Investors Business Daily: Cap-Drill-Nuke Idea Faces Big Challenges

Cap-Drill-Nuke Idea Faces Big Challenges

By SEAN HIGGINS

President Obama tried to revive cap-and-trade legislation Wednesday night by endorsing a Senate idea to include more nuclear power and offshore drilling. But a concrete plan is lacking, with support hard to come by, especially in an election year.

The three key negotiators — Sens. John Kerry, D-Mass., Lindsey Graham, R-S.C., and Joe Lieberman, I-Conn. — have been working on the concept since at least October and have yet to even introduce a bill.

"Senator Graham continues to meet with an assortment of senators on both sides of the aisle to discuss a pathway forward," said Kevin Bishop, a spokesman for the senator.
Asked when they might be able to present a bill and announce a list of co-sponsors, he replied, "(We have) nothing to share with you on those subjects."

Lobbyists told IBD the bill is bogged down over exactly how it will cut carbon emissions. One insider predicted that a deal wouldn't be reached for three or four months.

A deal would require green groups and the energy industry to come together. But few Republicans are willing to back any agreement with a cap-and-trade or other carbon-cutting program.

Conservative and business groups say any such deal would raise energy prices in a weak economy. GOP leaders have taken to calling the idea "cap-and-tax."

Scant GOP Support
A lot of Republicans want no part of a climate bill, even with nuclear and drilling sweeteners. Likely big electoral gains this fall only harden their resolve.

With some Democrats expected to vote no, at least eight Republicans would need to support the bill, analysts say. Those votes have not materialized.

:It is going to be a heavy lift for them to come up with a compromise bill that appeals to both sides," said Robert Dillon, a spokesman for Sen. Lisa Murkowski, R-Alaska. Any concession to one side costs support from the other.

Supporters are nevertheless hopeful. With health care apparently sidelined, something else can take the forefront on the Senate agenda. That could easily be jobs or banking regulation. But with climate change, Democrats are making an effort at recruiting Republicans.

In his State of the Union address Wednesday, Obama reached out by adding explicit endorsements of nuclear and offshore drilling as part of a broader compromise on clean energy programs.

"But to create more of these clean energy jobs, we need more production, more efficiency, more incentives. And that means building a new generation of safe, clean nuclear power plants in this country," the president said.

He added: "It means making tough decisions about opening new offshore areas for oil and gas development."

It wasn't "drill, baby, drill." But it was significant coming from a Democratic president. During the Bush years, GOP proposals for nuclear power and drilling were usually attacked.

A 'Seismic Shift'?
"We are very heartened by his comments," said Derrick Freeman, legislative director at the Nuclear Energy Institute. "We don't look at it as just rhetoric" from the White House.
Kerry called Obama's endorsement a "seismic shift."

"The inside-the-Beltway conventional wisdom that this issue has stalled is dead wrong," Kerry said in a statement, adding, "Senators Graham, Lieberman, and I will continue building consensus on both sides of the aisle."

Karen Harbert, president of the Chamber of Commerce's 21st Century Energy Institute, was much more skeptical.

"I don't think (the White House) broke any new ground," she said. "We haven't seen anything concrete."

Harbert noted that nuclear and drilling were more administrative matters than legislative ones.

What's in the bill matters less than actions the White House can already take on its own, she argued.

"The Department of the Interior has held for close to a year now the plan for expanding (drilling) leasing on-shore and off-shore hostage," she said. "We have no movement by the administration to expedite the permitting or siting or funding of new nuclear plants."

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