Question 1: Should we have carbon legislation in the United States? Why or Why not? View the video responses here or on YouTube.com

Featuring:

• Dr. Michael Webber, University of Texas
• Clay Sell, former Deputy Secretary of Energy and current President of Hunt Energy Horizons
• David Crane, President & CEO of NRG
• Pat Wood, former Chairman of the Federal Energy Regulatory Commission
• Luke Bellsnyder, Executive Director, Texas Association of Manufacturers

Transcript:

Dr. Michael Webber, University of Texas

Hi I’m Dr. Michael Webber with the University of Texas and I've got this Power Across Texas, Power Minute question. Should we have carbon legislation in the United States? Why or why not?

Clay Sell, former Deputy Secretary of Energy and current President of Hunt Energy Horizons

Absolutely we should. I think what the industry craves more than anything, and has craved for some time, is certainty--certainty about what the carbon future is going to be. And no matter what one's view is on climate change, I think the debate is largely over. There is a recognition broadly that the day when carbon is going to be priced is soon coming. We should get the regulatory approach designed properly and provide the much desired certainty that businesses are looking for so they can factor that into their decision making process and make the kind of infrastructure investments that need to be made to serve the energy needs of this country.

David Crane, President & CEO of NRG

Well we, actually, strongly support federal carbon legislation at a federal level because if we don't, we'll get a patchwork of state legislation. Having said that we support federal legislation, we are very concerned about how it's implemented and that particularly given the economic situation we are in it has to be, very sort of, mild in its impact in the early years-- what we call a long runway. But overall we think it's essential that a price be put on carbon because the market will not solve for something that does not have a price attached to it. So that’s why we support federal carbon legislation.

Pat Wood, former Chairman of the Federal Energy Regulatory Commission

Well honestly, I think we probably should get a better goal than just carbon; we should have a goal for how efficient we want our energy usage to be. Our energy efficiency today in the US is what it was when we had president Eisenhower. 33% of all the heat value and energy value in a block of coal or natural gas or uranium is actually something that is useful to a customer. If we can move that to 50% like the country of Denmark has done, that would be a goal. All right, having said that, if carbon is the next kind of largest endgame, yes we ought to go ahead and decide on some really balanced terms, which is a big challenge, and then get there. It took 10 years to get to a relatively comprehensive telecommunications bill back in ‘96 and I think this is probably 5 or 10 times as complicated and it's going to take a while to do. So yes, if this is something we're going to do, lets get started. But I really wish it was something more comprehensive like energy efficiency on a broad scale.

Luke Bellsnyder, Executive Director, Texas Association of Manufacturers

I think we need to be mindful of climate change and the causes and ways to mitigate that. I don't think at this economic time that it is particularly appropriate. And the cost drivers are enormous and most manufacturers, US employers, compete internationally and operate internationally. And if it's global warming, and not just climate change, than it's a global answer and not just a United States answer. To put the kind of costs associated that we've seen with a cap and trade or even just a carbon tax on US manufactures will put us at a greater disadvantage in a global market. I know that some of our friends and colleagues in the electric production industry, are saying the right things and going to DC and saying that they're amenable, somewhat, to carbon cap and trade or carbon tax and I would argue that they don't compete on a global level, particularly in Texas they're in a captured market and they compete with one another here within our grid, and the same goes for our national electric generators. We as manufactures will end up paying the higher cost as we are emitters as well, with any carbon cap and trade or carbon tax and we're going to pay an increased cost of electricity. From Warner-Lieberman, the bill that was filed two years ago we have cost estimates from the national association of manufactures that show Texas job loss up to 300,000 employees and energy costs increasing anywhere from 44 to 130 percent, with electricity being the number one cost driver for Texas manufactures it's just untenable. So while we're now competing globally we're paying a higher price of energy and again our friends at the electric companies aren't having that competition. So I would argue that now is absolutely the wrong time for the US government to impose a carbon cap and trade, or a carbon tax.