In this legislative session in Massachusetts, we are not expecting much new legislative progress on energy issues. We passed so much complex energy legislation last year that the regulators have their hands full figuring out what we really did, how it works and whether it will achieve its goals. In the transportation sector, there is room for legislative progress, but the financial reforms have consumed most of the available attention of transportation policy makers.
At the federal level, however, with the new administration, legislation is front and center. I recently had the opportunity to attend a forum at the Kennedy School of Government where Congressman Ed Markey and Energy Secretary Steven Chu talked about the state of federal energy policy.
Among the points that they seemed to agree on were:
- The Chinese — who have previously placed an exclusive emphasis on development, understandable given their poverty — are becoming more willing to address climate considerations.
- It is essential that we revive the nuclear power industry if we are to control carbon emissions in the power sector. Wall Street killed this industry decades ago but Wall Street seems poised to revive it in current conditions.
- Coal is so plentiful and cheap –in the key developing nations, China and India, not to mention Russia and the United States — that it will inevitably be used and we have to be interested in carbon capture and storage. This was probably the only point where I found Secretary Chu to be reaching — I hear that the geological conditions around most coal plants just won’t support CCS.
- We should be hopeful for rapid progress on some of the key technologies that will radically change our odds of controlling carbon emissions and energy costs — more efficient batteries, cheaper solar cells and sustainable biofuels. Chu talked as a scientist about how, with the right kind of leadership and collaborative approach, teams of scientists have, in history, made much more rapid progress than is common in academic science settings where professors tend to guard their own work to obtain credit. Markey talked about how his telecommunications legislation in the 90s led to surprisingly rapid growth of broadband internet access.
- The 2020 carbon reduction goals in the Waxman-Markey legislation are nowhere near as aggressive as the science calls for if we are to avoid climate change, but the bill is worth fighting for nonetheless.
- Chu gave a fairly technical response to this point, arguing that what matters is not the annual rate of carbon emission, but the total amount we emit in next century, so even if we aren’t able to cut immediately, if we cut more deeply later, the outcome is the same. This is certainly true, but at another point in the talk, Chu noted that a McKinsey study had found that even if we only make investments that are cost-justifiable in current market conditions, we can achieve aggressive reduction goals by 2020.
- Markey emphasized the political reality that more aggressive fossil reductions are not achievable in the House and especially the Senate and that the bill is a huge step forward, but not, by any means the last step to be taken. He forecast that as the legislation takes effect, people will come to accept and appreciate its benefits and that further steps will be easier to take.
- In the short run, energy conservation is the most cost-effective strategy and fully viable investments in conservation have the potential to create many “green jobs.”
Congressman Markey and Secretary Chu were both impressive in their mastery of policy and politics and I came away feeling that we are in good hands.