US House passes sweeping energy package; Senate discussions continue

The US House of Representatives Apr. 11 approved on a 247-175 vote a comprehensive energy bill largely similar to a proposal it passed in August 2001 that largely follows the White House's domestic energy policy blueprint.

April 16, 2003

2 min read

By OGJ editors
WASHINGTON, DC, Apr. 16 -- The US House of Representatives Apr. 11 approved on a 247-175 vote a comprehensive energy bill largely similar to a proposal it passed in August 2001 that largely follows the White House's domestic energy policy blueprint.

The Senate will resume consideration of its own energy plan when Congress returns from recess at month's end.

The House measure again includes a controversial plan to lease a portion of the coastal plain of the Arctic National Wildlife Refuge. In addition to that highlight, the House bill provides new royalty relief measures, updated clean fuel rules including an ethanol mandate plan, and wholesale electricity market restructuring (OGJ Online, Apr. 4, 2003).

Industry groups largely praised the bill because it emphasizes domestic production and streamlined permitting for public lands. And predictably, environmental groups uniformly denounced the House bill just like they did in 2001. They maintain the bill does little to improve energy efficiency and ignores clean air problems associated with burning fossil fuels.

Taxes appear to be the biggest difference between the Aug. 2001 version and this new version. The old proposal contained more than $36 billion in energy tax measures over a 10-year period. This latest plan is scored at $18 billion with oil and gas provisions expected to cost $6-7 billion.

Although the White House has endorsed the House measure, the Office of Management and Budget told lawmakers in an Apr. 10 letter that it is concerned about the "significant and direct cost" of the tax provisions, which exceed President George W. Bush's budget requests. But most industry lobbyists do not expect those concerns to translate into a veto.

A pending Senate plan contains similar tax incentives and also includes fiscal incentives for an Alaskan natural gas export pipeline that the White House does not want in the budget.

The White House also wants to wait before expanding the 700 million bbl capacity Strategic Petroleum Reserve to 1 billion bbl as recommended in the House bill.

"The administration recommends we analyze the optimal size of the SPR and review the results of this analysis with the Congress before determining whether further expansion of the SPR is warranted," OMB said.