U.S. Renewable Energy Legislation Is a Numbers Game

A numbers game is what it's felt like, as we've seen Congress time and again try to pass legislation that will rationalize our use of energy and promote development of solar and other clean technologies. The numbers represent a different attempt over the last few months to kick-start the process. Each number represents a bill put together by House or Senate, brought to the appropriate floor, debated, passed then torn to shreds by the other chamber.

Let's start, arbitrarily, with HR6 — last year's energy bill — that eked out money for corn ethanol and improved the CAFE standards without providing more than token funding for renewable electricity development. In February of this year, those measures that were stripped out from HR6 resurfaced in the economic stimulus bill, HR5140, only to be pushed back down underwater; Congress must have felt the government checks to be sent to taxpayers under this bill would be stimulating enough. In the same month we saw HR5351, a stand-alone bill worth some $20 billion in clean energy tax credits. The Senate shook its head.

Then, in April, S2821 came from the Senate with $7 billion-worth of tax credits and other benefits for clean energy. It was lumped in with HR3221 (a housing stimulus bill) with much fanfare but no way of paying for it; thumbs-down from the House on that one. Within days, the tax credit measures had been attached to the Iraq War Supplemental Bill, but without enough adhesive to stay put.

Moving on to May, we had a bill born in the House Ways & Means Committee that took a different tack, which was to get funding from the financial services sector instead of from Oil & Gas. HR6049, a bare-bones one-year "extenders" bill, is already battling opposition in the form of a letter from nearly 50 Republican senators to Finance Committee Chair Baucus, expressing their displeasure at financial offsets of any kind, as well as a Statement of Administration Policy from the White House promising a veto of the bill.

At this point, it all feels a little like banging one's head against a wall; i.e., it feels nice when you stop. But it's worth taking some time to consider what legislative vehicles might still be available in this Congressional session for extending clean energy tax credits.

There has been talk of an economic stimulus bill "Part II" later in the year, more focused on business than taxpayers; tax credit extensions could reasonably find a home there. But traditionally, "Part II" bills are placeholders, held out as a carrot for anyone who didn't get fed in "Part I." They have a habit of existing only as promises, never as real bills. There had been hope that Congressional reconciliation of the Administration's 2009 budget would allow some room for maneuver, but what came from the White House favored, in descending order of spending, "advanced coal technologies" (US $648M), nuclear (US $544M), and promotion of clean energy in developing nations (US $400M).

And that only leaves what many observers have, all along, suspected would be the one piece of legislation that would struggle into law after all others had failed: a last-minute extension of current incentives for just one year, passed by a Congress on its way out the door (metaphorically or literally) in mid-December, the aroma of chestnuts roasting by an open fire already in their nostrils. For let's not forget (how could we?) that this is an election year, and long before Congress' August recess arrives a third of our lawmakers will be distracted with the task of keeping their jobs — or at least with making the other side look too unworthy to keep theirs.

Reader, do not form the conclusion from the above that what is really happening in Washington is that Senate Republicans are doing everything they can to prevent the majority party from enacting meaningful legislation in this election year. Nor should you think that the minority party is simply reacting to veto hints and policy statements from the White House when deciding on such crucial bills. Or even that the Democrats' attitude to passing spending bills without revenue offsets owes more to their re-election concerns than to their desire to keep clean energy on an upward track.

I would not impute such motivations to our lawmakers.

But as to that rumored last-minute bill's chances, why would this kind of panicky legislation pass if a host of similar bills will have spent a whole year, by then, failing to even reach the White House? The sticking point for those other bills has always been the source of funding. When House Democrats have targeted Oil & Gas or Financial Services for offsets, Senate Republicans have objected, on principle, to a perceived tax increase, or have claimed that the tax credits were a form of stimulus and therefore did not need to be offset. Conversely, when bills have originated in the Senate with no identified offsets House Democrats have demurred, reluctant to act as fiscal spendthrifts.

Is Congress really so full of honest men? I would like to give them the benefit of the doubt. But it would not surprise me if House Democrats were to propose a one-year extenders bill without offsets during the month of lame-duck activity following this November's elections (and almost two years before they might be brought to account for it), which Senate Republicans pass and the president signs to prove they were really behind clean energy development the whole time.

Even with that scenario — the most likely, in my view — six months away, I think it's worth keeping pressure on all parties in Congress now, to remind members that these issues will not go away, nor will the record of their votes.

A different kind of numbers game.