Energy Talk and Federated States

President Obama just recently outlined his new energy vision following two years of setbacks in the Congress. The goals remain the same as in his campaign and in the policy rhetoric of the past: reduce energy dependence on foreign oil and increase the use of renewable energy sources. The politics are, however, more complicated. 

When Obama won his election back in November 2008, much of the energy talk centered around climate change. The legislation that came out of the House of Representatives had to do with Renewable Energy Standards and the adoption of a cap and trade system. The Senate, however, was unable to pass a bill for the President’s signature. 

The conversation has since changed with Obama’s party, the Democrats, no longer in charge of the House. The economy, while recovering, has not rebounded and this has brought us back to the win-lose dynamic about economic development and environmental protection.

Special interests groups have seen this as an opportunity and whatever emerging consensus that existed in 2008 has given way to confrontation. The election of the Tea Party in Congress, along with the fact that 23 Democrats out of 33 will have to defend their seats in the 2012 election, has led to a lowering of expectations on Capitol Hill. Few believe a bill will surface in the Congress for the President to sign.

A couple of disasters, off shore drilling in the Gulf of Mexico and the on-going nuclear crisis in Japan, have furthered muddled the discussion. It is becoming obvious that no source of energy will be without shortcomings or critics. Any federal legislation coming out of Washington before the election of 2012 will have to come to grips with reality.

The Senate Energy Committee chaired by New Mexico Senator, Jeff Bingaman (D) and ranking member Alaska Senator Lisa Murkowski (R) has made a valiant attempt to be more focussed and change the vocabulary. They are hoping to have a bill come out of their Committee dealing with Clean Energy Standards and are appearing to leave all energy options on the table. It is too early to predict the outcome, but at least, there is an effort to deal with the goals stated by the President.

This brings me to the role of federated states dealing with energy issues. It seems that the states and provinces along the Canada- US border may be doing more to push the conversation further. It appears that good sense has prevailed over politics in those jurisdictions.

Both Canada and the United States are federations with energy and environment seen as shared jurisdictions between the central government and the federated states. Some states have already acted on their own. The Regional Green House Gas Initiative (RGGI) was created as the first market-based regulatory program in the U.S. to reduce GHG’s. It is made up of 10 States in the Northeast and in Mid- Atlantic states. It is the first U.S. cap and trade system and it seems to be working.

The Western Climate Initiative began in 2009 to develop regional targets for reducing greenhouse gas emissions and it includes a mix of states and Canadian Provinces. Québec, Manitoba, British Columbia and Ontario are partners with Saskatchewan. New Brunswick and Nova Scotia acting as observers. It is an example of formal collaboration between Canada and the United States in dealing with climate change.

Québec and the Northeastern part of the U.S. (New York and the New England states) have long been energy partners and subscribe to climate change goals in their respective jurisdictions. The energy dialogue within those jurisdictions remains as strong as ever. With hydropower along with wind and solar very much a part of their conversation, and with leadership being exercised at the level of the federated states, we can be encouraged that the vision expressed for developing clean energy will not be solely at the discretion of the power that be in Washington.