Energy Bill Passes House. On to the Senate!

Let's pause from our usually scheduled subjects to cheer House Speaker Nancy Pelosi and the House of Representatives for passing the energy bill yesterday. The U.S. has not raised the fuel efficiency standard since the 1970s. It's stunning to realize it took six years after 9/11 to get around to it.

Repealing $9 billion in special tax breaks for the oil and coal industries also is long overdue. If $90-a-barrel oil and $3-a-gallon gas doesn't give them enough incentive to drill, I don't know that billions more from the taxpayers will. Better that money should go to homeowners who install solar, drivers who buy electric or hybrid-vehicles, and companies that install co-generation power plants.

There's a lot of pork barrel spending in the bill, of course. The alternative energy fields aren't immune from this disease, especially when it means subsidizing growers in Iowa to produce corn-based ethanol or dubious carbon sequestration schemes aimed at maintaining coal production.

It's interesting to note some of the Senate provisions in that regard (they'll be taking up the bill next week). While increasing the amount of fuel made from renewable biomass from 8.5 billion gallons per year in 2008 to 36 billion gallons per year by 2022, it requires that “advanced biofuels,” which means ethanol not derived from corn starch, must equal 60 percent of the total by 2022. It also provides financial support for increased research in cellulosic ethanol to meet that standard.

The Senate bill also places greater emphasis on energy efficiency, such as setting higher standards for new incandescent and fluorescent lights and home appliances. It also rejuvenates the program for helping low-income people weatherize their homes.

On the other hand, the Senate bill makes a huge push on carbon sequestration, including investment in a large-scale demonstration plant. It seems to me that the billions spent on maintaining our reliance on coal might be better spent on a massive R&D push into more efficient means of harnessing the power of the sun, wind and tides. There's new incentives in the House and Senate bills for households and businesses that invest in the current generation of clean technologies. But people who run out and make these investments will be buying the equivalent of personal computers with 286 chips. As one energy expert put it to me recently: "We're still in the 'rotary dial' era when it comes to green power." It's time to reverse the decades-long decline in clean energy R&D.