Video from the entire press conference will be available on Lugar's YouTube page: http://www.youtube.com/senatorlugar

Broadcast quality audio (.mp3 file) of the entire press conference will be available at: http://lugar.senate.gov/press/audio

Dick Lugar

U.S. Senator for Indiana

Date: 06/09/2010 • http://lugar.senate.gov

Andy Fisher • 202-224-2079 • andy_fisher@lugar.senate.gov

U.S. Sen. Dick Lugar today introduced his Practical Energy and Climate Plan, S. 3464, and made the following statement at a press conference. Full details of the bill, including text, an updated outline, a two-page summary, video of the press conference and more are available at http://lugar.senate.gov/energy. Sen. Lindsey Graham (R-SC) also appeared at the press conference and is a cosponsor of the bill. Sen. Lisa Murkowski (R-AK), ranking member of the Senate Energy and Natural Resources Committee, also cosponsored the bill today.

The most recent Congressional Connection Poll by the Pew Research Center and National Journal indicated that 81 percent of Americans believe Congress’ top priority should be creating jobs. This poll has consistently indicated the lowest priority of our constituents is dealing with climate change, with just 32 percent suggesting this in the most recent poll.

The same poll indicated that two-thirds of Americans said it was important for Congress to act on our country’s energy needs.

Waxman-Markey legislation in the House and Kerry-Lieberman legislation in the Senate represent a significant disconnect with the priorities of Americans. They could add significant – and perhaps debilitating – expense to our already fragile economy and they would be an invitation to special interest protectionism. It is also becoming more apparent that cap and trade schemes are not meeting their designed goals. The New York Times reported on May 24 that, “Carbon trading was meant to reduce greenhouse gas emissions in the European Union by making polluting more expensive for heavy industries, encouraging them to invest in cleaner technology. But even supporters admit that the system, also known as cap and trade, is falling far short of that goal. Critics decry it as just another form of financial profiteering with little environmental benefit.”

Energy is a vitally strategic national security issue for our country.  The real cost of petroleum includes the use of our military to defend shipping lanes and maintain geopolitical stability in oil producing regions. More troubling, four-fifths of the world’s oil reserves are controlled by government-owned oil companies, and many of these regimes do not wish us well or have shown some proclivity to use oil as a weapon of foreign policy.

It is time to recast the debate in Congress and match priorities with a practical alternative.

By placing carbon reductions ahead of solving energy vulnerabilities, the cap and trade bills situate the energy debate on the most controversial and unsustainable political ground.  Energy policy would benefit greatly from something close to a political consensus.  The most contradictory outcome would be the imposition of an expensive cap and trade plan by a narrow political margin at a time when the added expense could intensify economic pressures in the United States, thus undercutting the appetite of Americans for any efforts toward carbon reductions.

Moreover, if we experience intense shocks to the American way of life stemming from peak oil scenarios, politically motivated embargos, wars, or natural disasters, all bets are off for policies directed at mitigating climate change.  If the American public and economy are rendered immobile by a sustained oil shock, it is almost inconceivable that they would tolerate government imposed sacrifices focused on climate change that add to their burdens and slow the economy further.  In this context, breaking our oil dependence, with all the national security, economic, and environmental benefits that would come with such a victory, must be our top energy priority.

Today I am introducing legislation that would:

• Reduce our foreign oil dependency;
• Save Americans money on their energy bills;
• Improve our industrial competitiveness;
• Invest in cleaner and more diverse energy choices; and
• Better use our domestic fossil fuel resources.

This legislation reflects both Republican and Democratic proposals.

The plan would generate the following savings by 2030:

• Cut foreign oil dependence by more than 40 percent;
• Decrease national energy consumption by 11 percent;
• Reduce average household electric bills by 15 percent; and
• Cut greenhouse gas emissions by more than 20 percent, or about 1.6 billion metric tons – the equivalent of taking more than 240 million cars off our highways.

This practical energy and climate approach prioritizes the cheapest and easiest energy savings: to achieve efficiencies in our buildings, appliances and industrial processes.

In short, it fixes the major leaks in our energy system.

The bill accelerates electric power diversification, spurring the use of secure domestic resources and environmentally responsible generation. Most important, it targets our dangerous oil addiction by maximizing fuel savings in transportation and increasing domestic production of fossil and bio-based fuels.

The plan allows a flexible and predictable framework for use of energy sources and technologies. There is no bidding process among states, regions, political alliances, industries and special interests. It would accomplish nearly half the president’s 2020 greenhouse gas emissions goal — while saving money and boosting the economy. If there were a future decision to price carbon with a capping or taxing mechanism, the reduction goals would be substantially easier to attain.

A detailed outline of the plan has been on my website since March and can be found at: http://lugar.senate.gov/energy.  

Energy and climate legislation must reflect the economic realities facing Americans today. Like much of America, almost 10 percent of Hoosiers are unemployed. Many more are underemployed and living paycheck-to-paycheck.

We need policies that help Americans ease their financial burdens and encourage markets with job-creating opportunities.

This plan satisfies the concerns of two-thirds of Americans who say we should be addressing our energy needs now.

The $3.75 billion over five year net cost of the bill is more than justifiable. Without aggressive action to decrease our long-term energy dependency on foreign sources, we are risking economic and security disasters, as well as even more severe trade imbalances and costs for consumers. In 2008 our trade deficit was $840 billion, about half that, $439 billion, was for oil imports. That was nearly twice the $227 billion trade debt we ran up with goods we purchased from China. This bill would be a small price to pay for cutting this transfer of wealth away from our shores.

Finally this approach saves people money. It doesn’t threaten jobs and will create new ones. And it stimulates economic growth, answering the primary concern of Americans.

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Here is an excerpt from the bill:

SEC. 610. FEDERAL DIVERSE ENERGY STANDARD

DIVERSE ENERGY REQUIREMENT.—

 (1) REQUIREMENT.—

 (A) IN GENERAL.—Subject to subpara graph (B), each electric utility that sells electricity to electric consumers for a purpose other than resale shall obtain a percentage of the base quantity of electricity the electric utility sells to electric consumers in any calendar year from diverse energy.

 (B) PERCENTAGE.—Except as provided in section 611, the percentage obtained in a calendar year under subparagraph (A) shall not be less than the amount specified in the following table:

Calendar year: Minimum annual percentage:

2015 through 2019 ................................................ 15

2020 through 2024 ................................................ 20

2025 through 2029 ................................................ 25

2030 through 2049 ................................................ 30

2050 ......................................................................50

(4) DIVERSE ENERGY.—The term ‘diverse energy’ means electric energy generated at a facility (including a distributed generation facility) from—

(A) advanced coal generation;

(B) biomass;

(C) coal mine methane;

(D) end-user efficiency savings;

(E) efficiency savings in power generation;

(F) geothermal energy;

(G) landfill and biogas;

(H) marine and hydrokinetic renewable energy (as defined in section 632 of the Energy Independence and Security Act of 2007 (42 U.S.C. 17211));

(I) qualified hydropower;

(J) qualified nuclear energy;

(K) solar energy;

(L) waste-to-energy;

(M) wind energy; and

(N) any other energy source that will result in at least a 80-percent reduction in green house gas emissions compared to average emissions of freely emitting sources in the calendar year prior to certification of the Secretary, as determined by the Secretary through rulemaking.