[Congressional Record Volume 143, Number 29 (Monday, March 10, 1997)]
[Senate]
[Pages S2086-S2087]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. MURKOWSKI:
  S. 417. A bill to extend energy conservation programs under the 
Energy Policy and Conservation Act through September 30, 2002; to the 
Committee on Energy and Natural Resources.


          the energy policy and conservation act authorization

 Mr. MURKOWSKI. Mr. President, this bill is very simple, yet it 
is extremely important to our Nation's energy security. This bill 
contains the authorizations for two vital energy security measures, the 
Strategic Petroleum Reserve and U.S. participation in the International 
Energy Agency, which will expire at the end of this fiscal year. This 
bill would extend those two vital authorities, as well as several other 
important DOE programs, through 2002.
  For every year in recent memory, we have authorized this act on a 
year-to-year basis, and we have faced a potential crisis as these 
authorizations go unrenewed until the very end of the Congress. We 
always seem to end up facing a situation where the President does not 
have authority to withdraw oil from the Strategic Petroleum Reserve if 
an energy emergency occurs.
  Further, if these authorities are not renewed, our Government does 
not have authority to participate in International Energy Agency 
emergency actions in an international energy emergency. There will be 
no antitrust exemption available to our private oil companies to allow 
them to cooperate with the IEA and our Government to respond to the 
crisis. These provisions are not controversial in and of themselves, 
but this bill has a tendency to become a vehicle to address concerns 
over unrelated issues.
  In an attempt to avoid the annual crisis, I am introducing 
legislation today that will renew these authorities for 5 years. The 
bill also provides for the leasing of extra capacity in our reserve 
facilities and changes to the antitrust exemption in the bill to 
comport with the policies adopted by the IEA at our request.
  Although it appears to be easy for some to disregard these dangers, 
recent events have underscored exactly how precarious this Nation's 
energy security is. Events in the Middle East clearly demonstrate the 
instability of the region that we rely on to supply the oil that keeps 
this Nation moving.
  The situation is only getting worse. Since the establishment of the 
Department of Energy, our reliance on imported oil has passed 50 
percent, and is expected to rise to 71 percent by 2015. The OPEC 
countries are steadily regaining lost market share and it is projected 
to exceed 50 percent by 2000. The U.S. economy appears to be as exposed 
as it was in the early 1970's to supply disruptions and losses from 
monopoly oil pricing. We are talking about jobs and people's lives. In 
the face of these numbers, DOE has no real plan to stop our slide into 
near complete dependence on foreign sources of oil, and the President's 
budget contains a proposal to sell 67 million barrels of oil from the 
SPR in the year 2002.
  I am dismayed by a recent trend toward using the SPR as a piggy bank 
to pay for other programs. The oil in the SPR cost an average of $27 
per barrel. We have sold it for anywhere from $18 to $20 per barrel. 
Buying high and selling low never makes sense. We're like the man in 
the old joke who was buying high and selling low who claimed that he 
would make it up on volume.
  In the face of our growing oil dependence, and the administration's 
proposal to sell oil from the SPR, I can't resist noting the 
administration's opposition to the production of our domestic oil 
resources. The administration does not support the domestic storage or 
production of oil. They do not appear to like the reality that this 
Nation will continue to need petroleum. However, reality doesn't cease 
to be reality because we ignore it.
  We have already invested a great deal of taxpayer money in these 
stockpiles. As proven during the Persian Gulf war, the stabilizing 
effect of an SPR drawdown far outstrips the volume of oil sold. The 
simple fact that the SPR is available can have a calming influence on 
oil markets. The oil is there, waiting to dampen the effects of an 
energy emergency on our economy. However, if we don't ensure that there 
is authority to use the oil when we need it, we will have thrown those 
tax dollars away.
  So, the first step is to ensure that our emergency oil reserves are 
fully authorized and available to dampen the effects of the most severe 
supply disruptions. We are talking about people's lives and jobs. The 
least we can do is try to limit the possibility that this measure will 
be held hostage to political ambition.
  I urge my colleagues to support the passage of this legislation. I 
would also like to introduce, by request, proposed legislation 
transmitted by the administration. I ask unanimous consent that the 
administration's transmittal letter be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:


[[Page S2087]]




                                      The Secretary of Energy,

                                    Washington, DC, March 6, 1997.
     Hon. Al Gore,
     President of the Senate,
     Washington, DC.
       Dear Mr. President: Enclosed is a legislative proposal 
     cited as the Energy Policy and Conservation Act Amendments of 
     1997. This proposal would amend and extend certain 
     authorities in the Energy Policy and Conservation Act (EPCA) 
     which either have expired or will expire September 30, 1997, 
     as well as a weatherization provision in the Energy 
     Conservation and Production Act.
       The EPCA was enacted in 1975. Title I authorizes creation 
     and maintenance of the Strategic Petroleum Reserve (the 
     Reserve), which is the Nation's first line of defense in 
     responding to domestic and international oil supply 
     disruptions. Title II contains authorities essential for 
     maintaining a continuing commitment to the International 
     Energy Program administered by the International Energy 
     Agency (IEA) in Paris. Effective participation by the United 
     States in the IEA is critical to assuring our allies of our 
     mutual energy emergency preparedness in the event of a severe 
     interruption of international oil supplies. Title III 
     contains authorities for certain energy efficiency and 
     conservation programs.
       As a result of changes in the overall energy environment 
     since the Reserve was authorized in 1975, the Department is 
     conducting a comprehensive review of Reserve policy. That 
     review will be completed during fiscal year 1997. If the 
     review results in recommendations for changes in title I of 
     EPCA, the Department will submit a legislative proposal under 
     separate cover. This would include proposals relating to 
     title I similar to those submitted to the Congress in October 
     1995.
       Since Reserve and other authorities under EPCA expire on 
     September 30, 1997, it is necessary to extend, until 
     September 30, 1998, authorization for EPCA titles I and II, 
     and several provisions in title III, as well as the 
     Department's weatherization program in title IV of the Energy 
     Conservation and Production Act. The Administration also is 
     proposing amendments to certain provisions in EPCA title II 
     to ensure that the legal authorities for U.S. oil company 
     participation in the IEA's emergency preparedness programs 
     are fully in accord with current U.S. and IEA emergency 
     response policy. The United States has long advocated a 
     policy at the IEA of coordinated drawdown of government-
     controlled oil stockpiles (e.g., the Reserve) to respond to 
     international oil supply disruptions, with reference on the 
     IEA's emergency oil allocation program as a last resort. This 
     is now IEA's accepted policy. Unfortunately, EPCA's current 
     antitrust provisions do not enable U.S. oil companies to take 
     part in the full range of IEA oil crisis planning activities. 
     The Administration's proposed bill would amend the present 
     limited antitrust defense available to U.S. oil companies to 
     enable them to assist the IEA in planning or implementing a 
     coordinated drawdown of government-controlled oil stockpiles.
       The proposed legislation and a sectional analysis are 
     enclosed. The Office of Management and Budget advises that 
     submission of this proposal to the Congress would be in 
     accord with the President's program.
       We look forward to working with the Congress toward 
     enactment of this legislation.
           Sincerely,
                                                Charles B. Curtis,
                                                 Acting Secretary.

                           Section-by-Section


        section 2. energy policy and conservation act amendments

       Section 2 of the bill would amend the Energy Policy and 
     Conservation Act.
       Paragraph (1) would amend section 166 of EPC to authorize 
     appropriations necessary to implement the Strategic Petroleum 
     Reserve for fiscal year 1998.
       Paragraph (2) would amend section 181 of EPCA by extending 
     the expiration date of title I, parts B and C from September 
     30, 1997 to September 30, 1998.
       Paragraph (3) is a technical correction which would amend 
     section 251(e)(1) by striking section ``252(1)(l)'' and 
     inserting in lieu thereof ``252(k)(l).''
       Paragraph (4) would amend section 252 of EPCA, which makes 
     available to United States oil companies a limited antitrust 
     defense and breach of contract defense for actions taken to 
     carry out a voluntary agreement or plan of action to 
     implement the ``allocation and information provisions'' of 
     the Agreement on an International Energy Program (``IEP''). 
     These limited defenses are now available only in connection 
     with the companies' participation in planning for and 
     implementation of the IEP's emergency oil sharing and 
     information programs. The amendment would extend the section 
     252 antitrust defense (but not the breach of contract 
     defense) to U.S. companies when they assist the International 
     Energy Agency (``IEA'') in planning for and implementing 
     coordinated drawdown of government-owned or government-
     controlled petroleum stocks. In 1984, largely at the urging 
     of the United States, the IEA's Governing Board adopted a 
     decision on ``Stocks and Supply Disruptions'' which 
     established a framework for coordinating the drawdown of 
     member countries' government-owned and government-controlled 
     petroleum stocks in those oil supply disruptions that appear 
     capable of causing severe economic harm, whether or not 
     sufficient to activate the IEP emergency oil sharing and 
     information programs. During the 1990-91 Persian Gulf crisis, 
     the IEA successfully tested the new coordinated stockdraw 
     policy.
       Subparagraph (4)(A) would amend subsection 252 (a) and (b) 
     of EPCA. These sections would be amended by substituting the 
     term ``international emergency response provisions'' for the 
     term ``allocation and information provisions of the 
     international energy program.'' The new term establishes the 
     scope of oil company activities covered by the antitrust 
     defense and includes actions to assist the IEA in 
     implementing coordinated drawdown of petroleum stocks.
       Subparagraph (4)(B) would amend paragraph 252(d)(3) of EPCA 
     to clarify that a plan of action submitted to the Attorney 
     General for approval must be as specific in its description 
     of proposed substantive actions as is reasonable ``in light 
     of circumstances known at the time of approval'' rather than 
     ``in light of known circumstances.''
       Subparagraph (4)(C) would amend paragraph 252(e)(2) of EPCA 
     to give the Attorney General flexibility in promulgating 
     rules concerning the maintenance of records by oil companies 
     related to the development and carrying out of voluntary 
     agreements and plans of action.
       Subparagraph 4(D) would amend paragraph 252(f)(2) of EPCA 
     to clarify that the antitrust defense applies to oil company 
     actions taken to carry out an approved voluntary agreements 
     as well as an approved plan of action.
       Subparagraph 4(E) would amend section 252(h) of EPCA to 
     strike the reference to section 708(A) of the Defense 
     Production Act of 1950, which was repealed by Public Law 102-
     558 (October 28, 1992), and the reference to the Emergency 
     Petroleum Allocation Act of 1973, which expired in 1981.
       Subparagraph 4(F) would amend subsection 252(i) of EPCA to 
     require the Attorney General and the Federal Trade Commission 
     to submit reports to Congress and to the President on the 
     impact of actions authorized by section 252 on competition 
     and on small businesses annually rather than every six 
     months, except during an ``international energy supply 
     emergency,'' when the reports would be required every six 
     months.
       Subparagraph 4(G) would amend paragraph 252(k)(2) of EPCA 
     by substituting a definition of the term ``international 
     emergency response provisions'' for the present definition of 
     ``allocation and information provisions of the international 
     energy program.'' The new term, which establishes the scope 
     of company actions covered by the antitrust defense, covers 
     (A) the allocation and information provisions of the IEP and 
     (B) emergency response measures adopted by the IEA Governing 
     Board for the coordinated drawdown of stocks of petroleum 
     products held or controlled by governments and complementary 
     actions taken by governments during an existing or impending 
     international oil supply disruption, whether or not 
     international allocation of petroleum products is required by 
     the IEP.
       Subparagraph 4(H) would amend subsection 252(l) of the EPCA 
     to make clear that the antitrust defense does not extend to 
     international allocation of petroleum unless the IEA's 
     Emergency Sharing System has been activated.
       Paragraph (5) would amend section 256(h) of EPCA to 
     authorize appropriations for fiscal year 1998 for the 
     activities of the interagency working group and interagency 
     working subgroups established by section 256 of EPCA to 
     promote exports of renewable energy and energy efficiency 
     products and services.
       Paragraph (6) would amend section 281 of EPCA by extending 
     the expiration date of title II from September 30, 1997, to 
     September 30, 1998.
       Paragraph (7) would amend section 365(f)(1) to provide 
     authorization for appropriations in fiscal year 1998 for 
     State Energy Conservation Programs.
       Paragraph (8) would amend section 397 to provide 
     authorization for appropriations in fiscal year 1998 for the 
     Energy Conservation Program for Schools and Hospitals.
       Paragraph (9) would amend section 400BB to extend the 
     authorization for the appropriation for the Alternative Fuels 
     Truck Commercial Application Program to fiscal year 1998.


      section 3. energy conservation and production act amendment

       Section 3 would amend section 422 of the Energy 
     Conservation and Production Act to provide authorization for 
     appropriation for the weatherization program in fiscal year 
     1998.
                                 ______