Oil and gas companies and electric utilities over the past two decades have poured $8 million into the campaign coffers of lawmakers on the Senate Finance Committee who could now look to shape climate legislation.
Senators on the committee also have received campaign money from other segments of the energy industry that would be affected by a sweeping climate and energy bill, including wind, solar, coal, nuclear power, steel manufacturing and the forest and paper industry.
All told, those likely to be affected by climate and energy legislation for the current election cycle have given nearly $390,000 to Democrats on the Finance Committee and nearly $251,000 to Republican members, an E&E analysis of campaign contributions shows.
Chairman Max Baucus (D-Mont.) has indicated the panel will likely rewrite and vote on the portion of the climate bill that caps carbon emissions and lets businesses buy and sell emissions permits. Any rewrite would affect a broad cross-section of businesses now giving contributions.
"Companies have a lot to win or lose with legislative outcomes, and they are clearly positioning themselves to be winners," said Tyson Slocum, director of watchdog group Public Citizen's energy program.
"It's all an effort to get access," Slocum added. "That's what making campaign contributions provides you, is enhanced access with members of Congress. It doesn't guarantee outcomes but it increases your odds of being able to influence the outcomes."
The Finance Committee has jurisdiction over much of the structure of a cap-and-trade program including how much companies will be able to bank emissions permits in one year and use in another, and whether free permits given to companies could be turned into a kind of security that could be bundled and sold like mortgages, said Kenneth Green, resident scholar at the American Enterprise Institute.
Baucus has said he might want to look at how any free greenhouse gas emission allowances would be doled out to regulated industries.
"There are two reasons for a company to donate," to a political campaign, Green said. "One, they are hoping to make a profit either selling carbon credits, or having their competitor disadvantaged. Or, two, they are staring high costs in the face and they want to get something in the bill to reduce the costs."
The Finance panel is one of the most powerful on Capitol Hill, and a good portion of those on the committee have been in the Senate at least 20 years, the time period over which the oil and gas industry has given a combined total of at least $5.6 million to those now on the committee, according to data from the Center for Responsive Politics. Electric utilities gave at least $2.4 million during that same period.
Lincoln, Grassley are tops
Of all those on the Finance Committee, Sen. Blanche Lincoln (D-Ark.) has received the most money from companies and trade groups with an interest in climate legislation in this campaign cycle. A third-term senator who this summer became chairwoman of the Agriculture Committee, Lincoln is one of five committee members up for re-election. A moderate Democrat, she is also considered a key swing vote on the climate bill.
For the 2010 campaign, Lincoln has taken in $195,796 from 72 different energy interests. In comparison, she has received $242,250 from companies and groups with stakes in health care legislation -- another major issue that goes through the Finance panel.
The energy contributions came from diverse sources. Southwestern Energy Co., an oil and gas exploration company, gave $10,000, as did Koch Industries Inc., which has an oil refining arm and a paper mill business among others businesses. Lincoln also received $6,444 from the American Wind Industries Association, a trade group for wind energy businesses.
"Senator Lincoln is aggressively preparing for a competitive election cycle so it is not too surprising that she ranks No. 1," said Steve Patterson, Lincoln's re-election campaign manager. "All campaign contributions aside, the senator knows that she will be accountable to Arkansas voters come Election Day.
"That means that as she considers climate change legislation, she must merge the interests of traditional energy sources in Arkansas like oil and natural gas with emerging new energy industries in the state like wind and biofuels," Patterson added. "Also, she will weigh the impact of climate change policy on significant agricultural sectors in Arkansas such as rice, cotton and livestock. Nearly 25 percent of the state's economy is dependent on agriculture. Her primary objective will be to help develop a clean energy policy that creates economic opportunity for Arkansas."
Of the Republicans, ranking member Chuck Grassley (R-Iowa) received the most, with $128,500 in contributions from 52 different sources. During the same period, he received far more from health interests, a total of $228,800.
Grassley's biggest energy contribution came from Koch Industries, which gave $15,000. Oil and gas refining company Valero Energy Corp. gave $10,000. Atlanta-based utility Southern Co. and International Paper Co., the largest pulp and paper company, each gave $8,500.
"Senator Grassley accepts contributions that are legal and that come with no strings attached," said Grassley spokeswoman Jill Kozeny.
Grassley has shown some reticence about cap and trade, at least as it appeared in the House bill, and this summer said that he would prefer a much broader international response to the climate issue.
"You've heard me say that I'm very cautious on cap and trade unless it comes -- or, let's put it this way, not use the term cap and trade, but use the term global warming, I'm very much thinking that needs to be done on international treaty so that it levels the playing field between the United States and China," Grassley said.
Utilities give big
Electric utilities, though happier than oil and gas companies about the Kerry-Boxer bill, still are lobbying for changes in the cap-and-trade language.
Environment and Public Works Chairwoman Barbara Boxer (D-Calif.) included identical language to the House version in her chairman's mark that gave 30 percent of free pollution permits to state-regulated local electric-distribution companies, although from a smaller overall pie (E&E Daily, Oct. 29).
Those allowances must be used to benefit consumers. Edison Electric Institute, the association representing electric utilities, in a recent interview said that it wants that share of free permits increased to 40 percent.
EEI also advocates having utilities receive those free permits for a longer period. Under the Kerry-Boxer bill, investor-owned utilities and smaller local distribution companies would see their free credits zero out in 2030.
As one of the biggest electric utilities, Southern Co. in this election cycle was one of the largest contributors to the campaigns of lawmakers on the Finance Committee. Southern Co. gave a combined $16,500. Of that, Grassley received $8,500, Lincoln took in $5,500 and Sen. Mike Crapo (R-Idaho) received $2,500. All three are up for re-election.
"Our objective is to support candidates who understand issues that are important to Southern Company's customers, employees and shareholders," said Jason Cuevas, a Southern Co. spokesman. "Contribution decisions are made by our employee-elected PAC board and are not are not based on party affiliation or incumbency."
Southern Co., Cuevas said, wants the cap-and-trade program timetable to match up with available technology. It wants a limit on how high allowance prices can go and wants to ensure that companies can buy offsets for projects that reduce carbon, in lieu of paying for permits to cover carbon emissions.
"As the legislative process continues, we will communicate our views to policymakers working on this issue that climate legislation should contain provisions that help control costs in reasonable, effective ways to minimize impact to our customers, Cuevas said.
As for the oil and gas industry, the House bill (H.R. 2454) gave oil refiners 2 percent of those free emission allowances for two years. The Senate bill (S. 1733) would provide 2.25 percent, again from the smaller pie.
The American Petroleum Institute and Exxon Mobil Corp., which in the current campaign cycle has given $10,500 to lawmakers on the committee, did not respond for comment.
Paper has concerns
Of all the companies and trade groups giving to Finance Committee members this election cycle, International Paper gave the most, a total of $23,000. That went evenly split to Democrats and Republicans, each receiving $11,500.
"There are a variety of issues of importance to International Paper including energy and climate as well as environment, tax and trade, and transportation," said International Paper spokeswoman Kathleen Bark.
Weyerhaeuser Co., another pulp and paper company, gave $14,000 to committee members during the same period. American Forest & Paper Association, the trade group for the industry, gave $4,500.
The paper industry has argued that it will be hit with higher costs under a cap-and-trade system because other businesses will begin buying lumber and wood scraps to make biomass energy. That will drive up the cost of a limited product, the American Forest and Paper Association has said. Natural gas, which the industry also uses, is also expected to increase in price.
To compensate, forest and paper companies have argued they should get some free emissions permits that would cancel out some of the expected penalties for emitting carbon.
The forest industry wants to be included on the list of what Congress considers as offsets, the credits that companies can buy to counteract their carbon emissions. In recent years lawmakers have talked more favorably about giving those credits to trees planted on land that had not recently been forested, but not in commercial forests where trees continually are replanted.