Wind Energy: Offshore Permitting

Adam Vann
Legislative Attorney

Technological advancement, financial incentives, and policy concerns have driven a global expansion in the development of renewable energy resources. Wind energy, in particular, is now often cited as the fastest-growing commercial energy source in the world. Currently, all U.S. wind energy facilities are based on land. However, multiple offshore projects have been proposed and are at various stages of the federal permitting process. 

The United States has the authority to permit and regulate offshore wind energy development within the zones of the oceans under its jurisdiction. The federal government and coastal states each have roles in the permitting process, the extents of which depend on whether the project is located in state or federal waters. Currently, no single federal agency has exclusive responsibility for permitting related to activities on submerged lands in federal waters; authority is allocated among various agencies based on the nature of the resource to be exploited and the potential impacts incidental to such exploitation. The same is true for the offshore wind energy context, where several federal agencies have a role to play in permitting development and operation activities. 

Section 388 of the Energy Policy Act of 2005 (EPAct; P.L. 109-58) amended the Outer Continental Shelf Lands Act (OCSLA) to address previous uncertainties regarding offshore wind projects. This provision retained a role for the Army Corps of Engineers in permitting under the Rivers and Harbors Act but grants ultimate authority over offshore wind energy development to the Secretary of the Interior. The provision also contained various exemptions from the regulatory regime it establishes for projects that received certain permits prior to the enactment of EPAct. The statutory authority granted by section 388 is administered by the Bureau of Ocean Energy Management, Regulation, and Enforcement (BOEMRE), an agency within the Department of the Interior (DOI). 

This report supersedes CRS Report RL32658, Wind Energy: Offshore Permitting, by Adam Vann.


Date of Report: August 11, 2010
Number of Pages: 16
Order Number: R40175
Price: $29.95

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The Home Star Energy Retrofit Act of 2010: Operational and Market Considerations

Paul W. Parfomak
Specialist in Energy and Infrastructure Policy

The Home Star Energy Retrofit program as proposed is intended to promote both greater residential energy-efficiency and increased employment in the home remodeling, energy services, and related manufacturing industries. Two very similar Home Star programs are detailed in legislation proposed in the House and Senate. The House of Representatives version, the Home Star Energy Retrofit Act of 2010 (H.R. 5019), was introduced on April 14, 2010, by Representative Peter Welch and 44 cosponsors. H.R. 5019 passed with amendments on May 7, 2010, and was referred to the Senate Finance Committee. The latest Senate proposal was included as Division C Title XXX of the Clean Energy Jobs and Oil Company Accountability Act of 2010 (S. 3663) introduced by Senator Harry Reid on July 28, 2010. 

Home Star would employ a two-tiered structure for energy-efficiency rebates. Its Silver Star program tier would provide up to $3,000 per home in prescriptive rebates for straightforward home upgrades, including insulation; efficient heating, ventilation, and air conditioning units; new windows; and other measures. The Gold Star program tier would offer $3,000 rebates for more comprehensive energy retrofits achieving at least 20% energy savings, with rebates increasing up to $8,000 per home for retrofits achieving 45% energy savings. The Senate version would also offer up to $1,200 per home for comprehensive water efficiency retrofits. Quality assurance inspectors would visit 10% to 20% of participating homes to ensure measures are properly installed. H.R. 5019 authorizes $6 billion in funding for the program. S. 3663 authorizes $5 billion. 

In both the House and Senate versions, the proposed Home Star program may present an opportunity for both energy-efficiency and employment in the United States. The program targets the residential sector, which numerous studies have shown to be among the largest sources of cost-effective energy-efficiency opportunity in the United States. It also targets a wide base of currently unemployed or under-employed residential contractors. Structurally, the Home Star program seeks speedy implementation by building upon prior experience with both federal and state energy-efficiency programs to provide operating models that might be replicated nationwide. Nonetheless, several operational aspects new to such a federal program, or not previously tried for a program of Home Star's scale, may warrant further attention from Congress. These include the use of rebate aggregators, a two-tiered rebate structure, technical standards, and the general availability of rebates to all who may want them. Key market issues include the inclusion of a "Do-it-Yourself" rebate option, high expectations for program participation, and promoting the growth of a self-sustaining home weatherization industry. Given that it would be a new federal program, the level of homeowner participation implied by the rebate funding provisions in the Home Star proposal would far exceed that achieved by comparable programs in their initial years. 

Taken together, Home Star's key operational requirements may present greater challenges than some proponents suggest, and may present unanticipated obstacles to speedy and consistent program implementation across the country. As Congress examines details of the Home Star proposal, focusing on tradeoffs between rapid implementation, operational complexity, and energy-efficiency impacts may be important. Balancing the twin goals of short-term job creation and long-term investment in cost-effective energy savings could also be an ongoing challenge.


Date of Report: July 29, 2010
Number of Pages: 13
Order Number: R41273
Price: $29.95

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Civilian Nuclear Waste Disposal

Mark Holt
Specialist in Energy Policy

Management of civilian radioactive waste has posed difficult issues for Congress since the beginning of the nuclear power industry in the 1950s. Federal policy is based on the premise that nuclear waste can be disposed of safely, but proposed storage and disposal facilities have frequently been challenged on safety, health, and environmental grounds. Although civilian radioactive waste encompasses a wide range of materials, most of the current debate focuses on highly radioactive spent fuel from nuclear power plants.

The Nuclear Waste Policy Act of 1982 (NWPA) calls for disposal of spent nuclear fuel in a deep geologic repository. NWPA established the Office of Civilian Radioactive Waste Management (OCRWM) in the Department of Energy (DOE) to develop such a repository and required the program's civilian costs to be covered by a fee on nuclear-generated electricity, paid into the Nuclear Waste Fund. Amendments to NWPA in 1987 restricted DOE's repository site studies to Yucca Mountain in Nevada.

DOE submitted a license application for the proposed Yucca Mountain repository to the Nuclear Regulatory Commission (NRC) on June 3, 2008, and NRC docketed the application September 8, 2008. The NRC license must be based on radiation exposure standards set by the Environmental Protection Agency (EPA), which issued revised standards September 30, 2008. The State of Nevada strongly opposes the Yucca Mountain project, disputing DOE's analysis that the repository would meet EPA's standards. Risks cited by repository opponents include excessive water infiltration, earthquakes, volcanoes, and human intrusion.

The Obama Administration "has determined that developing the Yucca Mountain repository is not a workable option and the Nation needs a different solution for nuclear waste disposal," according to the DOE FY2011 budget justification. As a result, no funding for Yucca Mountain or OCRWM is being requested for FY2011. DOE filed a motion with NRC to withdraw the Yucca Mountain license application on March 3, 2010. DOE's withdrawal motion has drawn legal challenges from states that have defense-related and civilian waste awaiting permanent disposal. An NRC licensing board denied DOE's withdrawal motion on June 29, 2010, a decision that may be reviewed by the NRC commissioners.

Alternatives to Yucca Mountain are to be evaluated by the Blue Ribbon Commission on America's Nuclear Future, which held its first meeting March 25-26, 2010. Congress provided $5 million for the Commission in the FY2010 Energy and Water Development Appropriations Act. The Commission is to study options for temporary storage, treatment, and permanent disposal of highly radioactive nuclear waste, along with an evaluation of nuclear waste research and development programs and the need for legislation. A draft report is to be issued within 18 months and a final report within two years.

DOE's Office of Nuclear Energy (NE) is to take over the remaining functions of OCRWM and "lead all future waste management activities," according to the FY2011 budget justification. Substantial funding has been requested for NE to conduct research on nuclear waste disposal technologies and options and to provide support for the Blue Ribbon Commission.

Congress provided $198.6 million to OCRWM for FY2010 to continue the Yucca Mountain licensing process but terminate all development activities related to the proposed repository. DOE plans to reprogram the FY2010 funding toward shutting down the program.


Date of Report: July 16, 2010
Number of Pages: 26
Order Number: RL33461
Price: $29.95

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Renewable Fuel Standard (RFS): Overview and Issues

Randy Schnepf
Specialist in Agricultural Policy

Brent D. Yacobucci
Specialist in Energy and Environmental Policy

Federal policy has played a key role in the emergence of the U.S. biofuels industry. Policy measures include minimum renewable fuel usage requirements, blending and production tax credits, an import tariff, loans and loan guarantees, and research grants. This report focuses on the mandated minimum usage requirements—referred to as the Renewable Fuel Standard (RFS)— whereby a minimum volume of biofuels is to be used in the national transportation fuel supply each year. It describes the general nature of the RFS mandate and its implementation, and outlines some emerging issues related to the sustainability of the continued growth in U.S. biofuels production needed to fulfill the expanding RFS mandate, as well as the emergence of potential unintended consequences of this rapid expansion.

Congress first established an RFS with the enactment of the Energy Policy Act of 2005 (EPAct, P.L. 109-58). This initial RFS (referred to as RFS1) mandated that a minimum of 4 billion gallons be used in 2006, and that this minimum usage volume rise to 7.5 billion gallons by 2012. Two years later, the Energy Independence and Security Act of 2007 (EISA, P.L. 110-140) superseded and greatly expanded the biofuels blending mandate. The expanded RFS (referred to as RFS2) required the annual use of 9 billion gallons of biofuels in 2008 and expanded the mandate to 36 billion gallons annually in 2022, of which no more than 15 billion gallons can be ethanol from corn starch, and no less than 16 billion must be from cellulosic biofuels. In addition, EISA carved out specific requirements for "other advanced biofuels" and biomass-based biodiesel.

The Environmental Protection Agency (EPA) is responsible for establishing and implementing regulations to ensure that the nation's transportation fuel supply contains the mandated biofuels volumes. EPA's initial regulations for administering RFS1 (issued in April 2007) established detailed compliance standards for fuel suppliers, a tracking system based on renewable identification numbers (RINs) with credit verification and trading, special treatment of small refineries, and general waiver provisions. EPA rules for administering RFS2 (issued in February 2010) built upon the earlier RFS1 regulations; however, there are four major distinctions. First, mandated volumes are greatly expanded and the time frame over which the volumes ramp up is extended through at least 2022. Second, the total renewable fuel requirement is divided into four separate, but nested categories—total renewable fuels, advanced biofuels, biomass-based diesel, and cellulosic ethanol—each with its own volume requirement. Third, biofuels qualifying under each category must achieve certain minimum thresholds of lifecycle green house gas (GHG) emission reductions, with certain exceptions applicable to existing facilities. Fourth, all renewable fuel must be made from feedstocks that meet a new definition of renewable biomass, including certain land use restrictions.

In the long term, the expanded RFS is likely to play a dominant role in the development of the U.S. biofuels sector, but with considerable uncertainty regarding potential spillover effects in other markets and on other important policy goals. Emerging resource constraints related to the rapid expansion of U.S. corn ethanol production have provoked questions about its long-run sustainability and the possibility of unintended consequences in other markets as well as on the environment. Questions also exist about the ability of the U.S. biofuels industry to meet the expanding mandate for biofuels from non-corn sources such as cellulosic biomass materials, whose production capacity has been slow to develop, or biomass-based biodiesel, which remains expensive to produce owing to the relatively high prices of its feedstocks. Finally, considerable uncertainty remains regarding the development of the infrastructure capacity (e.g., trucks, pipelines, pumps, etc.) needed to deliver the expanding biofuels mandate to consumers.


Date of Report: July 14, 2010
Number of Pages: 33
Order Number: R40155
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Energy Tax Policy: Issues in the 111th Congress

Molly F. Sherlock
Analyst in Economics

Donald J. Marples
Section Research Manager

Energy tax policy involves the use of one of the government's main fiscal instruments, taxes (both as an incentive and as a disincentive) to alter the allocation or configuration of energy resources and their use. In theory, energy taxes and subsidies, like tax policy instruments in general, are intended either to correct a problem or distortion in the energy markets or to achieve some economic (efficiency, equity, or even macroeconomic) objective. In practice, however, energy tax policy in the United States is made in a political setting, being determined by the views and interests of the key players in this setting: politicians, special interest groups, bureaucrats, academic scholars, and fiscal dictates. As a result, enacted tax policy embodies compromises between economic and political goals, which could either mitigate or compound existing distortions.

The economic rationale for government intervention in energy markets is commonly based on the government's perceived ability to correct for market failures. Market failures, such as externalities, principal-agent problems, and informational asymmetries, result in an economically inefficient allocation of resources—in which society does not maximize well-being. To correct for these market failures governments can utilize several policy options, including taxes and regulation, in an effort to achieve policy goals.

Current energy policy reflects efforts to achieve both current and past policy objectives. Recent legislative efforts have primarily focused on renewable energy production and conservation to address environmental concerns. In contrast, past efforts attempted to reduce reliance on foreign energy sources through increased domestic production of fossil fuels. Recently enacted legislation focusing on encouraging renewable energy production and conservation reduces reliance on imported, foreign oil, while also addressing environmental concerns by reducing the use of fossil fuels. Favorable tax preferences given to domestic fossil fuel energy sources also promote domestic energy production, reducing the demand for imported oil.

In the 111th Congress energy tax legislation continues to be focused on increasing incentives for renewable energy production and conservation. The American Recovery and Reinvestment Act of 2009 (ARRA; P.L. 111-5) expanded and extended a number of tax incentives designed to promote renewable energy, conservation, and alternative technology vehicles. In addition, the President's 2010 and 2011 Budget Proposals contain a number of provisions that would, if enacted, continue to move energy policy toward promoting alternative energy sources by eliminating a number of the tax subsidies currently available to the oil and gas industry while also imposing additional taxes that would be borne—at least partially—by these industries. The President's 2011 Budget Proposal continued this policy direction through the proposed removal of a number of subsidies currently available to the coal industry.


Date of Report: June 16, 2010
Number of Pages: 30
Order Number: R40999
Price: $29.95

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