Too Big To Fail? Too Big, Period.

Cross-posted from the Breakthrough Institute and WattHead - Energy News and Commentary

The executives of General Motors, Ford and Chrysler made yet another trek to Washington DC this week - this time ditching the corporate jets to drive hybrid cars - and once again pled for a federal bailout to prop up their struggling companies. Up to $34 billion taxpayer dollars are apparently all that stands between at least two of the "Big Three" automakers and bankruptcy.

GM's executives told Congress the company will fail very, very soon unless it receives at least $12 billion in loans in the coming months. Chrysler warned they could go belly up by year's end without $7 billion in government aid. Even Ford, which is doing a bit better than its two Detroit brethren, is asking for an open, taxpayer-funded line of credit of up to $9 billion dollars.

All this means its time for Congress and the American public to face two basic facts.

First, GM and Chrysler are essentially bankrupt already, and Ford may not be far behind. The insular management of the Big Three has already run their companies into the ground, and if a massive government loan is the only thing that will keep them afloat, we might as well consider them failed companies, for all intents and purposes. So let's start treating them that way. With the economy in recession already, we certainly need to ensure a soft landing - rather than a hard collapse - for the auto companies and the millions of Americans who depend on them for their paychecks. But the objective of the bailout should be to preserve American auto industry jobs, not to preserve the Big Three companies themselves. GM, Chrysler, and perhaps even Ford are done. We shouldn't be afraid to turn the page on this chapter of the American auto industry and usher in something entirely new - and better.

Second, if GM, Chrysler and Ford are too big to fail, then it's time to realize that they are simply too big, period. If taxpayers are going to put their money on the line to bailout Detroit, we should be taking advantage of this opportunity to make fundamental changes to the American auto industry. It is time to say, "Never again!" to auto companies that are so large that they can hold taxpayer's hostage because the consequence of their failure is too great - companies that are so large that competition and innovation are stifled by their vast and unwieldy bulk.

Here's what we propose: offer government loans to the Big Three to ensure the companies don't collapse now during the midst of recession. But the conditions of those loans should be similar to the conditions of the Chapter 11 bankruptcy the companies would enter in absence of the loans. No blank checks for the Big Three to continue business as usual.

Instead, Congress will appoint an independent blue ribbon commission. They'll staff that commission with the best bankruptcy judges, restructuring consultants, and industry experts in the world. This commission will be charged with breaking the company up into several smaller companies that will inherit the different divisions, car models and assets of the parent. The commission will then seek new management to run each new company, deploying head hunters to recruit top talent from mid-level management within the Big Three, or even in the ranks of foreign companies like Toyota, Volkswagen or Hyundai.

The new companies - Baby GMs, or Baby Chryslers - will then be turned back over to the private sector and they'll be encouraged to issue new common stock to raise more operating capital. The government will have to vigorously enforce anti-trust laws to ensure these companies remain small, at least for the time being, and to keep foreign automakers or governments from gobbling them up (the Chinese government has already been shopping for one of the Big Three, and would gladly snatch up the new companies if we let them).

In the end, we'll have a new kind of American auto company - leaner and nimbler, and under a new class of managers - and a new kind of America auto industry - one that's more competitive and fosters the continual innovation that's been absent in Detroit for too long.

In the short run, we'll protect as many automaker jobs as possible by injecting capital into these new companies to help them weather the transition period. In the long run, some of these new companies will fail, but when they do, they won't be large enough to send the entire economy into tailspin. And for every company that fails, others will succeed by adopting a corporate culture that embraces innovation and produces high-quality cars that match the American consumer's demands.

The net result will be a vibrant and innovative American auto industry that sustains good manufacturing jobs here in the United States. The new competitive environment will foster the adoption of more efficient vehicle designs, encourage the development of cutting-edge technologies like plug-in hybrid electric vehicles, and create space for up-and-comers like Silicon Valley-based electric car manufacturer Tesla Motors to enter the field.

That's the future of the American auto industry. Anything short of this kind of dramatic restructuring of the industry will merely prolong the inevitable day when GM, Chrysler and Ford fall under their own weight, taking American jobs, taxpayer dollars and our economy with them. Too big to fail? Too big, period.

[Image source: FoxNews.com]

Barack Obama Commits to "New Chapter" on Climate Change

Cross-posted from WattHead - Energy News and Commentary

In a prepared video address delivered today at the Global Climate Summit in Los Angeles, CA, President-elect Barack Obama pledged to turn over "a new chapter in America's leadership on climate change."

In the short address, viewed by an audience that includes leaders from around the nation and the world, Obama emphasized the importance of the upcoming international climate negotiations in Poznan, Poland, and said he was "looking forward to working with all nations to meet [the climate] challenge in the coming years."

Obama reconfirmed his campaign commitments to reduce greenhouse gas emissions 80% by 2050 through a national cap and trade program and again pledged to "invest $15 billion each year to catalyze private sector efforts to build a clean energy future."

Convened by California Governor Arnold Schwarzenegger and other US governors on the forefront of global warming solutions, the Bi-partisan Governors Global Climate Summit convenes in Los Angeles today and begins two days of dialog designed to spur global cooperation on climate change in advance of the UN-sponsored talks in Poland next month. To this crowd of climate leaders, Obama said:

"Few challenges facing America -- and the world -- are more urgent than combating climate change. Many of you are working to confront this challenge....but too often, Washington has failed to show the same kind of leadership. That will change when I take office."

Watch the short video address below (full transcript below the fold):



Remarks as Delivered:

Let me begin by thanking the bipartisan group of U.S. governors who convened this meeting.

Few challenges facing America – and the world – are more urgent than combating climate change. The science is beyond dispute and the facts are clear. Sea levels are rising. Coastlines are shrinking. We've seen record drought, spreading famine, and storms that are growing stronger with each passing hurricane season.

Climate change and our dependence on foreign oil, if left unaddressed, will continue to weaken our economy and threaten our national security.

I know many of you are working to confront this challenge. In particular, I want to commend Governor Sebelius, Governor Doyle, Governor Crist, Governor Blagojevich and your host, Governor Schwarzenegger –all of you have shown true leadership in the fight to combat global warming. And we've also seen a number of businesses doing their part by investing in clean energy technologies.

But too often, Washington has failed to show the same kind of leadership. That will change when I take office. My presidency will mark a new chapter in America's leadership on climate change that will strengthen our security and create millions of new jobs in the process.

That will start with a federal cap and trade system. We will establish strong annual targets that set us on a course to reduce emissions to their 1990 levels by 2020 and reduce them an additional 80% by 2050.

Further, we will invest $15 billion each year to catalyze private sector efforts to build a clean energy future. We will invest in solar power, wind power, and next generation biofuels. We will tap nuclear power, while making sure it's safe. And we will develop clean coal technologies.

This investment will not only help us reduce our dependence on foreign oil, making the United States more secure. And it will not only help us bring about a clean energy future, saving our planet. It will also help us transform our industries and steer our country out of this economic crisis by generating five million new green jobs that pay well and can't be outsourced.

But the truth is, the United States cannot meet this challenge alone. Solving this problem will require all of us working together. I understand that your meeting is being attended by government officials from over a dozen countries, including the UK, Canada and Mexico, Brazil and Chile, Poland and Australia, India and Indonesia. And I look forward to working with all nations to meet this challenge in the coming years.

Let me also say a special word to the delegates from around the world who will gather at Poland next month: your work is vital to the planet. While I won't be President at the time of your meeting and while the United States has only one President at a time, I've asked Members of Congress who are attending the conference as observers to report back to me on what they learn there.

And once I take office, you can be sure that the United States will once again engage vigorously in these negotiations, and help lead the world toward a new era of global cooperation on climate change.

Now is the time to confront this challenge once and for all. Delay is no longer an option. Denial is no longer an acceptable response. The stakes are too high. The consequences, too serious.

Stopping climate change won't be easy. It won't happen overnight. But I promise you this: When I am President, any governor who's willing to promote clean energy will have a partner in the White House. Any company that's willing to invest in clean energy will have an ally in Washington. And any nation that's willing to join the cause of combating climate change will have an ally in the United States of America. Thank you.

##

A Pivotal Moment

Cross-posted from the Breakthrough Blog and WattHead - Energy News and Commentary...

With Americans focused on energy prices as never before, a game-changing shift is occurring in the American political climate. The time has come for climate and clean energy advocates to adopt a new strategy and policy agenda. Next year will see the inauguration of a new president, a new Congress, and a new international agreement on global warming. The moment is far too urgent to fall on our swords for a cap-and-trade agenda developed in an entirely different political environment.

There's one thing at the top of Americans' minds these days: energy prices. Prices at the pump have been hitting Americans hard for months now, and an overwhelming majority (87%) do not foresee things getting any better before the end of the year. As of June, concern for energy prices eclipsed the Iraq War as #2 on the Gallup monthly poll of top American concerns (just behind concerns over the ailing economy). And as Republicans and Democrats enter their conventions still sparring over oil drilling, energy is now the #1 election issue.

All of this paints a very clear picture of where Americans are at: they are focused on their pocketbooks, grimacing every time they head to the gas station to fill 'er up.

This new focus on energy prices is a game changer for the world of energy and climate policy.

On the one hand, these developments spell Trouble-with-a-capital-T for politicians and environmentalists pushing a climate-centered agenda and policy solutions aimed at capping and pricing carbon to reduce emissions. At a time of extreme sensitivity over energy prices, we cannot hope to price our way to deep reductions in global warming pollution.

On the other hand, energy now lies at the forefront of the American political environment in a way that it hasn't been since the Oil Shocks of the 1970s. This opens up a unique but urgent opportunity, a chance to advance a robust and bold new policy agenda centered on energy solutions.

Newt Gingrich and his "American Solutions" organization clearly recognized this opportunity. Their "Drill Here, Drill Now, Pay Less" petition garnered over 1.2 million signatures in a matter of weeks. This "drill here, pay less" meme has been so successful, GOP strategists now think energy might be the Republican party's last best hope this election season.

In response, environmentalists and Congressional Democrats scrambled to 'block and tackle' and stop the gathering momentum to simply Drill! Drill! Drill! for more oil. With drilling opponents beaten up by the "drill here, drill now" push, a compromise proposal seems increasingly likely.

Meanwhile, the push for climate policy seems to be on hold, as climate advocates attempt to regroup from the defeat of the Lieberman-Warner Climate Security Act. Once touted as a bipartisan proposal, the cap-and-trade bill ran into a Republican filibuster in June and failed to secure the support of at least ten Democratic senators. After the repeated failure and declining support for cap-and-trade in Congress, environmentalists and Congressional leaders are surely debating what the next move should be.

It's time to recognize that these two conversations - how do we halt the push for more oil drilling and how do we advance a new climate strategy - are really the same conversation. The question at the heart of both discussions is this: how do we meet Americans where they are at and give them compelling solutions to our mounting energy crisis?

In today's new political context of economic insecurity and energy price spikes, we must provide Americans with what they want: credible promises of affordable, abundant energy.

That calls for a critical pivot away from a focus on reducing greenhouse gas emissions and halting climate change and towards a new focus on making clean, cheap American energy sources a reality.

It's time to get serious about winning the frame game and make the critical pivot to a new message, a message that sounds something like this:

Oil is hurting our economy. Coal is poisoning our air. Both are threatening our climate and our future. It's time to make clean energy cheap and abundant. Which would you rather invest in? Coal and oil - the old, dirty, expensive stuff? Or clean, cheap, new American energy sources? Which will power America's future?

Americans are crying out for new energy solutions. They are hurting at the pump and ready to turn to anyone who can offer a credible path forward. Gingrich beat us to the punch, but the game isn't over.

Support for drilling as the solution to our energy woes seems to be pretty shallow, especially once alternatives are presented. We want somebody to do something, so in the absence of any compelling alternatives, the "drill here, pay less" meme is kicking our butts. But Americans aren't stupid. We understand that the old stuff really isn't working very well and that more of the same will not relieve the strain on our pocketbooks.

If climate and clean energy advocates consistently position the dirty, old, expensive, poisonous stuff on the one hand and present compelling examples of clean, new, renewable, stable, secure and affordable energy sources on the other hand, I think the choice for Americans will be pretty clear and easy. I also can't think of anything else that will work!

This pivot goes far beyond just fighting off a push for drilling and far deeper than simply adopting a new messaging veneer on top of the same old policies. It goes right to the core of our entire energy and climate agenda.

This kind of message - "make clean energy cheap and abundant" - is incompatible with a policy agenda that expects unrestrained carbon prices to do the heavy lifting in igniting a clean energy future - i.e. a "hard" cap-and-trade program without provisions to control the price of carbon. One could conclude that we should shy away from this new message and find one more consistent with the carbon pricing-based policy agenda that has been the focus of climate advocates for so long.

The conclusion I reach, however, is the exact opposite: we don't need to abandon the "clean, cheap energy" message in favor of cap-and-trade; we need to make this change in focus about more than just our message.

If we want this message to stick - and I believe the success or failure of our entire effort to advance a clean energy future may hinge upon that success - we need to adopt a policy framework that's actually in synch with our message. We need a policy agenda focused on developing clean and cheap energy for every American. If we don't, we'll soon find ourselves incoherent and inconsistent, and our message will fail when the public sees that.

The time has come to advance a compelling and effective set of solutions focused on making clean energy cheap and abundant, not making dirty energy expensive and scarce.

Gore's clean energy "moon-shot" speech was (almost) dead-on. He shifted the focus from climate change to the energy challenge and from reducing emissions to increasing clean energy production. Whether we make this transition to 100% clean energy in ten years, twenty, or longer, I think the timetable is far less important than the overall thrust of the message: we're going to make your energy cheap and clean and secure. And who wouldn't want that?

I'm sympathetic to arguments that failing to price global warming pollution at it's full societal cost is simply economically inefficient. And I understand that principles of justice would call for a push to make "polluters pay." However, as we develop our new suite of clean energy solutions, we must make sure that our policy is built as if politics actually mattered. Our ultimate success depends less on appeals to economic efficiency and principles of justice than it does on our ability to meet Americans where they are and overcome the vagaries of the U.S. Senate.

This new policy platform should be centered around a new national project of strategic investments necessary to spark a clean energy economy and develop cheap and clean energy for every American. Carbon pricing and regulation play a role here, but they cannot be the top-line items when it comes to messaging, nor are they likely to do the heavy lifting that unlocks our clean energy potential.

A policy like this is really the only way we're going to pass something in a political climate of high energy prices and economic insecurity, and the only way we'll enact a solution set that gets the job done.

Next year will see the inauguration of a new president, a new Congress, and a new international agreement on global warming. The moment is far too urgent to fall on our swords for a cap-and-trade agenda developed in an entirely different political environment than the one that exists today. Nor do we have time to just make Americans care enough about global warming to act.

What we have is a unique moment of opportunity when Americans are overwhelmingly concerned about energy and about energy prices, and hungry for new solutions. If we can credibly advance "make clean energy cheap and abundant" as an alternative to the "drill here, pay less" crowd, we can win the battle. In fact, it's probably the only way we can win.

Some Refreshing Common Sense! BLM Removes Solar Roadblock

Cross-posted from the Breakthrough Blog...

Well ask and you shall receive I guess...

On monday, my colleague and I called on the federal Bureau of Land Management to stop being an Energy Delayer and lift a moratorium that locked up the vast reserves of solar energy located on federal lands. Today, the BLM announced that they would lift the planned twenty-two month moratorium on land it stewards in six southwest states rich in solar energy. The BLM had claimed that an extensive environmental impact review was necessary before solar development on federal lands could move forward and called for the moratorium on May 29th.

Today's refreshingly smart move from the federal government clears the way for over 130 solar energy development projects already submitted to the BLM to move forward and opens up the possibility of further development of this untapped and vast American energy resource.

"We heard the concerns expressed during the scoping period about waiting to consider new applications," BLM Director James Caswell said in a statement, "and we are taking action. By continuing to accept and process new applications for solar energy projects, we will aggressively help meet growing interest in renewable energy sources, while ensuring environmental protections."

I'd love to think my blogging had something to do with this, but there were plenty of voices that arrived at the same conclusion Helen and I did. Among those calling for an end to the insane moratorium on solar development was Senate Majority Leader and solar-rich Nevada's senator, Harry Reid who I imagine might be slightly more influential than this blogger...

Either way, it's clear that as the price of oil continues to rise, buoying inflation and economic insecurity along with it, the time is now to tap our vast reserves of abundant renewable energy and develop the clean and cheap new American energy sources that will power the 21st Century.

So wether it's the Bush Administration, Congressional demogauges or NIMBY enviros, we can't afford to let Energy Delayers stand in the way of a new American energy future.

Energy Delayers, Get Out Of The Way: A New American Energy Future Awaits

By Helen Aki and Jesse Jenkins, cross-posted from the Breakthrough Blog

Just as the time becomes ripe for a major push towards clean, cheap sources of electricity, the Bureau of Land Management threw a two-year stumbling block in the path of solar power development last Friday. As solar power ramps up--the Bureau has received 130 proposals solar plants since 2005--the Bureau decided to put a hold on further development, claiming that that an exhaustive environmental impact report must be completed before solar plants can be installed on federally owned lands. Meanwhile, the push continues for oil drilling in protected offshore areas and the Alaskan National Wildlife Refuge (an endeavor that really merits an environmental impact assessment!).

Using environmental justifications to suppress the growth of new, clean, American energy sources doesn't fly with environmentalists (who must feel like their political tool (the EIS) has been perversely co-opted by the "dark side"). But the Mojave ground squirrel aside (a species allegedly threatened by the solar development), it strikes me that anything that actively blocks much needed new clean, renewable energy is not only perverse or ironic, but actually dangerous.

Timed as it is to coincide with the expiration of critical renewable energy incentives, this new road block is bad news for the solar industry-- and actively blocking the advancement of new sources of clean, American energy is bad news for the economy as a whole. Now more than ever, as the price of oil continues to rise, buoying inflation and economic insecurity along with it, the transition to new clean sources of American energy is critical to secure continued economic prosperity.

As the New York Times reports:

"It doesn't make any sense," said Holly Gordon, vice president for legislative and regulatory affairs for Ausra, a solar thermal energy company in Palo Alto, Calif. "The Bureau of Land Management land has some of the best solar resources in the world. This could completely stunt the growth of the industry." (emph. added)

Even if the moratorium on solar plants in public lands does not entirely smother the solar industry--after all, privately owned lands are still fair game--it is symbolic of a structural failure to fully acknowledge and understand the problems we face, or embrace progressive and effective policies to solve them.

The price of gas has exceeded $4 a gallon in most of the country (it was well over $4.50 in northern California this weekend), the economy is in a downturn, and Americans are crying out for new energy solutions. Cheap, abundant supplies of oil may have powered the United States of the past, but our continued reliance on this depleting and increasingly expensive fossil fuel is now imperiling our economy and our way of life. The obvious answer - to everyone but the federal government apparently - is to tap our vast reserves of abundant renewable energy and develop the new clean, cheap American energy sources that will power the 21st Century.

Instead, all we hear from our Bush Administration throws up roadblocks to the clean energy sources at our fingertips and calls to Drill! Drill! Drill! for more oil (i.e. more of the same). Meanwhile critical renewable energy incentives gasp their final, rattling breath in Congress.

Why? Though the answer may lie with oil interests, there is a deeper trend. In his most recent New York Times op-ed, Thomas Friedman laments the current state of the union and insists that we need to rebuild a dysfunctional nation. He writes that, "It's the state of America now that is the most gripping source of anxiety for Americans," adding that "our political system seems incapable of producing long-range answers to big problems or big opportunities" -- a myopia which is only too evident in a policy such as the BLM's, and in the absurd energy solutions proposed by the current administration.

Friedman goes on to say:

"I continue to be appalled at the gap between what is clearly going to be the next great global industry -- renewable energy and clean power -- and the inability of Congress and the administration to put in place the bold policies we need to ensure that America leads that industry."

We are living in a dangerous time, a time of energy crisis. Out of this danger comes opportunity, and a choice between futures.

We can choose to continue towards a future of oil dependency that spells disaster for both our economy and our climate, putting up impediments to essential new American energy industries and providing "life support" in the form of continued subsidies to the mature ones in decline. Or we can choose to recharge America with the power sources of a truly novel era, letting go of that which is no longer politically or economically strategic and cultivating that which will lead us into an age of clean energy and prosperity.

It seems that, so far, we have only chosen the former. Which future do you choose?

Image source: NY Times

Obama and Clinton Both Talking Up "Clean" Coal in Primary States

Both Barak Obama and Hillary Clinton have solid energy plans that, if implemented, would take America into a cleaner energy future. On energy and climate, like on so many other issues, both remaining Democratic contenders for the White House followed John Edwards' early example and developed bold clean energy and climate change plans late last year.

As David Roberts of Grist says, "Both would substantially cut greenhouse gas emissions and boost clean energy; both pitch sustainability as an issue of shared sacrifice and economic opportunity; both have an impressive grasp of the policy details."

In fact, when it comes to the two candidates' energy and climate plans, there's about as much distance between them as their current neck-and-neck delegate counts.

Obama and Clinton have something else in common we should all be taking note of: they've both been talking up so-called "clean" coal on the campaign trail, especially in coal-friendly primary states like Ohio and Wyoming.

Obama earned some well-deserved heat last summer for his seemingly friendly stance towards coal-to-liquids (CTL) synthetic fuel production. While CTL might help displace oil, the synthetic fuel results in up to twice as much greenhouse gas emissions as conventional gasoline. Obama has since "clarified" his position on CTL, saying he'll only support new plants if they decrease both oil use and GHG emissions (a tall order for this dirty fuel!).

Clinton has been pretty silent on CTL, but both candidates energy plans and stump speeches tout the potential of "clean" (aka slightly-less-deadly) coal technologies.

In coal-lovin' Ohio last week, Obama had this to say:

"Clean-coal technology should be part of [the] mix... We are the Saudi Arabia of coal."

And Clinton is just as bad. Her husband was out today touting "clean" coal to crowds in Wyoming (set to caucus on Saturday). From the Denver Post:

"At the University of Wyoming in Laramie, thousands of people braved icy winds and waited in long lines outside a campus arena to hear the former president speak. He answered with a speech that held them rapt even as he ranged from his wife's plans for universal health care to her plans for creating a technology that could burn Wyoming coal without generating greenhouse gases."

So what's wrong with a coal technology that lets us burn our most abundant domestic fossil fuel resource "without generating greenhouse gases." To answer that, I'll let you ask the fine citizens of West Virginia, or refer you to this video:



The short answer though, is that as long as you need dig coal out of the ground, it'll never be clean - particularly while coal companies employ the extremely destructive process of mountain-top removal strip mining to supply those "clean" coal plants with fuel.

Slightly-less-deadly, sure, but "clean?" Don't try to shovel me that!

As Jeff Biggers, the author of The United States of Appalachia: How Southern Mountaineers Brought Independence, Culture and Enlightenment to America, writes: "Clean coal: Never was there an oxymoron more insidious, or more dangerous to our public health."

Barak Obama has at least spoken publicly against mountaintop removal and strip-mining in both DC and Kentucky.

"We're tearing up the Appalachian Mountains because of our dependence on fossil fuels," Obama said at a campaign stop in Lexington Kentucky, sparking loud applause.

As of yet, the Clinton campaign has been silent on the practice of mountain top removal or strip mining.

Any energy plan that pledges to clean up coal must address both the combustion and extraction of the dirty fuel.

I sincerely hope that a President Obama will fight to end the practice of mountain top removal, which devastates both the environment and the lives of Appalachia. I also hope that Clinton's silence on the matter is merely oversight.

Neither candidate has yet convinced me that they their "clean" energy plans will not push an expansion of coal-fired power plants under the guise of "clean" coal that will accelerate mountain top coal mining and other strip mining and lead to expanded environmental and human devastation.

My question is this: what exactly do Obama and Clinton mean when they say "clean" coal? If this is what they have in mind (or what they are ignoring), then they can take their "clean" coal and shovel it!

Beating Back the Coal Rush: Feds Suspend Subsidized Loan Program for Rural Coal Plants

In another big victory in the fight against the coal rush, the feds apparently suspended a major loan program that provided rural electric cooperatives with subsidized loans to construct new coal-fired power plants. An official with the US Department of Agriculture's Rural Utilities Service (RUS), which manages the loan program, cited the uncertainties of climate change and rising construction costs as the reasons for the programs suspension.

"This is a big decision. It says new coal plants can't go to the federal government for money at least for the next couple years, and these are critical times for companies to get these plants built," said Abigail Dillen with the environmental law group Earthjustice.

Earthjustice, the Sierra Club, the Montana Environmental Information Center and other environmental groups filed suits to block RUS financing for new coal-fired power plants last summer, arguing that RUS did not consider the impact of greenhouse gas emissions spewing from the pulverized coal plants the program is financing and the impact those emissions will have on global warming.

The program's suspension marks the end of a reliable source of financing for new coal plants. The RUS program, established in 1935 as a New Deal-era program to finance rural electrification, has been a major funding source for the coal rush. The Seattle Times reported last May that "The beneficiaries of the government's largesse — the nation's rural electric cooperatives — plan to spend $35 billion to build conventional coal plants over the next 10 years, enough to offset all state and federal efforts to reduce U.S. greenhouse-gas emissions over that time." The RUS program provided $1.3 billion in loans to build new coal plants since 2001, according to the Minneapolis Star-Tribune.

The suspension of the subsidized loan program means that no loans will be issued to rural electric cooperatives this year and likely none in 2009, James Newby, assistant administrator for the Rural Utilities Service, a branch of the Department of Agriculture, said Tuesday.

According to the Star-Tribune, at least four utilities are currently lined up for RUS loans totaling $1.3 billion — for coal-fired power plants in Kentucky, Illinois, Arkansas and Missouri. Another project in Montana was denied funding last month and two more recently withdrew their requests for RUS loans: last October in Wyoming and earlier this week in Missouri. All seven plants will now have to look for private financing to move forward, and at least two of the plants are suspending development after this announcement.

"This decision means one more nail in the coffin of new coal plants," said Alice McKeown, coal analyst for the Sierra Club. "There have already been a handful of plants affected by this news, including the indefinite delay of a plant in Missouri."

The Star-Tribune reports:

Associated Electric Cooperative Inc. announced this week it was "delaying indefinitely" its proposed plant in Norborne, Mo., after receiving word of the loan program suspension.

At least one developer, the East Kentucky Power Cooperative, is hoping to wait out the suspension of the loan program rather than seek more expensive loans on the open market, spokesman Nick Comer said.

Other projects, like the embattled Highwood Generating Station proposed by Southern Montana Electric, Basin Electric Power Cooperative's Dry Fork plant in Wyoming, and East Texas Power Cooperative's proposed plant in Plum Point, Arkansas, must now try to secure private funding - a difficult task given the typically poor credit ratings of rural cooperatives and increased scrutiny of coal investments from Wall Street.

"The move by RUS to take a time out on coal is part of a larger story," says McKeown. "We're seeing different sectors coming together to make sure that we are looking before we leap into 50+ years of serious global warming pollution. From carbon principles out of Wall Street to ending taxpayer subsidies, financial uncertainties are turning up the heat on energy investors to look to solutions rather than following a business as usual mentality."

The suspension of the loan program is only temporary, but should hold at least through the end of 2009. It comes at a critical time in the coal rush and again signals growing (and appropriate) nervousness about new coal investments in the financial sector.

"Coal is not the best investment for our future. Dozens of states, major Wall Street banks, and now even the federal government, have all now said no to new coal," says MacKeown. "It’s becoming increasingly clear that energy efficiency and renewables are the way of the future.”

Hear hear to that!

Oil Hits Record Price. Gas Nearing $4.00. President Bush, Clueless…

Happy Friday! Oil hit record-prices today: $103.05 per barrel. Bully for us...

That tops the inflation adjusted high of $102.53 set in 1980. Oil first inched over $100 to welcome in the new year on January 2nd and has hovered around $100 since then, routinely spiking into new record territory. Now we've blown past the final record: the inflation adjusted highs reached in the '80s.

This news comes as analysts predict $4.00 per gallon gasoline when refiners switch over to reformulated blends in Spring.

Of course, you and I already know that. We see it every time we drive past a gas station, or god forbid, actually pull in to fill up our tanks!

You'd assume President Bush would be clearly aware of the state of gas prices as well, given how much they impact average Americans every day. Well, you might assume that about another president anyway... I wasn't too shocked to learn that President Bush is actually completely clueless that gas prices are soaring towards $4.00!

In a press conference today, he revealed his complete ignorance of what life is like for real Americans on the street in an interview that began with a simple question from Peter Maer of CBS News. Here's the transcript of the exchange, courtesy of NTYimes blog, "the Lede":

Q: What’s your advice to the average American who is hurting now, facing the prospect of $4 a gallon gasoline, a lot of people facing –

MR. BUSH: Wait, what did you just say? You’re predicting $4 a gallon gasoline?

Q: A number of analysts are predicting –

MR. BUSH: Oh, yeah?

Q: — $4 a gallon gasoline this spring when they reformulate.

MR. BUSH: That’s interesting. I hadn’t heard that.

"I hadn't heard of that?!" Seriously?! Well that explains a lot...

Like why President Bush has routinely blocked the US Congress's fiscally responsible attempts to re-invest wasteful oil subsidies to kick-start new sources of clean, homegrown renewable energy.

Three times now, the House of Representatives of the 110th Congress has passed bills that would end wasteful subsidies to oil companies designed to spur domestic oil exploration at a time when oil priced in at about $20.00/barrel. With oil prices at record levels over five times higher than when Bush took office, it's simply fiscally irresponsible to shower an industry recording record profits with taxpayer subsidies while denying the most promising and fastest growing clean, homegrown renewable energy technologies critical incentives that spur their growth.

The House passed their third attempt to correct this irresponsible tax spending and shift funds to extend critical renewable energy and energy efficiency tax credits, as well as support purchases of plug-in hybrid electric vehicles. Perhaps the third time's a charm, but this victory could be short lived, with President Bush again threatening to veto and a Republican-led filibuster in the Senate expected (again!).

But I guess if President Bush doesn't have a clue what oil and gasoline prices are really like these days, he can be forgiven for ignorantly and irresponsibly defending oil subsidies to Exxon, Chevron, ConocoPhillips and friends... These oil companies are incidentally reaping record profits off of the record prices paid by every-day Americans at the pumps, all while the economy tanks... But maybe President Bush doesn't know that either.

So maybe we should go light on President Bush... After all, he doesn't know any better!

But WE, the every day American tax payer do!

WE know that lavishing subsidies on established and highly profitable industries is a pretty poor use of taxpayer money.

We ALSO know that subsidizing the energy industries of the past will not help us solve the energy challenges of the future! To do that, we're going to have to be Energy Smart! We're going to have to invest in new, clean, domestic energy sources like wind, solar, geothermal, energy efficiency, new 100+ mpg plug-in hybrid cars and more in order to have an energy supply that is sustainable, both environmentally AND economically.

WE know better, so let's let the Senate and President Bush know it's time to re-invest! Let your Senators know it's time to be smart with our energy subsidies.

Tell the Senate to pass H.R. 5351 the Renewable Energy and Energy Conservation Tax Act of 2008 so we can take a step towards a sustainable, prosperous and secure America!

Can MLK's Dream Be Reborn in the Economic Stimulus Package?

When Dr. Martin Luther King Jr. was assassinated forty years ago in Memphis, he was calling for a campaign that would unite the poor and working classes of all races behind a shared economic future. Today, with ever increasing income gaps, rising oil prices, rapid climate change, expanding outsourcing, and economic instability, Dr. King's dream is as necessary as ever.

As we honor King's life and vision tomorrow, it's time for his dream to be reborn, not only to meet the still-lingering challenges from his time but also the unique challenges of ours.

Today, as Congress prepares a giant Economic Stimulus Package, there is no better way to honor Dr. King’s memory and continue his struggle than to demand that Congress go green and go equal in the stimulus.

The economic stimulus package could simply go towards short-term consumer spending that may temporarily prop up our economy, or it could help lay the foundation of prolonged economic prosperity. We could invest in new iPhones or in a sustainable, just, and prosperous energy future. It's up to Congress now to decide which.

Cross-posted at DailyKos...

While crafting a national stimulus package, Congress should develop policy measures that not only help keep our economy out of recession in the short-term, but also make smart investments in longer-term, sustained economic prosperity by moving our nation towards a clean energy economy that provides employment opportunities for all Americans.

In addressing America's current economic difficulties, we have a unique opportunity to not only avoid a recession, but also to address one of the root causes of our current economic woes: high energy prices and our dependence on dirty and depleting fossil fuels. We have an opportunity to act boldly to strengthen American energy independence, invest in the clean, sustainable energy sources that will form the foundation of a new era of economic prosperity, and take aim at global warming - all while putting hundreds of thousands of Americans to work.

More specifically, Congress should ensure that all tax cuts and direct spending measures promote a clean energy economy that provides economic opportunities for all Americans, including the poor and working class. This would mean, for example:

• Funding a public Clean Energy Corps that offers work and service opportunities to the young and poor to combat climate change through energy efficiency and weatherization projects;


• Expanded and immediate funding of the recent Green Jobs Act (GJA), Title X of the EISA;


• Directing infrastructure investments toward transit, “green” infrastructure in water and sewer, mixed use dense development, walkable communities, and overall reductions in vehicle miles traveled and our nation’s carbon footprint;


• Investing in improving our electricity grid to be “smarter” in improving end-use efficiency, allowing greater use of distributed renewable energy generation, and increasing its own efficiency in using the interconnected components of our national energy generation system;


• Using additional monies allocated to LIHEAP for improving building energy efficiency as well as home heating assistance, and removing current constraints on such use;


• Establishing federal credit guarantees for state and municipal “efficiency utilities” promoting energy conservation efforts in transportation, industry, and buildings;


• Establishing a federal revolving loan fund to support such efforts;


• Provide personal tax credits or rebates to encourage the purchase and installation of energy efficient appliances and heating and cooling systems;

By increasing national energy efficiency, reducing out-of-pocket energy spending, and creating employment opportunities, the measures above will meet basic stimulus goals while furthering national objectives of climate protection, energy security, and economic equity. This year's stimulus package offers the unique opportunity to advance all these aims, and we encourage you to seize it.

A new clean energy economy must provide equal opportunity and equal protection for all. Dr. King was working towards this dream when he was killed. Let us come together now to continue his unfinished work and create a more sustainable, just, and prosperous America. Help spread the word and put pressure on Congress to focus on solutions to the recession that also achieve longer-term economic prosperity, equal opportunity and a sustainable energy economy.

Let the Dream be Reborn!

[Image source: MLKOnline.net]

Keeping Up the Power Shift: Senate Set to Take Second Stab at Energy Bill

Bits and pieces of information are coming in today indicating that the Senate is gearing up to take a second stab at passing an energy bill later this week.

After failing to pass the full energy bill passed by the House last week, Senate leaders negotiated over the weekend to seek a compromise that would net the bill the crucial 60 votes to overcome a Republican-led filibuster threat.

It appears they are nearing that compromise and a second attempt to end debate and pass the bill is scheduled for Thursday, December 13th. If it passes the Senate, the bill will return to the House for passage on Friday before heading to President Bush's desk. Whether or not the President will veto a bill expected to save Americans billions at the pump and on their utilities bills at a time of record high gas prices remains to be seen...

Word has it that the renewable energy standard has been dropped from the bill and that the bill will include a stripped down package of tax incentives for renewable energy. The final makeup of that tax package is still under negotiation and details are sparse, although it is expected to include a two-year extension of critical credits for renewable energy generation, enough to get us into a new President's term and a new Congress.

Clearly losing the renewable energy standard, which would have required large utilities to acquire 15% of their electricity from renewable sources by 2020, is a major disappointment (although Reid has pledged to try to pass it as a stand-alone bill in 2008).

The fact that the Senate has had such difficulty passing an energy bill with strong support for clean, domestic renewable energy is a clear sign that we've got a lot of work ahead of us to keep up the Power Shift! We need to work hard to ensure that political realities change over the next year to closely match what real reality demands of Congress!

However, it still looks like an energy bill well worth passing is heading for a vote tomorrow and it's time again to get on the phone and urge your Senators to get the job done and pass a clean energy bill!

The bill heading for a vote is expected to include:

• The first increase in fuel economy standards in 30 years, up to 35 miles per gallon by 2020. These provisions will save American families $700 - $1000 per year at the pump, with $22 billion in net consumer savings in 2020 alone.


• The best energy efficiency standards in U.S. history, including new efficiency standards for lighting, appliances and boilers and incentives for home weatherization and industrial energy efficiency. The bill also directs the federal government to be a leader in energy efficiency with cutting-edge, efficient building practices and lighting in all federal buildings.


• A "Green Jobs" provision that creates an Energy Efficiency and Renewable Energy Worker Training Program to train a quality workforce for “green” collar jobs -- such as solar panel manufacturer and green building construction worker -- created by federal renewable energy and energy efficiency initiatives. This program will provide training opportunities to our veterans, to those displaced by national energy and environmental policy and economic globalization, to individuals seeking pathways out of poverty, to at risk youth and to those workers in the energy field needing to update their skills.


• A biofuels standard that requires 36 billion gallons of renewable fuels by 2022, including at least 21 billion gallons that come from advanced biofuels that do not rely on corn or other edible feedstocks. While the expansion of corn-based ethanol raises environmental, economic and justice concerns, advanced biofuels using inedible biomass or even algae could displace significant amounts of oil and help decrease greenhouse gas emissions from transportation.


• Some clean energy tax package. The House version of the bill included $21 billion in tax incentives for renewable energy, energy efficiency and plug-in hybrid vehicles, financed in part by reinvesting $13.5 billion in unnecessary tax subsidies for Big Oil in the clean energy technologies of the future. The final Senate version will likely include a smaller tax package but should retain critical renewable energy tax incentives that will ensure the industry can continue to grow, providing more and more clean, domestic renewable energy for America.

So call your Senators today and urge them to finish the job and pass a clean energy bill tomorrow! The future prosperity of this country depends on the success of the clean, domestic energy technologies of the 21st Century, and this bill is a critical first step towards unlocking a clean energy revolution.

You should feel free to let your Senators know you were disappointed that they couldn't pass the House version of the energy bill, but tell them you expect them to still pass a strong bill tomorrow, including critical tax incentives for renewable energy generation.

So what are you waiting for? Get on the phone...

Watch Out for the Echo-Boom: Why Politicians Had Better Start Paying Attention to the Millennial Generation

80 million teens and twenty-somethings are ready to make their mark on American politics. Is the growing youth climate movement - now poised to explode off campuses and into the nation's capitol for Power Shift 2007, the first national youth climate summit - the vanguard of a new progressive, pro-environment youth political movement?

By 2010, another 17.3 million young Americans will come of age, swelling the already sizable ranks of voting-age "Millennials" – those teens and twenty-somethings coming to age in the early years of the 21st century. At 80 million strong, the Millennial generation outnumbers even the Baby Boomers by 3 million and represents the single-largest demographic age group in electoral politics, according to a recent Mother Jones article ("The 50-Year Strategy", in the Nov/Dec 2007 issue - not online yet).

Polling data, recent voter turnout, and the swelling ranks and increasing coordination of the youth climate movement all demonstrate that this young generation is remarkably engaged, overwhelmingly progressive and pro-environment, and has largely rejected the "government-is-the-problem" conservative mentality that still dominates the general population (see table below).

General Population	Voting-age Youth (age 18-25)	Issue
58%	32%	agree that the federal government "is usually inefficient and wasteful"
52%	40%	say regulating business "does more harm than good"
49%	68%	say protecting the environment is at least as important as protecting jobs
47%	62%	favor tax-financed, government-administered universal health care

[Source: "The 50 Year Strategy", Mother Jones]

This young generation is razing the old stereotypes of the apathetic, unengaged youth that may have accurately characterized Generation Xers, as youth turnout in the past two elections hit the highest level in at least 20 years.

And the Millennials aren't simply waiting for politicians to take notice and seemingly won't content themselves with limiting their impact to the ballot box. In fact, they're demanding to be noticed, as thousands get ready to storm our nation's capitol to flex some political muscle in the first-ever national youth climate summit, Power Shift 2007, and rally at nationwide Step it Up actions in November.

According to www.PowerShift07.org, over 5,000 youth and students from across the country will soon explode off of campuses and converge on D.C. for Power Shift 2007, November 2nd-5th. With all 50 states represented, youth attending the conference will engage with solutions to global warming and learn how to effectively put solutions into practice as they cement the core of an increasingly sophisticated and coordinated nationwide youth climate movement.

Power Shift's agenda includes issue briefings from leading scientists and policy experts, training sessions, an opportunities fair, and additional networking opportunities, all designed to connect young leaders and use their collective experience to focus action on America's greener, more prosperous future.

That same weekend, tens of thousands more student and youth activists will join in hundreds of actions in their home communities as part of the second Step It Up nationwide day of action, Saturday, November 3rd (see www.StepItUp07.org).

Founded and organized by a group of Middlebury College students, recent grads, and their mentor, Bill McKibbon, Step It Up successfully organized 1,400 actions across the U.S. involving hundreds of thousands of citizens in their first nationwide day of action, April 14th, 2007. Thanks largely to these highly visible and well-attended actions – which demanded Congress “step it up” and cut carbon emissions 80% by 2050 – virtually all of the 2008 Democratic candidates for president are chanting the 80x2050"mantra in their stump speeches these days and striving to out-compete each other for the meanest, greenest energy plan. Sponsorship and support is also building behind bills in Congress that would tackle the climate crisis and put the 80x2050 plan into action.

This November, the young minds behind Step it Up 2 will be at it again, this time joined by the thousands of participants at Power Shift 2007 to demand real action to address the climate crisis and secure the future of today's youth. On Monday, November 5th, the youth at Power Shift will carry reports and pictures of the hundreds of Step It Up actions into the offices of their senators and representatives, as thousands of young people descend on Capitol Hill to make their voices heard.

If the increasing coordination, sophistication and activism of the youth climate movement is any indication, the Millennial generation has arrived on the political scene, and they are sure to make their mark.

According to Mother Jones authors Simon Rosenberg and Peter Leyden:

"[The Millennial] generation is politically engaged, votes in high numbers, and leans overwhelmingly Democratic. ... But the millennials' impact will show up beyond the ballot box. Polling data indicate that they are unusually civic minded (they volunteer at the highest level recorded for youths in 40 years, according to one study) and hold a wide range of progressive values ... [they] even believe in government again (Sixty-three percent think government should do more to solve the nation's problems)."

As the authors conclude, "This generation is poised to become the core of a 21st century progressive coalition."

It's clearly time for today's politicians to start paying serious attention to the Millennials – especially candidates in the 2008 elections.

According to Rosenberg and Leyden, if people under age 29 had been the only voters in the 2004 election, John Kerry would have won by a landslide with 372 electoral votes. And in the 2006 midterms, "the same age group went for Democrats over Republicans by 22 percent - an almost unheard-of margin."

When thousands of young people take to the streets in Step it Up actions and head to D.C. for Power Shift in a couple of weeks, politicians would be wise to take note. If they don't, they just might find themselves looking for a new job, as millions of young voters throw their support behind more progressive, pro-environment candidates committed to ending the climate crisis and protecting the future of the Millennial generation.