Transition:

Chamber of Commerce's Harbert lays out energy agenda for incoming administration

The U.S. Chamber of Commerce recently released its own transition plan for President-elect Barack Obama, detailing the steps his administration should take to promote energy independence and expand the development and use of clean energy. During today's OnPoint, Karen Harbert, executive vice president and managing director of the U.S. Chamber of Commerce's Institute for 21st Century Energy, tackles key policy issues, including the implementation of a national renewable electricity standard, the regulation of emissions under existing law and funding for carbon capture and storage technology. She explains how the shift at the helm of the House Energy and Commerce Committee may affect energy and climate agendas during the next session of Congress. Harbert also gives the Chamber's take on Obama's green jobs plan.

Transcript

Monica Trauzzi: Welcome to the show. I'm Monica Trauzzi. With us today is Karen Harbert, executive vice president of the U.S. Chamber of Commerce's Institute for 21st-Century Energy. Karen, nice to see you, thanks for coming on the show.

Karen Harbert: Great to be here. Thanks, Monica.

Monica Trauzzi: The Chamber of Commerce recently released a presidential transition plan for securing America's energy future and it's really a step-by-step guide on how President-elect Obama should be addressing the U.S.'s energy challenges. How important are the transition and those first 100 days in really setting out and setting up the tone for energy policy?

Karen Harbert: Well, as you know, President-elect Obama has said that energy is one of his top priorities. And so he's got the opportunity early on in the administration to make some very, very important decisions about our supply, about demand, about infrastructure. So, I think early action will help our country and particularly in this financial crisis. If we do the right things on energy policy we can create American jobs, American industries, American energy and that's really important, given the financial situation we find ourselves in.

Monica Trauzzi: Would you expect him to take sort of a more centrist approach to energy policy?

Karen Harbert: Well, I think that remains to be seen. We're certainly going to encourage him to not pick winners and losers and to take the high road and realize that it is important to have oil and gas, nuclear, coal, wind, solar, geothermal. I mean there's a place for everybody at the table, but we need them all.

Monica Trauzzi: And on the oil and gas note, the report urges more domestic oil and gas drilling and President-elect Obama has already signaled that he'd like to reverse some of the decisions made by the Bush administration. So how hopeful are you that there will be expanded domestic supplies of oil and gas? And can we reach our energy goals without doing that?

Karen Harbert: You know, the American public spoke strongly in this election about a number of things and one of them was that energy was one of their top priorities. We're spending anywhere between 400 and $700 billion every year and sending it overseas on imported oil. People would like to spend some of that money here at home and create jobs here at home. So we have to realize that hydrocarbons are with us for decades to come and do we want to spend some of that money here? So we have to have a transportation sector that over time has more alternatives. But, at the moment, it's 97 percent dependent on oil. So we've got to do more here at home. But at the same time invest in those alternatives that will transition us away from being so dependent on one single source. But there's no magic wand. We're going to have to have more oil and gas resources developed here at home.

Monica Trauzzi: And the report urges the president-elect to create an energy bizarre position within the White House. How would that person fit into the overall puzzle?

Karen Harbert: You know, it's amazing, in the Federal Enterprise on Energy Policy there's at least 13 federal agencies or regulatory commissions involved in energy policy. So it's no surprise that things are slow and sometimes in conflict with one another. Let's take that out. We can't afford that anymore and let's have a much more harmonious, comprehensive approach and have somebody in the White House that can look across the whole landscape and have a much more harmonious approach and have the direct line to the president and be able to weigh differing, competitive, and contradictory agendas. Whether it's at Interior, or Energy or EPA or the Nuclear Regulatory Commission, there's a lot of players and having one person that can look across, that will be very, very important in this challenging time.

Monica Trauzzi: And in Congress, Congressman Waxman recently defeated Congressman Dingell for the Energy and Commerce gavel. Waxman is thought to be more focused on the environment than Dingell and Dingell has long been seen as an industry guy. So what do you think this change in chairmanship means for the energy agenda for the next Congress?

Karen Harbert: Well, first thing, I mean the new chairman inherits a huge responsibility. He's going to have to take a number of actions or face a number of very complex challenges. And so I think it remains to be seen, certainly if history proves, and his record, he does point more in that direction. I think you're going to see a lot of groups, including the chamber, voice themselves very clearly about what are the priorities for business and what are the impacts of some of the environmental decisions on jobs, on the business community, on our ability to actually fuel our economy with the energy that we need. The environment is very important, but we can produce energy, we can use energy in a very environmentally sustainable way without sacrificing our economy. And I think that really is what Congressman Waxman is going to have to balance.

Monica Trauzzi: And something that President-elect Obama spoke a lot about on the campaign trail was this idea of creating 5 million green collar jobs. Is this going to be the boost that the economy needs? And do you think it's a feasible goal? You know, 5 million is a big number.

Karen Harbert: That's a big number. I think in the automobile industry that's about 5 million jobs across the country. The energy industry, as a whole right now, employs about 6 million people. So that's a very, very huge goal. We'd like to see all kinds of jobs created. Let's not distinguish between green or yellow. Let's talk about energy and let's create jobs, let's create technologies that create long-lasting jobs. And so we welcome that lofty goal, but let's be realistic and let's put the research and development dollars to work, because over time we want sustainable industries, not just ones that are propped up by government subsidies.

Monica Trauzzi: And the report states that President-elect Obama should reduce overly burdensome regulations and opportunities for frivolous litigation. And this brings to mind the Clean Air Act and there are signals that President-elect Obama may want to use the Clean Air Act to regulate greenhouse gas emissions. Make the case for why we should not be regulating greenhouse gas emissions via the Clean Air Act.

Karen Harbert: The Clean Air Act, the Clean Water Act, the Endangered Species Act, they were all designed for specific purposes. It was not to regulate greenhouse gases. If that's the objective of President-elect Obama than he has the opportunity to put his case forward and have a new vehicle. But to shoehorn greenhouse gases into an old mechanism really doesn't make sense. It could be very, very damaging to our economy with large unintended consequences. But there's other regulations that need to be addressed too. It takes close to 10 years in this country probably to get a new nuclear power plant built. It takes five in France. How long does it take to get a new transmission line built? We don't know because they're caught up in endless litigation. So we've got to get beyond the NIMBY-ism in this country and the huge regulations that are impeding the infrastructure we need to fuel our economy. I mean that is really a huge priority and has to be faced day one.

Monica Trauzzi: On climate though, can we afford to wait for some type of cap-and-trade legislation to actually pass through Congress? I mean it could be years before that happens.

Karen Harbert: You know, we don't have to wait for the regulation. There's choices that can be made now, huge opportunities for energy efficiency which obviously have great benefits for climate. We can choose to invest in clean coal, which will have an emissions free source of electricity. We could accelerate nuclear in this country. So it's not about having to wait for congressional action. It's about making wise energy policy choices now.

Monica Trauzzi: And will industries be compelled to do that without the certainty that would come along with a piece of legislation?

Karen Harbert: Well, if you look at the renewable industry for example, I mean Congress has renewed tax incentives for the renewable industry one or two years at a time. That's not the certainty they need. They need a long-term tax credit which eventually will phase-out over time. They need eight years, just like what they got in solar, but it should be more broadly applied. So we do need some regulatory certainty. We need some fiscal certainty that will provide the environment that will have these alternatives really prosper.

Monica Trauzzi: You mentioned clean coal, considering our current economic instability, how likely is it that we'll continue to see investments both from the private sector and from the federal government for things like carbon capture and storage? It's really expensive stuff. There's a lot of uncertainty there. How likely is it that people are going to be pouring money into it?

Karen Harbert: Well, we think it's extremely important and it's a matter of choosing your priorities. Either we're going to be a nation of competitiveness in the future or not. And that means having access to reliable and affordable energy. We have 250 years worth of coal in this country; we need to be able to use it. Certainly China and India are using it. If we develop that technology here at home we could use our supply, but we could also export those technologies. So that's jobs here at home. We've got to get serious about coal in this country and really providing those technologies that will lead us into a much more stable supply of electricity down the road.

Monica Trauzzi: Final question here. The renewable electricity standard, it was not included in last year's energy package. It's likely to come back into play early on in the next session of Congress. Is that a necessary component to getting things off the ground and becoming more energy independent?

Karen Harbert: You know, like so many things, the devil is in the details. If you do something like that in a way that harms parts of the economy and parts of the country, we're going to lose jobs and become less competitive. So if you want to stimulate renewables it's really about that regulatory certainty over time and the fiscal certainty. And so we don't want to see something enacted that's punitive to particular industries or punitive to particular parts of the country. And it should be more inclusive. Why is nuclear power, for example, not considered renewable when its emissions free? Why is hydropower not considered? So I think we need to have a broader discussion about what we want to accomplish and then design the type of system that would produce the results that everybody wants, which is affordable energy and clean energy.

Monica Trauzzi: OK, we're going to end it right there. Thanks for coming on the show.

Karen Harbert: Great to see you.

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

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