boehner recently stated "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."

How might Boehner's position translate into action? The Republicans would likely support President Obama's proposal to significantly increase federal loan guarantees for new nuclear plants provided he backtracks on shutting the Yucca Mountain repository for spent fuel. They will also push to limit the authority of the EPA to regulate carbon dioxide as a pollutant under the clean air act, though the administration may balk on this issue. With a de facto moratorium on offshore drilling still in place, and Representative Joe Barton of Texas the likely new chair of the House Committee on Energy and Commerce, we can expect to see pressure on the Department of Interior's Bureau of Ocean Energy Management to end the slow-walking of new drilling permits.

On the energy tax front, the U.S. Senate proposal to repeal the manufacturer's tax deduction for oil and gas companies - a deduction widely available to other American businesses - will fortunately go nowhere. Repealing the so-called Section 199 deduction for energy companies would effectively amount to a tax hike, raising their tax rate from 32.9 percent to 35 percent. Another tax lunge in the Obama administration's proposed 2011 budget would change what are known as "dual capacity" rules. In effect, the "dual capacity" provision allows U.S. companies to offset their federal tax with a credit against foreign taxes paid. Often, these foreign tax rates are quite heavy, enabling some energy rich nations to fill their treasuries. The administration wants to remove the current protection against the "double whammy" on taxes for energy firms, a protection that has been part of established U.S. tax law for more than 25 years. Here again, in view of the Republican capture of the U.S.House, this proposal is surely dead in the water.

In the search for common ground, it would be wise and efficient for the Obama administration and the new Congress to focus on developing and deploying domestic advanced biofuels. Good bi-partisan support already exists for this mission. In addition, two-thirds of the oil used in the United States goes to liquid transportation fuels, which are an absolute necessity in certain transportation sectors such as air travel. Addressing U.S. energy, environmental and economic challenges will be next to impossible without addressing our reliance on imported oil.

Competition with other economic powers for petroleum is a direct threat to future U.S. economic growth. Volatility in prices for fossil energy and raw materials limit the ability of U.S. businesses to plan long-term expansion and growth. But building advanced biofuel facilities in the United States could directly reduce reliance on imported oil, potentially saving as much as $350 billion in oil imports between now and 2022.

Building advanced biorefineries will also create jobs – not only in construction and plant operations, but also in research and development, agriculture, and manufacturing of new products. These are the economic sectors hit hardest by the economic recession. This ought to be a good reason for additional bi-partisan support.

Biorefineries producing biofuels will lay the technological foundation for sustainable future economic growth through production of chemicals, plastics and a range of other manufactured goods from renewable sources of biomass instead of oil. The World Economic Forum estimates that this full range of renewable biomass uses will generate upwards of $230 billion in economic growth by 2020. The United States must act now to secure its share of that growth and to spread that growth to every sector of the U.S. economy.

My hope is that the Obama administration will work with the new Congress to reduce reliance on imported oil and create new jobs through a sustained, consistent effort to commercialize innovative technologies for advanced biofuels. Secretary Vilsack’s speech on Oct. 21 contained useful proposals to serve as a starting point. Congress will begin writing the farm bill soon and a new energy bill and these will be good opportunities to show their commitment and follow-through, which are the only ways to achieve common energy, environmental and economic goals that help our economy and strengthen our national security.

So Washington is speculating what comes next for energy policy. And of course, the hot topic is the location (if it exists) of common ground between President Obama and a Congress now controlled on the House side by Republicans seized control and where they gained six seats in the Senate.

Will deals be made around natural gas development, domestic production of electric cars, and nuclear power, topics that President Obama threw out in his post-drubbing news conference.

What about energy efficiency in buildings and appliances?

What about subsidies for renewables or a national renewable electricity or portfolio standard (RES or RPS)?

In this climate, it’s safe to say we won’t be seeing a return of cap-and-trade legislation to raise the price and so lower the amount of carbon emissions in the next two years, as Obama acknowledged in his remarks to reporters. And of course, many progressive commentators such as Joe Romm are extremely pessimistic about the possibilities for meaningful progress of any kind, let alone on any sort of comprehensive carbon pricing or emissions reduction scheme. Over at Grist, for example, Chris Mims assesses the prospects pretty succinctly as “zero action on anything substantial.”

For my part, I’m pretty pessimistic too—at least in the short run of this Congress—but not entirely so. It’s true that Senate Republican Leader Mitch McConnell (R-KY) does not seem real eager to collaborate on clean energy topics. And for that matter, the massive GOP freshman class coming into the next Congress is dominated by legislators who, according to areport by the Center for American Progress’ ThinkProgress, either deny the existence of climate change or are opposed to any climate change legislation that increases government revenue.

Likewise, Politico this morning suggests that at least 56 senators are likely to support efforts next year to block the Environmental Protection Agency’s plans to regulate greenhouse gas emissions.

However, the fact remains that there is no shortage of possible convergence points for the next Congress should the GOP choose the path of cooperation in the coming months.

CAP’s Daniel Weiss has laid out one expansive menu of incremental to-dos that are all deficit-neutral and have enjoyed bipartisan and business support. Along these lines Weiss calls out as possible such items as tax credits for the purchase of natural-gas-fueled vehicles, piloting electric car changing infrastructure, tax incentives for home and business energy retrofits, and oil spill response and accountability. Weiss even mentions RES / RPS which some might say would move beyond the incremental yet which had four GOP co-sponsors in the 11^th Congress.

Meanwhile, I recently helped frame another potential road map for keeping things moving on climate and energy by focusing on cleantech innovation. Worked out in a dialogue with colleagues at the American Enterprise Institute and the Breakthrough Institute, our proposed cooperation agenda goes beyond the incremental to suggest a fairly deep-going push to put some $25 billion a year into intensified and reinvented research supporting new energy technologies, paid for by a modest tax on carbon, increased oil and gas royalties, or other energy-sector revenue-raisers. Central to the plan is the rationale for an energy research step change and the programmatic detail for making sure it’s carried out in new ways offered by the Brookings proposal for the development of energy discovery-innovation institutes.

While no substitute for more comprehensive action, I do think this architecture furnishes one important piece of the now-necessary era of making progress not by comprehensive grand strokes but in “chunks.” To make real progress on our economic, energy, climate problems the nation absolutely must rev up its technology development efforts and I do think our suite of steps has bipartisan appeal. However, while I would hope progress will be made in the next three or four years along the lines we’ve outlined I am not holding my breath unless world economic recovery pushes gas prices over $4 a gallon, at which point I think all of this and more will be done. Part of the problem, of course, is the likelihood of rank partisanship owning the day. But the more operational problem is of course that of financing the needed investments. Twenty-five billion a year for energy R&D is obviously a tall order for bipartisan compromise any time soon given the depressing failure of the last Congress to deliver the modest sums requested by the Obama administration to launch a network of energy innovation hubs similar to Brookings discovery institutes.

And yet, even then, hope springs eternal, and is somewhat encouraged by something called the American Energy Act, the 2009 energy plan introduced by House Republicans last year under the leadership of Rep. John Boehner, soon to be the new speaker of the House. At the center of that plan was a proposed bargain that would have paired expanded oil and gas drilling and nuclear development with new investments in renewable and alternative energy. To fund the latter the bill proposed putting hundreds of billions of the anticipated new oil and gas royalties into a trust fund to accelerate clean energy innovation. Sound familiar? The bargain has something of the architecture of cleantech innovation push I’ve been talking about.

And here’s the kicker: It took the Deepwater Horizon catastrophe in the Gulf to fully scotch such a deal last spring. Now, one wonders if the Democrats current “deep water” will bring such a deal back, along with other deals. No, none of it’s ideal, or by any means assured, but perhaps it’s possible.

After an election day that replaced many moderate legislators with conservatives, it’s unclear whether President Obama’s call for cooperation with Republicans will occur over energy policy.

The day after the election President Obama said that “We’ve got, I think, broad agreement that we’ve got terrific natural gas resources in this country…There's a lot of agreement around the need to make sure that electric cars are developed here in the United States, that we don't fall behind other countries. Are there things that we can do to encourage that? And there's already been bipartisan interest on those issues.”

Cooperation or Confrontation on Clean Energy? A Proposed Agenda for the New Congress and the President outlines a potential cooperation agenda. It proposes clean energy policies that have bipartisan and business support. On the other hand, new Congressional leaders may choose confrontation instead by seeking to weaken existing health protections.

Here are examples of bipartisan measures for a cooperation agenda. (For the complete list, go to Cooperation or Confrontation on Clean Energy?)

• Reducing oil consumption and improving energy security. The NAT GAS Act would provide tax incentives for the purchase of natural-gas-fueled trucks. Replacing diesel with natural gas could save 1.2 million barrels of oil per day. The bills have three Senate Republican co-sponsors, and sixty Republican House co-sponsors – including potential House Energy and Commerce Committee Chair Joe Barton (R-TX).
• Clean energy jobs and consumer savings. The HOME STAR program would provide incentives to retrofit homes to become more energy efficient, and would create 160,000 jobs. It would help 3 million families reduce their energy bills by $9 billion over a decade. It passed the House with support from 11 Republicans.
• Investments in renewable electricity and jobs. An independent Clean Energy Deployment Administration or “green bank” would help companies take new technologies from successful R&D to deployment. It was part of bills that passed the House of Representatives and Senate Energy Committee with bipartisan support.
• Oil spill response and accountability. Big oil companies must do more to prevent future spills and be held accountable for any that occur. Significantly raising the $75 million liability cap and establishing rig safety standards would help achieve these goals. Such provisions had bipartisan support in both bodies.

These and other bipartisan proposals would reduce oil use, create clean energy jobs, increase U.S. economic competitiveness, and protect us from future BP oil disasters.

During his November 4^th press conference, Senate Minority Leader Mitch McConnell (R-KY) signaled that he could cooperate with the President on a handful of energy issues. He said “On energy, the president has said he's for nuclear power. We're for nuclear power. The president has said he's for clean-coal technology. We're for clean-coal technology… [There is] I think, bipartisan enthusiasm for… plug-in hybrid cars, you know, reducing carbon emissions by automobile changes, those are areas of potential cooperation.”

Previously, however, McConnell (R-KY) seemed to dismiss cooperation on energy or any other issue. He said earlier that “The single most important thing we want to achieve is for President Obama to be a one-term president.”

House Republican leaders have already announced a confrontation oriented energy agenda. They plan to conduct hearings and investigations that undermine climate science and scientists. Other likely attacks include blocking EPA’s efforts to set greenhouse gas pollution reduction standards as mandated by the Clean Air Act. They could also attempt to remove or undermine EPA’s ability to protect people from power plant pollutants, including mercury, smog, sulfur dioxide, and toxic coal ash.

President Obama has extended his hand to cooperate on clean energy with new Congressional leaders. It is unclear whether this offer will be accepted or spurned. However, the new leaders’ votes, actions, and recent statements provide little assurance that they plan to boost clean energy policies in 2011. Like the Magic Eight ball says “Don't count on it.”

There are critical areas of potential compromise and agreement IN energy policy between the White House and congressional Republicans, especially involving natural gas and nuclear power. Whether they can actually agree on a mutually-acceptable way to finance such initiatives will depend on whether they can agree on much larger financing issues. In particular, the funding for these matters could be rolled into a meeting of partisan minds on medium and long-term deficit reduction.

Given the rhetoric of party leaders and the political bases of those parties, the current partisan divide would seem to preclude compromise and agreement on larger climate policy issues. But there is a powerful third factor in play here as well: The EPA is working busily under a legally-mandated schedule to begin to directly regulate greenhouse gases. That prospect might just drive enough Republicans to take some serious, early steps on climate in exchange a suspension of the EPA climate regulatory process, with White House cover for the Democrats. With this impetus, both sides might be able compromise, for example, around a modest carbon fee with half of the revenues designated for tax cuts and half for deficit reduction. But even given the benefits of such an agreement for both sides, it’s unlikely unless the two sides – or are there three? – have established a working relationship by compromising and agreeing on other issues they will certainly consider more urgent, especially taxes and the larger budget.

Concerns over the federal budget and spending will dominate Congress in 2011 and beyond. Arguably it would have no matter the results. But it will certainly be more prevalent with an influx of small government advocates.

Such a focus isn’t necessarily a bad thing, particularly for renewable energy technologies and biofuels in particular. Unlike fossil fuels, biofuels are still evolving and maturing with tremendous potential to create jobs and economic opportunity with a relatively small investment. Other renewable technologies can offer similar benefits.

Moreover, the investment in biofuels is providing unparalleled results in terms of return on investment for the federal government. The tax incentive for ethanol use, known as VEETC, added $3 billion in tax revenue above what the incentive cost, while also providing state and local governments with much needed revenue. The growth in the ethanol industry VEETC has helped foster is also reducing America’s oil tab by more than $20 billion annually and reducing and in some cases eliminating farm program payments over the last few years. All of this economic activity comes with nearly 400,000 jobs attached – jobs that cannot be outsourced.

But current biofuel technologies are just the beginning. New cellulosic ethanol and advanced biofuel companies are on the verge of commercialization technologies that will simultaneously expand the basket of feedstocks from which biofuels are made, incorporate thousands of additional communities into America’s growing green economy, displace greater volumes of imported oil, and employ hundreds of thousands of Americans.

It is for these reasons I believe that President Obama and this divided Congress can find some common ground on the issue of energy and renewable energy in particular. There is not a member of Congress whose state or district doesn’t hold the potential to significantly contribute to our nation’s energy future. In a climate of economic concerns and high unemployment, renewable energy opportunities cannot be passed by.

Even before we get to the 112th Congress, the current Congress still has work to do. It must extend important tax incentives, including VEETC, in the upcoming lame duck. A failure to do so would put tens of thousands of American jobs in jeopardy and undermine any possible progress that could be made in the next Congress.

If this Congress acts and extends these important incentives, I believe the 112th Congress can come together to address a number of key policies, particularly those relating to biofuels. Building on VEETC’s success, President Obama and Congressional leaders can help lead the biofuels industry into the 21st century with thoughtful and responsible reform of VEETC, increased investment in advanced biofuels through tax policies like a refundable investment tax credit, and assistance in expanding infrastructure for biofuel use.

I am not naïve enough to believe that these and other energy issues will be addressed quickly and without great debate. Ultimately, creating jobs will be the number one focus of both parties, and one of the surest ways to see employment rolls grow is to invest in domestic renewable energy production.

This year, the U.S. will spend $200 billion on foreign oil imports. Our transportation sector contributes to one-third of our greenhouse gas emissions. Reducing America’s dependence on foreign oil is an economic, energy security and environmental priority. This is a priority that can be addressed with common sense solutions and common ground in Congress.

Electric drive transportation is a key solution to the problems created by oil dependence. As the new Congress convenes and begins to identify priorities, advancing electric drive deserves to be among them. And Washington leaders seem to agree: President Obama and prominent Republican leaders such as Senator Lamar Alexander (Tennessee) and Senator Mitch McConnell (Kentucky) have identified electric cars as an area where the political parties, as well as the branches of government, can work together.

Electric drive vehicles provide a domestic, affordable, efficient and cleaner alternative to oil. Even with our existing grid power mix, plug-in electric vehicles produce one-third less greenhouse gas emissions running on gasoline. As the grid gets cleaner, the emission savings increase as well.

In addition, charging with electricity is on average one-fourth the cost of gasoline. At current gas prices, the average American could save more than $1,000 a year by driving an all-electric vehicle. The vast majority of our electricity is supplied domestically from a combination of natural gas, coal, nuclear, hydro and renewable sources. We don’t import our electric power.

We believe a comprehensive electrification effort is the best way to move the country forward, but critical advances can be made even in limited energy legislation. For example, some of the initial opportunities for both parties to work together include:

• Extending the tax incentives (especially the expired electric drive truck incentives and the infrastructure incentives that will expire soon);
• Establishing national and regional deployment programs for electric vehicles and electric drive infrastructure; and
• Maintaining U.S. leadership in advanced battery and electric drive vehicle technology.

The federal tax credit of up to $7,500 for plug-in electric drive vehicles is an important incentive for light duty buyers, and renewing a proportionate incentive for electric drive trucks would help make the medium and heavy duty segment more efficient. Support for infrastructure is also important. Nearly 20 different models of plug-in electric vehicles will be coming to market by the end of 2012, but the incentive for alternative fueling investments expires at the end of this year. The new Congress has a real opportunity to speed vehicle electrification and proliferation of diverse charging options for plug-ins by passing a multi-year extension of that credit, which had broad bipartisan support in this Congress. A national program to accelerate deployment, which includes large-scale regional efforts, will also help communities and consumers to adopt electric vehicles and maximize their benefits.

These policies, in combination with industry and government investment in technology research, development and manufacturing, will help establish a robust energy economy and sustainable energy future built on clean, efficient and secure domestic electricity.

There are many areas where the Obama Administration and the Congress can find common ground, if there is a sincere interest in doing. Words matter but actions matter more.

Energy is fertile ground and should be one of the easiest for building trust and taking action that will benefit the economy and the need to create jobs.

Every long term assessment of our energy needs out to 2030 concludes that fossil energy--coal, oil, and gas--will continue to be our dominant energy sources, providing 80 percent of the energy needed for a growing population and economy.

Given that reality, the foundation for common ground should be actions to promote more domestic oil production. Removing impediments on existing Gulf of Mexico leases and moving ahead on new ones would re-employ thousands of workers and create opportunities for new ones. Moving ahead with offshore leasing and leasing in Alaska would also lead to more domestic production and produce jobs and economic benefits not only in those areas but also in regions that provide goods and services to the industry. And, increased domestic production would reduce the growth in imports, a goal that is widely shared.

President Obama last week indicated strong support for natural gas as one way to achieve climate objectives. But, increased natural gas won’t occur unless action is taken to increase leasing and avoid excessively burdensome regulations on “fraking” for shale gas. The US proven reserves of natural gas are enormous and provide a solid basis for power generation for decades to come when renewable and other no-carbon sources might be cost competitive.

The foundation for electric power generation is coal and that will remain so for years to come in spite of the transition that is taking place to natural gas which has the additional benefit of lower carbon emissions. Currently many utilities are running old coal fired units because of government imposed impediments to replacement with newer and cleaner units.

Moving ahead quickly with a modified Clean Air Interstate Regulation or 3P legislation that already has bi-partisan support would provide the incentive to retire older units and replace them with state of the art units that produce significantly fewer air pollution and carbon dioxide emissions. In deed, some believe that either a modified CAIR rule or 3P legislation would be a cost-effective substitute for EPA’s proposed NAAQS standard which would kill hundreds of thousands of jobs and essentially throw virtually the entire nation into non-attainment.

There ought to be ways to find common ground on nuclear energy but it could be much harder because of emotions about Yucca Mountain, the budget impact of loan guarantees sought by utilities and supported by some in Congress, and the failure of industry and government to come to grips with factors that currently make nuclear power much more expensive than conventional electric power.

Although the Obama Administration and its environmental supporters are strong advocates of renewable portfolio standards and electric cars these are both controversial and divisive and it is doubtful there is room for common ground. Wasting effort on either could make it difficult to make progress on other important issues.

EIA estimates that existing renewable energy requirements will result in renewable energy providing 16% of our energy between 2020 and 2030 even though those requirements will only be met because of subsidies that rob the federal treasury of tax revenue and distort capital investment. And, electric cars are a dream that makes little economic sense given the high cost of batteries and their limited range. Subsidies to create a market for the Volt and Leaf or any other electric vehicle also distort capital investment and keep the deficit higher than it needs to be.

Since the 1970s, the Federal Government has produced an energy policy about every 5 years. For the most part, these were designed to promote favored technologies, hamper the development of conventional energy, and to chase energy illusions.

Since energy production is directly related to job creation and economic growth and since energy policy is climate policy, the Administration and Congress should first take steps quickly that have near term economic and energy production benefits and then explore whether it is possible to fashion a true long term energy policy that is sustainable, has realistic goals and focused on encouraging the market to bring forward cost-effective energy technologies that will be needed later this century without the heavy hand of government tilting the scale to determine winners and losers.

The bad news, at least in the near term, is that both Congress and the President will likely not take action that will truly correct course on American energy and climate policy. Corporate oil, coal, gas, nuclear and related industrial interests have simply too much invested in business as usual to stop their massive (and often corrupt) manipulation of the political process. Making this manipulation more understandable to the electorate will definitely occur over the next two years. Remember the 1996 elections.

However, the good news is that the new political landscape offers a potential check and balance situation where genuinely “consensus-based” initiatives can finally take hold. These include the following: reduction of greenhouse pollution from the largest and dirtiest sources such as old coal-burning power plants under the established Clean Air Act; reduction (both domestically and as a matter of foreign aid) of greenhouse pollution such as black carbon and smog that also possess deleterious public health ramifications; reduction of ozone depleting chemicals that also have greenhouse attributes under the successful Montreal Protocol; reduction of methane pollution that is over 20 times more powerful than carbon dioxide and that can easily be regulated in a clearly cost effective way; incentives to wind, solar and geothermal and an end to corporate welfare to clean coal and nuclear (I realize this one will be a fight but the facts are not on clean coal and nuclear’s side as a solution to our problems). If our political leaders are interested in new jobs, it is hard to refute the obvious opportunities in clean energy development and dissemination; we have only scratched the surface of our collective potential here.

If Majority Leader Harry Reid, the new legislative gatekeeper of the Congress in many respects, is smart, he will call the Republicans’ bluff on the very large Congressional spending gifts “Old Energy” still gets. Old
Energy, of course, is a brazen supporter of the Republican Party (generally) and has many financial links to the so-called tea party movement (itself a combination of movements rather than one as history will soon demonstrate). I suspect Speaker-to-be Boehner is duly nervous about the significant disconnect between tea party rhetoric and the regular Republican Party practice of itself guzzling from the federal treasury trough.

The President heretofore has allowed himself to be captured by elements of Old Energy but the recent elections offer him a chance to break that grip for sheer political survival. It is my sense the American people are looking for legitimately honest answers to both short-term and long-term energy needs, and the voters are inherently suspicious of the corporate oil and coal agenda. The problem with “cap and trade” was not only that it was big government at its most speculative, but it also provided zero assurances that abatement of climate change pollutants would actually happen. The White House needs to better support and explain the important work that the Environmental Protection Agency must do administratively. Existing laws and tools work well and are a known commodity.

Intelligent incrementalism can be both conservative and liberal, as well as both effective and efficient. It’s probably the only viable dance card over the next 24 months. The other option is utter failure.