Last updated: March 15, 2013 10:26 pm

Obama lobbies for alternative energy

President Barack Obama has urged Congress to back a plan to use $2bn from oil and gas drilling revenues over the next decade to fund research into alternative fuels, portraying the advanced energy sector as central to economic growth and national security.

But as he travelled to the Argonne National Laboratory in Illinois on Friday to tout his new “blueprint for a clean and secure energy future”, Mr Obama notably avoided mentioning the controversial Keystone XL pipeline.

Energy efficiency

Energy efficiency
US oil imports and primary energy sources

The Obama administration has delayed approving the construction of the pipeline, designed to carry oil from Canada’s tar sands to the Gulf of Mexico, but is coming under increasing pressure to act, with lawmakers on both sides of the aisle saying the long-delayed project is crucial for job creation.

Republican lawmakers introduced a bill on Friday that would allow Congress to bypass the president and approve the pipeline, a companion measure to a bipartisan bill introduced by Montana’s Democratic senators, Max Baucus and Jon Tester, on Thursday.

But in Argonne, Mr Obama focused almost exclusively on renewable energies, saying that the US risked falling behind countries such as China, Germany and Japan, which he said were increasing spending to find ways to cut energy use and explore alternatives to fossil fuels.

“We can’t afford to miss these opportunities while the rest of the world races forward,” the president said after touring the thermal test chamber at the federal energy lab.

“We have to seize these opportunities. I want the next great job-creating breakthroughs . . . to be right here in the United States of America, creating American jobs and maintaining our technological lead,” he said.

In his State of the Union address last month, Mr Obama said he wanted to make the US a “magnet” for high-tech manufacturing jobs. “No area holds more promise than our investments in American energy,” he said.

In his blueprint, the president urged Congress to establish a new Energy Security Trust that would invest in research into advanced vehicles that run on electricity, homegrown biofuels, fuel cells, and domestically produced natural gas. He proposed using $2bn over 10 years of federal revenues from oil and gasfield drilling to pay for the research, making it budget neutral.

The plan is similar to one put forward by a group of business executives and former military leaders pushing to lessen the US’s dependence on oil, and also to a plan touted by Lisa Murkowski, Alaska Republican senator.

The blueprint is heavy on alternative energies, laying out a challenge to double renewable electricity generation by 2020 and calling on Congress to make permanent the production tax credit for renewable energy.

“Few areas hold more promise for creating good jobs and growing our economy than how we use American energy,” Mr Obama said.

But his proposals are unlikely to make headway in a bitterly divided Washington that is focused almost entirely on budget cuts, and where climate change and green energy are highly partisan issues.

Certainly, no progress will be made until there is a decision on Keystone, which Republicans and the oil and gas industry view as a litmus test for the president’s approach to oil and gas in his second term.

The Obama administration has delayed making a decision on the pipeline, even though the state department has issued an environmental assessment saying it would not cause environmental harm, as feared. Authorities in Nebraska have also approved the portion of the pipeline that travels through that state.

The pipeline is steadfastly opposed by environmentalists critical of the US’s continuing dependence on oil, and demonstrators protested against Keystone during the president’s visit to Argonne.

People close to the White House say it is inevitable that the president will approve the project, given the jobs it will create and the fact that the US is experiencing an oil and gas boom.

But the White House says no decision has yet been made on the pipeline.

“That process is housed over at the state department,” spokesman Jay Carney said on Thursday. “It is moving forward and will end in a decision.”

The state department’s environmental assessment, released on March 1, is open for comment for 45 days.

When he took office in 2009, Mr Obama championed alternative energies such as wind and solar power and high-tech battery manufacturing, supported by hefty grants from the economic stimulus package.

But the fossil fuel boom, fuelled by the spectacular growth in US production through hydraulic fracturing and horizontal drilling, has forced the president to recalibrate and adopt an “all of the above” energy policy encompassing oil and gas, as well as greener energy sources.

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