Administration Proposes Expanded Energy Drilling

The Bush administration proposed on Monday leasing out millions of acres along the coasts of Alaska and Virginia to oil and gas drillers, a move that would end a longstanding ban on drilling in those environmentally sensitive areas.
Both areas have been closed to new drilling for many years. The areas off Virginia are still covered by laws that prohibit new drilling in all areas along the Atlantic and Pacific seaboards. But Congress lifted the prohibition on Bristol Bay off Alaska in 2003, and President Bush lifted an executive order in January that had blocked drilling there through 2012.
In the case of Virginia, administration officials are hoping to capitalize on interest in drilling expressed by the state legislature, which passed a bill last year asking the federal government to allow exploration for natural gas in waters 50 miles or farther from the state coastline.
Both proposals are part of a broader five-year plan to open up 48 million acres along the outer continental shelf to oil and gas drilling. Unless Congress objects within 60 days, most of the five-year plan will go into effect, though resistance has been voiced. Starting this year, the Interior Department plans to offer leases on about 8.3 million acres in the central region of the Gulf of Mexico, which Congress specifically approved for offshore drilling late last year.
But the department hopes to open up far more than that. It would offer leases on 37 million acres off Alaska, starting as early as 2008, in vast new areas in the Beaufort Sea, the Chukchi Sea and the Cook Inlet. None of those areas have been subject to a drilling ban, but none have been tapped before.
Starting in 2011, the Interior Department would also lease out 5.6 million acres in Bristol Bay along the Alaska Peninsula, an area that Congress closed off after the Exxon Valdez oil spill in 1989. If the plan can get approval from Congress, it would offer up three million acres off the coast of Virginia, starting in 2012.
“The outer continental shelf is a vital source of domestic oil and natural gas for America, especially in light of sharply rising energy prices,” said Dirk Kempthorne, secretary of the interior.
But Democrats in Congress criticized the plans for Alaska and Virginia, and they are likely to extend the current ban on drilling off Virginia. Gov. Tim Kaine of Virginia, a Democrat, said he supported limited drilling for exploration but has refused to endorse production.
“Whatever pressing energy issue comes before the American people, the Bush administration always responds with the same oil answer: more oil,” said Representative Nick J. Rahall II, Democrat of West Virginia and chairman of the House Natural Resources Committee.
The proposal includes measures to protect against damage to coastal areas from oil spills and other accidents. It would not allow drilling within 50 miles of the Virginia shore and would wall off an additional “obstruction zone” near the mouth of Chesapeake Bay.
Some environmental advocates said, however, that the proposed protections would be inadequate and could jeopardize fishing areas.
“The Bush administration is zeroing in on the most environmentally sensitive areas for offshore drilling,” said Richard Charter, a lobbyist for Defenders of Wildlife and co-chairman of the National Outer Continental Shelf Coalition. “These areas that they are characterizing as buffer zones are woefully inadequate when you consider that the Exxon Valdez oil spill traveled hundreds of miles in a matter of weeks.”
It is not clear how much fuel lies in the areas that would be made available. Interior Department officials estimated that the entire plan could produce 10 billion barrels of additional oil and 45 trillion cubic feet of additional natural gas over the next 40 years. That would be equal to about 16 months of the United States’ current oil consumption and about two years of its current consumption of natural gas.
The oil industry’s two big trade associations, the American Petroleum Institute and the Independent Petroleum Association of America, both praised the administration plan and urged Congress to open even more areas to drilling.
Royal Dutch Shell has been particularly eager to explore and develop the areas in Alaska, and has hired a number of former state and federal officials to help build popular support in communities near the proposed drilling areas.
If the administration does lease out areas in Alaska, companies may be entitled to a special reprieve from paying royalties to the government. In passing the Energy Policy Act of 2005, Congress extended what is known as “royalty relief” for deepwater drillers to cover oil and gas produced in “frontier areas” that are far from transportation centers.
The administration plan could encounter heavy resistance. New Jersey’s two senators, Frank R. Lautenberg and Robert Menendez, both Democrats, warned in a joint statement that the plan to allow drilling near Virginia was unacceptable because it “starts us down the slippery slope that could lead us to drilling off New Jersey’s coast.”
Congress has extended an annual moratorium on leasing along the Atlantic and Pacific Coasts for more than 20 years. Speaker Nancy Pelosi, Democrat of California, has been a staunch supporter of the drilling bans and has protested Mr. Bush’s decision in January to lift the prohibition for Bristol Bay.

Bush Splits With Congress and States on Emissions

By FELICITY BARRINGER and WILLIAM YARDLEY

Published: April 4, 2007

WASHINGTON, April 3 — A day after the Supreme Court ruled that the federal government had the authority to regulate heat-trapping gases, President Bush said he thought that the measures he had taken so far were sufficient.

But the court’s ruling was being welcomed by Congress and the states, which are already using the decision to speed their own efforts to regulate the gases that contribute to global climate change. As a result, Congress and state legislatures are almost certain to be the arenas for far-reaching and bruising lobbying battles.

Mr. Bush made it clear in remarks on Tuesday that he thought his proposal to increase automobile fuel efficiency was sufficient for the moment; he gave no indication he would ask the Environmental Protection Agency to regulate emissions of heat-trapping gases.

“Whatever we do,” he said, “must be in concert with what happens internationally.” He added, “Unless there is an accord with China, China will produce greenhouse gases that will offset anything we do in a brief period of time.”

But with Congress and the states more determined than ever to act, some of the nation’s largest industries — including automobile manufacturers and the oil companies that make their gasoline, and electric utilities and the coal companies that fire many of their boilers — now face the increasingly certain prospect of expensive controls on emissions of carbon dioxide, the most common heat-trapping gas associated with climate change.

At least 300 bills have been filed in 40 states that address heat-trapping gases and climate change in some form, said Adela Flores-Brennan, a policy analyst with the National Conference of State Legislatures.

In Washington, Congress has already begun a process that would eventually apportion both the responsibility for cuts in emissions that could cost tens of billions of dollars and the benefits and incentives that could mean billions of dollars of new income.

“Obviously, nobody wants to bear a disproportionate share of the burden,” said Representative Edward J. Markey, Democrat of Massachusetts and chairman of the newly created House Select Committee on Energy Independence and Global Warming. “It’s now going to be a multidimensional chess game with the planet’s future in the balance.”

The way legislation apportions emissions cuts among industries — and, as important, how the credits earned by companies that reduce emissions are allocated — will be the focus of the lobbying, said Mr. Markey and lobbyists for environmental groups and industry.

“It’s incumbent on everyone to roll their sleeves up, if they haven’t already, to deal seriously with this problem,” said Luke Popovich of the National Mining Association, the trade group for the coal mine operators who will be at the center of the lobbying. “If pain concentrates the mind, there will be more concentration on the issue now.”

Coal is the major source of electricity in more than half the states, and coal is the fuel most closely associated with high levels of emissions of carbon dioxide. And coal interests have a bipartisan audience. The United Mine Workers is a natural Democratic constituency, while the National Mining Association has been a reliable supporter of the Bush administration.

“There are differences within the industry,” Mr. Popovich said, “but we are allied in favor of a solution that preserves coal’s growth in the United States.”

Next to the electric-utility sector, which is responsible for about 40 percent of emissions of heat-trapping gases, Mr. Markey said, comes the transportation sector, which contributes roughly 30 percent.

The auto industry has long opposed increases in fuel-efficiency standards, which automatically mean a reduction in heat-trapping gases. The oil industry has resisted controls on carbon dioxide emissions. Until recently, the two industries, while occasionally sniping at each other, had avoided explicit endorsement of the regulation that was most feared by the other.

But, with the likelihood of Congressional action increasing, that informal nonaggression pact has ended. Executives of the Big Three auto companies testifying in the House last month explicitly supported regulation of carbon dioxide. And a senior oil industry executive earlier this year gave a speech advocating increases in fuel economy.

The Supreme Court found Monday that the Environmental Protection Agency had erred in justifying its decision not to regulate carbon dioxide and other heat-trapping gases. The court said that by providing nothing more than a “laundry list of reasons not to regulate,” the agency had defied the Clean Air Act’s “clear statutory command.” The ruling also said that the agency could not sidestep its authority to regulate heat-trapping gases unless it could provide a scientific basis for its refusal to do so.

In Congress, controls on automobile emissions remain a work in progress. In more than a dozen states, beginning with California in 2002, they have become a fact — although these laws have been stayed pending legal challenges. Those challenges were greatly weakened, however, by the Supreme Court ruling.

“States are not going to wait,” said Dennis McLerran, executive director of the Puget Sound Clean Air Agency, created by Washington State. “States are going to continue to act on this. If there is some confusion from this or if it creates greater pressure on Congress, then that’s all to the good.”

Washington is among more than a dozen states that have followed California’s lead in setting goals to restrict carbon dioxide emissions, and it is one of five Western states that have formed an alliance to combat climate change. States in the Northeast have formed a similar alliance.

Several environmental leaders said the court decision could persuade still other states to pass climate-change legislation.

California has been in the vanguard, first with its bill to regulate carbon dioxide emissions from vehicle tailpipes in 2002, and then with its landmark 2006 law requiring a 25 percent reduction in the state’s carbon dioxide emissions by 2020.

Arizona, New Mexico, Oregon and Washington have joined California to pursue a regional plan to cut emissions. The idea is to make it profitable for industries to pursue pollution reduction through cap-and-trade plans that would allow companies with emissions lower than the allowed caps to sell credits to companies that exceed them.

Most of the legislation in Congress follows the cap-and-trade model.

Outside the West and the Northeast, states are still finding their way. In North Carolina, government commissions are weighing measures like restricting auto emissions and establishing so-called renewable portfolios, which many states are proposing as a way to balance their energy supply between carbon-producing fuels like coal, oil and natural gas, and clean, renewable fuel sources like wind and solar power.

In Illinois, Gov. Rod R. Blagojevich has proposed restricting carbon emissions to 60 percent of 1990 levels by the year 2050, said Steve Frenkel, an aide to the governor.

“You’ve seen a lot of leadership coming out of the coasts,” Mr. Frenkel said. “Looking in the Midwest, where there’s a lot of coal and industrial pollution, how we handle this here is important for how we handle this nationally.”

With about half the states getting at least 50 percent of their electric power from coal, Congress will have to wrestle with the disproportionate impact that climate change legislation could have around the country.

“You’ve got 35 senators reliably for a pretty strong program,” said David Doniger, a lawyer with the Natural Resources Defense Council. “How do you get that to 50 or 60? You have to get senators who come from states where coal is important, autos are important and agriculture is important.”

Abu Dhabi Explores Energy Alternatives

Oil, however, will have nothing to do with it. The sun, the wind and hydrogen will.
Abu Dhabi, the capital of the United Arab Emirates, the fourth largest OPEC oil producer with about 10 percent of the known reserves, is seeking to become a center for the development and implementation of clean-energy technology.
At first, the Masdar effort drew skepticism and a few snickers. The United Arab Emirates has been singled out as one of the world’s highest per capita emitters of carbon monoxide and other greenhouse gases.
The U.A.E. has especially high energy demand to maintain a luxurious life of air-conditioning, chilled swimming pools and even an indoor ski slope in the emirate of Dubai.
The U.A.E. is only the most serious among Persian Gulf oil-producing countries whose thirst for electrical power has spawned efforts to find other sources of energy to save high value fossil fuels for export. Most Persian Gulf states get their water from desalinating gulf waters, an energy-intensive process. With their populations growing rapidly, domestic consumption of oil is commanding a greater share of production. Late last year Saudi Arabia and other gulf states began a research program looking into nuclear power; Iran, which has faced off with the United States and other international powers, insists that its nuclear program is intended to serve mounting energy demands domestically.
Alternative energy has attracted increasing interest over the past year as American industrial leaders have called for more aggressive action to be taken against the phenomenon of global warming and the Bush administration has focused greater attention on renewable energy. In Silicon Valley, the excitement over clean-energy technology startups recalls the flurry of new Internet companies in the 1990s.
“This is the first oil-producing state that has accepted and agreed with the concept that oil may not be the only source of energy in the future,” said Fred Moavenzadeh, director of the Technology Development Program at M.I.T. “That is a significant realization.”
Most important, they say, it hopes to prepare itself for a world that is not as reliant on fossil fuels as it is today. Abu Dhabi’s expertise, they say, is in energy, not just in oil.
“It is a very significant move because the Middle East is one of the areas where renewable energy has never made any strides.”

http://www.nytimes.com/2007/03/18/world/middleeast/18abudhabi.html?ex=1331870400&en=e87584d7bf64715a&ei=5088&partner=rssnyt&emc=rss

Green cars

Any colour you like, as long as it's green. The car companies’ most pressing environmental concern relates to European Union proposals to set stringent emissions targets for carbon-dioxide, the main greenhouse gas.
The average new Porsche pumps out nearly 300g of carbon dioxide; Mercedes and BMW also rely on luxury cars that are big, fast, profitable and polluting. But, more surprisingly, even smaller carmakers, which are much closer to meeting the new stringent conditions, say they are troubled by the proposed rules.
The problem for makers of those small cars is that any chance of getting decent profits in the saturated markets of Western Europe (emerging markets in Eastern Europe, Russia and Asia are another matter) comes from improving margins on each vehicle sold. But on small cars those margins are already rather thin. Thus the additional cost of developing new technologies to meet the 130g emissions target, let alone meeting tougher EU standards to come, might prove more painful for makers of small cars than for those who make luxury ones.
Car companies argue that new regulations may prove to be unnecessary. The demands of the market, they say, are driving them in the right direction anyway. Christian Streiff, boss of PSA Peugeot Citroën, says that pollution could be cut by two-thirds simply by removing the oldest (and thus dirtiest) 20% of vehicles from the roads. Moreover, the vast additional cost of trying to meet the targets quickly could endanger jobs and damage competitiveness. The industry argues that governments could instead do more to reduce congestion, improve roads and even teach more fuel-efficient driving techniques.

Conversion of wood to ethanol

The idea is to make ethanol, a biofuel that usually comes from maize (corn) or sugar cane, from trees instead. Politicians and environmentalists are embracing ethanol for a number of reasons. Unlike oil, ethanol is renewable: to make more of it, you grow more crops. And blending ethanol into ordinary petrol, or burning it directly in special “flex-fuel” engines, reduces greenhouse-gas emissions.
The ratio of the energy yielded by a given amount of ethanol to the energy needed to produce it is called the “energy balance”. The energy balance for ethanol made from maize is the subject of much controversy, but America's energy department puts it at 1.3; in other words, the ethanol yields 30% more energy than was needed to produce it. For ethanol made from sugar cane in Brazil, the energy balance is 8.3, according to the International Energy Agency.
But for ethanol made from trees, grasses and other types of biomass which contain a lot of cellulose, the energy balance can be as high as 16, at least in theory. In practice the problem is that producing such “cellulosic” ethanol is much more difficult and expensive than producing it from other crops. But the science, technology and economics of treethanol are changing fast.
Interest in cellulosic ethanol is growing as the drawbacks of making ethanol from maize and sugar become apparent. Both are important food crops, and as ethanol production is stepped up around the world, greater demand is driving up the prices of everything from animal feed to cola and biscuits. Growing maize requires a lot of land, water and agrichemicals, so environmental groups such as America's Natural Resources Defence Council argue that it is merely a short-term, first-generation approach to making ethanol.
Trees are a particularly promising feedstock because they grow all year round, require vastly less fertiliser and water and contain far more carbohydrates (the chemical precursors of ethanol) than food crops do. Treethanol has particular appeal in countries that have a lot of trees and import a lot of fossil fuel. Top of the list is New Zealand: in 2005 the country exported lumber worth NZ$411m ($290m) and imported fossil fuel costing NZ$4.5 billion. Because willows are fast-growing and can thrive even on nutrient-poor soils, BioJoule's technology could also be used in other parts of the world where there is strong demand for energy, but the soil is not suitable for food crops. Mr Watson thinks China and India look promising.