Obama pushes research fund, seeks common ground on energy policy

LEMONT, Ill./WASHINGTON Fri Mar 15, 2013 6:39pm EDT

1 of 4. U.S. President Barack Obama delivers remarks on energy at the Argonne National Lab near Chicago, March 15, 2013.

Credit: Reuters/Jason Reed

Related Topics

LEMONT, Ill./WASHINGTON (Reuters) - President Barack Obama tried to move past partisan fights over energy policy on Friday with a modest proposal to fund research into cars that run on anything but gasoline.

Obama toured the Argonne National Laboratory outside of Chicago, known for its research into advanced batteries used in electric cars, then delivered a speech highlighting the need to find more ways to wean vehicles off oil.

The United States has a newfound wealth of oil and natural gas resources made possible by hydraulic fracturing and other drilling advancements, but consumers still face high prices at the pumps because gasoline prices are tied to world markets.

"The only way to break this cycle of spiking gas prices for good is to shift our car and trucks entirely off oil," Obama said in Argonne's advanced photon facility, which says it produces the brightest source of X-rays in the Western Hemisphere, used for an array of research projects.

The Democratic president proposed a fund that will draw $2 billion over 10 years from royalties the government receives from offshore drilling in the Outer Continental Shelf.

The research would be aimed at new ways to lower the cost of vehicles that run on electricity, biofuels, natural gas or other non-oil fuel sources.

Obama first mentioned the Energy Security Trust fund in his State of the Union address last month.

The White House touted the idea as bipartisan, saying it came from retired military and business leaders, including some Republicans, who belong to a policy group called Securing America's Future Energy.

"This is not a Democratic idea or a Republican idea," Obama said, standing in front of three cars designed to run on alternative fuels. "This is just a smart idea."

But Republican approval was far from assured.

"For this proposal to even be plausible, oil and gas leasing on federal land would need to increase dramatically," said Brendan Buck, a spokesman for Republican House of Representatives Speaker John Boehner. "Unfortunately, this administration has consistently slowed, delayed, and blocked American energy production."

By choosing to focus his first energy speech on research - an issue that appeals equally to Republicans and Democrats, industry and environmental groups - Obama is seeking to build common ground on energy, which has been a divisive policy issue.

"In order for something like this to pass the Hill, it will need votes from both sides," said Michael Levi, an energy fellow at the Council on Foreign Relations. "That makes it wise for the president to start with something that Congress can work from."


The research trust fund will require consent from Congress, which is grappling with federal budget cuts. Senator Lisa Murkowski of Alaska, the top Republican on the Senate Energy Committee, had proposed a similar idea. But her version called for expanded drilling, which Obama's proposal does not include.

Murkowski's spokesman Robert Dillon said the president's plan relied on royalties that have already been factored into the budget, "which could mean either deficit spending or less funding for the Land and Water Conservation Fund."

"There's a better way that not only funds investment in research, but also addresses our need for affordable and abundant energy," Dillon said, referring to expanded drilling.

White House officials said the president's plan would not add to the deficit because they expect leasing revenues to grow in coming years for several reasons, including changes the administration plans to make to leasing policy.

White House spokesman Josh Earnest said the administration is willing to work with Congress on the research fund plan.

"If there are different ideas people want to offer up, we'll certainly have a conversation with them about that," he said.

Mark Kennedy, the director of George Washington University's Graduate School of Political Management, said despite the misgivings expressed by some Republicans, the White House may be able to negotiate a deal that pleases both sides.

"I think this is the opening bid," Kennedy said. "This is the beginning of the conversation."

In his first term, Obama pushed for laws that would use market forces to reduce climate-changing carbon pollution, but the "cap and trade" bill was opposed by industry and failed in Congress.

His administration pumped $90 billion in economic stimulus funds into clean energy and "green jobs" projects, helping to dramatically expand renewable energy production in America.

But some projects failed, including a California solar panel maker called Solyndra that had received a $527 million government loan. Critics excoriated his administration for that failure, as well as for delaying approval of the Keystone XL crude oil pipeline from Canada.

The energy trust fund "is a more pragmatic approach to try to continue investments in green energy given the degree to which the (clean energy) brand has been damaged," said Kennedy, a former Republican congressman from Minnesota.

(Editing by Doina Chiacu and Mohammad Zargham)

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/
Comments (18)
PaulBed wrote:
“He pumped in $90 Billion”?How do you arrive at that number?Sounds a little high.When it is just research that is usually a good investment he has gone way off track on loan garantees.The Audi G-tronA-3 already uses natural gas and gasoline.More research is needed to bring advanced nuclear fission to market such as LFTR,NGNP,FHR, all of which we invented and China is bringing to market and will be selling us in ten years.

Mar 15, 2013 6:50am EDT  --  Report as abuse
jaham wrote:
Has it not occurred to our dear “leader” that we now have the most plentiful proven reserves on the planet? Is it lost on him that cheap energy is a boon to consumers, to business, to exports, to competitiveness, and thus to jobs, economic growth, and even his precious tax revenues?

Has he realized that renewables are not efficient enough to be scalable and that he could use the taxes from these projects and the general economic growth commensurate with it to fund more R&D for the future of renewables?

It’s truly baffling how consistently liberals let their ideals supersede logical reasoning…

Mar 15, 2013 10:31am EDT  --  Report as abuse
speaker12 wrote:
Lets keep pumping money for research into alternate energy projects as the loss of billions brought on by Obama’s failures continues to add to our national debt. We have natural resourses available but our King doesn’t have the desire to utilize them. The insanity continues.

Mar 15, 2013 10:52am EDT  --  Report as abuse
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.