Senate committee proposes binding renewable energy targets

The Senate Energy and Natural Resources Committee formally introduced new energy legislation last week, proposing wide ranging reforms designed to accelerate the development of low carbon energy sources and introduce nationwide renewable energy targets.

The new legislation will now make its way through the Senate at the same time as the Waxman-Markey climate change bill continues to wind its way through the House of Representatives.

The Senate legislation, which mirrors some of the proposals included in the House bill but steers clear of the controversial issue of emission caps, would introduce nationwide renewable energy standards that would require energy suppliers to source a certain amount of energy from renewable sources.

President Obama has been calling for the adoption of such standards since he was on the campaign trail, but the Senate proposals fall well short of his plan to ensure that a quarter of energy comes from renewables by 2025, instead setting a 15 per cent target for 2021.

The bill will also attempt to put the president's smart grid dreams into action, proposing a nationwide interconnection plan for electrical grids, with the first plans to be submitted within two years of the legislation being passed.

The Bill would also create a new agency within the Department of Energy, called the Clean Energy Deployment Administration, which would facilitate loans to renewable energy companies, particularly those viewed as too risky for conventional commercial loans.

Green groups, including organisations that have written directly to the Committee, accused the members of the Committee of failing to set sufficiency ambitious renewables targets, and offering too many concessions to the fossil fuel industry in an attempt to secure the support of senators from coal-rich states.

Friends of the Earth called the proposals a "giant slush fund for nuclear and coal projects", and argued that the renewable energy standard could be counterproductive, lowering the bar compared to existing state-level renewable portfolio targets.

"The proposal weakens section 526 of the Energy Independence and Security Act, which stops the government from purchasing fuels with a higher carbon intensity than gasoline," the lobby group added. "This provision is currently in effect and the government is complying with it. Weakening the provision would encourage the use of dirty tar sands oil."

The groups were also angered by proposals within the legislation to open new offshore drilling areas in the eastern Gulf of Mexico, and introduce new rules that would require the Federal government to hold at least 30 billion barrels of refined petroleum products in reserve.

However, there were also some sweeteners for environmentalists, including a comprehensive plan to study the relationship between water consumption and energy use, and proposals for a new energy efficient building code from the Department of Energy.