Oil compromise in the wind?

Could environmentalists and energy-industry supporters be headed for a deal?

It’s not often that the two sectors find common ground, but President Obama’s nuclear deal with Iran might be just the ticket to resolve some longstanding disagreements between the two sides.

The Iran nuclear deal, as evidenced by numerous comments at the Northern Colorado Energy Summit, July 23, has revived efforts to rescind the longstanding ban on exports of domestically produced oil. Many attendees at the Energy Summit  argued that it makes no sense that Iran could be allowed to export oil while the United States remains unable to do so. Still, whether Congress can muster the votes necessary to remove the ban remains to be seen.

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The ban was enacted in 1975 as a way to protect domestic oil supplies and tame gasoline prices after the Arab oil embargo.

Nationally, many pundits have likened the ban to sanctions on the United States itself –self-imposed sanctions. Some say that it only plays into the hands of nations such as Iran, Venezuela and Russia.

The Washington Post this week endorsed an end to the ban, and a Senate committee has passed just such a measure. The Post points out that increased U.S. production – up 74 percent since 2008 – has contributed to a glut of oil stateside.

Export supporters theorize that U.S. exports would increase prices for U.S. crude but lower gasoline prices, which are driven by international factors.

As the negative effects of lower energy prices start to filter through the economy, pressure will mount for an end to the ban to help domestic producers and their suppliers.

But environmentalists generally oppose lifting the ban, arguing that the planet needs to accelerate the shift to renewable energies. They argue that hydraulic fracturing, which has spurred the boom in U.S. production, damages the environment and delays measures necessary to combat climate change.

But politics could give way to some strange alliances, if environmentalists and oil-industry backers could bring themselves to compromise on the ban.

The Washington Post suggests a deal that could get environmentalists onboard: Rescind the ban, while also boosting funding for energy research and efficiency programs, and imposing a carbon tax.

While a carbon tax stands little chance of passing Congress, the other measures could garner enough support for a compromise. Perhaps now is also the time for a longer-term extension of renewable-energy tax credits, a national renewable-energy standard similar to what’s in place in Colorado and commitments to reduce methane emissions from domestic production.

Colorado’s senators could help spur such a compromise. Sen. Cory Gardner heralds from a part of the state rich not only in oil and gas production but also in wind-energy jobs and production. (Think Vestas.) Sen. Michael Bennet has taken some hits from environmentalists for his support of the Keystone pipeline.

A deal that benefits both renewable and traditional energy could be just what both senators – not to mention Congress and the Obama administration – need.

Christopher Wood can be reached at 303-630-1942, 970-232-3133 or cwood@bizwestmedia.com.