[Congressional Record Volume 149, Number 116 (Thursday, July 31, 2003)]
[Senate]
[Pages S10569-S10574]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
ENERGY POLICY ACT OF 2003--Continued
The PRESIDING OFFICER. The Senator from Mississippi.
Mr. LOTT. Mr. President, what is the regular order?
The PRESIDING OFFICER. There is an order to proceed to the House
Energy bill and substitute last year's Senate language.
Mr. LOTT. Mr. President, are we ready to proceed?
The PRESIDING OFFICER. The Senate is ready to proceed.
Mr. LOTT. Reluctantly and temporarily, Mr. President, I suggest the
absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. LOTT. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. LOTT. Mr. President, I believe we are ready to proceed to the
regular order.
The PRESIDING OFFICER. The clerk will report H.R. 6.
The legislative clerk read as follows:
A bill (H.R. 6) to enhance energy conservation and research
and development, to provide for security and diversity in the
energy supply for the American people, and for other
purposes.
The PRESIDING OFFICER. Under the previous order, the text of the
Senate amendment to H.R. 4 from the 107th Congress is inserted in lieu
of the House language.
The amendment (No. 1537) is printed in today's Record under ``Text of
Amendments.''
The question is on the engrossment of the amendment and third reading
of the bill.
The amendment was ordered to be engrossed, and the bill to be read a
third time.
The bill was read a third time.
The PRESIDING OFFICER. The bill having been read the third time, the
question is, Shall the bill pass?
Mr. CRAIG. Mr. President, have the yeas and nays been ordered?
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The PRESIDING OFFICER. They have not been ordered.
Mr. CRAIG. Mr. President, I ask for the yeas and nays.
The PRESIDING OFFICER. Is there a sufficient second?
There appears to be a sufficient second.
The clerk will call the roll.
The legislative clerk called the roll.
Mr. REID. I announce that the Senator from Massachusetts (Mr. Kerry)
and the Senator from Connecticut (Mr. Lieberman) are necessarily
absent.
I further announce that if present and voting, the Senator from
Massachusetts (Mr. Kerry), would vote ``nay.''
The PRESIDING OFFICER (Mr. Talent). Are there any other Senators in
the Chamber desiring to vote?
The result was announced--yeas 84, nays 14, as follows:
[Rollcall Vote No. 317 Leg.]
YEAS--84
Akaka
Alexander
Allard
Allen
Baucus
Bayh
Bennett
Biden
Bingaman
Bond
Breaux
Brownback
Bunning
Burns
Byrd
Campbell
Carper
Chafee
Chambliss
Cochran
Coleman
Collins
Conrad
Cornyn
Corzine
Craig
Crapo
Daschle
Dayton
DeWine
Dodd
Dole
Domenici
Dorgan
Durbin
Edwards
Ensign
Enzi
Fitzgerald
Frist
Graham (FL)
Graham (SC)
Grassley
Gregg
Hagel
Harkin
Hatch
Hollings
Hutchison
Inhofe
Inouye
Jeffords
Johnson
Kohl
Landrieu
Leahy
Levin
Lincoln
Lott
Lugar
McConnell
Mikulski
Miller
Murkowski
Nelson (FL)
Nelson (NE)
Nickles
Pryor
Reid
Roberts
Rockefeller
Santorum
Sarbanes
Sessions
Shelby
Smith
Snowe
Specter
Stabenow
Stevens
Talent
Thomas
Voinovich
Warner
NAYS--14
Boxer
Cantwell
Clinton
Feingold
Feinstein
Kennedy
Kyl
Lautenberg
McCain
Murray
Reed
Schumer
Sununu
Wyden
NOT VOTING--2
Kerry
Lieberman
The bill (H.R. 6), as amended, was passed.
Mr. DASCHLE. Mr. President, I move to reconsider the vote.
Mr. FRIST. I move to lay that motion on the table.
The motion to lay on the table was agreed to.
The PRESIDING OFFICER. Under the previous order, the Senate insists
on its amendment, requests a conference with the House on the
disagreeing votes of the two Houses, and the Chair is authorized to
appoint conferees on the part of the Senate in a ratio of 7 to 6.
colloquoy on Amendment 1473
Mr. SMITH. Mr. President, today I have joined with my colleague from
Alaska to sponsor an amendment to S.14, the Energy bill, which would
strengthen the commitment of the United States to supply oil to Israel
and other nations pursuant to the International Emergency Oil Sharing
Plan of the International Energy Agency.
The United States is currently party to two agreements to ensure that
in the event Israel was unable to independently acquire its own supply
of oil, the United States Government would procure the necessary oil to
meet Israel's needs.
Ms. MURKOWSKI. Mr. President, this amendment would make both
agreements part of the United States law, rather than subject to
continued renewal agreements. Further, the amendment also authorizes
the President to export oil to, or secure oil for, Israel pursuant to
these agreements, or to any country that is part of the International
Emergency Oil Sharing Plan.
This language also ensures that should legislation reinstating a ban
on the exportation of domestic oil be implemented in the future, the
United States would still be able to meet its obligations to Israel.
Mr. SMITH. I believe it is important to ensure that the United States
can fulfill its commitment to this vital ally. I want to clarify,
however, that nothing in this language would authorize the President to
permit oil exploration and drilling in areas currently not legally open
to development. Is that also your understanding of the language?
Ms. MURKOWSKI. That is correct. No areas where drilling is prohibited
could be developed under this language.
Mr. SMITH. I thank my colleague for that clarification.
landfill gas tax credits
Mrs. LINCOLN. Mr. President, I want to congratulate Chairman Grassley
and Ranking Member Baucus on this package of energy tax incentives. But
also I would like to raise two concerns with the bill, which I request
they address in the House-Senate conference on the energy bill.
On February 11 of this year, I introduced S. 358, the Capturing
Landfill Gas for Energy Act of 2003. My bill is cosponsored by Senators
Santorum and Hatch and would provide a credit under either Section 29
or 45 of the Tax Code for the production of energy from landfill gas,
or LFG.
In the past, Congress has recognized the importance of LFG for energy
diversity and national security by providing a Section 29 credit in
1980 and extending it for nearly two decades. However, the bill before
us provides no Section 45 credit for LFG, and it severely limits the
Section 29 credit by applying a volume cap of 200,000 cubic feet per
day. In contrast, the President proposed a Section 29 credit for LFG
with no volume cap, and the House has passed a Section 45 credit for
LFG. Both of these proposals would provide meaningful tax incentives to
encourage the collection and use of LFG. Thus, the Senate bill falls
well short of recognizing the importance of dealing with LFG, and I
urge the Chairman to address this shortfall in the House-Senate
conference.
My second concern deals with a provision included in the Senate
energy tax bill which would clarify the definition of ``landfill gas
facility'' for purposes of Section 29. I am grateful to have worked
with the chairman and ranking member of this provision, but I am
concerned that we have not yet found the proper solution.
Typically, a landfill is comprised of a number of ``cells.'' A cell
is filled with trash, closed up, and then a new cell is filled. Over
time, cells within the landfill begin to generate methane gas as the
garbage decomposes. So a landfill produces methane gas in stages as the
individual cells produce LFG, and new ``wells, pipes, and related
components'' are run from the landfill gas facility to collect the gas.
The Tax Code is unclear whether the new components run to cells in
the landfill over time are considered part of the landfill gas
facility, and thus, the question is raised whether gas from these cells
are eligible for the Section 29 tax credit. Under S. 358, a landfill
gas facility would include additional ``wells, pipes, and related
components'' used to collect landfill gas. Further, the new components
of the expansion would share the facility's placed in service date for
purposes of Section 29. For example, the wells, pipes, and related
components added to an eligible facility placed in service in 1997
would share the eligible facility's 1997 placed in service date and gas
produced from the facility would receive the credit for the duration of
the facility's credit pay out period.
In contrast, the provision in the Senate Energy bill would include
all wells, pipes, and related components added to the eligible
facility, but for all expansions placed in service after date of
enactment, the components would be treated as a new facility with a new
placed in service date. The difference is critical since other
provisions of the Senate Energy bill subject new LFG facilities to a
new volume cap of 200,000 cubic feet per day. As I mentioned, this new
volume cap will seriously curtail the use of Section 29 for LFG under
the bill, and it was never my intention to deny payment of the full
credit for gas produced from expansions of the original facility during
the 10-year payout period.
The potential energy and environmental benefits of future LFG
projects are substantial, but they will be lost if we do not provide
adequate provisions to support project development. I request that
Chairman Grassley and Senator Baucus continue to work with me to make
sure Americans garner all of these benefits.
Mr. GRASSLEY. Mr. President, I want to assure Senator Lincoln that I
will continue to work with her to make sure adequate incentives for LFG
are included in any final package from the
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upcoming House-Senate conference. Her concerns are my concerns as well.
She has started them well and I will devote my best efforts to
resolving them as we move forward on discussions and deliberations with
the House of Representatives.
labor law colloquy
Mr. NICKLES. Mr. President, I would like to ask my colleague from New
Hampshire, the chairman of the Committee on Health, Education, Labor
and Pensions, if he shares my understanding that the sense of Congress
contained title 7, section 714, of the Energy bill, H.R. 6, dealing
with project labor agreements, is exclusive to the natural gas
transportation construction project in the State of Alaska under this
title?
Mr. GREGG. I would say to my colleague that he is correct. Further,
the provision is neither legally binding nor should it be construed to
undermine or conflict with Executive Order 13202.
Mr. NICKLES. Mr. President, to further clarify, I ask my colleague,
should the inclusion of this provision be seen as a break from the
longstanding tradition of Federal Government neutrality in labor-
management relations?
Mr. GREGG. No. The sense-of-Congress provision should not be
interpreted to encourage the sponsors of the Alaska natural gas
transportation project to engage in discriminatory hiring or
contracting practices on the basis of a person's labor affiliation or
lack of labor affiliation.
Mr. NICKLES. Mr. President, I thank my colleague from New Hampshire
for his view on this important labor law clarification.
energy tax incentives
Mr. VOINOVICH. Mr. President, I would like to take this opportunity
to express my support for States that provide tax incentives for
ethanol or for electricity produced from clean coal technology or
renewable in their State. For example, in my home State, the Ohio coal
tax credit provides $3 per ton of Ohio coal burned using clean coal
technology. This tax credit encourages use of clean coal technology and
holds down electricity costs in Ohio. With Ohio's large manufacturing
base, affordable energy costs keep costs down to these companies and
keep jobs in the State.
I believe that States should have the opportunity to provide tax
incentives for energy production and am hopeful that this is something
we can address in conference on this bill.
Mr. INHOFE. I agree with my colleague. States should be able to
provide incentives for energy production, much like the Federal
Government does including incentives in this bill. I believe that this
issue is something that should be addressed by the conference committee
on this bill.
Mr. DOMINCI. I understand the concerns raised by the Senators from
Ohio and Oklahoma and would like to work with them to ensure that
States maintain the right to provide these incentives.
CREDIT FOR INSTALLATION OF QUALIFIED FUEL CELLS
Mr. BAUCUS. The Energy Tax Incentives Act provides an incentive for
new business installations of qualified fuel cells. For those in the
future who might be interested in ascertaining the intent of the
authors of this provision, the Finance Committee in drafting this
language did so with the knowledge that there are various types of fuel
cells that convert the chemical energy in fuels, such as hydrogen or
methanol, into electrical energy by means of electrochemical reactions.
Rechargeable fuel cells can convert electricity into chemical energy
that can be stored, and then reconvert that chemical energy into
electrical energy when it is needed. Rechargeable fuel cells can
provide the capability for storing electricity during periods of low
demand and releasing it at periods of high demand. This feature can
help stabilize the output from renewable resources, including wind
generation, electricity generated from swine and bovine waste
nutrients, geothermal power, solar power, and biomass facilities. This
language is intended to encourage the provision of electricity through
non-polluting means, and to assist in the development of alternate,
renewable resources. Our policy is to help develop these and other
alternative, renewable resources.
As the chairman of the Finance Committee who has worked diligently to
develop appropriate incentives for renewable resources, is it also your
view that the proposed credit for qualified fuel cells should include
rechargeable fuel cells, such as those that store electricity generated
from these renewable resources?
Mr. GRASSLEY. As my friend from Montana pointed out, I am pleased
that the tax title of the pending energy conference report includes
several such incentives on which we have dedicated much effort and
attention. Fuel cell power plants represent a promising means for
providing electricity that is generated in environmentally friendly
means and from nonconventional sources. They also provide important
load-leveling capabilities that will reduce the stress and reliance on
our Nation's electricity grid. I am pleased to assure my friend from
Montana that I will work to make sure that rechargeable fuel cell power
plants, such as those he described, would be eligible for this tax
credit.
Mr. BAUCUS. I thank my friend from Iowa for his cooperation on this
issue, and I look forward to continue our efforts to enact this
important energy security legislation.
nuclear waste
Mr. REID. I want to confirm that acceptance of this still does not
create any opportunity to discuss nuclear waste issues in conference.
Mr. DOMENICI. I agree with the Senator's view. I will be a conferee
on this bill. I assure the Senator that I will resist any attempt to
open the conference to discussion of waste issues. I would also like to
note that there are provisions in this bill that will allow the
national labs to play a strong role. From our positions on the Energy
and Water Development Subcommittee, let's work together to ensure their
participation.
Criminal Liability
Mr. INHOFE. I would like to engage the Senator in a colloquy and draw
the Senate's attention to several statutes which have been, through
litigation, expanded beyond what are believed was the intent of
Congress.
Mr. DOMENICI. Is the Senator referring to the criminal negligence
provision of the Clean Water Act and the strict criminal liability
provision of the Migratory Bird Act and the Refuse Act which can be
triggered by a simple accident?
Mr. INHOFE. Precisely. Now, I want to be clear that I do not want to
suggest for a minute that we should make it easier for polluters to
damage the environment or put the public at risk.
Mr. DOMENICI. But the situation the Senator is talking about refers
to clear accidents involving ordinary people, correct?
Mr. INHOFE. Yes. Recent court decisions have made it clear that
employees, at any level, who are involved in environmental accidents,
can be prosecuted criminally, and potentially imprisoned. These are
non-deliberate environmental accidents that do not threaten or harm
others.
Mr. BREAUX. I am also concerned about criminal liability as it
applies to oil spills. In fact, during the 106th Congress, I introduced
legislation to address a long-standing problem which adversely affects
the safe and reliable maritime transport of oil products. The
legislation was aimed at eliminating the application and use of strict
criminal liability statutes, statutes that do not require a showing of
criminal intent or even the slightest degree of negligence, for
maritime transportation-related oil spill incidents.
As stated in the Coast Guard's environmental enforcement directive of
1997, a company, its officers, employees, and mariners, in the event of
an oil spill ``could be convicted and sentenced to a criminal fine even
where [they] took all reasonable precautions to avoid the discharge.''
Accordingly, responsible operators in my home State of Louisiana and
elsewhere in the United States who transport oil are unavoidably
exposed to potentially immeasurable criminal fines and, in the worst
case scenario, jail time. Not only is this situation unfairly targeting
an industry that plays an extremely important role in our national
economy, but it also works contrary to the public welfare.
To preserve the environment, safeguard the public welfare, and
promote the safe transportation of oil, we need to eliminate
inappropriate criminal liability that otherwise undermines spill
prevention and response activities. I
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pledge my support to work with my colleagues to address these
environmental liability issues.
Mr. INHOFE. The American Waterways Operators have devoted a great
deal of time to training mariners and vessel operators. Clearly, the
Coast Guard goes to great lengths to ensure its officers and staff are
well trained. However, unfortunately, accidents--true accidents--
happen.
Mr. DOMENICI. My colleagues are clearly describing a legal minefield
where employees involved in an accident become less likely to cooperate
with accident investigations because they are being advised by counsel
not to potentially incriminate themselves.
Mr. INHOFE. That is absolutely correct.
Mr. DOMENICI. And as chairman of the Environment and Public Works
Committee, is it the Senator from Oklahoma's position that this leads
to less environmental safety instead of more?
Mr. INHOFE. Indeed. I also wish to draw the Senator's attention to
the Clean Air Act, which has a different, and I suggest, more
appropriate provision of negligent endangerment.
Mr. DOMENICI. I am familiar with the provisions--it requires risk of
physical harm to the public for an accident to trigger criminal
prosecution.
Mr. INHOFE. Yes. That is the type of activity for which we should
reserve criminal prosecution. I also remind my colleague that the Clean
Water Act clearly allows prosecution for deceitful or purposeful
environmental damage, or for fraudulent efforts to conceal such
damage--a provision we would not change.
Mr. DOMENICI. I agree with the Senators' assessment, share their
concern, and look forward to working with them to address this
important issue.
Cantwell Amendment
Mr. DASCHLE. Mr. President, Senator Cantwell has a market
manipulation amendment that she was seeking a vote on. It is my
understanding that the agriculture appropriations bill or the energy
water appropriations bill is where she would like to offer her
amendment. I would inquire of the majority leader that should she offer
her amendment to either of those bills would she be assured of a vote
on, or in relation to, her amendment with no second degree amendments
prior to such vote?
Mr. FRIST. The Democratic leader is correct if Senator Cantwell
offers her amendment to that bill she will get a vote on, or in
relation, to it.
Feinstein Amendment
Mr. DASCHLE. Mr. President, Senator Feinstein has a market
manipulation amendment that she was seeking a vote on. It is my
understanding that the Agriculture appropriations bill would be the
appropriate bill for that amendment. I would inquire of the majority
leader that should she offer her amendment to that bill would she be
assured of a vote on, or in relation to, her amendment with no second
degree amendments prior to such vote?
Mr. FRIST. The Democratic leader is correct if Senator Feinstein
offers her amendment to that bill she will get a vote on or in relation
to it.
Mr. FEINGOLD. Mr. President, energy policy is an important issue for
America and one which my Wisconsin constituents take very seriously.
The bill before us seeks to address important issues, such as the role
of domestic production of energy resources versus foreign imports, the
tradeoffs between the need for energy and the need to protect the
quality of our environment, and the need for additional domestic
efforts to support improvements in our energy efficiency, and the
wisest use of our energy resources. Given the importance of energy
policy, an Energy bill is a very serious matter and I do not take a
decision to oppose such a bill lightly. In my view, this bill does not
achieve the correct balance on several important issues, which is why I
will oppose it. In addition, I am deeply troubled by the process that
has led us to abandon efforts to develop meaningful energy legislation,
and instead simply stop our work, take up last year's bill, and pass
it.
In my work on this legislation, I have heard from large numbers of my
constituents. Of the many pieces of correspondence I received on the
matter of a national energy policy was a detailed paper prepared by a
group of students at Marquette University. The students wrote, as part
of their interdisciplinary minor in environmental ethics, a
comprehensive analysis and a series of recommendations regarding energy
usage and efficiency. I commend and compliment these students on their
hard work, and I am very pleased to see young people becoming so
involved in our political process.
In conducting their analysis and crafting their recommendations, the
students underscored that it is imperative that our focus in developing
energy policy remains resolutely long term. I share this belief, and I
agree with the students' assessment that sensitivity is required in
working to craft an energy policy because of its effect on consumers,
on our society, and on the environment. During my time in the Senate I
have consistently worked to ensure that energy policy is both
environmentally and fiscally responsible. Unfortunately, I cannot
assure these students, or any of my other constituents, that this bill
meets those goals.
This bill now contains a renewable portfolio standard requiring
electric utilities to generate or purchase 10 percent of the
electricity they sell from renewable sources by 2020. I supported an
amendment offered by the Senator from Vermont, Mr. Jeffords, last year
to increase this percentage to 20 percent, but it was watered down to 8
percent. Additional exemptions in this bill make this target actually a
target of 4-5 percent of new generation from renewable sources by 2010.
We can and should do better on renewable energy sources. This bill
should have set a serious target, and we should have had a floor debate
on this issue.
In addition, this bill repeals the pro-consumer Public Utility
Holding Company Act, the Federal Government's most important mechanism
to protect electricity consumers. The Senate failed to adopt my
amendment to protect electricity consumers, investors, and small
businesses from abusive transactions between utilities and affiliate
companies within the same corporate family. It also failed to pass a
proposal by my colleague from Washington, Ms. Cantwell, banning Enron-
like trading schemes. The bill should have given the Federal Government
more oversight of utility mergers and tried to prevent utilities from
passing on the costs of bad investments to consumers and from using
affiliate companies to out-compete small businesses. Also, the
electricity provisions of the bill do not provide additional oversight
of energy markets. This would have been addressed by an amendment by
the Senator from California, Mrs. Feinstein, that passed and which I
supported, that would have fostered a more stable market with
transparent transactions and helped to prevent another Enron.
Finally, I am also concerned that we included $14 billion in tax
breaks without paying for them on this bill. Our budget position has
deteriorated significantly over the last year, in large part because of
the massive tax cut that was enacted. We now face years of projected
budget deficits. The only way we will climb out of this deficit hole is
to return to some sense of fiscal responsibility, and first and
foremost that means making sure the bills we pass are offset. Without
offsetting the cost of the tax package, we are digging our deficit hole
even deeper and adding to the massive debt already facing our children
and grandchildren.
The American people deserve better than this bill, and I cannot vote
in favor of it. This measure will need to be greatly improved in
conference to get my vote.
Mr. COCHRAN. Mr. President, I am concerned about the recent efforts
by the Federal Electric Regulatory Commission, commonly known as FERC,
to make RTOs mandatory. Recently, FERC released a white paper
describing their intentions to mandate Regional Transmission
Organization participation by utility companies.
A Regional Transmission Organization, or RTO, would act as a third
party which sets the rules for power companies about pricing and
delivering power in a given region. These RTOs are being formed around
the country. There may eventually be one in the South. But, that should
not give FERC the authority to strip State Public Utility Commissions
of their right to decide whether their states enter into these types of
arrangements.
I understand that entering into an RTO may be a good choice for some
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companies and Public Utility Commissions to make. I believe that is who
should be deciding these issues--not the FERC.
I have a letter from the Mississippi Public Service Commission which
I would like to submit for the Record. It clearly states the problems
which would beset my state if it were forced into an RTO.
Currently, the FERC is attempting to force utilities to enter into
RTOs. There was a federal court case in Atlantic City about this. Some
groups point to that case and say that since the utility won its right
to withdraw from the RTO, that every other utility can simply file a
suit if they are mandated into an RTO. This is not a sensible way to
make policy.
We should not equate the right to file a lawsuit with the voluntary
ability to join one of these organizations.
I am pleased that an agreement has been reached to amend the Federal
Power Act, not just this Energy Bill, to make it clear that FERC cannot
mandate participation in an RTO. Unfortunately, this language expires
on December 31, 2006. While I wish that there was no expiration to this
provision, I am glad that the bill includes language to clarify that
when this provision expires the FERC does not have authority to mandate
participation into RTOs.
I am hopeful that the FERC will follow Congressional intent and allow
states and utilities to decide when and if they wish to enter into an
RTO. I thank Senator Domenici and his staff for their work on this
provision and I am glad to have a commitment that this provision will
be included in the final bill during the energy bill conference.
There being no objection, the letter was ordered to be printed in the
Record, as follows:
Mississippi Public Service
Commission,
July 28, 2003.
Senator Thad Cochran,
Washington, DC
As a Mississippi State Utility Regulator, I appreciate the
opportunity to submit for the record my comments and
observations pertaining to the Federal Energy Regulatory
Commission (FERC) and its efforts to restructure the
electrical industry. Federalizing the delivery of electricity
for Mississippi consumers would have a negative impact on our
state.
In April of this year, the FERC released its white paper on
Wholesale Power Markets and Standard Market Design. They
continue to insist that Regional Transmission Organizations
(RTO) will be mandatory and FERC will exert jurisdiction over
retail service. If FERC has the authority to exercise
jurisdiction over the Terms and Conditions of bundled retail
service, this clearly suggest they will have a direct
influence in the rates for such service. Bundled retail
transactions are subject to State jurisdiction and the Terms
and Conditions should not come under Federal control.
I personally question the legal authority, based on
existing law, which would allow FERC to mandate Mississippi
public utilitiess to join an RTO and ISO. To do so would
require our electrical utility companies to turn over their
transmission assets to third parties.
Even though our transmission facilities were built to serve
local retail customers and paid for in their rates, FERC now
claims everyone is entitled to the same priority and
emphasizes that Terms and Conditions of the RTO or ISO tariff
will apply equally to all users. If utilities are required to
take service under the Terms and Conditions of a wholesale
tariff, it is difficult to see how the transmission component
of retail rates will not become FERC jurisdictional.
In May of 2000, we issued formal document to the
Legislature after three years of Public Hearings pertaining
to retail access transmission , in which we clearly indicated
that restructuring the electrical industry in our state would
not benefit all Mississippi consumers. The principle impact
of wholesale competition in our state is in providing an
additional option for meeting incremental generation needs
via competitive procurement under long-term contracts and
through short-term economic and reliability purchases. We do
not depend on the wholesale market to the same extent, or in
the same manner, as is the case with stats that have chosen a
different regulatory scheme.
Our electric supplies are among the least costly and most
reliable in the nation. We have sufficient generation, for
the foreseeable future, and are aware of no major
transmission bottlenecks that are resulting in cost or
reliability problems for our consumers. We have an electric
system that is serving the consumers of Mississippi in
helping our state meet its economic development potential,
therefore, in my opinion, allowing FERC to mandate RTO's and
exert their jurisdiction over retail transmission is not only
not necessary but will be financially harmful to our
citizens.
Senator Cochran, I appreciate this opportunity to provide
you and the Senate with my comments regarding this critical
issue and I strongly urge the Senate to preserve our
authority to manage and regulate our electrical industry in
Mississippi.
Sincerely,
Nielsen Cochran,
Commissioner.
Mr. LEAHY. Mr. President, while I recognize the Nation needs a sound
and balanced national energy plan emphasizing a clean, reliable,
sustainable, and affordable energy policy, unfortunately this bill
fails to do that. In my home State of Vermont we are proud of an
environmental ethic that supports the increased use of clean and
sustainable energy. Vermonters have a long history of taking good care
of our natural resources, which has served our economy and ecosystems
well. It is important to strike a balance when working to resolve
environmental and energy problems. That is why I will continue to
strongly support programs such as Low-Income Home Energy Assistance
Program.
While the Senate has been debating the energy bill on-and-off for the
past few months, the debate has been fairly limited compared with the
debate on the energy bill during the 107th Congress. During the 107th
Congress, when the Democrats were in the majority, we debated the bill
for 24 days over an 11-week span. During that time, the Senate adopted
126 amendments and rejected 18 others. At no time during the
consideration of that bill, did the Senate try to limit debate by
entering into a unanimous consent agreement to limit amendments. In
comparison, we have had very limited debate on this bill and avoided
critical issues.
Many of my colleagues offered common sense amendments that would have
greatly improved the bill. This includes conservation measures offered
by Senate Durbin that would have required cars, SUVs, minivans and
cross-over utility vehicles to achieve a new fuel standard of 40 mpg by
2015 and would require pickup trucks and vans to achieve a CAFE
standard of 27.5 mpg by 2015. Senators Cantwell and Bingaman offered
several amendments to the electricity title to improve consumer
protections. Senators Feinstein and Schumer offered amendments to
reduce the impact of ethanol mandates on consumers in the Northeast. I
am disappointed that all of these amendments failed.
Further, it should be noted this bill is fiscally irresponsible.
Senators Wyden and Sununu proposed an amendment that would have struck
from the energy bill a provision to make available Federal subsidies
for nuclear power plants. This amendment was not against nuclear power
but an amendment for Congress to be fiscally responsible to the
American taxpayer. Unfortunately, this amendment failed earlier in the
summer. Now the American public will have to subsidize an estimated
$14-$16 billion for a source of energy that leaves many citizens
concerned over their safety. Lastly, many other amendments that
attempted to hold the administration accountable to environmental laws
were rejected by my colleagues that will result in further degradation
to the American public's natural resources.
If these amendments had passed, they would have reduced our
dependence on foreign oil imports, maintain air quality protections,
and conserve energy. Instead this bill forces the American people to
pay for the construction of new nuclear power plants and increased oil
and gas drilling.
The Senate had a real opportunity to put together a sensible energy
policy that shifted the focus from nuclear power and offshore drilling
to a clean, renewable, and affordable energy plan. Unfortunately, we
failed to so this, and that is why I cannot support S. 14.
Ms. MURKOWSKI. Mr. President, I come to the floor at this late hour
to express my strong support for Senate passage of a comprehensive
energy bill. This bill is an important first step in increasing the
energy security of the United States. It has been a long time in
coming, but we welcome this action by the Senate tonight.
From the jaws of defeat come some of the sweetest victories, and I
want to commend our leadership for getting this done, really to the
surprise of many pundits and experts around DC who said it could never
get done this week, much less by the end of this year. We should also
acknowledge the willingness of the other side to reach accommodation on
this important bill.
[[Page S10574]]
Every where I go people talk to me about natural gas--back home in
Alaska, in Seattle, or here in Washington, DC. Everyone, from the
President of the United States to Federal Reserve Chairman Alan
Greenspan to the farmers of Iowa, know that we face serious problems in
our natural gas supply.
With passage of this bill the Senate is telling consumers, farmers
and natural gas dependent industries that help is on the way. That is
good for American jobs, good for our families and their pocket books
and good for the economy. The provisions contained in this bill will
truly help us get the all important Alaska natural gas pipeline moving
forward.
Experts predict that the U.S. will face a 20 billion cubic foot per
day shortage of gas by the year 2020. In Alaska we have 35 trillion
cubic feet of gas in Prudhoe Bay that has already been found, and we
expect more than 100 trillion additional cubic feet to be found on the
North Slope with relatively little effort. Alaska's natural gas can
help close more than 25 percent of the expected 2020 gap, but we need
to assure the markets that some of the risk associated with this
project can be mitigated. If we can get it built it will be one of the
largest privately financed projects in the history of the planet. It
will employ over 400,000 people nationwide, with thousands of new jobs
being created in my State of Alaska. Nationally the creation of 400,000
new jobs could reduce our unemployment rate by a whopping \1/2\ of a
percentage point. That is a huge shift from just one project. And it
will mean a stable supply of gas for America for years to come. No
other project I know can have that kind of positive impact on America--
from either a gas supply, energy security or job creation perspective.
It is imperative that we get this project moving now.
I would note that the Senate bill reported by the Energy Committee
this year, and the accompanying tax provisions reported out of the
Finance Committee this year, called for a marginal well credit that
would have capped tax credits for the production of Alaska gas at 52
cents per thousand cubic feet of gas, should the price fall below $1.35
at the wellhead.
It also contained a loan guarantee for up to $18 billion of the
project's cost and an accelerated depreciation provision.
The bill we are passing tonight reverts to last year's proposal that
provides a gas line tax incentive to producers if the price of natural
gas falls below $3.25 per thousand cubic feet delivered to the AECO hub
in Canada. Producers, however, will have to pay the credit back in full
whenever the price of gas exceeds $4.85 per unit.
The provision accepted by the Senate also includes a loan guarantee
where the government helps to underwrite some $8 billion of the first
$10 billion of the cost of the line, in the event that unexpected
energy price drops occur.
It includes all the other provisions that passed the Senate last
year, including: a prohibition against a northern route, guaranteeing
the gas line will follow the Alaska Highway south through the Railbelt
and Yukon to reach the Lower 48 States; a streamlined permitting and
expedited court review process to speed construction; Provisions that
allow Alaska to control gas to facilitate use for heating or
construction of petrochemical plants in State; a guarantee that the gas
line will accommodate an LNG plant to be developed at tidewater in
Alaska whenever exports markets for the gas appear; provisions to
guarantee that new gas producers in Alaska will be able to get their
gas to market; and a provision that authorizes $20 million for worker
job training and promotes Alaska-hire provisions in State.
The bill also includes a proposal that will provide up to $120
million in grant aid yearly for rural electric improvements in high-
cost areas. These grants can go for power plants or to reduce power
demands by other utilities.
The bill also includes a $35 million grant ($5 million per year for
seven years) to Alaska to help fund its Rural Power Cost Equalization
(PCE) program that subsidizes the high cost of electricity in rural
Alaska.
The bill authorizes the Department of Energy to make a loan of up to
$125 million to retrofit the Healy clean coal plant with new technology
so it can produce power economically without causing air pollution
problems. The loan should make the plant economic, provide vitally
needed power to the Fairbanks area at reasonable cost and aid the
Usibelli coal mine and its workers.
The bill includes a tax incentive equal to $3 per barrel to produce
heavy oil from northern Alaska or to produce low-pollutant synthetic
fuels from coal. The same provision also provides a tax credit to fuels
produced before 2007 from biomass, tar sands, or brine. For heavy oil,
Alaska's West Sak field contains 15 billion barrels of known heavy oil.
The incentive should help make an additional 200 million barrels of
production economic over the next decade.
This legislation reauthorizes the Arctic Science Research Act of 1984
and expands its power to make grants for scientific research.
Thankfully the bill also makes it a federal crime to damage any
intra-state energy pipeline. The amendment specifically provides extra
legal protection to the trans-Alaska oil pipeline.
This package contains language originally proposed by Senator Ted
Stevens with Senator Byrd for the Barrow Arctic Research Center to
support climate change research and scientific activities. The
amendment includes $35 million for planning, design, support and
construction of the Barrow facility. The goal is to develop
technologies needed to reduce greenhouse gas emissions.
I am pleased the bill also contains the following important
provisions: Tax credits for hybrid and fuel-cell vehicles; tax credits
for alternative and renewable fuels use and development; tax credits
for marginal oil producers to protect oil production from stripper
wells; extra funding for the Low Income Home Heating Program (LIHEAP)
and for low-income weatherization grants; funding for an Advanced Clean
Coal Technology program; funding for a hydrogen energy act; provisions
to increase the use of ethanol in clean burning gasoline;
reauthorization of hydroelectric dam licensing provisions;
reauthorization of the Price Anderson Act to permit nuclear power to
continue; provisions on electricity restructuring; and provisions to
require a sensible increase in automobile fuel efficiency standards.
Using last year's bill was the quickest way to get the bill off the
Senate floor so that details of a final package could be worked out in
a conference committee with the House. Without this action today it was
unlikely we would have seen positive movement until the late fall. Now
we can move forward quickly for America and Alaska.
I want to assure Alaskans that I will work to include in the
conference report on this bill the provisions I secured during this
year's debate in the Energy Committee. With those changes this bill
will help us to address our energy problems even more.
I thank the fine Chairman of the Energy Committee for his effort and
leadership and I applaud the work of both Leaders to get this bill done
before the August recess.
The PRESIDING OFFICER. The Senator from Connecticut is recognized.
____________________