WASHINGTON (CN) – Republican Sen. Richard Lugar of Indiana said he will introduce a bill this week that calls for reducing foreign oil imports and increasing fuel efficiency standards in what he calls the “main alternative to the divisive cap-and-trade approach” proposed by Sens. John Kerry, D-Mass., and Joe Lieberman, I-Conn.
Lugar said the bill would cover half of Obama’s goals to reduce emissions by 17 percent by 2020, “reducing the carbon-reduction burden of future climate proposals.”
Under the plan, passenger vehicles would be required to increase fuel efficiency by 4 percent a year starting in 2016, with medium- and heavy-duty trucks subject to stricter fuel efficiency standards starting in 2017.
The plan proposes a “feebate” system in which purchasers of the most efficient passenger vehicle in its class would receive a rebate, and purchasers of the least efficient would pay a fee.
The plan would also implement new efficiency standards for residential and commercial construction, and would establish programs for retrofitting homes and office buildings with energy-saving features.
Lugar said home and office energy improvements could cut nationwide energy demand by nearly 7 percent by 2030 and slash greenhouse gas emissions by about 11 percent.
His plan also includes a voluntary coal plant retirement program that exempts coal plants from buying expensive scrubbers over the next few years if they retire by 2020. It also calls for ramping up nuclear power plant construction.
Lugar’s plan calls for cutting foreign oil imports by 1.75 billion barrels by 2030, a 68 percent reduction, which would bump up domestic oil production along the outer-continental shelf.
The shelf has been subject to a drilling moratorium since the April 20 explosion on the BP drilling rig Deepwater Horizon started a devastating oil spill.
“The legislation contains no specific provisions to enhance outer-continental shelf oil production,” Lugar said. “The primary driver of increased [outer-continental shelf] production will be increased oil prices.”
“We don’t stop flying after a terrible airplane crash, and we’re not going to stop drilling after this spill,” Sen. Lamar Alexander, R-Tenn., said in a Senate floor speech Monday.
Senate Majority Leader Harry Reid, D-Nev., has asked the Senate to pass energy legislation by July 4.
“We’ll never be a secure nation where we’re dependent on foreign oil,” Reid said.
The House already passed its version of the energy bill last year.
At a speech at Carnegie Mellon University last week, Obama called to “aggressively accelerate” the nation’s transition to clean energy, saying continued dependence on foreign oil “will jeopardize our national security.” Obama called for making vehicles and homes more energy efficient, building nuclear power plants and focusing on domestic natural gas reserves.
The United States consumes more than one-fifth of the world’s oil, but has less than 2 percent of the world’s oil reserves, Obama said.
The only way to encourage private-sector clean energy investment is “by finally putting a price on carbon pollution,” he said.