Energy Department could gain clout under Obama presidency

President-elect Barack Obama has proposed an ambitious agenda for breaking the nation's addiction to petroleum. Among other things, he says his administration will invest $150 billion in clean energy programs during the next 10 years; put 1 million made-in-America plug-in hybrid cars on the road by 2015; ensure 10 percent of electricity comes from renewable sources by 2012 and 25 percent by 2025; and implement an economywide carbon cap-and-trade program to reduce greenhouse gas emissions 80 percent by 2050.

The logical place from which to direct such initiatives is the Energy Department, said Bill Loveless, editorial director for Platts, the energy information division of McGraw-Hill Cos. Loveless was among a group of analysts to participate in a Wednesday forum on expectations for energy policy in the Obama administration. The discussion, sponsored by the American Council on Renewable Energy, was broadcast over the Internet from the offices of consulting firm Baker and Daniels LLP in Indianapolis.

Energy's influence has fluctuated over the years, but all indications point to the department playing a much stronger role in the next administration, Loveless said. "It's really not been a prominent agency in terms of clout since the Carter administration, when it was invested with various regulatory authority, much of which was stripped from it in the 1980s during the Reagan administration," he said.

On Wednesday, Obama transition officials said the Nobel Prize-winning physicist Steven Chu would be Obama's choice to lead Energy. Chu is now director of the Lawrence Berkeley National Laboratory, where he has been a strong advocate for research into biofuels and solar technologies.

Energy already has much of the capacity needed to implement Obama's goals through its Office of Energy Efficiency and Renewable Energy. "It has a suite of programs that with more funding and more authority could act much more extensively than they do currently," Loveless said. He noted that the 2005 Energy Policy Act and 2007 Energy Independence and Security Act give the department the power -- but not the money -- to pursue more aggressive renewable and alternative energy programs.

Howard Useem, vice president of the energy practice at the Washington-based consulting firm BlueWater Strategies, said the Obama administration might find it more expedient to tackle its goals through regulations as opposed to legislation.

"Some things should be left to agencies," he said. "It's politically easier to do and the agencies tend to have a great deal of expertise and can address these issues in a way that Congress cannot." Useem participated in crafting every major energy law between 1979 and 2003 as the senior professional staff member of the Senate Energy and Natural Resources Committee.

The Obama transition team has created the Energy and Environment Group, led by David Hayes, the former deputy secretary of Interior during the Clinton administration, to examine operations at the Council on Environmental Quality, the Environmental Protection Agency, and the Agriculture, Energy and Interior departments.

A separate transition group, led by Carol Browner, EPA administrator during the Clinton administration, is formulating specific energy and environmental policy initiatives the Obama administration is expected to roll out in early 2009. Browner is to become Obama's "energy czar" as director of a National Energy Council modeled after the National Security Council.

"Right now, they're really focused on the [economic] stimulus package," Congress is crafting to present to Obama perhaps as early as his first day in office, said Eric Washburn, a principal in BlueWater Strategies. "That bill is expected to include a number of green energy initiatives," he said.

Circumstances are ripe for implementing ambitious plans, according to Loveless. "This deep recession provides an opportunity to implement many changes under the banner of job creation," he said. "President-elect Obama has made clear he will seize that opportunity to dramatically change the way Americans are lighting and heating their homes and powering their vehicles. How he will structure and lead his administration to do that is a matter of much speculation."

Obama transition officials also said Lisa Jackson would be tapped to lead the EPA and Nancy Sutley would lead the White House Council on Environmental Quality. Both served at EPA during the Clinton administration under Browner.

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