Greens to Obama: What the Hell?

I think it's safe to say that Obama has veered right on energy. His State of the Union speech called for offshore drilling, his 2011 budget proposed a tripling of loan guarantees to the nuclear industry, and yesterday he moved to bolster both corn-based ethanol and carbon-capture initiatives—darlings of the farm belt and the coal industry, respectively.

So far he's said next to nothing about wind, solar, smart grids, or energy efficiency, a move that will certainly disappoint his greenest supporters, who would like to see those technologies play a more central role in our energy future. I agree that may be impractical, especially given the intermittency issues that continue to plague wind and solar projects. But greens will argue, rightly, that clean-coal, nuclear energy, and corn-based ethanol come with their own set of hurdles.

For example: Obama's goal is to scale up biofuel production from 12 billion gallons a year (what we currently produce) to 36 billion gallons by 2022. Because we don't have the physical space to produce that much corn, we'll have to start converting switch grass and forest waste into fuel, and some of those processes are no more carbon-free than oil. Meanwhile, even some supporters of carbon capture say the technology has a way to go before we can reasonably expect to establish five to 10 large-scale, functional carbon-capture plants, which is what the Energy Department plans to do by 2016. And before we can build more nuclear power plants, we really ought to figure out what to do with all the waste that's piling up at the 100-plus existing nuclear reactors across the country.

While taking cap-and-trade off the table might have also been politically necessary—some Democrats and most Republicans abhor the idea of pricing carbon—that move will almost certainly come back to haunt both sides. Without emission caps or a carbon tax of some sort, energy companies will have little incentive to press on with carbon capture and storage—or any other low-carbon project for that matter—once the cost outpaces government subsidies. And eventually, the EPA might step into the vacuum created by Congress and impose its own regulations (under the Clean Air Act, for example), which would probably be more stringent and less voluntary.

It's clear that by focusing on such Republican favorites, Obama hopes to win support for his climate-change bill, now waning in the Senate. But how well that's working remains to be seen. The biofuel industry is already complaining about adequate federal support for their new mandate and fretting that the life-cycle rules are too stringent for the industry to prosper. (To qualify for biofuel money, producers must show that their fuel produces less carbon than oil does—across its entire life cycle, from growing the corn to processing it to burning the final product—meaning they have to PROVE they're cleaner than oil. Imagine that!) And the nuclear industry—pleased as it is with the additional loan guarantees—would be even more pleased with some extra production tax credits for whatever power they do generate. Considering what Obama has offered up so far (and without much of a fight), you can't blame the Greenpeace contingent for worrying about how he'll respond to those demands.