All across New Hampshire this holiday season, residents found their stockings stuffed with crazy, courtesy of the new GOP majorities in that state’s legislature.

The writers at the indispensable Blue Hampshire have published a series exploring incoming GOP legislators “Legislative Service Requests” (LSRs). These contain basically a bill number and a brief description of a law the legislator intends to propose, and they provided the first real glimpse of the priorities of the new GOP majority.

By Blue Hampshire’s count, LSRs so far include:

• Four bills seeking to abolish marriage equality;

• Three bills withdrawing from the wildly successful Regional Greenhouse Gas Initiative, and another challenging federal climate action;
• Eight bills challenging the federal health insurance reform law;
• One bill abolishing the Federal Reserve and switching New Hampshire to a system of gold and silver currency; and
• One bill “ordering” Senators Shaheen and Ayotte to vote against the UN Convention on the Law of the Sea.

There are a lot of head-scratchers in that list, but none more so than the LSR filed by Rep. Daniel Itse opposing the Law of the Sea Convention.

For one thing, state legislatures do not and have never had the authority to “order” their U.S. Senators to vote a certain way. Not even in the years before the 17th Amendment. Rep. Itse clearly needs to re-read our constitution (or perhaps the Cliffs Notes version) before voting on any legislation.

As for the Convention itself, it’s an extremely important body of international law. But the section gaining the most attention lately is arguably Articles 100-107, which define and establish every nation’s “Duty to cooperate in the repression of piracy.”

You read that right – piracy.

So, to recap, New Hampshire Republicans apparently think climate change, health care costs, and piracy are all imaginary. And the “threats” they take seriously? Gays and paper currency. Ridiculous.

New Hampshire, welcome to the Republic of Tea.

Ever since Democrats won control of the Colorado Legislature in 2004, the state has become a leader in pushing for clean energy investment. And that leadership was recently recognized by U.S. Commerce Secretary Gary Locke, who described Colorado as a model for national action.

Aldo Svaldi and Drew FitzGerald at the Denver Post wrote about Locke's remarks a few weeks ago:

The country could miss a key opportunity for growth if it doesn't soon follow Colorado's example in pursuing the new-energy economy, U.S. Secretary of Commerce Gary Locke said Monday. (...)

Colorado earlier this year required that utilities obtain 30 percent of their electricity from renewable sources by 2020, one of the nation's strictest mandates.

That was an increase from an earlier voter- approved requirement of 20 percent by 2020, and the mandate has helped the state attract thousands of jobs in wind, solar and other technologies.

Republicans in both legislative chambers voted near-unanimously against HB 1001, which established the new standard – presumably because they’d rather see more job creation in China, instead of Colorado and elsewhere in the United States.

As Secretary Locke explained, Republican intransigence on clean energy is already causing the United States to fall behind:

China, by contrast, is investing $9 billion a month in the clean-energy field, and not just to meet its own internal energy needs or improve emissions. The Chinese want to export the technology to other countries and reap the millions of jobs that could come from doing that, Locke said.

"If we don't act soon on an energy policy . . . we will wake up and say, 'How is it that Shanghai, China, or Berlin, Germany, have become the next Silicon Valley of clean energy?' " he said.

Colorado, of course, is hardly alone in the push for clean energy. 2009 saw a surge of activity in several states, almost always led and supported by Democratic lawmakers.

It’s an open question whether Republicans will eventually come around to supporting clean energy legislation. But no matter what they do, you can expect Democrats to continue making it a priority in Colorado and across the country.

Maine is one of ten states across the country which has adopted a mandatory cap-and-trade system. While critics consistently maintain that carbon trading programs will cost jobs, the experience in the Pine Tree state suggests otherwise.

The nation's first mandatory carbon trading scheme is being credited with potentially creating nearly 1,000 [new] jobs while promoting energy efficiency projects in industries located across Maine.

Those jobs will be spread amongst 16 different projects, which altogether already employ nearly 7,000 people in the state. The money to create these new positions comes from a number of sources, including both money allocated by state policymakers and federal stimulus money.

With all eyes on Copenhagen for the big climate change summit, now is a good time to talk about the “cap and trade” carbon reduction idea. What most people don’t know is that some parts of the United States already use a cap and trade system passed at the state level, and the year-old program is already debunking many of the most persistent criticisms of the idea:

Some business groups and conservative critics have warned that cap-and-trade regulation of greenhouse gases could cripple the U.S. economy, driving energy prices through the roof and putting millions out of work. Some economists and environmentalists also oppose the approach, arguing that it's too complicated and fraught with loopholes to make a real dent in emissions that threaten to drastically alter the world's climate.

But power companies in Maryland and the nine other states have been paying for the rights to emit greenhouse gases for more than a year with slight impact on consumers' electric bills. Baltimore Gas and Electric Co.'s residential customers are paying perhaps $1.25 a month more as the costs of the carbon-dioxide permits are passed through, said Constellation Energy spokesman John Quinn. That represents about 1 percent of the average household's electric bill.

Meanwhile, the state has collected more than $96 million in revenue from the six carbon-dioxide auctions held since September 2008, with the funds earmarked for providing relief from energy costs and ultimately reducing greenhouse gas emissions.

About half of the money Maryland collects is used to help the state’s poorest residents pay their electric bills, with much of the rest split between conservation programs and renewable energy projects. The actual “cap” part of the program declines between now and 2018, until carbon emissions are ten percent lower than they are now.

In all, ten states participate in the program (Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Rhode Island, and Vermont). All ten of them are northeastern, and all ten have solidly Democratic state legislatures.

State legislators don’t get to vote in Congress, but that doesn’t mean they ignore what happens there. And Washington State’s Democratic legislators have been working overtime to make sure their state’s residents get a say on health care reform and climate change legislation.

Last month, over two-thirds of Washington State’s Democratic legislators –- including State House Speaker and DLCC Board Member Frank Chopp –- signed on to a petition demanding real health care reform, with a robust public option. They followed up by sending a delegation to press their case in Washington, DC:

What a state lawmaker can hope to accomplish in pushing for national health-care reform remains to be seen. But Democratic state Sen. Karen Keiser of Kent put out word yesterday that she, Rep. Brendan Williams of Olympia and Rep. Steve Conway of Tacoma are heading back to Washington, D.C., today and Wednesday to see what they can do to help along the reforms. (…)

Keiser expects to meet today Tuesday with House and Senate leaders as well as Sen. Maria Cantwell, D-Seattle, and U.S. Rep. Adam Smith, D-Tacoma. They'll visit tomorrow Wednesday with U.S. Rep. Jay Inslee, D-Bainbridge Island, Sen. Patty Murray, D-Seattle, and White House officials.

The legislators also met with President Obama during the trip.

Now, Washington State Democrats are also pressing the case for national climate change legislation. A group of 46 State Senators and Representatives –- nearly half the Democratic caucus -- wrote to the state’s U.S. Senators to demand action:

"We need a comprehensive energy policy that sets us on a course to reduce this dependence on fossil fuels that is crippling our economy: A firm limit on global warming pollution is the policy that will do this," said the letter.

The U.S. House of Representatives narrowly passed a sweeping climate change bill last summer. The legislation is currently before the U.S. Senate, where it faces an uncertain fate.

Until legislation passes, we won’t know how effective these voices are in spurring Congressional action. But in Washington State, Democrats are determined to do everything they can.

Pennsylvania Republican Rep. Daryl Metcalf is already on record saying he doesn’t care about victims of domestic violence (or, to be more precise, that he hates gays more than he cares about domestic violence). Now it turns out Metcalf also hates the environment more than he loves America.

What else would explain Metcalf’s reply to retired Army Captain Jonathan Powers, who fought bravely in Iraq for more than a year, when Powers and Operation FREE (on the web: operationfree.net) invited Metcalf to meet with veterans seeking to raise awareness of how global climate change would threaten U.S. National Security?

I believe that any veteran lending their name, to promote the leftist propaganda of global warming and climate change, in an effort to control more of the wealth created in our economy, through cap and tax type policies, all in the name of national security, is a traitor to the oath he or she took defend the Constitution of our great nation!

Remember Benedict Arnold before giving credibility to a veteran who uses their service as a means to promote a leftist agenda.

Drill Baby Drill!!!

For Liberty,
Daryl Metcalfe
State Representative
Veteran U.S. Army

This time, at least Metcalf is picking on someone his own size –- as opposed to last month’s crusade against victims of domestic violence.

But something more needs to be said about this. The event Metcalf was invited to, while it promoted action against climate change, was not about saving wildlife and preserving the polar ice cap. It was about national security: it was a group of veterans talking about what it would mean for the safety of American families if the Earth continues to warm.

Metcalf obviously believes that won’t happen, and he’s entitled to his opinion (however wrong he may be). But Metcalf was wrong to call veterans of Iraq and Afghanistan “traitors” for simply talking about how to better protect America.

Here at the DLCC, country always comes before party or ideology. Rep. Metcalf needs to get those priorities straight.

We’ve spent a lot of time tracking (and praising) state efforts to promote renewable energy, but today we want to highlight one such effort and how it’s expected to re-shape an economy at the local level.

Arizona’s SB 1403 provides a 10% income tax credit to renewable energy producers that meet certain requirements, and new projects investing more than $25 million in the state could qualify for local property tax reductions. With less than five months until the bill goes into effect, an official with the Yuma, AZ Economic Development Corp. took a look at what the changes will mean for Yuma:

So, how will Yuma directly benefit from this legislation? The current state of affairs at the Capitol is a lesson that we no longer can rely on construction and retail sales to fuel our economic engine. The institution of SB 1403 has put Arizona, and Yuma in particular, on an even playing field with competitor states such as New Mexico, Texas and Oregon.

Currently, we are working with two potential company locates that were monitoring this bill very closely. Their project scope estimates may account for 200+ high-wage jobs and approximately $50 million to $75 million in new capital investment.

From an economic development perspective, solar manufacturing companies that need to have a presence near large consumers of their products such as California are now focused specifically on communities that can provide the available labor force, shortest time to end markets and up-front capital cost offsets. Leveraging the presence of three large-scale solar farms developing projects in our county, California’s ravenous appetite for clean energy and our distinct regional advantages; we have the potential to become the epicenter for solar activity in the desert Southwest.

It’s worth noting that SB 1403 was passed at the end of June and signed by the governor on July 10th, despite significant Republican opposition in the House and Senate – both Republican-controlled chambers. Were it not for the overwhelming support of legislative Democrats, the bill likely would have failed in the State Senate, where it squeaked by on a 16-12 vote.

Without that close win, residents of Yuma and other cities and towns across Arizona would have lost out on potentially millions of dollars and thousands of new jobs in an emerging economic sector. We won’t know for several years whether Yuma really will become the solar powerhouse of the Southwest, but we feel confident that the city’s future has, in fact, brightened because SB 1403 passed.

The Louisiana Legislature voted several weeks ago to dramatically improve state tax incentives for small-scale solar power systems. Unlike other states that focused on creating new tax incentive programs during the 2009 legislative session (several of which we profiled in last month’s Progress Report), Louisiana changed their existing 50 percent tax credits to encourage more participation, and the new changes have renewable energy advocates buzzing:

The act helps foster a solar leasing business, where an installer pays the money upfront, gets the tax credit and a homeowner leases the system back from them.

"You, in essence, pay a bill to them, just like you would pay your utility bill through Entergy or any other utility," [South Coast Solar CEO Troy] Von Otnott said. "At the end of the lease, after they've made their return on investment, you're allowed to purchase that system for a dollar."

Before the change in the law, it wasn't possible for anyone, other than the homeowner, to claim the state tax credit. Now, though, the new law will benefit not just third parties, but also could be used by developers.

"If you're a developer and you want to do a new development that involves solar, the developers can also claim the tax credit for all the solar they put on the homes," [Alliance for Affordable Energy representative Christian] Roselund said. "So, developers and contractors being able to claim this credit really opens the door for a lot more solar in new construction."

If successful, this new flexibility in the state’s solar incentive program will encourage a new wave of solar equipment installation across Louisiana and allow thousands of homeowners to enjoy lower energy bills.

Legislative Act 467, which allowed these changes, was passed unanimously by both houses of the Democratically-controlled legislature.

One issue we’ve been following closely is how the recession is affecting individual states’ economies and budgets. This morning, the Wall Street Journal took a closer look at how some states are using traditional energy production to try and repair some of that damage, and they found wide variation in each state’s approach:

Lawmakers in Pennsylvania and California have proposed what are known as severance taxes on oil and natural gas produced in their states. A tax increase took effect in Arkansas at the beginning of the year, and Alaska last year raised its oil-production tax.

Some lawmakers in Louisiana want to take the opposite tack, in a bid to attract more drilling. The state House of Representatives recently approved a package of tax cuts targeted at certain high-cost forms of oil and gas production.

Severence taxes are an attractive option for policymakers because unlike sales taxes (e.g. on gasoline), energy severance taxes are not always felt directly by consumers. Industry groups are pushing back hard against such plans by arguing that higher taxes would drive production to other states. However, evidence suggests that oil and gas severance taxes may not introduce the same elasticity as other forms of corporate taxes:

But advocates for increased taxes argue that taxes play a smaller role in companies' drilling decisions than factors such as how much oil is present or how difficult it is to produce. A study released last fall by Headwaters Economics, a Montana-based nonprofit, found that Montana and Wyoming, despite widely differing effective tax rates, haven't seen much difference in drilling activity.

"It doesn't seem to be affecting where companies drill," said Mark Haggerty, one of the study's authors.

Mr. Haggerty said that if states want to encourage drilling and maximize revenue, they should have relatively high severance taxes but encourage companies to look for new oil fields. That is the approach taken by Alaska, which has the country's highest severance tax rate, at 25% of net income per well, but also offers subsidies for companies to invest in the state.

As noted above, Alaska -- generally considered one of the most industry-friendly states in the country when it comes to oil and gas -- actually raised its highest-in-the-nation severance taxes this year. With some states following that lead and others taking a different approach, we likely won’t know for some time which strategy is most cost-effective. Still, it’s an issue we plan to watch very closely, even as we follow ongoing developments in clean energy.

A two-year-old Oregon program is making significant progress promoting renewable energy production and energy conservation. At the same time, the success of the program is tearing down one of the most persistent, Republican-peddled lies in the rural West: that clean energy and environmental protection are somehow threats to rural livelihoods.

As Oregon’s program is proving, clean energy and rural prosperity actually go hand-in-hand:

"Renewable energy and efficiency are more prevalent in agriculture," [renewable energy specialist Stephanie] Page said. "A lot of folks have completed projects already, but as energy prices go up, more people will look for opportunities."

On the energy efficiency side, operators have found ways to save through more efficient irrigation, greenhouse heating, lighting, pump and motor operation, and even milk cooling in dairies. On the renewable energy side, operators have harnessed solar, wind, small hydroelectric, and geothermal energy sources. Some producers have pursued biofuels. In many cases, the energy saved or generated on the farm is being used to run the operation. In other cases, a surplus of energy is used to provide power for others. What works best for an individual farmer or rancher depends on the type of operation and, to some extent, the tax liability. Accessing tax credits can make these kinds of projects worthwhile.

"Oregon has some of the best incentives in the country," said Page, who credits the 2007 State Legislature for adopting a comprehensive renewable energy package.

Among the programs available to producers is the Oregon Business Energy Tax Credit, which provides a 35 percent credit for energy efficiency projects, a 50 percent credit for renewable energy projects, and a pass-through option for businesses that don't have the tax appetite to use the credit themselves.

As states expand their small-scale renewable energy programs across the country, we’re learning that rooftop solar panels are only the beginning, especially in rural America. Some of the most exciting opportunities involve agricultural production, which uses scores of energy-intensive (or energy-producing) processes that can be re-thought and harnessed. Oregon is leading the way and proving that renewable energy is more than a pet project for urban progressives – it’s also a money-saving tool that’s helping more and more farmers stay in business.