The Move On Energy

It is commonly believed that the Obama Administration will make health care reform its next big policy push. But there are enough signs that energy actually has more momentum right now. In the stimulus there is as much attention paid to energy and energy infrastructure (like the smart electric grid) as health care. And the imminent EPA decision to regulate carbon dioxide under the Clean Air Act is a major step forward.

The decision, which most likely would play out in stages over a period of months, would have a profound impact on transportation, manufacturing costs and how utilities generate power. It could accelerate the progress of energy and climate change legislation in Congress and form a basis for the United States’ negotiating position at United Nations climate talks set for December in Copenhagen.

The environmental agency is under order from the Supreme Court to make a determination whether carbon dioxide is a pollutant that endangers public health and welfare, an order that the Bush administration essentially ignored despite near-unanimous belief among agency experts that research points inexorably to such a finding.

Lisa P. Jackson, the new E.P.A. administrator, said in an interview that she had asked her staff to review the latest scientific evidence and prepare the documentation for a so-called endangerment finding. Ms. Jackson said she had not decided to issue such a finding but she pointedly noted that the second anniversary of the Supreme Court decision, Massachusetts v. E.P.A., is April 2, and there is the wide expectation that she will act by then.

“We here know how momentous that decision could be,” Ms. Jackson said. “We have to lay out a road map.”

At Grist, Dave Roberts lays out the importance, including how this will end new coal plant production in the US as we know it. Some would call that exclusionary, but actually it just properly prices the externalities in a way that the coal industry has never had to deal with. If they want to keep spewing toxicity into the atmosphere, they can pay the public health costs and the costs in changing weather patterns and increased natural disasters and droughts.

Depending on how they want to play it, the Obama administration could use the regs one of two ways, either:

• use them to put the screws to the economy's biggest CO2 polluters, thereby easing some pressure off the economy-wide cap-and-trade program, allowing it to ramp up more gently and serve as the backstop rather than the primary means of transforming America's dirtiest industries;

• use the threat of regs to reduce industry opposition to cap-and-trade and force big polluters to the table; however much industry hates cap-and-trade, they'll prefer it to hard regs.

Ultimately, if I had to guess, I'd say it's the latter: ultimately, the EPA rulemaking will be a cudgel to force big polluters to play ball on cap-and-trade.

And the other way that old-energy power plants will be legislated into irrelevance is through a renewable energy standard, which apparently is going to happen without delay.

Not satisfied with the billions for clean energy projects in the stimulus package, Senate Majority Leader Harry Reid (D-Nev.) said today he will work to pass a new energy bill within a matter of weeks.

Reid -- who's helped organize a clean energy summit next week in Washington that is bringing former president President Clinton and vice president Al Gore to town along with entrepreneur T. Boone Pickens -- said he's asked Senate Energy and Natural Resources Committee Chairman Jeff Bingaman (D-N.M.) to prepare a bill that will set a national renewable portfolio standard.

That would mandate that a percentage of the nation's electricity come from renewables by a certain date. I've heard 25% by 2020 as a baseline. It could be more, but that's a very good start.

I think energy is an issue that unites individuals of both parties, if not their legislators. It's a good issue for Obama and the Democrats to take up.