CLIMATE:

Democrats gamble with one-bill energy and climate strategy

Senate Majority Leader Harry Reid's decision to merge controversial energy and global warming measures together into one large bill raises the stakes for sponsors, who now begin counting votes on issues at the core of President Obama's agenda.

Reid confirmed yesterday that he now supports packaging a cap-and-trade bill together with a nationwide renewable electricity standard (RES) and other energy provisions.

Advocates applauded the Nevada Democrat for following a strategy spelled out by House Democratic leaders that blends major energy and climate provisions into one omnibus bill, saying it would show the U.S. public the dramatic transformation needed for the United States to curb its greenhouse gas emissions. "I think there's a recognition now that you can't take care of some of the big problems with small solutions," said Tony Kreindler, a spokesman for the Environmental Defense Fund.

Seasoned vote counters responded that the Senate Democrats' one-bill strategy may be a big gamble that ends up harming efforts to enact a controversial cap-and-trade program, which on its own has never come close to crossing the 60-vote threshold needed to defeat a Republican filibuster.

"The cap-and-trade bill is one of the single most important pieces of legislation Congress is ever going to vote on," said Joe Romm, a climate expert with the liberal Center for American Progress. "I would not put anything else in it. I do not want to give people a reason not to vote for it."

As recently as last week, Reid had spoken of splitting the energy and climate items up into at least three different bills, with the energy provisions moving forward first while holding back on the global warming measure for the late summer (Greenwire, Feb. 25).

But in a brief interview yesterday, Reid offered a one-word answer -- "yes" -- when asked whether he would wrap the items together. Sources tracking the Capitol Hill climate debate said Reid's shift came after a month of intense lobbying for the one-bill strategy that originated with House Energy and Commerce Chairman Henry Waxman (D-Calif.).

Waxman first convinced House Majority Leader Steny Hoyer (D-Md.) and House Speaker Nancy Pelosi (D-Calif.) on his approach. Pelosi, in turn, got approval from the Obama White House before pitching Reid the idea earlier this week during their weekly conference meeting.

Pelosi went public with her endorsement of Waxman's strategy Tuesday. "I would like to see one bill, which is the energy bill with the cap and trade and the grid piece," she told reporters. "They're the three elements that we have to pass more fully. I'd like to see it as one bill."

Changing the vote count

Democrats will not have an easy task in trying to move both a cap-and-trade program and a renewable electricity standard -- especially in the Senate. Both items have been left on the cutting room floor during past Capitol Hill energy debates as supporters fell short of the required 60 vote hurdle.

This time around, sponsors of the two items are within reach of the necessary votes thanks to Obama in the White House and larger Democratic majorities in the House and Senate. But neither is certain to reach 60 votes -- and it gets even trickier when the two proposals get combined. "I don't think anybody has a clear vote count on what happens when you put those two things together," said an environmentalist tracking the debate.

On a cap-and-trade bill, an E&E analysis places 47 senators either in the "yes" or "probably yes" camp. For the rest, sponsors must work from a group of 21 fence-sitters who will not come along without significant concessions, including Sens. Mark Begich (D) and Lisa Murkowski (R) of Alaska, Sherrod Brown (D) of Ohio, and Carl Levin (D) and Debbie Stabenow (D) of Michigan.

Add the renewable energy standard -- which requires utilities to supply escalating amounts of power from renewable sources such as wind, geothermal and solar energy -- into the mix and the whip count lines get fuzzy very quickly.

Already, backers of the renewables mandate are facing a tough slog to reach 60 votes as they seek to persuade enough conservative Democrats and moderate Republicans to back the policy. Several lawmakers in the fence-sitter category for a climate bill have either opposed or at least expressed skepticism about an RES. These lawmakers include Murkowski, Lindsey Graham (R-S.C.), Bob Corker (R-Tenn.), Mary Landrieu (D-La.) and Blanche Lincoln (D-Ark.).

Considering those dynamics, one industry lobbyist expressed surprise at Reid's plan, arguing that merging the measures makes it more difficult to reach 60 Senate votes. "I can't imagine it makes their job any easier," this oil industry source said, adding "you are going to take something that was difficult to do on the floor and amplify it times 10."

Given these hurdles, the oil lobbyist believes Reid may try and steer the measure through the filibuster-proof budget reconciliation process, where the 60 vote threshold does not apply. Senate Environment and Public Works Chairwoman Barbara Boxer (D-Calif.) said in late February that she was mulling using the reconciliation process to move a cap-and-trade bill, but Reid has yet to weigh in publicly (E&ENews PM, Feb. 26).

Republicans do not like the budget reconciliation approach. "That'd be an extremely inappropriate thing to do," Senate Republican Conference Chairman Lamar Alexander of Tennessee said yesterday. "This is a very complex piece of legislation that affects our energy industry, our jobs, our family budget."

Timing uncertain

Pelosi and Reid have both promised floor votes this year on the global warming and energy measures, though they have been less clear about exactly when that may occur.

"This is a big beast, you can't predict the timing," said one former Senate Democratic aide.

Here is what is known: Waxman has pledged a committee markup by Memorial Day, and Pelosi has pledged a first-ever floor vote before the end of the year.

Reid has previously said he wanted to hold a floor debate in the spring on energy, while holding back on the climate bill until later this summer. But he did not elaborate yesterday on his agenda in light of the shift to a one-bill strategy, and his spokesman, Jim Manley, declined comment.

Asked yesterday about the House's floor timing, Pelosi spokesman Drew Hammill yesterday would only point to Waxman's Memorial Day schedule for a committee markup.

Overall, Hill observers envision a House energy and climate debate working its way through other committees beyond Waxman in June, with a floor debate possible before lawmakers break for their summer recess in August. In the Senate, Boxer has not given specifics yet on when she will produce a climate bill, telling reporters last month that it will happen "soon."

Bill Wicker, a spokesman for Senate Energy and Natural Resources Chairman Jeff Bingaman (D-N.M.), said yesterday that Reid's plan does not change his boss' strategy of trying to shepherd a broad-based energy bill through the committee before the Easter recess. "Our homework assignment here is to report an energy bill, and as Bingaman reiterated again this morning, that is what our plan is and we are on target to do that," Wicker said yesterday. "As far as what happens after the committee delivers its assignment and reports an energy bill, that is and always has been and should be the prerogative of the leader."

Bingaman has floated a draft RES plan. But it remains unclear whether he would try and add the RES -- which faces opposition among many Republicans and some Democrats -- to the broader energy bill in a committee markup or later on the Senate floor.

The energy bill is expected to include a range of provisions on energy efficiency, building a "smart" power grid, boosting Energy Department research and development, and several other areas.

Different views on one-bill strategy

There are plenty of different opinions about the one-, two- or even three-bill strategy on and off Capitol Hill.

"Personally, I think they go hand in hand," said Senate Foreign Relations Chairman John Kerry (D-Mass.). "I'm very comfortable putting them together."

Rep. Rick Boucher (D-Va.) advocated for the combination strategy as well, saying it helps lawmakers grasp the entire picture of what they are voting on. "You can adjust one in order to compensate for changes you might want to make in another," Boucher said. "It does create a broader opportunity for balanced legislating. So I think it's a better way to do it that way."

A former House Democratic aide said Reid's decision "really makes sense given the scarcity of Senate floor time," though he now will have a challenge in deciding who leads the floor debate on the bill: Boxer, Bingaman or another lawmaker.

Tennessee's Alexander may not approve of the final product. But he nonetheless said it may have merit for prompting a more thorough debate. "There's a logic to putting them together because it's hard to discuss energy without climate change and vice versa," he said. "It might even focus attention on a realistic way to deal with climate change. For example, an effort that relies solely on solar and wind and geothermal power to try to deal with climate change is not a serious effort. You've got to use nuclear. And you've got to find a way to clean up the coal. And you've got to find more natural gas. So it might be that putting the issues together makes a more sensible bill."

Several environmental groups -- Environmental Defense Fund, Natural Resources Defense Council, National Wildlife Federation and Environment America -- praised Reid for going with a one-bill strategy. "We applaud Senator Reid's decision because this reflects the urgency of getting both global warming and energy legislation through," said David Doniger, NRDC's climate policy director.

Anna Aurilio, director of the Washington office of Environment America, said the logistics of the energy and climate legislation should be secondary to passing a measure as fast as possible. That said, she backs a single bill. "We want to get it done," she said. "If it moves together, if it moves separately, we want to get it done. The urgency of solving the problem is paramount, so obviously enacting one bill is easier than enacting separate bills."

But not everyone is on the same page.

Bingaman this year has repeatedly raised doubts whether a cap-and-trade bill can move within the same timeframe as the energy provisions he wants to see passed into law. "I hate to see all of that sort of held hostage until we can get agreement on a cap-and-trade bill," he told reporters yesterday.

Andrew Wheeler, a former GOP staff director on the Senate Environment and Public Works Committee now working for the B&D consulting firm, predicted an even bigger floor fight under the one-bill approach. "Combining energy and climate legislation, while at first blush might seem easier, it will probably increase the number of complex issues and amendments exponentially, not just doubling them," he said.

Sen. Olympia Snowe (R-Maine), a critical swing vote for Democrats as they pursue Obama's agenda, said she too had concerns with Reid's approach. "I think you have to be careful not to make things such mega-bills," she said. "You give people plenty of reasons to vote against this."

And Senate Minority Whip Jon Kyl (R-Ariz.) also found fault in taking energy and climate change up in one package.

"It's an enormous undertaking," Kyl said. "And I don't think we're anywhere close to having the information necessary to pull all of this off. There's a great error being made here that we really know how to make all this stuff work. It's a bit like running the banking and financial institutions. If you're comfortable with the way we do that, well, then maybe you're comfortable with the way we run the energy system of the entire country. I think not."