UPDATE 1-Obama touts 'responsible' energy development measures, climate goals

Wed Jan 29, 2014 12:23am EST

(Adds details from Obama's speech, reaction)

By Valerie Volcovici

WASHINGTON Jan 28 (Reuters) - President Barack Obama told lawmakers on Tuesday his energy strategy had boosted the economy and reduced carbon emissions, but he did not address the question of whether he will approve the politically charged Keystone XL oil pipeline.

In his annual State of the Union address, Obama touted the role natural gas had played in cutting U.S. greenhouse gas emissions and creating jobs.

"The all-of-the-above energy strategy I announced a few years ago is working, and today, America is closer to energy independence than we've been in decades," he said.

The speech aimed to strike a balance between his administration's climate goals and championing the benefits created by one of the biggest oil and gas booms in the history of the United States.

But one subject not on the agenda was the proposed Keystone XL pipeline from Canada to the Gulf of Mexico, which is still awaiting a decision from the administration.

Supporters say Keystone XL would create thousands of jobs and cut U.S. fuel costs by reducing the nation's reliance on oil imports from nations that are less friendly than Canada. Critics say it would harm the environment and hasten climate change.

Obama instead highlighted several new and existing measures to expand clean energy production, chiefly by using executive powers that are not dependent on action by a divided Congress.

Among the proposals cited by Obama were incentives to encourage the country's fleet of medium- and heavy-duty trucks to run on natural gas and alternative fuels.

Those incentives would complement new fuel efficiency standards the Environmental Protection Agency and Department of Transportation will issue later this year for heavy-duty trucks, the White House said.

Obama added he wanted to boost the use of natural gas in transportation and industry. He said his administration was also working to develop new environmental standards for oil and gas drilling on public lands, and to reduce emissions of methane, a potent greenhouse gas.

'CLIMATE CHANGE A FACT'

Obama also used his speech to reaffirm his commitment to the Climate Action Plan he launched in June that relies on executive orders to cut carbon emissions.

"The debate is settled. Climate change is a fact," Obama said.

He said the EPA would continue to work with states and cities to develop new carbon pollution standards for the country's existing power plants, the largest source of domestic emissions. Obama ordered the EPA to deliver that proposal by June this year.

Environmental groups praised the president's commitment to act on his climate agenda, but some were wary of his strong emphasis on natural gas.

"We can't drill or frack our way out of this problem," said Michael Brune, executive director of the Sierra Club.

Fred Krupp, president of the Environmental Defense Fund, warned of "profound problems for the climate unless (Obama's) administration takes action to curb methane releases from the natural gas industry."

America's Natural Gas Alliance Chief Executive Marty Durbin told Reuters after the speech that methane emissions were lower despite the greater use of natural gas in the economy.

"But if we can find areas within the natural gas distribution chain where we can further reduce methane emissions, I think every one of those players is willing and able and already involved in finding those leaks and fixing them," he said. (Reporting by Valerie Volcovici; Additional reporting by Julia Edwards in New York; Editing by Ros Krasny, Jim Loney and Peter Cooney)