President-Elect Obama’s plan calls for short term relief for Americans suffering the consequences of regulatory loopholes in the commodity futures market which enabled notoriously speculative commerce and consequently, record high crude oil prices. The plan also proposes mid-to-long term solutions aimed at eradicating America’s foreign oil dependence, boosting economic growth, and reducing greenhouse gas (GHG) emission.
President-Elect Obama’s short term relief calls for:
(1) A tax rebate of $500 for individuals and $1000 for married couples to help Americans at the pump. The plan stresses the rebate will “be fully” paid for by record windfall profits of oil companies. Implementation of this plan will be “as quickly as possible.” (2) Closing loopholes in the commodity futures market which allow for speculative trading as well as increase transparency in the commodity futures industry. (3) Immediately release oil from the nations strategic petroleum reserve (SPR) to increase supply consequently reducing gasoline prices.
The mid-to-long term proposal outlines six strategies for what the President-Elect calls the “moral, environmental, economic, and security imperative to address our dependence on foreign oil and tackle climate change in a serious, sustainable manner.” These include:
(1) Investing in a green energy economy projected to create 5 million jobs (2) Focusing on climate change (3) Improving the fuel efficiency of cars, trucks, and SUVs (4) Advocating domestic energy sources (5) Diversifying America’s energy sources (6) A focus on lowering energy use and cost
Over the next decade, President-Elect Obama calls for an investment of $150 billion in the sustainable and renewable energy industry. This investment is projected to create five million green jobs. The investment will focus on training programs such as the “Green Vet Initiative,” youth training programs, and clean manufacturing programs. Investments will also be made in plug-in vehicles, renewable energies, low emission coal plants, next generation bio-fuels, and modernization of America’s electric grid.
Climate change will be addressed by the implementation of a cap and trade program to reduce America’s carbon footprint to levels below 1990 levels. A portion of revenue generated from the cap and trade program, about $15 billion, will be used in the development of clean and efficient energy, next generation biofuels, and wildlife protection programs. The plan also calls for leveraging America’s leadership and partnership with the U.N. Framework Convention on Climate Change (UNFCC) in convincing developing countries to curtail their greenhouse gas emissions.
Fuel efficiency of vehicles will be increased by demanding auto makers increase vehicle fuel economies by 4% every year, emphasis on the development of advanced vehicles through investments in R&D and tax incentives, mandating increased manufacture and sales of Flex Fuel Vehicles (FFVs), development of bio-fuels and their dissemination infrastructure, and establishing a national Low Carbon Fuel Standard (LCFS) to accelerate use of low carbon fuels.
The plan also calls for boosting domestic energy sources by motivating increased domestic oil production through implementation of a “use it or lose it” policy towards companies with land and offshore drill leases, efficient use of current oil fields, and accelerating the construction of the Alaska natural gas pipeline.
Diversification of the nation’s energy source will be accomplished by advocating use of renewable biofuels, clean coal technology, and safe nuclear energy. The plan proposes that 10 percent of the nation’s electricity is derived from renewable sources by the year 2012.
The last proposal calls for weatherizing the homes of low income Americans to save money on energy bills, setting national building efficiency and federal efficiency standards, efficient use of energy by the federal government, investments in smart electrical grids, and development of green communities.
As stated earlier, Obama’s proposals are ambitious and require concerted efforts and partnerships between the government, private sector, Wall Street, and individual Americans. There will be a lot of barriers impeding progress and only foresight and leadership will get America where it needs to be on the energy issue. Stay tuned as we intend to keep you posted on each and every one of these proposals over the coming months and years. For more on this summary and other bio-fuel news, visit