January 30, 2011

ENERGY POLICY was near the top of President Obama's agenda in his State of the Union address Tuesday - a topic so politically toxic last year that Sen. Joe Manchin (D-W.Va.) ran a campaign ad in which he shot a "cap and trade" bill with a hunting rifle. Nearly all Republicans joined Mr. Manchin and other coal-state Democrats in opposing the comprehensive energy plan that Democratic leaders pressed in 2010. Cap-and-trade was a desirable policy, but Congress passed nothing. Meanwhile, Americans continue to consume massive amounts of dirty fossil fuels to heat their homes, power their appliances and run their cars.

So this year Mr. Obama has endorsed two concepts more modest than cap-and-trade and built to appeal to Democrats and Republicans. The first is establishing a clean-energy standard expected to require that American utilities derive a certain amount of the electricity they provide from clean sources - the president mentioned 80 percent by 2035. Last year, Democrats opposed including nuclear energy or natural gas in that mix; Tuesday night, Mr. Obama included both.

If America is to have such a standard, this is the right call. It widens the appeal of the policy to Republicans, but it's also sensible, since nuclear energy produces no greenhouse gases and natural gas produces about half the carbon emissions of coal. A well-designed policy would take advantage of that difference while giving less credit for natural gas than for truly renewable fuels. In the long run, any significant dependence on carbon-emitting fuels is dangerous, but replacing coal with natural gas may well provide years of breathing room for cleaner-energy technologies to catch up and become more affordable.

Which leads to Mr. Obama's other proposal - to increase clean-energy research and development funding by a third, to $8 billion. Advocates argue persuasively that government support for basic research has seeded critical technological leaps such as the 1990s Internet boom. But federal energy R&D funding is tiny compared with what the government spent in past decades, even though energy technology challenges are far greater. An alliance of business leaders, a diverse group of think tankers and others have recently offered proposals for revitalizing the federal research effort. They all favor much larger increases than Mr. Obama described.

The president's latest energy plan is probably not ambitious enough to produce the emissions reductions needed to participate credibly in a global effort on climate change. Its effectiveness will depend on a slew of details. Where will the money come from, and is it enough? How will the government enforce a federal clean-energy standard, and will there be easy ways for utilities to duck the policy's requirements? Given political realities, though, Mr. Obama has laid out two potentially useful paths to progress.

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