Forming what one pro-environmental group called a “green dream team,” President-elect Barack Obama has settled on Nobel Prize-winning physicist Steven Chu, who runs the Lawrence Berkeley National Laboratory at the University of California, to be secretary of the Department of Energy (DOE) in his administration, and has selected experienced regulators to oversee three other offices dealing with energy, environmental and climate-change issues, Washington sources said. No formal announcement, however, had been issued last week.

Obama will choose Carol Browner, administrator of the Environmental Protection Agency (EPA) for eight years in the Clinton administration, for a new White House post overseeing energy, environmental and climate policy, sources said (see NGI, Dec. 8). Browner, who was closely involved in the Obama campaign, is a principal at The Albright Group LLC, which is headed by former Secretary of State Madeleine K. Albright.

Obama also is reported to have selected Lisa P. Jackson, currently chief of staff to New Jersey Gov. Jon S. Corzine and former commissioner of the state’s Department of Environmental Protection, as EPA administrator. And Nancy Sutley, deputy mayor for energy and development in Los Angeles, will be picked to head the White House Council on Environmental Quality (CEQ), insiders said. She previously served as former California Gov. Gray Davis’ energy advisor during the state’s rolling blackouts of 2000-2001, and was special assistant to then-EPA Administrator Browner.

“Steven Chu has proven himself not only as one of the world’s great energy scientists, but also as a powerful advocate for fighting the effects of global warming. The choice of a Nobel Prize-winning scientist to head the Department of Energy foreshadows a new age for energy policy, one in which we decide our country’s energy future based on science instead of politics,” said the League of Conservation Voters, an environmental advocacy group.

Obama “is wise to create a position that will coordinate climate change policy between agencies and departments, and Carol Browner is the perfect candidate for that vital role,” the group further noted.

By creating the White House post, “it seems the president-elect wants to keep pretty direct control over energy and environmental policy in the White House,” said Martin Edwards, vice president of legislative affairs for the Interstate Natural Gas Association of America (INGAA). He believes Browner is “going to have more control” over environmental policy than Jackson will at the EPA.

“We see an unmistakable trend: environmental stewardship will drive energy policy in the next administration, and the energy department will be the engine of research science. Obama’s pick for Interior secretary remains outstanding, but we expect that his choice will complete the green trend and signal stricter Endangered Species Act enforcement, longer environmental reviews for extractive industries and tighter regulation of oil and gas drilling and coal mining,” said Friedman Billings Ramsey Research.

“This accompanies a leftward power shift on [Capitol] Hill, most visible in Rep. Henry Waxman’s (D-CA) besting incumbent Chairman John Dingell (D-MI) for the House Energy and Commerce Committee gavel,” FBR added (see NGI, Nov. 24).

Thomas J. Pyle, president of the Institute for Energy Research, expressed some concern about the apparent selection of Sutley for the CEQ. “Advocates of responsibly developing America’s abundant homegrown energy reserves had hoped the new president would use the CEQ appointment to send a signal to the country and the world that securing our nation’s energy future will be a top priority of his administration. The apparent selection of Ms. Sutley for this important post does not appear to meet this mandate, though we remain hopeful that her tenure during this critical time will prove to be a successful one.”

No one from the oil and natural gas industry has ever been named DOE secretary. The only electricity executive who was appointed energy secretary was Hazel O’Leary, former vice president of Northern States Power Co. She headed up the DOE between 1993-1997.

The focus of the DOE is nuclear weapons, rather than crude oil, natural gas and electricity. “About 70% of its budget is nuclear related…It has a huge role in building nuclear bombs” and storing them, INGAA’s Edwards said. Energy is a “side show.”

Although “we don’t have a history with Chu, we look forward to working with him,” said Lee Fuller, vice president of government affairs for the Independent Petroleum Association of America.

He noted that the DOE provides producers, particularly independent producers, with two benefits. It plays a “very active role” in the research and development of new technologies to enhance oil and gas production, and it provides a “voice for energy development” when federal agencies are developing new regulations, Fuller said.

With respect to natural gas, Edwards acknowledged that the DOE has “played a significant role in the development of technology that facilitated the boom in unconventional gas production.” But “industry has kind of become a victim of its own success,” with new supply flooding the market and driving down gas prices, he said.

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