Speaking to a Washington, DC, audience at the NDN advocacy think tank, Heather Zichal, Deputy Assistant to the President for Energy and Climate Change, outlined in 2,500 words what the Obama Administration is doing to promote production of oil, natural gas, ‘clean’ coal, nuclear power, and renewable energy, plus increased energy efficiency – the ‘all of the above’ approach, they call it – without mentioning climate change as a driver for a US energy strategy. ‘All of the above’ is certainly not a way to develop a climate strategy. Transcript of Zichal’s remarks on June 25 follows.
Before joining the Obama presidential campaign as Policy Director for Energy, Environment and Agriculture, Zichal was Sen. John Kerry’s Legislative Director. Sen. Kerry recently gave an hour-long address on the Senate floor in which he said “we should be compelled to fight today’s insidious conspiracy of silence on climate change – a silence that empowers misinformation and mythology to grow where science and truth should prevail.” This was the sort of thing we associated Zichal with before she went into the White House. It was the kind of straight talk on climate that Obama hasn’t given, and the message the White House is steering clear of at this point.
It’s not that the White House doesn’t understand the problem, it’s that they have more pressing priorities, including diplomatic relationships with the energy industry, that make it awkward to emphasize the climate change problem.
Heather Zichal remarks at NDN, Washington, DC, June 25 (transcript by CSW from our recording at the event):
Thank you for the opportunity to be here and to talk a little bit about the Administration’s approach to energy policy. Certainly we get a lot of questions these days spanning the spectrum of, “what does this Administration believe about coal? What future do you see for wind power?” I’m happy to spend a little bit of time giving you a bird’s eye view of the Administration’s view on energy policy.
From the very first days that the President came into office, you saw us launch a very aggressive all-of-the-above energy approach. We said, “let’s develop more natural gas and oil, but let’s also double down on energy efficiency and building a clean energy economy.” The record behind that is not always known, but I think is something worth talking about and I expect you’ll continue to hear a lot from the President – this issue, energy policy, is core to many of his fundamental beliefs about our economy, about our security, and about our environment.
I think if you take a step back there’s sort of three buckets of energy policy: First, there’s conventional energy production. We talked earlier about the fact that domestic oil production is currently at an eight-year high. In fact, every year the President has been in office, oil production has increased. Today we are producing more natural gas than we ever have in history. Imports of foreign oil are down. In 2011 our dependence on foreign oil was lower than at any point in the last 16 years. In the last year alone, we’ve cut net oil imports by 1 million barrels a day.
At the same time, we are looking for new areas to develop. Last week the Department of the Interior – you probably noticed the lease sale in the central Gulf of Mexico that covers 38 million acres. It was a very successful lease sale in that we are going to work to finalize the proposed 2012-2017 leasing program that will make available 75% of the potential offshore oil and gas resources available for development. We continue to make additional areas on-shore available for development as well.
There’s so much conversation in Washington these days about natural gas, I want to spend a few minutes talking about that. It’s hard to overstate how natural gas and our ability to access more of it than ever has been a game changer. And that’s why it’s been a fixture in the President’s “all of the above” energy approach. Just a few years ago, the conventional wisdom was that the US needed to build more terminals to import natural gas from overseas, but today the conversation is about whether or not we can export our natural gas supplies. Thanks to recent advances in technology we now have access to a nearly 100-year supply of natural gas, and our ability to tap into that supply will bring significant economic, geopolitical, and other benefits.
For all these reasons, the Administration sees tremendous potential. That’s why we continue to take concrete steps to allow for increased domestic production for both conventional and unconventional gas. On federal lands and in factories we’re taking a number of important steps in the next couple of weeks to open new areas for development.
Part of what’s been missing from the conversation is: How do we ensure that development of natural gas is done safely and responsibly? One of my roles in the White House is to make sure that across the federal government there is a common understanding when it comes to natural gas development, including both surface and sub-surface issues. We all realize that hydraulic fracturing is not a zero-risk proposition if it’s not done right. There are some legitimate concerns about protecting underground water resources, reducing air pollution, and minimizing surface impacts like truck-trafficking road damage. These are all important and necessary issues to consider; at the same time we know that it can be done safely and responsibly.
As I think about the future of natural gas, what’s clear to me is that with the new technology we have and the know-how we have, the only thing that could undermine our ability to take advantage of our natural gas resources would be a failure to demonstrate to the public that we can do that safely and responsibly. Natural gas production is an area where we should be able to set aside the battles of the past and work together in a concerted way with industry, public health, and environmental groups, Democrats and Republicans, to tackle some of the issues that I mentioned. Because from our perspective, that’s when we end up with the best outcomes.
I’ll give you a recent example: In April, the EPA released new air emissions standards for oil and gas production. In the end, thanks to the extensive input we received from many of you in this room and other key stakeholders, we were able to land that policy in the right place. By that, I mean that we were able to reduce air pollution and protect public health, but we will also do so in a way that’s achievable and cost-effective for the industry. When the final rule was rolled out, we had the support of API [American Petroleum Institute] and major environmental groups.
There’s no reason why, as we move forward and think about our natural gas policies, that can’t be the model. I know that’s certainly something the President is absolutely focused on.
I will mention two other areas in the conventional energy production space that get a lot of press these days. Which is, clean coal and what role does the Administration need coal to play?
Today, coal plays an incredibly important part in our domestic energy portfolio, but that doesn’t mean we don’t have some advances and investments we can make to make sure that it’s burned more cleanly and in a more environmentally friendly way. That’s why the Administration has made an overall investment of 5 billion dollars in clean coal technologies and research and development. Today there are projects being launched across the United States on carbon capture and gasification projects that are creating jobs and allowing us to move the needle forward in a meaningful way.
One statistic I recently learned was that 90% of enhanced oil recovery in the world is happening here in the United States, thanks in large part to many of the investments from our Administration.
The last piece of this puzzle worth noting is that when you think “all of the above,” there is certainly an important role for nuclear power. This Administration has provided support for the first nuclear reactors in more than three decades. It will provide power for 1.4 billion people when it’s built. We are also investing in new nuclear technologies through small modular reactors. The Department of Energy will be making some very important decisions about grants for independent projects later this summer.
The second big key area of energy policy, and we’re thinking about this more broadly, is in energy efficiency. I can’t underscore enough that this is truly something that we have grabbed the bull by the horns on and made some tremendous success. After nearly three decades of inactivity, the President asked the Department of Transportation and EPA to work together with the auto industry, labor, Democrats, Republicans, to develop fuel efficiency standards for the future. Based on two successful rounds of negotiations, we were able to have broad support for new fuel efficiency standards out to model year 2025, that will require the average performance equivalent of 55 mpg, saving the average consumer over $8,000 over the life of the program, and allowing us to significantly reduce our dependence on oil.
It’s not just about what we do with our transportation sector, we’ve also focused a lot on the built environment. This spring, based on two programs through HUD [Department of Housing and Urban Development] and DOE [Department of Energy], we hit a historic landmark in that we weatherized a million homes. Which is exciting from our perspective, not only because you’re creating new technologies in homes and helping bring energy costs down, but you’re creating jobs in the supply chain in terms of building new energy-efficient appliances, and insulation of those appliances and other products.
Speaking of appliances, this is something again that the Department of Energy and Secretary Chu deserve a lot of credit for. There are a lot of appliances that we encounter every day – you might not think about the efficiency of your microwave or your television. But the Department of Energy has finalized new efficiency standards for more than 30 products, which are estimated to save consumers more than $300 billion through 2030. And that’s just since we’ve been in office. We continue to make progress on efficiency standards across the board.
The last area I want to touch on – we’ve been through conventional energy production, we’ve talked about energy efficiency, but it’s worth noting the important role that alternative clean energy can play going forward. This is something – through the Recovery Act, setting up historic investments from this Administration in clean energy. We set, when we first came into office, the bold but achievable goal of doubling renewable energy production. In three we’ve met that goal, and in the process we’ve created a lot of jobs, which we’re very excited about. But a lot of that hangs in the balance, particularly for the wind industry, because of the expiration of the production tax credit. Recently you’ve seen and heard from the President directly on the need to get that tax credit extended.
What I’ve seen from my perch is, there are a lot of conversations in Washington today about, “how do you create jobs? How do we make sure we protect the economy?” We know for a fact that the expiration of the PTC [Production Tax Credit] and the uncertainty that’s creating is leading to layoffs today across the country. These are jobs not only in the development and installation, but also in the supply chain. I can’t tell you how many CEOs I’ve talked to who are facing decisions about whether to invest in the United States or move to China, are making the first layoffs they’ve made in 30 years. The story is pretty stark.
Again, when you go outside the beltway and people ask, “You’ve got everyone from Karl Rove to President Obama supporting this, and the Sierra Club, and the Chamber of Commerce. Why can’t it get done?” It’s really had to answer that question because practically speaking, you know this is something that overnight could ensure jobs are protected and build a platform for the future for this important part of the economy. So there’s not a good answer for why Congress hasn’t acted. We’re going to continue to keep that a priority for the Administration, and you can expect to hear from the President directly on that.
The other exciting thing that’s happening in the renewables space, is that we’re looking at new opportunities to site renewables. When we came into office, there were virtually no renewables sited on federal lands. Today, based on the work the Department of the Interior is doing, we will have, by the end of this year, permitted enough power for 300 million [?] homes. Which is very exciting; we’re talking about solar, we’re talking about wind. The successes we’ve seen there are incredibly important for the future. Three million acres are directly linked to 29 on-shore projects, but we are also working as quickly as possibly to develop offshore renewable activities through the Department of Interior.
It’s also worth having a conversation about the biofuels space. Currently domestic production in the US is at an all-time high. In 2010, President Obama set a goal of breaking ground on at least 4 commercial-scale advanced biorefineries by 2013. We’ve already accomplished that goal, one year ahead of schedule. This is certainly a space where we continue to see tremendous development and have a very robust conversation with the biofuels world. We’re seeing some real payoffs for those investments, but it doesn’t mean there isn’t more work to do in the research and development side as well as commercialization and infrastructure.
The Administration has very much been focused on research and development of clean energy technology. The President believes that in order to remain competitive in a global environment, we need to invest in clean energy; we need to continue to be the world’s clean energy leader. But we also need to look down the road at what are those technologies that are 5, 10, 15, 20-plus years down the road. Every budget has been committed to a robust R&D agenda. We have programs like ARPA-E [Advanced Research Projects Agency – Energy] and some of the energy hubs focused on some of the nation’s most challenging energy issues. And every day, the advances that we’re making, whether that’s on battery technology or more efficient wind turbines, is tremendous, and something that you can continue to expect to see from this Administration.
To wrap everything up, we truly do need a full portfolio of energy resources. There are many questions right now – there’s a game in Washington about trying to play one fuel source over the other, or make up a story that the Obama Administration doesn’t like oil but they really like gas. Or they don’t really like coal, but they really like wind. But what we have focused on is looking at all of our energy sources, but doing that from a lens of what makes sense from an economic perspective in terms of affordability, but also what we can gain as a country in advancing new technologies and being the global leader in clean energy development. We’ve done that through the lens of security – how do we make sure we are taking steps to reduce dependence on foreign oil, yet safely and responsibly develop our resources here at home. And doing that through the lens of what makes sense for the environment. Whether its energy efficiency or biofuels, nuclear power, natural gas; there are a lot of environmental benefits, not only from conventional air pollutants, but also from the greenhouse gas perspective. [CSW note: finally, seven words on collateral GHG benefits.]
All of those provide us the lens to assess our energy portfolio, to make sure that we are truly investing across a diverse portfolio. You will continue to hear from the President about an “all of the above” energy approach, and see true commitments from this Administration going forward. If you take a step back and look, we have not been afraid in the absence of Congress acting to use our existing authorities, and to use those well to provide for a transition to a more robust and diverse energy supply.
A couple worth noting: The Defense Department has committed recently to the largest purchase of renewable power. The DOT and EPA will finalize the second round of efficiency standards for model 2017-2025 later this summer. We’ve used the tools in the Clean Air Act to make sure we’re pushing the envelope in terms of investments in clean coal.
We are very much committed, and taking a step back, the Administration feels we have a great story to tell. But this doesn’t mean that there’s not improvements and more progress to be made. We’re committed to working with you and other key stakeholders to advance that agenda.
# # #
See, at Climate Progress:
Earlier CSW posts: