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Policy Program Updates

S.2012, Energy Policy Modernization Act [Summary Analysis]

Published on 02 Aug 2016  |   Written by    |  

Overview

The Senate bill is a bipartisan effort, assembled by Committee Chair Lisa Murkowski (R-AK) and Ranking Member Maria Cantwell (D-WA), who have worked to find common ground and avoid controversial issues that could spark partisan divisions – including, for example, proposals for a national renewable energy standard or, conversely, proposals to block implementation of EPA’s carbon rules. As approved by the Senate in an overwhelming vote 85-12 on April 20, 2016, the bill is shaping up to be a mixed bag, with a number of provisions that advance renewable energy and a couple that are of concern.  Most notable on the positive side are provisions that facilitate permitting of new hydropower projects and promote geothermal energy development on public lands. The most troubling of the negative provisions include a measure that undermines the credit subsidy in the DOE loan guarantee program and a measure that weakens the current requirement for new or renovated federal buildings to phase out fossil fuel consumption by 2030. 


Now that the bill has been approved in the Senate, it will need to be reconciled with H.R. 8, the North American Energy Security and Infrastructure Act of 2015, a far more controversial companion bill approved in the House of Representatives. This House legislation contains a number of provisions that would undermine renewable energy development in the U.S., including most notably, provisions that would eliminate elements of the Public Utility Regulatory Policies Act of 1978 (PURPA) that have long provided important policy support for renewable energy.


Realistically speaking, the bipartisan Senate proposal has a strong chance of enactment as long as it is not amended to include controversial elements of the House bill which are likely to provoke a Presidential veto.  The White House has expressed strong opposition to the House bill while also signaling support for the Senate version, but with some concerns.  


Both the House and Senate have now selected conferees to reconcile the differences between the two bills and leaders in both parties have recently signaled that they will work to advance a bill that could win approval in both houses of Congress and be signed by the President by the end of the year.    

Key EPMA Provisions Advancing U.S. Renewable Energy Development & Deployment

  1. Government Contracting and Programs
    1. Increases funding for the Advanced Research Projects Agency-Energy (ARPA-E)
    2. Creates Department of Energy (DOE) programs for research and development of advanced ancillary services, such as battery storage and smart grid deployment
    3. Directs DOE and DOI to focus on developing interagency programs to solve problems related to the water-energy nexus
    4. Provides new research, grant and loan authorities to DOE and USDA for development and deployment of biomass resources
    5. Creates a new DOE program to research and develop marine hydrokinetic renewables
    6. Creates a new DOE program aimed at creating a 21st century energy workforce

  2. Grid Modernization
    1. Focuses on modernizing our aging grid infrastructure by directing DOE to:
      1. Develop a demonstration program for electric grid energy storage
      2. Establish grant programs for modernizing the distribution grid
    2. Decreases barriers to deploying new transmission infrastructure by:
      1. Creating an interagency rapid response team for transmission permitting
      2. Establishing a transmission ombudsperson lead at CEQ
      3. Continues existing use and occupancy right-of-ways for public lands

  3. Renewables Supply
    1. Improves hydropower permitting processes
    2. Provides an hourly incentive on non-federally owned hydropower production facilities
    3. Prioritizes geothermal production and site identification goals on federal land
    4. Sets targets for drastically increasing geothermal deployment on Federal land

  4. Electric and Alternative Vehicles and Infrastructure
    1. Support continued development of EVs, charging infrastructure and other alternative vehicles

 

 Key Provisions of Concern

  1. Government Contracting and Programs
    1. Removes the requirement that new federal buildings and those undergoing major renovations phase out fossil fuels consumption by 2030
    2. Modifies the terms and conditions of the 1703 DOE Loan Program and adds a new provision that prohibits a loan guarantee unless DOE receives not less than 25% of the cost of the guarantee from the borrower
    3. Repeals the Section 1705 loan program that covers renewable energy systems, electric power transmission systems, and biofuel projects, and remaining unobligated funding is rescinded.

ACORE will continue to follow legislative developments and advocate for effective renewable energy policy.  For more information, please contact Scott Clausen, ACORE Policy & Research Associate at 202-507-4634 or clausen@acore.org

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