In an earlier blog post I noted that June was likely to be a critical month for possible federal energy legislation. It now looks like June will be consumed with work on the long-term federal budget and raising the federal debt ceiling, crowding out other issues. Earlier hopes that the debt ceiling issue would be resolved in May when we hit the current ceiling have evaporated in light of the difficult and down-to-the-wire wrestling match to enact a continuing resolution for the last six months of the 2011 fiscal year. Instead, debt ceiling discussions are likely to extend into June, or even July, as the Treasury Department uses various mechanisms to keep from either defaulting on existing debt or issuing new debt.

Furthermore, prospects for the energy initiative receiving the most attention — a clean energy standard (CES) — may be fading. The original concept was to broaden support for a renewable energy standard by also including energy efficiency, nuclear, coal with carbon capture and storage, and perhaps natural gas. But the Obama Administration, following advice from the National Economic Council, has resisted entreaties to include energy efficiency, instead endorsing unspecified “complementary policies.”  In light of the Japanese nuclear accident and publicity about potential groundwater and methane release problems with shale gas, some Senators on the left are moving away from a standard that includes nuclear and natural gas. On the other side of the aisle, given the high costs of nuclear power and coal with carbon capture and storage, some on the right are concerned that a CES will not be sufficient to push these technologies without additional subsidies (a challenging notion given mounting federal budget deficits).

On the other hand, individual measures may be possible — what Speaker John Boehner calls “bite-size chunks.” The Senate Energy Committee reported out a bill with a variety of consensus equipment efficiency standards on a strong 18-4 bipartisan vote. The U.S. Chamber of Commerce recently endorsed this legislation. In the fall, Congress is likely to discuss extensions and modifications to existing energy efficiency tax incentives for new homes, appliances, commercial buildings, and home energy retrofits. A few other bills may receive consideration such as the Clean Energy Development Administration (CEDA) that was reported out of the Senate Energy Committee last year and will soon be the topic of new hearings.

In the meantime, for those interested in more comprehensive steps to promote energy efficiency, a bill is being introduced by Senators Shaheen (D-NH) and Portman (R-OH) later this week that could provide a foundation for future activity when Congress is ready to tackle energy issues in earnest. Until then, the majority of action is likely to be at the state and local level.

Photo by harrykeely.