Obama energy options may be long wait

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By Amanda DeBard

"Right now, there is no incentive for companies to invest in these technologies because it's free to pollute," Mr. Weiss said. "Once you put a price on carbon, it creates an economic incentive not to put pollution in the air."

Nobel Prize-winning economist Paul Krugman said skeptics of the Obama plan appear to lack faith in the capitalist system.

"If you really believe in the magic of the marketplace, you should also believe that the economy can handle emission limits just fine," the liberal economist wrote recently.

But not everyone thinks the energy plan's incentives are big enough to create new machines and technologies.

"What the administration is doing is risky, borderline dangerous," said Kenneth P. Green, an environmental-policy specialist at the American Enterprise Institute, a conservative-leaning think tank. "The speed of transition Obama is proposing is certainly not possible, and the technology is not in a state of development that can be scaled up in 10 years; maybe in 20 or 30 years."

The administration plans, by 2022, to blend 36 billion gallons of ethanol with petroleum to wean the nation off oil and to reduce pollution from cars. But of that total, 16 billion gallons must come from sources that do not exist.

Corn ethanol currently is blended with gasoline, but scientists say corn is only a "gateway" or "bridge" to next-generation biofuels - cellulosic ethanol, which will come from wood, grasses or other nonedible plants - once the refineries are built.

According to the Renewable Fuels Association, the technology to meet the administration's biofuels goals is "close to being commercially viable," but ethanol producers still don't know how much large-scale refineries will cost to build or operate.

Matt Hartwig, a spokesman for the association, said the economic crisis has made it difficult to expand refinery construction, thus making it harder to ramp up biofuel production.

Mr. Obama has instructed the Energy and Agriculture departments to invest in biofuels technologies and refinery construction, but petroleum producers would be required to bear the majority of the costs associated with additional biofuel use. The administration's plan to cap total carbon emissions and have companies trade permits to pollute could be an answer.

Companies would be required to obtain a credit for each ton of carbon they emit, and fewer permits would be sold each year. Thus, carbon-intensive industries would have to find ways to compete with clean energy.

The administration hopes to foster carbon-capture and ethanol technologies so that they'll be ready for commercial use in a shorter amount of time and cost polluters less in fees. The House's pending climate-change bill contains incentives and funding for wide-scale commercial deployment of carbon capture and sequestration. The Energy Department plans to spend $656.5 million in economic-stimulus money to construct advanced biofuel refineries this fiscal year and an additional $133.5 million next year.

But skeptics say that the science cannot be rushed. Some also assert that Mr. Obama has confused being hopeful with being confident that technology will deliver the results within his preferred time frame.

"I think Obama is genuinely deceived by his own rhetoric," Mr. Green said. "He thinks if you say, 'We can' often enough, then it will magically happen."