The Energy Bill Gets Oiled

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Want a laugh? Think back to the end of March, back when people probably thought “Deepwater Horizon” was the title of James Cameron’s next film. President Obama roiled the environmental community by announcing his support for expanded offshore drilling, as part of a broader, more comprehensive energy strategy. Here’s a relevant passage from the Mar. 31 speech—which was entitled, tellingly, “Energy Security”:

My administration will consider potential areas for development in the mid and south Atlantic and the Gulf of Mexico, while studying and protecting sensitive areas in the Arctic.  That’s why we’ll continue to support development of leased areas off the North Slope of Alaska, while protecting Alaska’s Bristol Bay.There will be those who strongly disagree with this decision, including those who say we should not open any new areas to drilling.  But what I want to emphasize is that this announcement is part of a broader strategy that will move us from an economy that runs on fossil fuels and foreign oil to one that relies more on homegrown fuels and clean energy.  And the only way this transition will succeed is if it strengthens our economy in the short-term and the long run.  To fail to recognize this reality would be a mistake.

The more liberal green groups were dismayed that a Democratic president would look to expand the waters open to offshore drilling, but far-seeing pundits—like myself—saw it as a pragmatic compromise. Expanded offshore drilling—along with gifts to the nuclear industry—would be a bridge to Senate Republicans and conservative Democrats who would otherwise be wary of supporting more comprehensive climate legislation. Democracy—there’s something for everyone!

Well, the BP oil spill changed all that. The environmental and economic destruction wrought from the spill—however serious you think it will ultimately be—made it impossible for coastal Democrats like Robert Menendez of New Jersey or Bill Nelson of Florida to support anything that would expand drilling, even if it came with climate legislation. But at the same time, if environmentalists thought that the worst oil spill in U.S. history would cause many Republicans or petro-state Democrats like Mary Landrieu to rethink the need for more drilling—they were mistaken. Offshore drilling went from a bridge of compromise to a…landmine…of…oily politics. (My metaphor manufacturer is malfunctioning today.)

So perhaps it shouldn’t be surprising that even after paring down climate and energy legislation to focus almost exclusively on offshore drilling and oil spills, Senate Majority Leader Harry Reid is still running into trouble. Among other proposals, Reid’s bill would eliminate the $75 million cap on liability for oil spills—something the industry says will greatly retard development, especially for smaller players. Republicans are—hold your hats—also against the tougher provisions of the spill, but right now so are a few Democrats, including Alaskan Senator Mark Begich.

Now, Reid may be playing politics here—forcing Republicans to either support his spill bill, or cast no votes and stand with a not terribly well-liked industry. But while that might help the Democrats in November, all this bickering now means that Congress is unlikely to act on these bills until September, following the August recess. And I would worry that the longer a bill like this waits, the more the initial outrage over the spill will evaporate—not unlike much of the oil on the surface of the Gulf of Mexico. (Metaphors working again.)

Of course, maybe Reid could just wait for the next oil spill. It shouldn’t take long—a burst pipeline in Michigan has now spilled over a million gallons of oil into the state’s Kalamazoo River. (The new estimate is significantly higher than what pipeline owner Enbridge Energy Partners initially predicted, which seems to be the standard oil company response to a spill.) And a new report by the National Wildlife Federation (NWF) shows that accidents and spill in the oil industry are anything but unusual. Between 2001 and 2007, there were 1,443 offshore-drilling accidents in the Outer Continental Shelf, with 41 fatalities, 476 fires and 356 pollution events. Onshore—and it’s notable that Reid’s bill doesn’t really address onshore oil production—there have been 2,554 significant pipeline accidents between 2000 and 2009, with 161 deaths. And it’s not just a problem for industry-friendly states like Texas or Louisiana—no part of the country has been untouched by these accidents:

“We need new and more effective policies that protect the public and wildlife,” said Tim Warman, director of NWF’s global warming solutions program. “But [Reid’s] bill absolutely doesn’t do enough.” Under the current political climate—and the onerous need to score 60 votes in the Senate—the even watered-down environmental legislation has a watered-down chance of passing.