US energy proposal pushes toward center

From aggressive greenhouse-gas limits to new nuclear plants, independent group tries to bridge divisive issues.

The effort to craft a comprehensive national energy strategy got a significant nudge this week. After two year's work, the nonpartisan National Commission on Energy Policy, a panel funded by several foundations, issued what's likely to be an influential report addressing all aspects of energy policy: supply, national security, environmental impact, and diplomacy.

Recommendations are laced with incentives as well as regulations that in total are unlikely to completely please anyone - smokestack apologist or solar-powered activist. Still, the commission's middle-of-the-road approach could stimulate movement on the national energy policy, which has stalled over things such as global warming and drilling for oil in Alaska.

Among the major recommendations:

• "Significantly strengthening" vehicle fuel-economy standards while providing $3 billion in consumer and manufacturing incentives to build and buy hybrid and advanced diesel cars and trucks.

• Applying diplomatic pressure to encourage nations with underdeveloped oil reserves to allow foreign investment while also easing US economic sanctions that currently prevent such investment.

• Beginning in 2010, institute a mandatory "cap and trade" program on greenhouse-gas emissions that would reduce such emissions 2.4 percent a year. This rate of reduction is 50 percent more than the Bush administration proposes in its voluntary program.

• Build an Alaska natural gas pipeline.

• Invest $4 billion over the next 10 years in advanced coal technologies.

• Provide $2 billion over the next 10 years to research and develop one or two advanced nuclear power plants.

• Increase federal support for renewable energy technology by $360 million a year.

It's a plan designed to be both ambitious in scope and politically realistic. Seated around the discussion table were advocates for business, labor, consumers, and the environment.

The commission - prompted by 9/ 11, the California energy crisis, and rising global energy expenditures - was formed early in 2002 by independent foundations to address growing concerns about shared resources. Among the 16 commission members are former EPA administrator William Reilly, United Steel Workers president Leo Gerard, Sharon Nelson of the Consumers Union, Ford Motor Company vice president Martin Zimmerman, former CIA chief James Woolsey, and Ralph Cavanaugh of the Natural Resources Defense Council. The contrast with Vice President Dick Cheney's closed-door task force, generally thought to be industry-heavy, was obvious.

While the overall energy package would cost some $36 billion over 10 years, it is designed to be revenue-neutral in that the money would be raised by selling emission allowances for greenhouse gases.

On many of the most important recommendations, there is a "prime the pump" approach that assumes that technology development - spurred by incentives and deadlines - will take off in a way that impels more efficiency and less reliance on foreign energy sources, as well as eventual reductions in climate-changing emissions.

"We almost always overestimate what technology can do in the short run, but underestimate what it can do in the long run," says commission co-chair John Holdren, an engineer and physicist who teaches environmental policy at Harvard.

As expected, there are criticisims. The National Association of Manufacturers calls the recommendation for mandatory caps on greenhouse gases "a significant threat to US industrial growth." The group prefers the Bush administration's voluntary approach to such reductions.

"The last thing our economy needs right now is a new government mandate that will raise energy prices even higher," says NAM vice president Mark Whitenton.

But the context for this week's energy policy report includes political activity and public pressure that moves well beyond what the White House and much of the business community want in terms of government control.

Under the bipartisan "Climate Stewardship Act," authored by Sens. John McCain (R) of Arizona and Joseph Lieberman (D) of Connecticut, all major sectors of the economy would be required to return greenhouse-gas pollution limits to year 2000 levels by 2010.

California is in a court fight with auto manufacturers, which filed suit this week seeking to halt the state's new program curbing vehicle emissions of carbon dioxide and other greenhouse gases. Seven other states are moving in that direction as well. Eight states have filed a "public nuisance" lawsuit against the country's five largest power companies for the 652 million tons of carbon dioxide (the principal greenhouse gas) emitted annually.

One of the major criticisms of the Kyoto Treaty on global warming has been that it does not include developing countries such as China and India, whose burgeoning economies could account for increasing amounts of climate-changing gases. Members of the National Commission on Energy Policy take account of that possibility by recommending a review in 2015 of US actions to reduce emissions in light of what such countries have accomplished.

Having spent considerable time with officials and scientists in China and India, commission cochair John Holdren predicts those countries will be working to reduce their emissions as well, particularly as the technology to do so becomes more developed and available. "I think in 2015 they'll all be on board," says Dr. Holdren.

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