The low-down on Obama’s clean energy plan

Centre for American Progress

Today President Obama will give two speeches about his clean energy blueprint announced Tuesday during the State of the Union address. The first talk will occur at a United Parcel Service facility in Las Vegas where he plans to discuss American workers developing American energy. Buckley Air Force base in Aurora, Colorado will host the second address, which will focus on energy security.

In conjunction with these speeches, the White House released more details about its clean energy proposals beyond the State of the Union address or the Blueprint for America document.[1] Here is brief rundown on the details of these proposals that rely on existing executive authority, and do not require legislation.

▪ The lease sale of 7,250 unleased blocks covering 38 million acres in the central Gulf of Mexico could yield 1 billion barrels of oil and 4 trillion cubic feet of natural gas. The minimum bid for these leases will be nearly triple the previous amount. This could raise nearly $4 billion if companies lease every available acre. The leases will stipulate that companies must develop these areas promptly or risk losing them, which should increase oil and gas production.

▪ The Advanced Research Projects Agency – Energy (ARPA-E) — will announce a new research competition to develop innovative methods to use natural gas as transportation fuel. Hopefully, this contest will lead to the development and deployment of breakthrough technologies that can dramatically reduce oil use and pollution, create new jobs, and save drivers money.

▪ The Navy will add 1 gigawatt (1,000 megawatts) of renewable electricity generation capacity for its “shore-side” installations. This is enough power for a quarter-million homes. The Navy will use “existing authorities such as power purchase agreements… [to] ensure these energy projects are cost neutral and require no up-front investments by the government.”

There are also proposals that would require legislation to become law, so Americans depend on Congress to act:

▪ The blueprint would include new incentives to increase natural gas use for heavy trucks and buses. This fuel burns more cleanly and is more secure than oil. Converting part of this fleet to natural gas could reduce oil consumption by over 1 million barrels per day, as well as slashing particulate and toxic pollution from truck and bus exhaust.

The “New Alternative Transportation to Give Americans Solutions (NAT GAS) Act of 2011,” sponsored by Senators Robert Menendez (D-NJ), Harry Reid (D-NV), and Richard Burr (R-NC), “would extend tax credits for natural gas vehicles and building refueling infrastructure, and be fully paid for by a temporary user fee on natural gas used as a vehicle fuel.”

A CAP analysis estimates that deployment of 3.5 million natural gas fueled trucks and busses could reduce oil use by over 1 million barrels per day.

Some conservatives – lead by the Koch-funded Americans for Prosperity – attacked the House version of this legislation, H.R. 1380, because of the counter intuitive claim that “natural gas vehicle subsidies hurt consumers” by providing more fuel choices for heavy trucks. These attacks convinced nineteen House Republican cosponsors to take the unusual step of withdrawing their name from the bill.

This plan should be accompanied by additional safeguards to reduce air, water, and methane pollution from shale gas production.

▪ The President will ask Congress to create tax incentives to help manufacturers increase efficiency and use additional clean energy. In addition, he will ask for an extension of the Production Tax Credit for wind energy that provides 2.2 cents per kilowatt-hour credit for electricity generated by wind. It expires at the end of 2012. Without an extension, 37,000 jobs in the wind energy industry could be lost.

As with almost any government proposal or legislation, “the devil is in the details.” More specifics about these and the other elements of the clean energy blueprint would make more in-depth analysis possible.

Daniel J. Weiss is a senior fellow at the Center for American Progress Action Fund