Wyden and Murkowski: The Great Senate Hope for Energy Innovation Policy in 2013

Originally posted at Forbes.com.

West Virginia Senator Joe Manchin recently proclaimed in reference to possible energy policy in 2013, “I have never been more optimistic than I am right now with Ron Wyden and Lisa Murkowski.” That’s a bold statement in an energy policy debate known more for its political pitfalls like Solyndra and a Senate known more for mind-numbing gridlock and inaction. But it’s Wyden and Murkowski’s keen sense to move beyond the energy policy stagnation of years past that is fueling cautious optimism for future progress.. Here are some key areas of potential agreement and policy action to keep an eye on as the calendar flips to a new year:

Refreshing America’s Energy Agenda

In many ways, Senator Manchin is correct to be optimistic. Atop his new perch as Chairman of the Senate Energy and Natural Resources Committee, Senator Wyden (D-WA) and Committee Ranking Member Murkowski (R-AK) are in the driver’s seat for molding energy policy in the new year. The United States last officially refreshed its energy policy in 2007 with the Energy and Security Act. Since then clean energy has taken a small, but growing foothold in the energy market and the emergence of cheap shale natural gas has knocked off coal as the leading source of fossil fuels. The energy game has changed and America needs a new strategy fit to address these and other challenges – like climate change – that threaten the country’s future progress.

Both Senator’s Wyden and Murkowski seem up for the challenge. Senator Murkowski has been tailoring her major “energy blueprint” for the better part of 2012 with an eye towards releasing it for debate in early 2013. And Senator Wyden has continued his public theme that there is no “one size fits all” energy policy, and the United States must support the continued development of clean energy as well as leverage our new natural gas reserves. More importantly, and unique for today’s Congress, neither member is developing their ideas in a vacuum; both have continued to publicly discuss policies for Murkowski’s blueprint and the Committees focus in 2013 through much of the fall. Their renewed bipartisanship opens the door to a much needed energy agenda refresh. It will be interesting to see the reaction Murkowski’s blueprint receives on the Committee, from Wyden, and from the rest of Congress.

Reframing the Debate to Energy Innovation

One potential source of Wyden and Murkowski’s bipartisanship is how they frame their energy policy goals. Instead of being chained to the stale policy tropes of previous years – cap-and-trade, Solyndra, and the like – both Senators have their attention on supporting energy innovation. This provides two immediate benefits.

First, energy innovation is the solution to address our energy and climate challenges. Spurring energy innovation is the only way America is going to produce cost- and performance competitive clean energy technologies that everyone can afford. Without producing more competitive technologies, large-scale deployment of low-carbon technologies is increasingly difficult and economically costly. While Stimulus investments super-charged clean technology development in 2009, efforts to strengthen energy innovation policy have largely screeched to a halt, even as early successes like Envia,Ambri, and PolyPlus emerge. Increased public support for clean energy technology research, development, and commercialization is more vital today than ever to aggressively advance the clean energy industry towards competitiveness.

Second, energy innovation is not a partisan issue and both Senator’s agree.According to incoming New Mexico Senator and fellow Committee member Martin Heinrich, Wyden, “certainly understands the opportunities that are inherent in a low-carbon economy” and intuitively gets that, “one of the things our country does better than anyone else in the world is innovation.” This compares well with Murkowski’s point of view; the senator publicly supports a strong government role in developing and deploying emerging clean energy technologies. Refocusing on innovation moves energy policy away from divisive issues like mandates and regulations and towards high-impact innovation policy aimed at supporting the new technologies America needs.

Getting Clean Energy Innovation Policy Right

Potentially the most important aspect of Wyden and Murkowski’s renewed push for bipartisan energy innovation policy is their emphasis on diving into the weeds. Without a doubt, energy innovation policy is a complex issue that requires nuance. Research investments must be linked to market pathways and allow flexibility to pilot and commercially scale. Market incentives must be structured in a way that pulls new research ideas to market, rather than lock-in uncompetitive technologies. And National Labs must be provided the capabilities to partner with industry to produce positive market outcomes and not just patents on a shelf. In comparison, the national debate on clean energy has often been childishly simple, centered on black-and-white arguments over eliminating loan guarantees, basic or applied research investment, and the extension or elimination of production tax credits.

Instead, Wyden and Murkowski have preliminarily embraced nuance.  In aNovember interview on Platt’s Energy Week, Senator Wyden discussed how he would rather reform the politically troubled DOE Loan Guarantee Program to support innovation, rather than eliminate the program entirely or keep it as is. Senator Murkowski has come out in support of phasing-out the Production Tax Credit for Wind to gradually move the wind industry to cost competitiveness, rather than simply extending the credit as is or allowing it to sunset at the end of the year. And Senator Wyden supports the underlying need for something like a national Clean Energy Standard, but wants to be careful to account for regional energy differences, emerging technologies, and the potential impact it might have on consumer energy prices.

It’s clear that Wyden-Murkowski energy bipartisanship gives a breath of fresh air in an often repressive legislative atmosphere.  It’s well understood, of course, that the buck doesn’t stop with either Senator. Any potential new energy innovation policy will require passage by the full Senate and House, and the signature of the President – not an easy task to overcome, even armed with the power of bipartisanship in the Senate Energy Committee. If anything though, it gives energy innovation policy a fighting chance; a lead out of the gate. That’s far more than any advocate, policy wonk, or policymaker has been able to say for a few years and it’s enough to keep hope alive.

Image credits: Wikicommons and Joint Base Elmendorf-Richardson