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How would you spend $50 billion to stimulate the economy AND energy efficiency, Part 1

We are going to have a huge economic stimulus package soon after Obama becomes President. And a big piece of it is going to be aimed at energy efficiency and renewable energy, as the NYT reported today in “Proposal Ties Economic Stimulus to Energy Plan.”

I have asked a bunch of my wonk ee friends for some energy efficiency ideas, which I’ll be posting in the coming days. I’d love to hear some ideas from you — please try to keep them practical. Focus on spending that creates jobs in the next two years AND that either saves energy (like weatherizing low-income homes) or helps jumpstart the transition to a clean energy economy (like ‘green’ transmission).

I’ll even send one or two the best ideas to the various transition folks I know. Realistically, it would be very hard to actually get into the stimulus package, but a good idea might still find its way into the huge energy bill that is equally inevitable for 2009, but on a somewhat slower track.

Try not to duplicate stuff in the Center for American Progress’s plan, “A Strategy for Green Recovery” (which is a good guide for how to write up an idea). Nor should you duplicate ideas in the NYT piece:

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President-elect Barack Obama and leaders in Congress are fashioning a plan to pour billions of dollars into a jobs program to jolt the economy and lay the groundwork for a more energy-efficient one.

The details and cost of the so-called green-jobs program are still unclear, but a senior Obama aide, speaking on the condition of anonymity to discuss a work in progress, said it would probably include the weatherizing of hundreds of thousands of homes, the installation of “smart meters” to monitor and reduce home energy use, and billions of dollars in grants to state and local governments for mass transit and infrastructure projects.

The green component of the much larger stimulus plan would cost at least $15 billion a year, and perhaps considerably more, depending on how the projects were defined, aides working on the package said….

Congressional officials working with the Obama administration saidthe stimulus program was also likely to involve tax breaks or directgovernment subsidies for a variety of clean energy projects,including solar arrays, wind farms, advanced biofuels and technologyto capture carbon dioxide emissions from coal-burning power plants.

The programs will be a part of a larger economic stimulus packagewhose outlines are faint but which is expected to cost $400 billionto $500 billion. Mr. Obama has said that his goal is to create orsave 2.5 million jobs in the next two years. He has assigned to hiseconomic and environmental advisers the task of devising a proposalthat is expected to combine a shot of new federal money into existingfederal and state programs and the possible creation of agenciesmodeled on New Deal public works programs.

“We’ll put people back to work rebuilding our crumbling roads andbridges, modernizing schools that are failing our children, andbuilding wind farms and solar panels, fuel-efficient cars and thealternative energy technologies that can free us from our dependenceon foreign oil and keep our economy competitive in the years ahead,”Mr. Obama said in a radio address last month, echoing a campaignpromise with a new sense of urgency….

“Now they’re talking about some large amount of money — what, $100 billion? — and spending it on windmills, job training, whatever,” said David Kreutzer, who studies energy economics and climate change at the Heritage Foundation, a conservative research group. “But where do you get the $100 billion in the first place? Are you going to take $100 billion from some other part of the economy, are you going to tax some people to pay for it? Are you just going to print it or borrow it? The money has to come from somewhere.”The Obama team and Congressional leaders say they want a plan ready shortly after Congress reconvenes in January.

Mr. Obama has said that, after stabilizing the economy and the markets, putting the nation on the path to a more energy-efficient future is his top priority. The House speaker, Nancy Pelosi of California, said this week that rebuilding infrastructure and creating green jobs was “the first order of business that we will have” when Congress reconvenes in January. Several hearings are planned even before Mr. Obama takes office on Jan. 20.

State officials say a lack of financing has stalled billions of dollars in projects. Gov. Arnold Schwarzenegger of California told Mr. Obama this week that the states were ready to break ground with $136 billion in infrastructure projects that could provide new jobs within two years.

The American Public Transportation Association, which represents local mass transit authorities, said there were $8 billion in “ready-to-go” projects that could preserve or create thousands of jobs and provide more energy-efficient transportation.

Beverly A. Scott, the chief executive of Atlanta’s transit agency and head of the national association, told Congress in October that the projects included diesel-electric hybrid buses for Chicago; a new bus maintenance shop for Eugene, Ore.; and a set of crossover tracks to allow San Francisco’s rapid transit trains to turn around more quickly and carry more riders.

The Obama aide said the residential smart meters were a relatively small project that would not create a large number of jobs, but the aide said they would be an essential building block for the electric grid of the future. The new grid — a multiyear, multibillion-dollar project — would more efficiently move electricity from its source to its destination and would reward those who saved power or used it during off-peak hours.

Senator Jeff Bingaman, Democrat of New Mexico, who heads the Energy and Natural Resources Committee, said he was sympathetic to Mr. Obama’s desire to pump up the economy and reduce energy usage. But Mr. Bingaman said he was wary of big government spending programs without sufficient oversight or expertise.

“Just buying smart meters for everybody doesn’t really move the ball very far,” said Mr. Bingaman, who will hold a hearing next week to gather ideas for energy-related stimulus spending. “Realistically speaking, getting money properly spent in a short period of time requires some degree of competence in the government agency doing it.

The best plan is to start with existing programs that work, like weatherization, and build on those.”

Bingaman doesn’t get the big idea. But I know you do! Change is coming. Ideas welcome.

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