Wednesday, January 23, 2008

Candidates & Energy: Clinton

Among all the candidates I've scrutinized so far in this year's presidential election campaign, energy independence has emerged as a common theme. Each of the candidates approaches it with different emphasis and solutions, but the worries about our reliance on unstable regimes for our energy supplies span both parties, as does the concern that our remittances for imported oil are funding our enemies in the War on Terror. My systematic review of the 2008 presidential aspirants now turns to one of the best known candidates on either side, Senator Hillary Clinton (D-NY,) winner of the New Hampshire Democratic Primary and the Nevada Democratic Caucuses. She treats energy policy as a key issue and combines it with a focus on stronger measures to address climate change.

Anyone curious about Senator Clinton's views and proposals on energy and the environment needn't look much farther than her campaign website, which includes a summary page and links to a 14-page energy plan, other policy documents, and speeches. It would take me a week's worth of postings to enumerate and evaluate all of the details, which include expanding US biofuels production to 60 billion gallons per year, increasing fuel economy to 55 mpg, and phasing out incandescent lights. Knowing the intellectual resources at her disposal, I'm not surprised by the granularity of the Senator's proposals. At the highest level, all of these ideas support three goals that she articulates consistently: reducing greenhouse gas emissions by 80% by mid-century, reducing US oil imports by two-thirds (compared to current projections of approximately 13 million barrels per day) by 2030, and building a green-energy sector that will provide millions of new jobs. Unlike the goals of complete energy independence or oil independence that other candidates have announced, Senator Clinton's oil import target just might be achievable, leaving us importing 3-4 million barrels per day of crude oil, about what we get from Canada and Mexico today.

The centerpiece of her plan is the creation of a "strategic energy fund" amounting to $50 billion over 10 years for expanding R&D on energy efficiency, renewables and other alternative energy sources. This figure includes significant funding for demonstration projects to prove the feasibility of applying carbon sequestration to "clean coal" power plants, which would apparently be the only kind of coal facilities she would allow to be built. But when Senator Clinton says that she knows where to get the money for this fund, you know what is coming next. As described in a key speech on energy, the money would come from "ending the tax breaks that oil companies receive to maintain the existing oil dependence economy" and by enacting some form of a windfall profits tax on the oil industry. It would also receive revenue from the greenhouse cap-and-trade system she envisions, with 100% of emissions allowances auctioned, rather than allocated to existing sources. Additional funds for emerging energy would come from new "Energy Independence Bonds."

Concern about climate change shapes all of Senator Clinton's energy proposals, resulting in programs intended to reduce energy dependence while also reducing emissions. This includes an idea from former Vice President Gore, for the establishment of a "carbon-neutral mortgage association" or "Connie-Mae," that would finance home improvements that reduced energy consumption and emissions.

Although many of these ideas and proposals are well thought-out and address urgent problems, particularly with regard to tackling energy security and climate change simultaneously, I am concerned about the Senator's adversarial approach to the existing energy industry, which must play a key role, if her goal of reducing our reliance on imported oil is to be achieved. I don't see how we can close the enormous and growing gap in our energy supplies, while taking away financial resources from the industry that accounts for 45% of domestic energy production. I'm sure Senator Clinton understands that, because she voted in 2006 to expand offshore drilling in the Gulf of Mexico. In addition, although not explicitly anti-nuclear, she has apparently ruled out any role for new nuclear power in reducing greenhouse gas emissions or providing the power for the plug-in vehicles that she sees as a key strategy for reducing oil use.

On the "experience vs. change" scale, Senator Clinton's proposed energy policies represent significant departures from the status quo. Her team has taken a systematic approach to energy and the environment, connecting technologies such as renewable power and advanced biofuels to the smart-grid and flexible-fuel infrastructure needed to maximize their usefulness. Although her target for reducing oil imports is less ambitious than that of Senator Obama, her emphasis on climate change matches his, and the specificity of her energy proposals exceeds that of any other candidate I've reviewed to date. At the same time, I have been surprised by the populist tone of much of her campaign rhetoric. It extends to implying that oil refiners collude to drive up prices, a charge on which the industry has been exonerated numerous times. This doesn't match the seriousness and pragmatism she has applied to her Senate role over the past seven years, but it certainly reflects the dynamics of the current three-way race for the Democratic nomination.

No comments: