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Special Edition on Energy Legislation — Congress Proposes More Government Intervention in Energy Markets

October 15, 2020

Climate Change Weekly #376

While most people’s attention was focused on the presidential election or battling the coronavirus and struggling to survive the economic shutdown the pandemic inspired most states’ governors to impose, swamp creatures in Congress have been working behind the scenes to impose more inside-the-beltway big-government mandates and subsidies on U.S. energy markets.

In the U.S. House of Representatives, House Speaker Nancy Pelosi (D-CA) and the Democratic majority rammed through H.R. 4447, laughingly titled the “Clean Economy, Jobs, and Innovation Act,” shortly after the last sections of the bill were inserted, without any hearings or real debate. This gave no one time to read the entire 900-page monstrosity before a final vote was taken. This was another instance in which Pelosi thought people should have to pass the bill in order to find out what’s in it.

A statement of policy offered by the White House Office of Management and Budget said it would recommend President Donald Trump veto the bill if it reaches his desk, because the bill:

would implement a top-down approach that would undermine the Administration’s deregulatory agenda and empower the government to select favored solutions, while reinstating big-government policies and programs.

H.R. 4447 would lead to higher energy costs and discourage innovation and entrepreneurship.

The White House was right to issue its veto threat, and not just for the reasons it cited. H.R. 4447 is nothing more nor less than a down payment on the multitrillion-dollar, socialist, Green New Deal (GND) boondoggle. Like the GND and Democratic presidential candidate Joe Biden’s energy proposal, H.R. 4447 sets a goal for the country to reach net-zero greenhouse gas emissions by 2050.

‘Environmental Justice’ Crusade

Also like the GND, H.R. 4447 makes environmental justice, whatever that means, a priority, requiring every agency of the federal government to add that to its mission. The bill would establish a 26-person Environmental Justice Advisory Council to “ensure the ‘fair treatment’ of different groups based on race, ethnicity, and socioeconomic status,” according to the Washington Examiner. “They would accomplish this by taking the already cumbersome National Environmental Policy Act review process, which is used to approve new energy and infrastructure projects, and require these projects to undergo an ‘environmental justice’ review.”

It already takes years, sometimes decades, for critical infrastructure projects—such as bridges, oil and gas pipelines, power lines, sewage lines and sewage treatment facilities, and roads—to get through the federal approval process and NEPA review and then built. And that is when the process is supposedly based solely on scientific and economic considerations—things that can be calculated, measured, and compared with some degree of objectivity. The process will become much more onerous, lengthy, and vulnerable to special-interest influences when amorphous, politically charged concepts such as “fairness” and “environmental justice” are made integral to it.

Even more projects will be delayed or cancelled, unable to get through the expensive process. Of course, that may be the very point of the provision: to make even more projects too expensive to complete. Cancelled projects, or projects never proposed, don’t produce carbon dioxide emissions because they don’t create jobs or stimulate economic growth. Stagnant economic growth always reduces energy use and consumer spending, and thus emissions. As evidence, consider the declines in emissions that occurred during the COVID-19 shutdown and the recession of 2007. Radical environmentalists have long called for an end to consumer society and economic growth, and this bill would be a down payment on that goal. Is this really what any sane person wants for a national energy or economic policy?

In addition, although Democrats tout themselves as the party of science, with members regularly chanting or carrying placards with the phrase “Follow the Science,” they inserted a provision in the bill that directly undermines science and replaces it with politics. The Clean Economy, Jobs, and Innovation Act would implement a new “community-based science” model unleashing “voluntary public participation in the scientific process.” As the Washington Examiner describes this provision, “This means that instead of allowing scientists to have the final say in conducting experiments, collecting data, interpreting results, and developing new technologies, the so-called ‘party of science’ would let everyone have a say. They call it the ‘democratization of science’—and if you’re against it, you’re probably against democracy, too.”

These are just a few of the idiotic proposals unique to the energy legislation that has already passed the House.

Lobbyists’ Dream

The Senate often bills itself as the more deliberative body of the two houses of Congress. As a result, one would hope it would develop legislation that allows markets to function more efficiently. This would mean an energy bill that reduces the mandates, taxes, and subsidies that distort market incentives. Such a bill would deliver cheaper, more reliable energy. In this case, one would be hoping in vain.

The Senate energy bill doesn’t have each and every harmful proposal that’s in the House bill. How could it, at only 555 pages at present? However, it contains enough bad stuff, some from the House bill and some terrible provisions unique to the Senate bill, that the White House should issue a veto threat for it as well.

Senate Bill S. 2657 started life innocuously enough as the “Advanced Geothermal Innovation Leadership Act of 2019.” The original bill was a manageable 20 pages long and, as the title suggests, was narrowly focused on advancing the development of an underappreciated, nonintermittent, renewable source of energy: deep-drilling geothermal power. Because the bill contained relatively little pork and the geothermal industry, not having received billions of dollars in government subsidies and mandates in past energy bills, has no lobbying presence on Capitol Hill, the original S. 2657 went nowhere.

Never fear, however. The wind and solar lobby and climate action activists saw S 2657 as a perfect vehicle to get their various aspirations adopted into law. As such, S. 2657 was transformed into the “American Energy Innovation Act,” which combined more than 50 separate bills into one 555-page package.

S. 2657 would reduce the nation’s sovereignty by requiring the U.S. Department of Energy to cooperate and coordinate with other countries and international bodies in the development of internationally binding energy and water efficiency standards for an array of technologies and appliances. International standards, driven by the rest of the world’s embrace of radical proposals to fight climate change, are often much more stringent than U.S. standards, imposing higher energy and product costs on the people of those nations. There is no good reason Americans should be forced to comply with, and pay higher costs for, energy and water efficiency standards developed by foreign bureaucrats.

Banning HFCs

Until now, Congress has never passed a law specifically aimed at fighting climate change by reducing greenhouse gas emissions. Every climate bill Congress has considered before has failed to reach a president’s desk. S. 2657 would change that by barring the continued use of the class of refrigerants known as HFCs, the replacement for ozone-depleting CFCs, solely on the grounds that the chemicals supposedly contribute to dangerous climate change. Certain senators are trying to get through the back door what most senators have been unwilling to embrace publicly as a standalone bill.

As part of the Obama administration’s efforts to fight climate change, the Environmental Protection Agency tried to ban the use of HFCs, a class of chemicals the agency had earlier approved under a law passed by Congress as nontoxic, non-ozone-depleting alternatives to CFCs. The manufacturers of HFCs sued to block EPA’s ban. In 2017, a three-judge panel of the U.S. Court of Appeals for the District of Columbia scotched EPA’s HFC ban, ruling the agency lacked the authority to implement it under the 1990 revisions to the Montreal Protocol because the latter agreement doesn’t apply to HFCs.

“[T]he fundamental problem for EPA is that HFCs are not ozone-depleting substances,” wrote the court in its August 8, 2017 ruling. “EPA’s well-intentioned policy objectives with respect to climate change do not on their own authorize the agency to regulate.”

Having failed to ban HFCs through regulation, the Obama administration worked with most of the parties to the Montreal Protocol, the treaty that phased out the use of ozone-depleting refrigerants, to expand the treaty to fight climate change by phasing out the use of HFCs through the “Kigali Amendment.” The Senate never took up the Kigali Amendment, and President Trump indicated he was opposed to it. When some senators offered a bill to phase out HFCs, obviating the need for a vote to alter the treaty, it failed to garner enough support to be brought up for a vote.

Unable to get majority support for their HFC-banning bill as standalone legislation, the senators have now added it as a provision to S. 2657, a bill supposedly aimed at energy innovation, though the provision has nothing to do with energy. The provision has some Republican support because the much more expensive chemicals that would replace HFCs are or would be manufactured in or by companies with offices in states they represent. To bring home that potential pork, some Republicans are collaborating with radical Democrats to ban a chemical on the phony grounds of fighting climate change.

This provision represents the camel’s nose under the tent, dangerously opening the door for further climate change-based legal restrictions in the future. After all, if one type of greenhouse gas is bad and should be banned, why shouldn’t other products contributing to climate change also be banned or regulated?

National Renewables Mandates

Also contained in S. 2647 is a provision long sought by the powerful, taxpayer-funded wind and solar power lobbies. Physicist John Droz points out that in addition to $600 Million in new U.S. taxpayer handouts for wind, and $1.3 Billion for solar, this S.2657 amendment requires that:

…the Secretary of Agriculture, through management of public land and administration of Federal laws, shall seek to issue permits that, in total, authorize production of no less than 25 Gigawatts of electricity from wind, solar, and geothermal energy projects no later than December 31, 2025.

The initial geothermal bill had no mandate at all.

Under the nation’s federalist system of government, powers are divided between the states and the federal government. For more than 100 years, states have rightly been recognized as having control over the power systems within their borders. Twenty-nine states and the District of Columbia have enacted some form of renewable energy mandate (REM) requiring utilities to provide minimum amounts of wind and/or solar power.

As has been repeatedly detailed over the years by The Heartland Institute and others, REMs impose higher energy costs on residents and businesses in the states that have adopted them relative to states free of such mandates. REMs also cause significant environmental and public health harms in the United States and overseas. Recognizing these problems, 21 states have chosen not to enact REMs.

S. 2657 would trash this constitutionally recognized balance of responsibilities and power by imposing, for the first time ever, a huge national REM. This would saddle residents and businesses in states that have rejected REMs with one dictated by Washington, D.C., whether they want it or not.

The Clean Economy, Jobs, and Innovation Act and the American Energy Innovation Act would do huge damage to the nation’s energy and economic security. Both bills give lavish handouts—money from current and/or future taxpayers—to politically connected industries favored by radical environmentalists. In addition, both bills would expand the role of government in every person’s life through energy, housing, and appliance mandates. The bills would also replace the scientific pursuit of knowledge with mob rule in the name of democratizing science. Both bills would also undermine states’ legal authority to make decisions for their residents and would cede U.S. sovereignty over many of our energy choices to other nations’ rulers.

These bills have nothing to recommend them. If either bill ever reaches the president’s desk, whoever that president is, he or she should put the American people first and veto it.

—    H. Sterling Burnett

SOURCES: The White House; The Washington Examiner; Watts Up With That; America Out Loud; John Birch Society; Real Clear Energy; Environment & Climate News

Author
H. Sterling Burnett, Ph.D., is a Heartland senior fellow on environmental policy and the managing editor of Environment & Climate News.
hsburnett@heartland.org
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