Q+A-Obama's speech and U.S. energy legislation

WASHINGTON, June 15 Tue Jun 15, 2010 3:47pm EDT

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WASHINGTON, June 15 (Reuters) - President Barack Obama will use the Gulf of Mexico oil spill as a backdrop for urging the U.S. Congress to pass legislation tightening offshore oil drilling practices and encouraging more alternative energy, in a televised address late on Tuesday.

The fate of such legislation this year will hinge on some of the questions posed here:

* WHAT WOULD THE LEGISLATION DO?

It is still very much a work in progress with scores of proposals coming from members of Congress, congressional committees, the White House, lobbyists and environmentalists.

Among the likely components of what could be the largest rewrite of U.S. energy and environment policy in a generation are:

-- Removing a $75 million cap on what individual companies have to pay in the aftermath of an oil well leak or other disaster;

-- Imposing tougher rules on the way new offshore oil drilling sites are leased by Big Oil and more stringent safety standards for both the planning and implementation stages;

-- Reforming government agency oversight after years of its cozy relationship with industry. Obama already has announced he is revamping the Interior Department's Minerals Management Service. But Congress might decide to legislate some additional changes. One idea -- to create a totally new, independent agency -- has some significant opposition in the Senate;

-- Requiring electric power utilities to use more alternative power sources, including wind and solar energy, so that there is less reliance on dirty coal-burning plants that contribute to global warming. Government aid for building more nuclear power plants too;

-- Encouraging the development of more fuel-efficient cars and thus reducing U.S. reliance on foreign oil;

-- Possibly imposing a new "cap and trade" pollution permit system on utilities to further encourage the use of cleaner-burning fuels.

* WHAT MIGHT OBAMA ANNOUNCE?

Obama is expected to talk broadly about the need for the United States to decrease its dependence on oil and other fossil fuels. That likely will be his lead-in to a call on Congress to pass legislation this year that requires more wind, solar, biomass and other alternative energy. And while he is expected to talk about the need for legislation to tackle global warming, which dovetails with more alternative energy use, he might not get into specifics. Congress will be listening closely for hints that Obama will push hard for legislation to put a price on carbon. That would be his way of telegraphing that he wants a comprehensive climate control bill.

* WHAT ELSE DOES HE HAVE TO DO?

The president has made four trips to the Gulf Coast to get a first-hand look at the disaster, inspect cleanup activities and reverse a perception that he was slow to act or too detached. His national address aims to stir up public support for energy and environmental legislation.

Next comes a less public effort to convince lawmakers to support legislation. He'll have to use the dual powers of his office and personal persuasion to convince moderate Democrats and a few centrist Republicans to work with him. It'll be reminiscent of fights over healthcare reform and the economic stimulus bills.

* WOULD A BILL PASS CONGRESS?

In the wake of BP's massive oil spill in the Gulf of Mexico that began April 20, Republicans would have a hard time -- especially in an election year -- voting against a bill that gets tough on multinational oil companies.

Such legislation also is likely to be sweetened with additional aid to Gulf Coast communities hurt by the BP spill.

Democrats, who hold majorities in the Senate and House of Representatives, might want even tougher actions against Big Oil and more progress on reducing greenhouse gas emissions. But given that they are facing the loss of some seats in November's elections, they could see this year as the optimal time to pass a compromise bill, as they still have strong majorities in the Senate and House.

* WHEN WOULD CONGRESS DO IT?

If the Senate manages to pass a huge bill in July, it would then begin negotiations with the House, which passed a climate change bill a year ago. The goal would be to meld the two together in a way that a compromise bill would have enough support to pass both chambers. But the final deal might not come until after the Nov. 2 elections, and the vote could complicate the bill's passage.

* WHAT IMPACT WOULD IT ACTUALLY HAVE?

The U.S. is already making some progress on controlling carbon dioxide emissions through the use of more energy-efficient appliances. Meanwhile, Obama is moving ahead with higher fuel efficiency requirements for vehicles. U.S. carbon pollution also has dropped as a result of the economic recession that slowed factory orders.

While new legislation would add to those carbon reductions, it still would disappoint many foreign governments, which think the United States as the biggest carbon polluter among developed countries, ought to do more to battle global warming.

But there will be opportunities in the future for Congress to build on climate control laws.

As for the clampdown on offshore oil drilling, Congress will want to show it is protecting the environment from future disasters, but it doesn't want Big Oil to abandon drilling.

* WHAT'S NEXT IN CONGRESS?

On Thursday, Senate Democrats huddle in the Capitol to gauge sentiment for coupling climate change legislation with alternative energy and offshore drilling initiatives.

Leaders in both chambers want all ideas submitted by the start of the July 4 recess.

* WHAT DO VOTERS WANT?

This might be the toughest question of all. The one thing that's clear is that voters are angry with Congress, angry with big business and angry with the growing size of the federal debt. So, it could be tough to sell legislation that includes a new scheme for trading pollution permits, even if it's just aimed at one sector -- utilities.

But a poll just published by the Pew Research Center for People and the Press indicates shifting attitudes that likely are related to the BP oil spill. Fifty-six percent said it was more important to protect the environment, while 37 percent said it was more important to keep energy prices low.

* COULD IT ALL FALL APART?

That's always a possibility. There are enough political and procedural hurdles to doom major legislation, especially during an election year.

While a full-scale legislative attack on global warming might fall short this year, Congress is likely to at least pass legislation clamping down on offshore oil industry practices and encouraging more alternative energy use. (Editing by Chris Wilson)

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