President Barack Obama on Friday unveiled a “blueprint for a clean and secure energy future” for the US that stresses alternative energies and the relatively clean fossil fuel of natural gas, and encourages greater energy efficiency.
He will travel to Argonne, Illinois on Friday to promote the blueprint, a key plank of which involves taking $2bn over 10 years from federal revenues from oil and gas field leases to pay for research on vehicles that do not use oil.
However, the plan makes no mention of the controversial Keystone XL pipeline, designed to carry oil from Canada’s tar sands to the Gulf of Mexico. The Obama administration is expected to approve it but has not done so yet, despite no impediments to construction remaining.
With the president expected to approve the pipeline, Republicans and the energy industry are eagerly awaiting an announcement. But environmentalists resolutely oppose Keystone and protesters from the Sierra Club and 350.org are readying to demonstrate in Argonne, even though Friday’s blueprint is overwhelmingly focused on green policies.
The White House said that in his blueprint the president had put the US on a path to a cleaner and more secure energy future.
“Since President Obama took office, responsible oil and gas production has increased each year, while oil imports have fallen to a 20-year low [and] renewable electricity generation from wind, solar and geothermal sources has doubled,” the plan says.
“In short, the president’s approach is working. It’s a winning strategy for the economy, energy security and the environment,” it says, although it noted there was still more work to be done.
Business groups have been calling for a clearer energy strategy and on Thursday, the president met with top executives from Anadarko Petroleum Corp, renewable power producer NextEra, power producer Sempra, and logistics giant FedEx Corp, one of the world’s biggest fuel consumers.
In his blueprint, Mr Obama called on Congress to establish a new “Energy Security Trust” that would invest in research to make new energy technologies cheaper and better. He suggested setting aside $2bn over 10 years for the trust, which he said should look into advanced vehicles that run on electricity, homegrown biofuels, fuel cells and domestically produced natural gas.
He proposed funding the trust from revenues from oil and gas development in the Outer Continental Shelf.
Even in this time of fiscal rectitude, the energy trust plan could win some bipartisan support as it echoes a proposal put forward by Lisa Murkowski, the Alaska senator and ranking Republican on the Senate’s energy and natural resources committee.
When he took office in 2009, Mr Obama championed alternative energies such as wind and solar power and high-tech battery manufacturing. This was supported by hefty grants from the economic stimulus package.
But the notorious collapse of Solyndra, which owed $528m to the US government when it failed, and the simple fact that the stimulus funding has run out means there will be much less emphasis on alternative energies in the second Obama term.
Meanwhile, the fossil fuel boom means the pendulum is swinging back to traditional sources of energy, fuelled by the spectacular growth in US production as “tight oil” reserves in states such as North Dakota and Texas have been unlocked using hydraulic fracturing and horizontal drilling.
This has forced Mr Obama to recalibrate and adopt an “all of the above” energy policy encompassing oil and gas, as well as greener energy sources.
The blueprint is heavy on alternative energies, laying out a challenge to double renewable electricity generation again by 2020, calling on Congress to make the production tax credit for renewable energy permanent and refundable.
He also said the interior department should improve its permitting process, and that more money should be invested to ensure the safer production of and cleaner electricity from natural gas.
Noting that oil imports had declined by almost one-third since he took office, Mr Obama set a new goal to cut them by half (from 2008 levels) by the end of the decade.
But on Keystone, people close to the White House say there is no way Mr Obama can block construction of the pipeline now that Nebraska has issued a report saying that the proposed re-routing would avoid environmental impacts that had been initially feared.
Environmentalists resolutely oppose Keystone and would be dismayed by such a decision.
Most analysts expect Mr Obama to approve the pipeline but, in the next breath, to apply tough new emissions standards to new, as well as existing, coal-fired power plants as a way to cut greenhouse gas emissions. That would go some way to placating environmentalists.