Senators Kerry (D-MA), Graham (R-SC), and Lieberman stated today that they intend to work on a compromise with business groups and the White House that can garner 60 votes. The three offered few details on what the essential elements of a compromise bill would include.

Of note to our community in the legislation:

Investments in Advanced Energy Research and Development- 4% (compared to 1.5 % in House legislation) of distributed allowances in 2012 and 2013, 2% in 2014 and 2015, and 1.7% of allowances in subsequent years will be allocated for research on advanced energy technologies, including funding for applied research at “Clean Energy Innovation Centers” at research universities and institutions.

FY10 Appropriations

Last week congressional leaders discussed including the extension into the conference report on the Interior-Environment appropriations bill, similar to how the original one-month CR was added in conference to Legislative Branch spending bill.  They decided against this path forward likely because the Interior bill may face controversy over unrelated provisions.  The CR extension is expected to go to December 15th, a little more than a week before Christmas.  To date, Congress has completed action on just four of the 12 spending bills for the fiscal year that began on October 1 (Agriculture, Energy & Water, Homeland Security, and Legislative Branch).  The UW has secured two earmarks in the Energy & Water bill.  The first is a $1 million mark for biofuels work and the second is $880,000 for accelerating research on tidal energy production.

The Interior-Environment appropriation bill is scheduled for House action this week if an agreement can be reached on one controversial provision related to EPA regulation of vessel emissions on the Great Lakes.  The UW College of the Environment stands to gain a $4 million earmark in that bill to conduct, compile, and disseminate research on how best to restore and protect the Puget Sound.

The House is also scheduled to consider a bill that would reauthorize Small Business Administration (SBA) programs that provide entrepreneurs with access to capital.  The legislation is a combination of eight bills that would extend some stimulus programs that allowed the SBA to increase loans, provide more capital to low-income areas and renewable-energy industries, and make loan guarantees to small health care firms purchasing health information technology.

The Senate may try to take up the Commerce-Justice-Science bill after pulling it from floor consideration last October 13^th after Democrats failed to come up with enough votes to limit debate and amendments to the bill.  One amendment that is holding up progress would require the 2010 Census to include questions about citizenship and immigration status, which is opposed by the Obama Administration.

Meanwhile, the Senate will focus on the economy this week and try to finish a bill that would extend unemployment benefits.  The measure would provide an additional 14 weeks of benefits to unemployed individuals nationwide and would give six more weeks on top of that to states with a three-month average unemployment rate of at least 8.5 percent.  The Senate may also take up its FY10 Military Construction-VA appropriations bill.

Because the appropriations process has been slow this fall, mostly due to the health reform debate, Congress is now thinking that a year-end omnibus bill may be necessary to complete the remaining FY 10 appropriations bills.  Additionally, the remaining appropriations measures may be used to enact further legislation to help the unemployed and boost job creation.

Health Reform

Debate on health care reform is not expected to begin until next week at the earliest, as Democratic leaders in both chambers are still trying to finalize the legislation they intend to bring to the floor. The House hopes to release their renegotiated health reform measure this week so that they can vote on the package by November 6^th.  It is possible, that the House will work through that weekend and into Monday and Tuesday before taking a small break for Veterans Day. 

Unveiling the bill would answer questions about the shape of the public option and clear the way for final decisions on how to raise revenue to pay for it.  While House liberals are looking for a public plan based on Medicare rates, House Leaders are leaving room for moderates’ preferred version after Senate Democrats indicated they were likely to include a public option in their overhaul.  Leaders still have a few thorny issues to resolve before they introduce a bill, such as questions about abortion services, insurance for immigrants, cost of medical devices, and hospital payments.

Meanwhile, the Senate continues to work on merging the two reform bills from the Senate Finance and HELP committees, and appears to be moving toward a stronger public option than currently included in the Senate Finance Committee bill.  Senate Democratic leaders have other issues to resolve, including whether the final bill would include an employer mandate; a long-term insurance program for those who become disabled; financing to make up for revenue lost by increasing the value of plans considered high cost that would be taxed under the bill; and how to make premiums more affordable since individual coverage will be required by law.

Energy and the Environment

The Senate Environment & Public Works Committee will hold three days of hearings this week on a revised draft of climate change legislation the panel is looking to mark up soon.  On Tuesday, the committee will hear from five administration officials – Energy Secretary Chu, Interior Secretary Salazar, Transportation Secretary LaHood, EPA Administrator Jackson, and Federal Energy Regulatory Commission (FERC) Chairman Wellinghoff.

Last week, the House passed legislation that would lead to the creation of a federal research strategy for solar energy.  The bill (HR 3585) directs the Energy Department to establish a Solar Technology Roadmap Committee, which would develop a comprehensive federal solar research plan.  Bill supporters noted rapid growth in solar manufacturing by European nations and China in recent years.  The bill would authorize $350 million for the Energy Department in fiscal 2011, rising to $550 million in fiscal 2015, for a total of $2.25 billion over the five-year period.  Some members expressed concerns about the high cost of the bill even while supporting the underlying goals.   

The roadmap committee created by the bill would include at least 11 members appointed by the Energy secretary within four months of the bill’s enactment.  At least one-third of the members — but not more than half — would be required to come from the solar industry.  The bill also would require the appointment of a chairman from outside the federal government.  Within 18 months of enactment, the committee would be required to chart a course for research, development, and demonstration activities between the federal government and the private sector.  The Energy secretary would be directed to award merit-based grants for projects, with an emphasis on solar manufacturing research performed by industry-led consortia.

FY11 Appropriations

Today is the deadline for submitting proposals for the FY11 federal agenda.  Proposals will be reviewed and evaluated over the next several weeks.  In January 2010, the Office of Federal Relations will share the results of that work when we present our FY11 Federal Agenda.  If you have any questions about this process, please contact me or Jonathan Nurse.

On October 27th, the US Senate’s Environment and Pulbic Works (EPW) Committee will begin hearings on a companion bill to the American Clean Energy and Securirty (ACES) Act (H.R. 2454) that passed the House over the summer.  The Senate legislation, introduced by EPW Chair Barbara Boxewr (D-CA) and John Kerry (D-MA) on September 30th, is currently being refined by committee staff and is undergoing an analysis by the EPA that should be completed in time for the hearings. Conventional wisdom held that the Senate’s version of a massive climate change mitigation plan would be pushed until next calendar year, due to the already partisan environment created by the current health reform debate. However, Senator Boxer’s team is moving ahead with the legislation now. Further, initial drafts of the Senate bill have drawn bipartisan support. Last weekend, Senator Lindsay Graham (R-SC) and John Kerry co-authored a piece in the New York Times entitled “Yes We Can (Pass Climate Change Legislation).“  In the article, Senator Graham makes the case that a climate change bill that promotes nuclear energy, more offshore oil and natural gas development and carbon sequestration from coal power plants would draw the 60 votes necessary to assure passage. The duo also articulated that climate change legislation should also establish limits on prices for carbon allowances provided under a cap-and-trade system, and a tax on energy-intensive goods from countries with less stringent emissions requirements than the United States.

Research investments were mentioned only briefly in the op-ed. House and Sente bills seem to ignore President Obama’s call for a $15 billion investment in research and development as part of a comprehensive climate change mitigation bill; a point made to Senate Majority Leader Reid (D-NV) this week in a letter from the research community.

Hearings will begin with testimony from Secretary of Energy Steven Chu, Secretary of the Interior Ken Salazar, Secretary of Transportation Ray LaHood, Environmental Protection Agency Administrator Lisa P. Jackson, and Federal Energy Regulatory Commission Chairman Jon Wellinghoff.

The Senate legislation consists of two divisions:

Division A: Authorizes new greenhouse gas (GHG) emissions standards, creates new programs for energy, research and development (R&D), adaptation, transition assistance and other purposes
 
Division B: Authorizes the establishment of GHG emission caps and directs the investment of allowance value to various programs including those established or revised in Division A.

Clean Energy Jobs and American Power Act

House and Senate conferees on the fiscal year 2010 Energy and Water Appropriations have approved a conference agreement. The conference agreement reconciles differences in the bills produced by the individual chambers and now must go back for final approval, which is expected. Within the legislation is support for two important University of Washington projects: $880,000 for the Northwest National Marine Renewable Energy Center, and $1 million for the Washington Biofuels Industry Development project. Additional items of importance in the conference report include:

Energy Efficiency and Renewable Energy- $2.2 billion, $314 million above 2009, to increase investments in technologies that use energy more effectively and produce clean, inexpensive energy from domestic sources.

• Solar Energy: $225 million for research, development, and demonstration projects to make solar energy more affordable.
• Biofuels: $220 million for grants to improve production of alternative fuels such as cellulosic ethanol
  and biodiesel.

Office of Science- $4.9 billion, $131 million above 2009, for scientific research critical to addressing long-term energy needs. This funding, in addition to the $4.8 billion appropriated in fiscal year 2009 and $1.6 billion in the Recovery Act, exceeds the goals in the America COMPETES Act.

• Basic Energy Sciences: $1.6 billion for basic research primarily on materials sciences and on chemical
  sciences, energy biosciences and geosciences. This work places heavy emphasis on advancing the frontiers of using ever-faster tools, including $394 million in the Advanced Scientific Computing Research program, to better understand ever-smaller and more detailed phenomena.
• Applied Research: $2.4 billion for Nuclear Physics, High Energy Physics, Biological and Environmental Research, and Fusion Energy Sciences.
• Energy Innovation Hubs: Funding for three of the proposed eight Energy Innovation Hubs (at $22 million each) in the following areas: Fuels from Sunlight; Energy Efficient Building Systems  Design; and Modeling and Simulation.
• RE-ENERGYSE: Funding was not provided for the newly proposed RE-ENERGYSE education program.

Full Energy and Water Conference Report

“Training the next generation of U.S. scientists and engineers is critical to our future energy security and economic competitiveness,” said Secretary Chu. “This Fellowship is part of the Administration’s effort to encourage students to direct their talents towards careers in science and our nation’s next technology revolution.”

To be eligible for the Fellowship, applicants must be U.S. citizens and currently a first or second year graduate student enrolled at a U.S. academic institution, or an undergraduate senior who will be enrolled as a first year graduate student by the fall of 2010.  Applicants must be pursuing graduate study and research in the physical, biological, engineering and computational sciences.  Interested students can apply online at: http://www.scied.science.doe.gov/SCGF.html

Each fellowship award will be $50,500 per year for three years to provide support for tuition, living expenses, research materials and travel to research conferences.  Fellowships will be awarded on the basis of peer review. Applicants may begin submitting applications on September 30, 2009.  Completed applications are due November 30, 2009.

NEWS MEDIA CONTACT:                         FOR IMMEDIATE RELEASE:
(202) 586-4940                                        Wednesday, July 22, 2009

Chu: U.S. Can “Lead this New Industrial Revolution” in Clean Energy
 
Richmond Times-Dispatch op-ed highlights economic opportunities in energy and climate bill

WASHINGTON, DC– The Wednesday, July 22, 2009 edition of the Richmond Times-Dispatch includes the following opinion piece from Energy Secretary Steven Chu:
 
Cleaning Up: Energy and Climate Bill Will Boost the Economy
US ENERGY SECRETARY STEVEN CHU
Published: July 22, 2009
Over the next few months, Congress will decide on historic energy legislation that would create a generation of clean-energy jobs here in America, reduce our dependence on foreign oil, and prevent the worst effects of climate change. I believe passing a strong energy and climate bill is the single most important step we could take to secure our economic prosperity and leave a healthier planet for future generations.

The status quo on energy is unsustainable. Today, we import about 60 percent of the oil we use, which is a huge drain on our economy and which weakens our security. When we burn fossil fuels for energy, we emit enormous amounts of greenhouse gases, which have already begun to change our climate. Climate experts predict that, on our current course, the planet could be around 10 degrees Fahrenheit warmer by the end of this century. Such an increase could cause more frequent extreme weather events like droughts, heat waves, and hurricanes; rising sea levels and coastal erosion; serious agricultural losses and water shortages; and many other impacts in the United States.

There is no question that our energy habits need to change. The only question is whether we can turn this energy challenge into an energy opportunity.

Here is the future that I see. In the coming decades, the laws of supply and demand will almost certainly force oil and gas prices to rise. At the same time, the consequences of climate change will become so starkly apparent that continuing to emit carbon pollution at today’s levels will be unacceptable. As a result, clean-energy technologies will be in high demand. Tens of thousands of windmills and solar panels will be manufactured and installed around the world. Consumers will demand more efficient vehicles, appliances, and buildings. There will be a race to produce the most advanced batteries and biofuels.

We must ask ourselves: How does the United States want to position itself in this future world? When the great hockey player Wayne Gretzky was asked how he positions himself on the ice, he replied: “I skate to where the puck is going to be, not where it’s been.” America should do the same.

President Obama is committed to signing comprehensive energy and climate legislation that will position America where the puck is going to be. The government can’t solve this problem alone, but it can provide the right incentives for America’s entrepreneurs, industries, and innovators to transform how we produce and use energy.

With the right incentives, the private sector will first seek out the lowest-hanging fruit. The quickest and easiest way to reduce our carbon emissions is to make our appliances, cars, homes and other buildings more efficient. In fact, energy efficiency is not just low-hanging fruit; it is fruit that is lying on the ground. And energy efficiency means money back in your pocket because you pay less on your energy bills.

A new energy bill will also make clean energy profitable. That will drive investments in wind and solar power and next generation biofuels from grasses and agricultural waste. It will spark American innovation in fuel efficient automobiles and the development of advanced batteries for electric vehicles. It will offer incentives to re-start our nuclear power industry and encourage utilities to invest in carbon capture and storage from coal-fired power plants.
Finally, the right clean energy incentives will start the great American research and innovation machine, which will lead to better and cheaper energy and climate solutions.

We can do all of this for a very affordable cost for America’s families. The Environmental Protection Agency and the Congressional Budget Office found that the goals of the energy bill passed recently by the House of Representatives can be achieved for between 22 to 48 cents per day per household in 2020. That’s about the price of a postage stamp per day. At the same time, the legislation would not increase the deficit.

We have talked for decades about the energy problem; it is time to solve it. By passing a comprehensive energy bill that spurs a revolution in clean technologies, the United States can position itself to lead this new industrial revolution. This is our opportunity to shape our energy destiny, and we must seize it.

Steven Chu is the Secretary of Energy.
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To be eligible for the competition, a researcher must be an untenured, tenure-track assistant professor at a U.S. academic institution or a full-time employee at a DOE national laboratory.  The applicant must also have received a Ph.D. within the past ten years. 

Each university award will be at least $150,000 per year for five years to support summer salary and other research expenses.  For DOE national laboratories, awards will be at least $500,000 per year for five years to support year-round salary and expenses.

Early career researchers may apply to one of six Office of Science program offices: Advanced Scientific Computing Research; Biological and Environmental Research; Basic Energy Sciences; Fusion Energy Sciences; High Energy Physics; or Nuclear Physics.  Proposed research topics must fall within the programmatic priorities of DOE’s Office of Science, which are provided in the program announcements.  Funding will be competitively awarded on the basis of peer review. 

Letters of intent will be due on August 1, 2009, and proposals will be due on September 1, 2009.    

Read more about DoE grant opportunities.

“Low-cost renewable energy generation that includes energy storage is one key to our efforts to diversify domestic energy sources and create new jobs,” Energy Secretary Steven Chu said. “By investing in the development of low-cost solar technologies we can pave the way toward faster deployment of carbon-free, large-scale energy sources.”

Concentrating Solar Power (CSP) technologies concentrate the sun’s energy and capture that energy as heat, which then drives an engine or turbine to produce electrical power. CSP plants can include low-cost energy storage, which allows them to provide electricity even when the sun is not shining. CSP technologies currently used in utility-scale power plants typically do not have the capability/capacity for storage, operating only during daytime hours. These projects will seek to improve technology and novel system designs to extend operation to an average of about 18 hours per day, a level of production that would make it possible for a CSP plant to displace a traditional coal power plant.

The competitive funding opportunity involves two areas:

• Research and development of concepts and components for a CSP system that enables a plant to produce low-cost electricity at least 18 hours of the day.
• Evaluation of the feasibility and development of a prototype complete CSP system capable of operating at least 18 hours per day while generating low-cost power.

Projects are based upon continuing annual appropriations. DOE anticipates making up to 13 project awards totaling up to $52.5 million. 

Learn more about US Department of Energy grant opportunities.

The House Appropriations Committee was able to provide the Department of Energy Office of Science funding of $4.9 billion, the same as the President’s budget request and an increase of $171 million over last year.  The Administration’s new initiatives, the Energy Innovation Hubs and the Re-ENERGYSE energy education program, received partial funding by the House Committee.  In the Senate, the Appropriations Committee cleared their bill yesterday and provided a similar increase for the DOE Office of Science. They provided funding for three Innovation Hubs but did not fund the Re-ENERGYSE program.
 
In terms of the comprehensive energy and climate authorization bills, the House passed its bill, the American Clean Energy and Security Act (HR 2454), in late June. House Leadership made agreements for votes up until the end, reaching a final vote of 219 to 212.  The most important R&D provisions in HR 2454 are the 1.5 percent of the climate mitigation credit allowances that were allotted for research and development and related activities. The House bill has been sent to the Senate for consideration, with most of the interested Senate committees with scheduled to hold hearings this month and mark up in early September.  Senate Leadership has asked that all Committee markups be completed by September 28.

Senate Energy and Water Appropriations Summary

House Energy and Water Appropriations Summary

Statement of Steven Chu, Secretary of Energy Before the Committee on Environment and Public Works, United States Senate, Washington, D.C.

 July 7, 2009

Chairman Boxer, Ranking Member Inhofe, and Members of the Committee, thank you for the opportunity to testify on moving America toward a clean energy economy. 
 
We face many serious and immediate challenges.  American families and businesses are struggling in a recession and an increasingly competitive global economy.  We have become deeply dependent on a single energy source to power our cars, trucks and airplanes, and spend hundreds of billions of dollars a year to import nearly 60 percent of the oil we use.  We face an unprecedented threat to our very way of life from climate change.
 
To solve these challenges, the Administration and Congress need to work together to spur a revolution in clean energy technologies. The President and I applauded the historic action by the House to pass a clean energy bill, and we look forward to working with the Senate to pass comprehensive energy legislation.

I want to focus today on the threat of climate change.  Overwhelming scientific evidence shows that carbon dioxide from human activity has increased the atmospheric level of CO2 by roughly 40 percent, a level one- third higher than any time in the last 800,000 years.  There is also a consensus that CO2 and other greenhouse gas emissions have caused our planet to change. Already, we have seen the loss of about half of the summer arctic polar ice cap since the 1950s, a dramatically accelerating rise in sea level, and the loss of over two thousand cubic miles of glacial ice, not on geological time scales but over a mere hundred years.

The Intergovernmental Panel on Climate Change (IPCC) projected in 2007 that, if we continued on this course, there was a 50 percent chance of global average air temperature increasing by more than 7 degrees Fahrenheit in this century.  A 2009 MIT study found a fifty percent chance of a 9 degree rise in this century and a 17 percent chance of a nearly 11 degree increase. 11 degrees may not sound like much, but, during the last ice age, when Canada and much of the United States were covered all year in a glacier, the world was only about 11 degrees colder.  A world 11 degrees warmer will be very different as well.  Is this the legacy we want to leave our children and grandchildren?

Denial of the climate change problem will not change our destiny; a comprehensive energy and climate bill that caps and then reduces carbon emissions will.

America has the opportunity to lead a new industrial revolution of creating sustainable, clean energy.  We can sit on the sidelines and deny the scientific facts, or we can get in the game and play to win.

Opponents of this effort claim the nation cannot afford to act at this time.  I disagree, and so do the Environmental Protection Agency and the Congressional Budget Office.  These organizations estimate that meeting the greenhouse gas targets in the House bill can be achieved at an annual cost between 22 to 48 cents per day per household in 2020.  That’s about the price of a postage stamp per day.

History suggests that the actual costs could be even lower.  The costs to save our ozone layer, to reduce smog with catalytic converters, and to scrub the sulfur dioxide from power plants were all far less than estimated.  For example, according to the EPA, the SO2 reductions will be achieved for one-quarter of the estimated cost.[1] <outbind://28/#_ftn1>   The right clean energy incentives will start the great American research and innovation machine, and I am confident that American ingenuity will lead to better and cheaper climate solutions.

We can make significant near-term carbon reductions through energy efficiency.  We use 40 percent of our energy in buildings.  I firmly believe that, with today’s technologies, we can build new homes and buildings that use 40 percent less energy than today’s new buildings and therefore save money on energy bills.  By developing a system integration approach, I believe we could eventually build buildings that use 80 percent less energy with investments that pay for themselves in less than 15 years through reduced energy bills.  Similarly, we could retrofit existing buildings to achieve 50 percent energy savings with investments that will pay for themselves.

A comprehensive energy and climate bill will drive American innovation in fuel efficient automobiles and the development of advanced batteries for electric vehicles.  It will offer incentives to re-start our nuclear power industry and encourage utilities to invest in carbon capture and sequestration.  It will drive investments in wind and solar power and next generation biofuels from grasses and agricultural waste.

In addition to deploying the technologies we have today and can see on the horizon, we must pursue truly transformative solutions.  Climate experts, such as the IPCC, tell us we must reduce our carbon emissions by 80 percent by mid-century to stabilize atmospheric greenhouse gas concentrations at a level that may avoid the worst consequences of climate change.  To achieve our long-term goals in a more cost-effective way, we will need a sustained commitment to research and development.  Only R & D can deliver a new generation of clean technologies.

Let me close with a quote from Dr. Martin Luther King.  His words seem so fitting for today’s climate crisis:

“We are now faced with the fact, my friends, that tomorrow is today.  We are confronted with the fierce urgency of now.  In this unfolding conundrum of life and history, there is such a thing as being too late.”

Now is the time to take comprehensive and sustained action.  With the leadership of the President, the actions of this Congress, and the support and participation of the American people, I am confident that we will succeed.

Thank you.