Energy Policy:

U.S. Chamber's Harbert discusses new landscape for regulation

Will President Obama's new approach on regulation affect Clean Air Act rules? During today's OnPoint, Karen Harbert, president and CEO of the U.S. Chamber of Commerce's Institute for 21st Century Energy, reacts to President Obama's recent speech before the chamber on regulatory policy. She also explains how the chamber will contribute to the energy discussion this year.

Transcript

Monica Trauzzi: Hello and welcome to OnPoint. I'm Monica Trauzzi. With me today Karen Harbert, president and CEO of the U.S. Chamber of Commerce's Institute for 21st Century Energy. Karen, it's great to have you back on the show.

Karen Harbert: Delighted to be here, thank you for having me.

Monica Trauzzi: Karen, the in discussion in Washington has shifted from climate to clean energy and regulatory reform and the chamber is dead center in these talks. You're calling on the government to create a predictable regulatory environment. Does that mean doing away with some of the regulations that the president is currently trying to implement such as the Clean Air Act regulations?

Karen Harbert: Well, it really calls upon the administration and Congress to be more practical. We have a very daunting economic situation in front of us and we have a real energy reality. We need more energy put into our system and a lot of the regulatory structure right now is preventing that. So we need to streamline it. We need to get rid of the regulations that don't make any sense and we certainly don't need to apply those regulations in a way that will harm our economy and harm our energy infrastructure.

Monica Trauzzi: So, specifically on the Clean Air Act regulations Boiler MAC, the transport rule, and even the greenhouse gas emissions regulations. Are those items ones that you're looking at to do away with?

Karen Harbert: We are looking at all of them and they do have very, very deep impacts on our economy and we've asked the administration, we've asked Congress and we've asked the oversight committees in Congress to take a very hard look at these and look at the cost benefit of the these regulations. We feel that that hasn't been done in a very fair and transparent way. We'd like it done so that everybody is on board at what this is going to cost and isn't there a better way to do this and have Congress actually address that?

Monica Trauzzi: Do you agree with the president that there is such a thing as too much deregulation?

Karen Harbert: Well, we think there is certainly too much regulation, let me put it that way. But also there is good regulation. Everybody wants clean air, clean water, we agree with the president. What we don't agree with is that there is such a regulatory tsunami with 132 significant economic rules coming forward on the energy industry that they really don't know which way to turn. And so let's eliminate some of that uncertainty so that actually a lot of the money that's out there that could be invested, would be invested. Rather than what industry is doing right now, which is to wait to see what the regulatory framework looks like for them.

Monica Trauzzi: But how do you achieve clean air and clean water without some of these regulations?

Karen Harbert: Well, I mean when they were put in place, for example the Clean Air Act in 1970, it was applicable for 1970. It's not really applicable first 2011. And let's bring them up to date. We've called on the administration very clearly to not weaken them, but bring them up today, modernize this structure so it's actually applicable to today. Quite frankly, it is so burdensome that it takes years and years and years to get anything permitted. And that's not what our economy needs.

Monica Trauzzi: Is there somewhat of a mixed message coming out of the White House with all this talk about regulatory reform and in the meantime they're trying to push through one of the more controversial Clean Air Act regulations, the regulation of greenhouse gas emissions?

Karen Harbert: Well, we haven't seen any significant weakening of the regulatory march and we have called upon the administration to not exempt the agencies that were exempt in the presidential executive order. You know, this is not a new Executive Order. Every president has called for regulatory review. But this executive order exempted a significant number of agencies and we'd like those to be subjected to review as well. If we're going to do it let's do it all across the board. But what we really need to do is to streamline them, just not to get weakened regulation.

Monica Trauzzi: The chamber has laid out with a new energy plan with five key points. Do you think the clean energy standard that's being discussed in Congress right now can achieve many of those goals? Is this a logical legislative approach to the energy issues that we have in this country?

Karen Harbert: Well, first and foremost we have to recognize that what do we really need to do? What is the most important thing we need to be doing in energy is to become more self-reliant. So you have to ask yourself the question, does this clean energy standard make us more self-reliant or does it just increase the cost of energy? I think the devil will be in the details. We dissected what the president said in the state of the union. And what we found was that it was going to necessitate an enormous increase in non-hydro-renewables. Do we have the structure in place right now both fiscally, regulatorily wise to actually achieve that without a significant devastating economic impact. Those are discussions and analysis that needs to be done. But we want to be more self-reliant, we want to use what we have here at home. You think about what's happening in the Middle East, it should be another wake-up call for us to say, you know what, we really need to be looking at home for solutions, both conventional and renewable, but get them in balance and don't mandate what needs to happen. Let's also look at what the market can afford right now.

Monica Trauzzi: You spoke about predictability earlier. How do you make things more predictable for industry and sort of level the playing field so that all these technologies can come online?

Karen Harbert: Well, we need to prove out some of these technologies that are relatively more costly than others and we've called upon the administration to establish for example a clean energy bank that would provide concessionary financing for certain new and market making technologies. But we can't turn our back on our existing resources. We are blessed with a lot of natural gas. We are blessed with a lot of oil that can be environmentally produced here in a responsible way and obviously we have a lot of coal, so we can't just immediately flip the switch and turn to higher cost technologies. But over time we should be investing in bringing down those costs so that we can have a broader array, more options on the table for our American consumers.

Monica Trauzzi: Is there more common ground on clean energy than there was on climate or are we going to see the same kind of regional disputes that we did with cap and trade?

Karen Harbert: Wall, like anything, there are regional differences in our country. The South East has a lot of nuclear and the Northwest has a lot of hydro and I think there is going to be some serious discussion about how do we accommodate regional differences and that's good. But if what comes out of it is that it is simply a way to make the definition so broad, but that people are still paying higher costs. I think that that will fall flat. It is not going to be something that's going to be resolved in the next two or three weeks or two or three months. But I do think it's a good sign that the people are willing to sit down at the table. I saw members on the Energy and Commerce Committee today say they want to use the committee structure rather than what happened in climate which was there was a big bill that came out, didn't go through the committee structure and it was brought to the floor for a vote. And I think we'll see a much more deliberative process which normally yields a better outcome.

Monica Trauzzi: The chamber will be launching a campaign later this month to rile support for your energy plan. What are you hoping to accomplish with this new tour and is the focus really just going to be on jobs?

Karen Harbert: Well, energy does produce a lot of jobs and particularly it could produce should a lot of jobs if the energy industry was allowed to invest, whether it's in oil and gas or coal or nuclear renewables. We're seeing a lot of that held back. So we're going to be going out and talking to business leaders, opinion leaders and getting more skin in the game if you will so that we can get a more practical achievable, useful, outcome in energy policy. People are frustrated out there. We spent the last year in 30 states and the basic message was we want to see some practical, you know, policy come out of Washington so we have a more secure energy future. They're not seeing it. They saw themselves very out of step with policymakers and we'd like to get that actually more balanced.

Monica Trauzzi: OK, we'll end it right there. Thank you for coming on the show.

Karen Harbert: Thanks, Monica.

Monica Trauzzi: And thanks for watching. We'll see you back here tomorrow.

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