Senators stake out positions in US energy legislation

June 21, 2005
Senate energy leaders said they expect floor debate to conclude and their 2005 energy bill to come to a vote by the end of the week.

Nick Snow
Washington Correspondent

WASHINGTON, DC, June 21 -- Senate energy leaders said they expect floor debate to conclude and their 2005 energy bill to come to a vote by the end of the week.

"Several important amendments have been offered, debated, and voted on," Energy and Natural Resources Committee Chairman Pete V. Domenici (R-NM) said June 20. "We are farther along than I expected us to be at this point."

A number of senators have staked out positions already by offering amendments to HR 6, the bill approved by the House in late April. In doing so, they have presented sometimes dramatic contrasts to the House legislation.

Votes on the proposed amendments have generally followed predictable patterns. A change offered by Florida's two senators, Democrat Ben Nelson and Republican Mel Martinez, would have struck language calling for the Minerals Management Service to conduct an inventory of outer continental shelf oil and gas resources.

It failed by 52 to 44 votes on June 21. But its strongest support came from other coastal state senators outside Louisiana and Texas.

"The Bush White House is hell-bent on drilling off Florida," Nelson said following the vote. "Why take an inventory in an area where they've guaranteed there won't be any drilling? All it is is the next step toward drilling off the coast of Florida."

He said the vote came a week after he had won a pledge from Domenici and Jeff Bingaman (D-NM), the committee's ranking member, to preserve a ban on drilling off Florida until 2012.

Nelson and Martinez said they would now try to get federal lawmakers to let Florida stop an inventory off its coast if state leaders don't want it.

"There may be a compromise that will allow us to just take Florida out of this," Martinez said after the vote.

Ambitious goals
Democrats entered the floor debate planning to offer amendments that would establish ambitious goals to reduce US dependence on foreign oil; boost production of clean, renewable energy; and address global warming.

Maria Cantwell (D-Wash.) was first, with her proposal to set a goal to reduce oil imports by 40%, or more than 7.6 million b/d, from the 19.1 million b/d of imports that the US Energy Information Administration forecasts for 2025 in its latest Annual Energy Outlook.

Supporters argued that setting such a goal would focus attention on developing technology and alternative sources to meet it. Opponents responded that the proposal was vague and unrealistic. It failed by 53 to 47 votes.

Next was Bingaman's proposed amendment to require electric utilities to get minimum annual percentages of power from renewable sources, culminating at 10% from 2020 through 2030. The program would set up a system of renewable energy credits to be traded among electric utilities.

Action on global warming looked less likely. Domenici conceded that "we need to do something to address climate change" but added that there would not be time to prepare an addition to the current bill based on findings of the National Commission on Energy Policy.

Domenici said the commission's recommendations "are an important step toward controlling carbon emissions but do so with a much smaller impact on the economy" than the Kyoto accords or an earlier bill cosponsored by John McCain (R-Ariz.) and Joseph L. Lieberman (D-Conn.).

Bingaman expressed disappointment that there would not be time during the energy bill's debate to discuss global warming. The commission's plan would set in motion "a mandatory, economy-wide program for greenhouse gas reductions that will start a gradual, but decisive, shift in energy policy toward low-carbon energy sources, without any material effect on our economy."

SPR amendments
Two proposed amendments involved the Strategic Petroleum Reserve. The first, from Ron Wyden (D-Ore.) and Byron L. Dorgan (D-ND), would order the energy secretary to fill the reserve to 1 billion bbl "as expeditiously as practicable, without incurring excessive cost or appreciably affecting the price of gasoline or heating oil to consumers."

The SPR now holds 696 million bbl and has storage capacity of 727 million bbl.

Purchases would be suspended when crude oil closed at more than $58.28/bbl (adjusted for the consumer price index) for 10 consecutive trading days and resume when the price dropped below $40/bbl for 10 consecutive trading days.

The second proposal came from Charles H. Schumer (D-NY). Its provisions included directing the Federal Trade Commission and the attorney general to exercise oversight to prevent consumer price gouging. It also would release 1 million b/d of crude from the SPR for 30 days following its enactment.

Senators were debating a package of energy tax initiatives that had cleared the finance committee. They included temporary expensing for refining equipment, a pass-through to customers of costs incurred by small refining cooperatives of complying with Environmental Protection Agency sulfur regulations, modifications to the enhanced oil recovery credit, and treatment of natural gas distribution lines as 15-year properties.

There was no indication that the Senate would take up methyl tertiary butyl ether liability protection or authorization of drilling in the Arctic National Wildlife Refuge before its final vote. Both are part of HR 6, which sets the stage for a showdown when the House and Senate try to reconcile their energy bills in conference next month.

Contact Nick Snow at [email protected].