December 2012 Archives

[Editor's note: Sen. Lamar Alexander, R-Tenn., is guest-moderating and providing the question this week. Alexander is a member of the committees on Appropriations and Environment and Public Works.]

Should Congress extend wind power's federal tax credit for six years at a cost of about $50 billion, or instead save the money for clean-energy research and to reduce the federal debt?

The wind production tax credit was created in 1992. It gives wind developers a subsidy that is often equal to or below the wholesale cost of electricity in some markets. This "temporary" subsidy, already extended seven times, expires this month. Wind developers have urged Congress to extend the credit at decreasing levels over the next six years. The one-year extension passed out of the Senate Finance Committee costs $12.1 billion, according to the Joint Committee on Taxation. Some have estimated the industry's proposed six-year "phase out" would cost $50 billion--on top of $16 billion in federal wind subsidies from 2009 through 2013.

This subsidy should not be extended, first, because a government that borrows 42 cents of every dollar it spends can't afford it. Second, U.S. Energy Secretary Chu has testified that wind is a "mature" technology. Third, after 20 years and billions in subsidies, wind produces only 3 percent of our electricity. Fourth, such large subsidies distort the marketplace, making coal and nuclear uncompetitive. Replacing such baseload power with electricity that is produced only when the wind blows is the energy equivalent of going to war in sailboats when nuclear submarines are available. Finally, giant turbines and their power lines strung along scenic mountaintops destroy the environment in the name of saving the environment.

A better idea is to reduce the debt and increase research for solar, batteries, carbon capture from coal plants, more energy-efficient buildings, advanced biofuels, and the disposal of nuclear waste (the U.S. spends only $5 billion to $6 billion annually on energy research). Then let the marketplace decide which fuels can produce enough clean, cheap reliable energy for a country that uses 20 to 25 percent of the world's electricity.

Do you agree or disagree -- and why?

27 responses: William O'Keefe, William O'Keefe, Phyllis Cuttino, David C. Brown, Alex Trembath, Kate Offringa, Gene Karpinski, Sen. Lamar Alexander, R-Tenn., Rep. Michael Honda, D-Calif., Scott Sklar, Marlo Lewis, Kevin Knobloch, David Murphy, Amy Harder, Peter Lehner, Craig Rucker, Brent Erickson, Phil Kerpen, Rob Gramlich, Karl Gawell, Dennis McGinn, Benjamin Zycher, Thomas J. Pyle, James Valvo, Rich Deming, David Banks, Mindy Lubber

What are the risks and potential opportunities for energy and environment issues as Washington debates a way to avoid the fiscal cliff?

This so-called "fiscal cliff," which has become the most popular buzz phrase inside the Beltway, is a metaphor to describe a combination of automatic tax hikes and budget cuts--including the first round of sequester cuts Congress approved in 2011--that will go into effect in January unless lawmakers strike a deal on budget cuts. Several tax policies, including the Bush-era tax cuts and the payroll tax holiday will also expire at year's end unless Congress votes to extend some or all of the policies at stake.

Congress is focusing mostly on the big issues, like the Bush-era tax cuts. But energy and environment issues are also at stake. The production tax credit for wind energy is set to expire at year's end unless Congress votes to extend it. The mandatory, across-the-board sequestration cuts set to go into effect on Jan. 2 would affect all parts of the government, including the Environmental Protection Agency and the Energy and Interior departments. It's unclear exactly which projects would face the chopping block.

Congressional Democrats are pushing to eliminate oil and gas subsides as part of any compromise. Meanwhile, some fossil-fuel industry and business groups are making the case that increased oil and natural-gas drilling can help solve the country's fiscal crisis, too. Do either or both of these efforts have a chance at making it into any grand bargain?

What are the other factors that will influence how much energy and environment issues are affected by the fiscal cliff?

Will the wind-energy PTC be renewed if Congress strikes a broad deal on all tax extenders?

If Congress lets the country fall off the cliff, does that create doomsday scenarios for the energy industry and environmental protection? Or, are these issues not affected much at all by the broader fiscal-cliff debate?

15 responses: Brigham McCown, Jonas Monast, Gene Karpinski, Jack Rafuse, Dennis McGinn, Peter Lehner, Howard A. Learner, David Moulton, Rich Deming, Jamie Rappaport Clark, William O'Keefe, Michael Canes, Bernard L. Weinstein, Amy Harder, Scott Sklar

Should international negotiators abandon the top-down multilateral system to confront climate change and find another way?

The 18th installment of the United Nations Framework Convention on Climate Change is now in its second and final week in Doha, Qatar, the country with--ironically--the world's highest per capita carbon emissions. Expectations that negotiators will strike a grand bargain by week's end are very low, but a lot is at stake nonetheless. The Kyoto Protocol, an international agreement signed in 1997 that set binding greenhouse-gas reductions for more than three dozen countries, expires at year's end. (The United States failed to ratify that agreement). Some experts hope that negotiators can come up with some agreement to preserve some of the reduction accomplishments achieved under Kyoto.

Realistically, what can negotiators accomplish by week's end? What other forms of agreement could nations, global organizations, or regions construct that could serve to combat global warming? Should President Obama take a stronger leadership role in this process?

9 responses: Rep. Michael Honda, D-Calif., Brian Murray, Jennifer Morgan, Michael Canes, Keya Chatterjee, Craig Rucker, Elliot Diringer, William O'Keefe, Scott Sklar