E2-Wire

* Much more oil is leaking into the Gulf of Mexico than previously believed

U.S. Coast Guard officials said the damaged BP well could be leaking as much as 5,000 barrels per day into the Gulf following last week’s explosion. The amount is five times larger than previous estimates.

“There’s an additional breach in the well,” Coast Guard spokesman Erik Swanson said in this Bloomberg account of efforts to contain the spill before it reaches fragile shorelines.

The April 20 blast and resulting oil spill are roiling the political battle over offshore drilling.

Read more...

The authors of Senate climate and energy legislation on Wednesday sent the draft measure to the U.S. EPA for modeling, a sign that the senators are continuing to prepare for possible floor debate even though the bill has stalled on Capitol Hill.

The EPA analysis is expected to take roughly five weeks and will yield forecasts of effects such as predicted household costs.

The step comes as the bill itself is in limbo politically. Sen. Lindsey Graham (R-S.C.) has suspended his support for advancing the measure he crafted with Sens. John Kerry (D-Mass.) and Joe Lieberman (I-Conn.).

Senate Majority Leader Harry Reid said he will not move immigration reform before a comprehensive energy and climate bill.

President Barack Obama on Wednesday touted ethanol – both the current variety and next-wave fuels – as a key part of his energy strategy and a way to revive rural economies.

Obama endorsed expanded ethanol production during a speech at a Macon, Missouri plant owned by POET, the country’s largest ethanol producer.

“I believe in the potential of what you are doing right here to contribute to our clean energy future but also to our economy,” Obama said at the plant that produces 46 million gallons per year.

The Interior Department has approved the Cape Wind project that is slated to be the nation’s first offshore wind farm.

An array of companies including Nike, eBay, Levi Strauss and Starbucks on Wednesday pressed the Senate to get stalled climate and energy legislation “back on track.”

“Every day the Senate fails to pass comprehensive climate and energy legislation is a day our economy falls another step behind and delays our ability to create millions of new American jobs,” states an open letter from the business coalition We Can lead.

The letter is the latest effort by climate advocates to revive legislation that has been imperiled by a partisan battle over immigration reform.

Dueling letters from members of Congress paint a different picture of a controversial drilling technique that has raised natural gas supplies but poses an environmental hazard according to critics.

Two House members – one Democrat, one Republican – said federal oversight of a controversial natural gas drilling technique would raise costs with little public health benefit. Reps. Mike Ross (D-Ark.) and John Sullivan (R-Okla.), both members of the Energy and Commerce Committee, wrote panel leaders to urge them to back-off from an apparent push to regulate hydraulic fracturing through the Safe Drinking Water Act.

Fracturing, or fracking, has given gas companies access to reserves trapped in hard shale rock formations, but critics say it has the potential to pollute drinking water supplies. Water, sand and chemicals are injected into the rock to free trapped natural gas in the process.

Read more...

Interior Secretary Ken Salazar “appears poised” to announce his approval of a controversial wind farm slated to be built in federal waters off the Massachusetts coast, according to the Boston Globe.

Salazar has scheduled a press conference in Boston at noon Wednesday and will “make a major announcement concerning the Cape Wind project,” Interior said this morning, but provided no details about the decision on the proposed 130-turbine project.

But the Boston Globe’s website reports that Salazar plans to give the project – which has been planned for nine years – a green light.

* Rig explosion presents another hurdle for climate change legislation

The oil flowing out of a well head into the Gulf of Mexico after a rig erupted and sank last week likely complicates efforts to pass a sweeping climate change bill this year, says the New York Times.

NYT's John Broder reports that, “The loss of life and the looming ecological catastrophe…have piled political complications onto the push for energy and climate change legislation here, officials and interest groups say.”

As even not-so-faithful readers of E2 Wire can attest, the legislation’s call to expand offshore drilling is seen as carrot to attract support from the center. But expanding access in the outer continental shelf also may cost some support among Democrats.

Read more...