DFL Rep. Tim Walz and Republican Rep. Erik Paulsen have joined together to urge Gov. Mark Dayton to sign a bill that would lift Minnesota’s moratorium on new nuclear power plants. The moratorium repeal is currently in conference committee after passing the House and is likely to end up on Dayton’s desk this legislative session.

“Today, the people of Minnesota have a unique opportunity to move the country forward and embrace the path to a cleaner, more secure energy future. They can do so by repealing the moratorium on building new nuclear power plants in the state.,” Paulsen and Walz wrote in the letter sent to Dayton. “We believe a 21st century energy mix must include nuclear energy, providing well-paying jobs for local communities, tax revenue for the state and clean air for everyone. Please join us in supporting repeal of the moratorium on nuclear power plant construction in Minnesota.”

In 2009 and 2010, Walz and Paulsen teamed up to urge the Minnesota Legislature to pass a moratorium repeal.

DFLers Sens. Al Franken and Amy Klobuchar have also expressed their support for nuclear power as part of the solution to pollution and carbon dioxide emissions.

Sen. Al Franken told the Rochester Post-Bulletin that he has changed his mind on nuclear power due to a conversation with former Vice President Al Gore. Nuclear power has become a hot topic in Minnesota politics as legislators, mainly Republicans, look to lift the ban on new nuclear power plant construction. That plan has already passed one committee in the Minnesota House.
Franken said that with newer technologies, nuclear waste handling and storage capabilities can be improved and nuclear power can play a role in curbing global warming, the Post-Bulletin reports.

“Yes, (the nuclear waste) will be around for hundreds of thousands of years, but I am kind of hoping we will, too,” Franken said. “And I am kind of hoping that just as we’re going from a decade to map the human genome to a day or two days or whatever it is that we will be more and more sophisticated on storing the waste.”

He said it was a conversation with Gore that helped him change his position on the use of nuclear power to reduce greenhouse emissions.

“Nuclear has to be a part of the solution to that,” he said.

Franken didn’t directly address the lifting of Minnesota’s ban on construction of new nuclear plants, but the Post-Bulletin editorial board came out in favor this week of lifting the ban on nuclear power plant construction, which has been in place for 17 years in Minnesota.

Concerns about air pollution and global warming are blocking the construction of new coal-fired plants, and although wind energy is an important part of our future, it won’t keep up with our state’s increasing appetite for energy. Our two nuclear plants provide one-quarter of the state’s electricity — more than all “green” energy sources combined — but their futures beyond 2030 are uncertain at best.

The bottom line is that Minnesota needs to keep all of its energy options open.

A coalition of 19 environmental groups sent a letter (pdf) to President Obama today encouraging him to require that cars made after 2025 meet a 60 mile-per-gallon fuel efficiency standard.

Natural Resources Defense Council Executive Director Peter Lehner, in a blog today, said this goal is achievable.

We can achieve 60 mpg by 2025 using and improving on technologies that already exist such as hybrid electric cars. And, of course, we have the know-how to do it without compromising affordability, safety, or consumer choices.

And he says new standards will help reduce the country’s dependence on foreign oil:

Not only will they save drivers money at the pump and make America’s car industry more competitive, but they will also dramatically reduce our need for foreign oil and cut down on global warming pollution. By 2030, it will cut our oil consumption by 49 billion gallons per year and more than 535 million metric tons of carbon pollution.

The letter comes as the Obama administration is expected to release new fuel efficiency rules later this month.

The Department of Energy’s National Renewable Energy Lab estimated it would cost at least $43 billion to upgrade the nation’s electric system to move to 20 percent wind by 2030. Photo: Travel Aficionado, Flickr

By now, the Obama administration has made clear it wants to ramp up the use of renewable energy, calling it a key to the nation’s leadership in the 21st century. And some in Congress are hoping to pass a federal renewable energy standard, requiring the production of more wind, solar, biomass and geothermal energy.

Utilities recognize the shift to green energy as a major growth prospect. But they also recognize an impediment: Infrastructure. Indeed, across the country, utility and energy companies are preparing for a massive fight over how to deliver clean energy to people’s homes — and, more to the point, who will pay for the necessary infrastructure to get the energy there.

Behind the scenes, in recent months, utilities have battled over how to allocate the costs of the new high-powered electric lines necessary to move wind energy from one part of the country to the other. Despite efforts by federal regulators to referee the fight, some experts foresee further delays in the construction of the new electric, or transmission, lines they say are essential for meeting federal and state renewable energy mandates.

“A lack of transmission lines is the single greatest barrier to wind here in the Midwest. The lack of transmission has proved to be a huge barrier,” says Jamie Karnik, communications manager at Wind on the Wires, an advocacy group. Karnik says the Midwest produces about 10,000 megawatts of wind now, and needs to build at least 25,000 to 40,000 further megawatts of capacity to meet state and regional renewable energy goals.

Many utilities in the wind-rich Midwest would like to move excess electricity to the Northeast on new, high-powered lines. But utilities in the Northeast see Midwestern wind as a threat to its nascent offshore wind industry. While offshore wind is plentiful in the region, it has been plagued by regulatory delays and high costs. Cheap wind from the Midwest could keep the Northeast from developing its own local source of renewable power.

“As the nation looks to move to a renewable energy standard, a lot of that really comes down to how to meet the energy needs of the East coast,” Karnik says. “Certainly people who are building wind in the Midwest, have their eye on the eastern market.”

Utilities on both sides of this divide are drawing the battle lines over so-called cost allocation policies, which lay out a structure for how the costs for these lines are spread among ratepayers. One faction (including some Midwestern utilities and renewable energy advocates) proposes spreading the costs broadly over an entire region, arguing that new lines deliver broad economic and electric reliability benefits to all ratepayers. The other faction (including many Northeastern utilities) says costs should be paid by the specific beneficiaries of the new line.

Electric industry stakeholders — utilities, renewable energy developers, transmission companies — stand to lose or gain billions of dollars based on the structure of these policies. As a result, they are pouring significant lobbying resources into their development. “Needed transmission in the eastern interconnection would be about $85 billion,” says one lawyer following the issue who was not authorized to speak on the record. “The dollars involved here are huge and the regional economic impacts are huge. Utilities are keenly aware of that and that’s why they are fighting over cost allocation.”

A 2008 study by the Department of Energy’s National Renewable Energy Lab said it would cost at least $43 billion to upgrade the nation’s electric system to move to 20 percent wind by 2030. Others have put estimates significantly higher. A study conducted by the lab in January also said that any effort to meet the 20 percent goal in the Northeast would require “significant expansion of the transmission infrastructure.”

At the center of this fight is the Federal Energy Regulatory Commission, or FERC, a little-known agency that has often played second fiddle to the Department of Energy, but energy policy experts say has far more power over shaping the country’s energy policy. After months of discussions with industry stakeholders, FERC released in June a cost allocation proposal meant to assuage utilities’ concerns. It drew on elements of both utility factions’ proposals, giving some preference to projects that meet policy goals like renewable mandates, while ensuring that the costs allocated are at least “roughly commensurate” with the benefits delivered.

For the most part, industry stakeholders say they can work within the framework FERC set up: It gives utilities latitude to develop their own workable proposals. But as the public comment period on FERC’s proposal comes to a close at the end of this month, they also say the cost allocation debate might take years to resolve.

The lawyer following the issue said the ongoing battles between utilities over cost allocation could significantly impact states’ abilities to meet renewable energy standards. “I think it will affect it tremendously,” the lawyer says. “I think it’s going to continue to be really, really hard to build big lines.”

Rob Gramlich, senior vice president for public policy at the American Wind Energy Association, the wind industry’s national trade group, says he is “encouraged by what FERC is doing,” adding, “They clearly understand the challenges of the new clean energy economy and what that entails.” He says that FERC is working to expand a “Balkanized” electricity grid that was meant only to work on a local, rather than a regional basis.

In order to meet a stringent renewable energy standard, Gramlich says transmission must be built across regions in order to bring wind from the Midwest to states that don’t have many renewable resources. “To do that we’d need more regionalization of the type that FERC is pursuing now,” he says. “To do it cost effectively, by using the most economic resource areas, significant new transmission would be needed.”

But Gramlich notes that any rulemaking that FERC finalizes will likely be challenged in court, as some companies will “stand to lose a lot” no matter what proposal is adopted. Such challenges could delay a process that likely won’t even go into effect until 2012, given the various compliance periods allowed under the plan.

Joseph Kelliher — former FERC chairman and current executive vice president of federal regulatory affairs at NextEra Energy, the country’s largest renewable energy developer — says FERC’s cost allocation proposal is “critical and essential to translating conceptual renewable energy projects to real projects. They actually won’t get built until there is some clear conception of cost recovery.”

Kelliher also defends broad cost socialization, saying that entire regions benefit from new lines that carry renewable energy. “The notion that only ‘A’ and ‘B’ have to pay for that line and nobody else has to pay for anything, economists would look at that and say it’s a classic ‘free rider,’” he says. “Free riders tend to like the status quo and would like to get something for nothing. The current policy does discourage investment.”

At the same time, offshore wind is just not as cost competitive as onshore wind from the Midwest, Kelliher says. “The difference between onshore wind and offshore wind is about 400 percent. If transmission constraints don’t allow you to import good onshore wind from the Midwest for at least part of your renewable energy needs, you’re left paying” more, he says.

But Tim Fagan, director of public policy at the New Jersey-based PSEG, says broad socialization of costs puts the Northeast at a disadvantage because it favors Midwestern wind. “The concern is that we may end up with an overall less economic solution,” he says. “If the resources from the Midwest are able to have these long transmission lines paid for, that may competitively eek out other options.”

Fagan says Northeastern states need to be given time to develop local offshore wind and solar resources. “Eastern states are looking to develop offshore resources; they’re plentiful and they’re close to load,” he says. “In New Jersey, we’ve been aggressively developing PV solar.”

While a broad energy bill authored by Sen. Jeff Bingaman (D-N.M.) addressed some electric transmission issues, those provisions are not expected to come up for a vote in the Senate this year. Until then, electric utility officials say they will be watching Congress closely in the coming weeks to see if momentum is building for passage of a federal RES. Renewable energy advocates have been working feverishly behind the scenes during the August recess to convince key senators that the proposal could get the 60 votes necessary for passage.

“You’re beginning to see people stepping up and saying we can’t meet these mandates if we can’t get transmission built,” says one utility official who requested anonymity to speak openly. “All of this comes down to whether or not we have a federal RES. That has the potential to change things.”

A new Pew Research poll shows broad support for a variety of energy policy options currently on the table in Congress but “no public consensus on top priorities.”

A spokesperson for House Speaker Nancy Pelosi (D-Calif.) was quick to tout the results of the poll, arguing it shows that “the American people overwhelmingly support a comprehensive energy and climate bill that reduces our dependence on foreign oil, limits carbon pollution, and requires utilities produce more energy from renewable sources.” The spokesperson used the poll to tout various energy bills passed by the House, including the comprehensive energy and climate bill passed last year.

Americans overwhelmingly support broad policy goals like reducing the country’s dependence on foreign oil or creating new green jobs, the poll finds. But they also support keeping energy prices low. According to Pew:

Roughly two-thirds (69%) say reducing America’s dependence on foreign sources of energy should be a very important goal for Congress and the president in any decisions on energy policy. The same number say keeping energy prices low is very important. Nearly as many (64%) say creating jobs within the energy sector should be a very important goal of energy policies, and 61% believe protecting the environment from the effects of energy development and use is a very important goal.

But there is less certainty among Americans when it comes to what should be the country’s top energy policy priority:

When asked to pick the one goal that should take highest priority, energy independence ranks at the top of the list. About three-in-ten (31%) say reducing America’s dependence on foreign energy should take priority in the energy policy debate. Roughly two-in-ten choose each of the other three goals as the top priority.

Both Republicans and Democrats listed energy independence and low energy prices as important priorities, while other issues appear to have split along party lines:

There is more of a partisan gap over environmental protection and job creation. Far more Democrats (76%) than Republicans (46%) see protecting the environment from the effects of energy development and use as a very important goal. And Democrats are also significantly more likely than Republicans (73% vs. 56%) to say that creating jobs within the energy sector should be a very important goal.

The poll was conducted July 29-Aug. 1 by the Pew Research Center for the People and the Press and the National Journal, and was sponsored by the Society for Human Resource Management.

Oil-covered goose in Michigan. Photo: Todd Heywood

Enbridge Energy, the firm behind a pipeline leak in Michigan that dumped more than 800,000 gallons of oil in a rural creek over the weekend, has had leaks in Minnesota 11 times since 2002, according to data from the U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration (pdf). The data — which doesn’t count spills from trucks, generators, fires and explosions at refineries or gas stations — was provided to the media by Minnesota environmental groups who this morning are releasing the National Wildlife Federation’s new study, “Assault on America: A Decade of Petroleum Company Disaster, Pollution, and Profit.” It underscores that oil spills aren’t just limited to the Gulf of Mexico — or Michigan, which is a point environmental advocates will make at a 10:30 a.m. press conference in Edina.

The DOT data shows that around 8,000 gross barrels of oil were spilled by Enbridge. Overall, Minnesota saw 57 pipeline spills between 2000 and 2009, “or one every other month for ten years on average,” according to a statement by organizers of the press conference. Property damage for all spills statewide surpasses $36 million.

Gary Botzek, Executive Director of the Minnesota Conservation Federation, a NWF affiliate, will be joined at this morning’s event by Edina resident and homeowner Justin Barrow, who lives near the site of a diesel spill on Saturday Saturday, in which diesel oil spilled from a generator directly into Minnehaha Creek. Also speaking is Chris Cox of the Pew Environment Group.

The Enbridge pipeline leak, as our sister site the Michigan Messenger reports, has dumped well over 19,000 barrels of oil, making it that state’s — and likely the midwest’s — worst spill ever. In Minnesota, that company’s spills — which are attributed to factors including equipment failure, damage from natural disasters or operator error — caused more than $12 million in property damage, according to the report.

Read the just-released NWF report:

NWF_OilSpills_Explosions_pages

Photo: Marianna Day Massey, ZUMApress.com

As expected, Robert Dudley will take over for embattled BP CEO Tony Hayward starting Oct. 1, The Washington Post reports. The company also announced today that it lost $17 billion in the second quarter of the fiscal year.

According to the Post:

The board said Tuesday that BP had taken a $32.2 billion pre-tax charge in the second quarter to cover the cost of the April 20 spill, including $20 billion it pledged to set aside in an escrow account. The petroleum company faces unquantifiable liabilities in lawsuits from fishermen, holiday hotel owners and tourism businesses across the Gulf Coast.

These numbers give us a sense of BP’s thinking about the cost of the oil spill. Up until now, only the $20 billion escrow account for economic damages, to which the company publicly committed at the prodding of the Obama administration, had hinted at the spill’s probable cost.

And more on Dudley:

The choice of the even-keeled Dudley represents a fresh start for BP, which has seen its reputation badly soiled in the aftermath of the rig explosion and spill.

Dudley grew up in Hattiesburg, Miss., and later spent eight years working in Russia, gaining experience and knowledge that could be key in running a company that relies largely on oil produced in the United States and Russia.

“God hasn’t shared that with me yet,” he said.

Kenneth Feinberg, administrator of the BP Oil Spill Victim Compensation Fund, testifies before the House Judiciary Committee on Wednesday. (Pete Marovich/ZUMApress.com)

For Barisich and thousands of other victims of the spill, the inability to work has brought about substantial financial hardship. Now, with BP nearing the final stages of its three-month effort to stop thousands of gallons of oil from leaking into the Gulf of Mexico, the big question they’re all asking is how they’ll be compensated by BP for the economic damage they’ve suffered.

But as officials unveil details of the claims process, spill victims face a conundrum: Many of them will be required to predict the long-term damages they will face as a result of the oil spill years before the true damages are known.

Kenneth Feinberg is the man in charge of what is likely to be one of the largest claims processes in U.S. history. Feinberg was appointed by the White House last month to oversee a $20 billion escrow account being put aside by BP to pay claims from the spill.

He has been trekking across the Gulf Coast region over the last several weeks in an attempt to gain the trust of oil spill victims. For the most part, people seem to like him. They appreciate his candor. “This program I am running is absolutely voluntary — nobody has to do it,” Feinberg told Louisiana residents last week, according to The New York Times. “It’s my opinion you are crazy if you don’t participate.”

But first impressions don’t mean much in the Gulf, which has faced more than its share of tragedies and government recovery efforts. Observers say they are waiting to see just how Feinberg restructures the claims process.

While Feinberg has not outlined his plan in great detail, a major battle over the claims process is looming. BP has been offering interim payments to oil spill victims to hold them over until the leak can be capped. While there have been complaints about this process (including frustration over the disbursement of second payments), the White House says BP has not denied any claims. As of Tuesday, “119,012 claims have been opened, from which more than $220 million have been disbursed,” the White House says.

But these are just interim payments. Feinberg has outlined a process whereby, beginning three months after the well has been permanently capped, victims will need to file claims for the total damages they expect from the oil spill. They will then be offered a single payment. If they accept the payment, they must sign a waiver saying they cannot sue BP for more money. If they aren’t happy with the payment, they can sue BP, entering a legal process that could take years to resolve.

Observers and lawyers in the region say this scenario raises several questions, the main one being: How can you calculate the economic damages you’ll suffer before you know what the true consequences of the oil spill will be years and even decades down the road?

Barisich, who is the president of the United Commercial Fisherman’s Association, put it this way: “It’s a crap shoot. It really is. … Fishing may come back within two years and then you win. But if it doesn’t come back, if it takes four, five, six, or 20 years, then you lose.”

Barisich said there are no accurate estimates for when the fishing industry will fully recover. “Nobody can give you that answer,” he said. “If somebody tells you, it would be a best guess. [The spill is] so vast, it’s so huge, it’s so spread out. They tell you it’s going to come back in two years. Would you put your salary up on that estimate? Because you’re sure as hell putting my salary up on it.”

Richard Shore, a partner at the law firm Gilbert LLP, which has worked on litigation resulting from the Exxon Valdez oil spill, echoed Barisich’s concerns. During the next six months to a year, as Gulf Coast residents become more desperate for a settlement, they are more likely to accept what BP has to offer, even before the full consequences of the spill are adequately understood, Shore said.

“People with claims against BP will need income, but they won’t know the full extent of their damages,” Shore said. “People shouldn’t be forced to choose between going for long periods without compensation and guessing prematurely what their full damages might be. In the longer term, what Mr. Feinberg is saying is that people will have to make an educated guess about what their full damage is.”

While any victim can choose to sue BP for more money, Shore warns that this process can be expensive and time consuming. “The litigation route has its downsides and may create pressure on people to accept an offer of compensation from BP,” he said. “That will result in a lot of scrutiny on the Feinberg process.”

Ed Sherman, a law professor at Tulane University, said the process Feinberg is implementing is very similar to the one he employed as the head of the 9/11 Victims Compensation Fund. But Sherman noted that the wide-ranging nature of the spill makes it different from the 9/11 attacks. The spill is “unlike 9/11, where a loved one was killed or there were injuries and you have a fixed condition on which to base a claim,” he said.

Still, Sherman said that outside of the BP claims process, courts are tasked with making these kinds of determinations all the time — for example, when determining compensation for long-term disability. Sherman said Feinberg will likely review the data in detail to form as accurate an estimate for long-term damages as possible to use as a basis for assessing the claims.

Feinberg did not respond to requests for comment, but a source in his law office confirmed his plan for long-term compensation for spill victims.

Regardless of the outcome of the claims process, it could be some time until Barisich and others are able to get back to work.

“We don’t know if the Gulf is going to be screwed up for years,” Barisich said. “It’s our mother basically. It gives us our product.”

Sens. Joe Lieberman (I-Conn.) and John Kerry (D-Mass.), the authors of a comprehensive climate bill, on Tuesday. Photoe: epa/ZUMApress.com

If President Obama hoped that his meeting with key senators on Tuesday would produce anything resembling a consensus on energy legislation, he came away disappointed. Democratic leaders emerged from the meeting expressing their grudging willingness to compromise further — provided some sort of emissions limits are put in place — while Republicans continued to hammer emissions controls as an “energy tax.”

But the events of the day may have brought some clarity to a point that has gradually emerged over the past two weeks: If the eventual energy bill is to include a price on carbon, it’s likely to affect the utilities sector only.

Sen. Olympia Snowe (R-Maine), a moderate Republican without whose support energy legislation stands virtually no chance of passing the Senate, issued a statement after the meeting expressing hesitation on an economy-wide carbon cap — a provision many scientists consider essential to efforts to fight global warming.

“On the complex and difficult question of curbing greenhouse gas emissions, there is no consensus at this time,” Snowe said. “From my perspective, I’ve long asserted that placing a price on carbon will send the appropriate signals to entrepreneurs that would unleash the innovation to position America as a global clean energy industry leader. However, today we are in different and perilous economic times. … We cannot afford economy-wide approaches to carbon reduction that could cost consumers another 18 cents per gallon of gasoline in this struggling economy or subject our manufacturing sector to unnecessary regulations when they’ve already reduced their emissions by five percent below 1990 levels.”

Her solution? “I believe that one possibility is to more narrowly target a carbon pricing program through a uniform nationwide system solely on the power sector which is the sector with the most to lose from the EPA regulations and it’s also the sector in which businesses actually make decisions today based on prices 20 to 30 years in the future.”

It’s hardly a new idea. Two weeks ago, White House Chief of Staff Rahm Emanuel proposed a utilities-only cap as a possible compromise solution. And last week, Duke Energy CEO Jim Rogers, the most vocal advocate for climate legislation in the electricity industry, co-authored an op-ed in Politico in which he expressed openness to a carbon price for utilities alone — provided other sectors eventually follow.

“It’s time for all of us — politicians, business leaders and environmentalists — to put wishful thinking aside, establish realistic goals and develop a consensus for legislation that can be passed this year,” he wrote, along with Pew Center on Global Climate Change president Eileen Claussen. “If that means capping emissions from the utility sector first — so be it.”

But they added, “Electric utilities may be willing to go first. But they are not going to be willing to go alone.”

Exactly how other sectors would be added remains unclear.

“Some climate bills have featured a sort of Phase Two,” said Marchant Wentworth, deputy legislative director of the Union of Concerned Scientists, where other sectors are phased in “four, five, six years down the road.”

But Wentworth was skeptical that a utilities-only bill would be able to pass a Senate where Republican opposition to climate legislation has grown increasingly intense.

“Is there something unique about a utility-only bill that gets you more support in the Senate than a comprehensive bill?” he asked. “Can you get to 60 [votes] on utility-only? No.”

Still, for all the disappointment among environmentalists over the repeated compromises Democrats have made on climate legislation to win over moderates, some argue that a utilities-only cap would achieve most of the goals of an economy-wide carbon pricing scheme. The question now is whether Democratic leaders in the Senate can muster 60 votes for even a weakened bill to overcome a Republican filibuster.

The answer may be in the president’s hands — at least according to Senate Majority Harry Reid.

“I think it’s pretty clear we have to do something,” Reid said last week. “The question is, what do we do? Now, a lot of that depends on what the White House is going to do to help us get something done.”

Sen. Jeff Merkley (D-Ore.), a leading voice for strong climate action, thinks Obama took an important step in that direction in the meeting Tuesday.

“He didn’t lay out a recipe, but he made it clear that a price on carbon is a very powerful instrument,” Merkley told The Washington Post. “He said it’s a very important tool and one we should thoroughly explore. … He made a point of raising carbon pricing a number of times. I dont think he would have done so if that wasn’t very important to him.”

But the president himself equivocated on the need for a price on carbon following the meeting.

“The President told the Senators that he still believes the best way for us to transition to a clean energy economy is with a bill that makes clean energy the profitable kind of energy for America’s businesses by putting a price on pollution — because when companies pollute, they should be responsible for the costs to the environment and their contribution to climate change,” the White House said in a statement. “Not all of the Senators agreed with this approach, and the President welcomed other approaches and ideas that would take real steps to reduce our dependence on oil, create jobs, strengthen our national security and reduce the pollution in our atmosphere.”

The diversity of opinions on energy legislation notwithstanding, Obama remains optimistic about the prospects of a bill.

“The President is confident that we will be able to get something done this year,” the White House said.