Taking charge, GOP to seek balance on energy, enviro front

By Nick Juliano | 01/06/2015 06:49 AM EST

Republicans face a delicate balancing act this year: Convince the moderate voters who typically decide presidential elections that the GOP can govern responsibly while still delivering enough red meat to prevent conservative activists from mounting primary campaigns aimed at unseating congressional incumbents.

Republicans face a delicate balancing act this year: Convince the moderate voters who typically decide presidential elections that the GOP can govern responsibly while still delivering enough red meat to prevent conservative activists from mounting primary campaigns aimed at unseating congressional incumbents.

Capitol Hill debates on energy and environmental policy could offer an early indication of how GOP leaders will navigate that tightrope. The approach will be twofold: Demonstrate bipartisan appeal with bills to expand energy production and address infrastructure needs across all sectors, traditional and renewable, while continuing to do battle at every turn with President Obama’s environmental agenda that conservatives see as an assault on the economy.

When the 114th Congress convenes today, Republicans will hold 54 seats in the Senate, giving them a majority for the first time in eight years, and their returning House majority will have grown to 246, its largest level in generations.


Both chambers of Congress are operating under the same majority party for the first time since 2010, when Democrats were in charge, meaning legislation stands a better chance of making it to the president’s desk. But the de facto 60-vote threshold to pass anything in the Senate, combined with the fact that Obama has two more years in office, means at least some bipartisan support will be necessary for anything to become law.

"We still have a divided government, and what our folks need to remember is the president still has a veto pen," Rep. Tom Cole (R-Okla.), a close ally of House GOP leaders, said on MSNBC’s Morning Joe yesterday. "He has more than enough votes in both chambers to sustain those vetoes."

The political dynamics for the new session also will be a shift from recent years. The 2016 presidential primary campaigns will be in full swing by this fall, with the Republicans likely to see a broad field that could include several members of Congress, such as Sens. Ted Cruz of Texas, Rand Paul of Kentucky and Marco Rubio of Florida. The GOP also has more than twice as many seats as Democrats to defend in the Senate next year, including incumbents running for re-election in traditionally blue states such as Illinois and New Hampshire, as well as relative moderates like Sens. John McCain of Arizona, Rob Portman of Ohio and Lisa Murkowski of Alaska, who could draw primary challenges.

"What I hope Senate Republicans will present to the country is a conservative right-of-center governing majority, serious people elected in serious times to try to get results," incoming Senate Majority Leader Mitch McConnell (R-Ky.) said in an interview aired Sunday on CNN.

Broadly speaking, aides and lobbyists see three areas in which agreements are possible on either end of Pennsylvania Avenue, all of which could have implications for energy and environmental policy: trade promotion authority, which could include consideration of expanded liquefied natural gas exports; tax reform, which may determine the future for a variety of permanent and temporary incentives for everything from drilling for oil to constructing a wind farm; and infrastructure, a broad issue including roads and bridges, public transportation, oil pipelines, and transmission connections between remote renewable energy facilities and power-hungry cities.

Incoming Senate Energy and Natural Resources Chairwoman Lisa Murkowski (R-Alaska) plans to put forward a comprehensive energy bill, working with returning House Energy and Commerce Chairman Fred Upton (R-Mich.). It will incorporate proposals from Murkowski’s "Energy 20/20" blueprint released at the beginning of the previous Congress and Upton’s "Architecture of Abundance" framework, a GOP aide said.

The legislation would be crafted during a series of hearings and markups throughout this year and is expected to be as broad in scope as the 2005 and 2007 energy laws — the most recent comprehensive pieces of legislation to be enacted addressing the energy sector.

On the regulatory front, the Environment and Public Works Committee is expected to lead the charge. Incoming Chairman James Inhofe (R-Okla.) is a vocal skeptic of the widely held scientific view that climate change is caused by human activity, and he is expected to use his gavel to probe the administration’s regulatory agenda on that front. He also has promised "rigorous oversight" of U.S. EPA’s proposal to lower the national ambient air quality standard for ozone to between 65 and 70 parts per billion.

In the CNN interview, McConnell pointed to rules affecting the coal industry that carries outsized sway in his home state, as well as EPA’s proposed "waters of the U.S." rule that would increase the number of streams and creeks that currently receive automatic protection under the Clean Water Act.

"We need to do everything we can to try to rein in the regulatory onslaught, which is the principal reason that we haven’t had the kind of bounce-back after the 2008 recession that you would expect," McConnell said.

The House Energy and Commerce Committee will play a key role in both the energy-promotion and regulatory reform aspects of the coming agenda. A House GOP aide said the energy bill being assembled will include several proposals that passed the House last session, including legislation addressing cross-border pipelines and energy efficiency, as well as new ideas related to grid security and reliability, which Republicans say could be threatened by EPA rules to limit greenhouse gas emissions from power plants.

The goal, the House aide said, is to find bipartisan support both to "advance energy infrastructure and rein in EPA’s harmful rules" in legislation that could be signed into law.

For their first order of business, Republicans want to send Obama a bill approving the Keystone XL pipeline. The House is expected to pass the bill this week, GOP aides said yesterday, with the Senate Energy and Natural Resources Committee scheduled to advance the legislation by Thursday. It remains to be seen when final Senate passage would come, with McConnell promising a relatively freewheeling amendment debate that could stretch on for days or weeks (see related story).

Several other smaller pieces of legislation from the previous Congress also are on track for early action this year, at least in the House. A GOP aide said the lower chamber next week is expected to consider a bill mirroring the "Natural Gas Pipeline Permitting Reform Act" from Rep. Mike Pompeo (R-Kan.), which passed the House in November 2013 but saw no action in the Senate last year.

The House also is expected to consider legislation in the coming weeks expediting consideration of liquefied natural gas export licenses, and Sen. John Barrasso (R-Wyo.) is planning to introduce a bill on the subject today (see related story).

Then there’s the longsuffering energy efficiency bill from Sens. Rob Portman (R-Ohio) and Jeanne Shaheen (D-N.H.). The bill collapsed amid the broader gridlock-inducing procedural disputes that prevented much of anything from passing in the previous Congress, but both sponsors pledged last month to bring it back this year. Whether the bill is offered as a KXL amendment, incorporated into a comprehensive energy bill or brought to the floor on its own remains to be seen.

Over the longer term, Congress has several must-pass pieces of legislation on its plate, including the need to enact new homeland security funding by next month amid the ongoing showdown over Obama’s immigration policy. Among other looming issues, the debt ceiling is suspended until March 15 but will need an increase after that to prevent a default on the nation’s debt, although the exact deadline to avoid a default is unclear. A transportation bill to replenish the highway trust fund is needed before the end of May. And fiscal 2016 appropriations bills — or continuing resolutions — will need to be enacted by Sept. 30 to prevent federal agencies from shutting down.

All of the must-pass deadlines provide an opportunity for Republicans to try to force the White House’s hand by attaching "policy riders" that would otherwise be vetoed on their own. Such was the case last month, when language was added to a sweeping spending bill preventing an endangered species listing for the sage grouse, expanding farmers’ exemptions from Clean Water Act rules and changing financial reform regulations to benefit large banks, among other measures.

The transportation bill could be a venue to limit EPA’s impending ozone regulation, for example, aides said. Democrats are likely to push for an increase to the gasoline tax in order to bolster the highway trust fund, citing the fact that the tax has not gone up in more than 20 years and that gasoline prices have plummeted in recent months.

A gas tax increase has some fans among Republicans such as Sen. Bob Corker (R-Tenn.), and incoming Senate Commerce Chairman John Thune (R-S.D.) has said he is open to a potential gas tax increase. But the approach remains a tough sell among most rank-and-file Republicans.

"That’s still a nonstarter," a senior House Republican aide said yesterday.

Another issue likely to get a lot of attention this year is reform of the tax code, although it remains to be seen how ambitious Republicans become on that front or whether they can find agreement with the administration. Incoming Senate Finance Chairman Orrin Hatch (R-Utah) yesterday outlined broad principles for tax reform in an op-ed published by the conservative magazine National Review.

Hatch said reform should be revenue neutral, eliminate expenditures to offset lower overall tax rates and be made permanent, among other principles. He did not specifically address any energy-specific incentives, such as the permanent intangible drilling cost deduction prized by oil and gas companies or the expired production tax credit that primarily benefits wind energy producers.

The PTC is part of a broader package of temporary incentives known as "tax extenders," which Congress extended just through the end of last year after broader negotiations fell apart. The package includes more than 50 breaks, including several Republicans would like to be made permanent, although the PTC and other clean energy incentives have attracted increased GOP resistance in recent years. At the end of 2016, the investment tax credit for solar energy drops in value from 30 percent of a project’s cost to 10 percent, and the industry is likely to seek an extension of that credit in either a comprehensive reform or narrower extenders bills.