While oil spill hurts offshore drilling bids, a wider impact on energy policy is unclear

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Bid to enact energy bill might survive Gulf spill

WASHINGTON — The Gulf oil spill has dealt a big blow to expanded offshore drilling, leaving the nation’s energy problems as murky and unsettled as ever.

The disaster may bolster arguments for greater energy conservation and renewable energy sources such as wind and solar, environmentalists say. But it’s hard to see any other political beneficiaries, and under the best of scenarios, few experts think the nation’s thirst for foreign oil will abate for years to come.

Apart from the deaths of 11 oil rig workers and the environmental damage to the Gulf and southeastern coastlines, the spill has hurt an array of political causes. At best it’s an embarrassment to President Barack Obama. He recently had embraced expanded offshore drilling in hopes of winning Republican support for a broad-ranging energy bill that would include efforts to limit heat-trapping gases.

The spreading oil slick has prompted several GOP officials to withdraw their support for more offshore wells, complicating efforts to craft a bipartisan energy package.

The disaster also is causing discomfort for some conservative Republicans eyeing a possible 2012 presidential bid. Former Alaska Gov. Sarah Palin’s “drill, baby, drill” motto, and former House Speaker Newt Gingrich’s “drill here, drill now” refrain, suddenly don’t seem so clever or wise.

Government and environmental activists said Wednesday that the only clear political fallout of the oil spill is a halt in momentum for expanded offshore drilling. Drilling will continue where it is established, including portions of the Gulf of Mexico and Alaskan waters. But proposed expansions in those areas and along much of the Atlantic coast are now in limbo.

Energy and environmental advocates, meanwhile, are regrouping and trying to gauge the potential strengths of other causes, including incentives for mass-transit and high-mileage vehicles, renewable energy sources and stay-the-course policies that rely heavily on imported oil. On Wednesday, it was hard to pick winners and losers.

The Gulf oil spill “has definitely changed the equation but not necessarily in a negative way,” said Sen. Barbara Boxer, D-Calif., an opponent of offshore drilling and advocate of tougher carbon emission controls. Backers of more offshore drilling, she said, “understand they’re going to need to work with us in making it safer. In some ways, it opens up that door.”

Until the April 20 incident, backing an expansion of offshore drilling was largely a centrist political position. It drew support from Obama and moderate Republican governors of coastal states, such as Florida’s Charlie Crist and California’s Arnold Schwarzenegger.

But the two governors dropped their support as the Gulf spill’s magnitude became clearer. The White House has said no new drilling will occur until the accident’s causes are thoroughly examined.

“All the political winds are blowing in the direction of no additional oil drilling,” said Erich Pica, president of Friends of the Earth, which opposes such expansions. The Gulf disaster, he said, “has given us a political-policy timeout.”

Pica said it’s possible Congress will approve a scaled-down energy bill that’s far less ambitious than the bill the House passed last year. The Gulf spill could fuel efforts to reduce energy use, he said, which might include new tax incentives for electric or hybrid-fuel cars and renewable energy sources.

Even before the Gulf rig explosion, it seemed unlikely the Senate would match the House by passing an energy bill capping greenhouse gas emissions and establishing some type of marketplace in which emission permits could be exchanged. The best hope involved drawing the support of Republican Sen. Lindsey Graham of South Carolina, who insisted on expanded offshore drilling and more federal loan guarantees for new nuclear power plants.

Graham said in an interview Wednesday that the Gulf spill does not necessarily rule out passage of a comprehensive energy bill this year, although he noted it’s always difficult to round up 60 votes to overcome filibusters in the 100-member Senate.

Praising Obama’s approach to the oil spill, Graham said, “We should be cautious, we should let this settle out, get this spill under control, find out what happened, but realize that America’s energy dependency is a national security threat.”

“Our choices all involve risk,” Graham said. The risk of having Middle East countries set oil prices for America, “and this money getting into the wrong hands that we send overseas, to me, is much greater than the risks of domestic exploration for oil and gas.”

Sen. John Kerry, D-Mass., who is leading efforts to craft a Senate energy bill, told an environmental gathering Wednesday that this year is “perhaps our last, best chance to pass comprehensive climate and energy legislation.”

To settle for a scaled-back bill that deals only with energy sources and consumption, Kerry said, “ignores the fact that America today is confronting three interrelated crises: an energy security crisis, a climate crisis and an economic crisis. Our best response to all three is a bold, comprehensive bill that accelerates green innovation and creates millions of new jobs as we develop and produce the next generation of renewable power sources, alternative fuels and energy-efficient cars, homes and workplaces.”

Associated Press writers Matthew Daly and Laurie Kellman contributed to this report.

Eds: CORRECTS Graham quote in graf 15, “spill” instead of “bill.”. Moving on general news and financial services.