Some members of Congress seem intent on brokering a deal to satisfy both sides of the energy policy debate in Washington D.C. where the ban on exporting crude oil would be lifted if the legislation also included extending tax credits for high-cost renewable energy resources. Sen. Cory Gardner (R-CO) has stated that Congress should accept such a deal.
A member of the U.S. Senate Energy and Natural Resources Committee, Gardner was elected Senator from Colorado last year in part on a pledge to support more development of wind energy. Gardner also pointed out that Sen. Martin Heinrich (D-NNM) and Sen. Angus King (Ind-ME) have announced they would be willing to lift the ban on exporting crude oil along with supporting the tax credits for renewable energy.
Regarding a deal lifting the ban and extending renewable energy tax credits, Gardner said, “I think that’s a great opportunity we should look at.” Sen. Heinrich said, “Before we make such a monumental shift in U.S. policy, I hope we can agree to extend our existing policy incentives for carbon-free energy resources.” Even Sen. Minority Leader, Harry Reid (D-NV) has indicated support for a such a deal tying lifting the export ban with extending renewable energy tax credits.
The concern with increased federal support, in the form of tax credits or subsidies, for expanding the development and usage of renewable energy is the fact that the energy generated is well above market rates. Often the energy generated by such projects, such as the failed Cape Wind electricity generation project, is well above market rate. Cape Wind would have generated electricity at more than three times the market rate in that region of the country. It makes no sense for most that Congress should expect Americans to support spending tax dollars on creating more energy resources that would also cause higher monthly electric bills as well.
Regardless of our policy on renewable energy, the free flow of conventional energy resources on the open market is the best way to support cheaper energy for all Americans, including lifting the ban on exporting crude oil. This export ban is part of the unwise energy laws Congress has passed, as exhibited by Ryan Houck critiquing such policies in his “If I Wanted America to Fail” video for FreeMarket America, in which he said, “I’d make cheap energy expensive, so that expensive energy would seem cheap. I would empower unelected bureaucrats to all-but-outlaw America’s most abundant sources of energy. And after banning its use in America, I’d make it illegal for American companies to ship it overseas.”
Congress needs to reverse this unwise policy and repeal the ban on exporting crude oil without also including the tax credits for uncompetitive renewable energy. Last month, the House voted to pass stand-alone legislation to lift the ban on exporting crude oil by a vote of 261-159, but that margin fell short of the two-thirds needed to override a veto of that bill promised by President Barack Obama. Gardner suggested that passing an export ban in the Senate would be a tough challenge during the 2016 election cycle than passing it this year.
Sen. Gardner should reject the deal and instead stand firmly for lifting the ban on exporting crude oil. Renewable energy, with improvements in technology, will eventually become competitive in the open market, and then and only then will it succeed without tax credits and subsidies. Otherwise, the two issues should not be subject to such a deal, and Sen. Gardner should work for the most affordable energy for Americans by opposing the deal and supporting lifting the ban.