[Congressional Record Volume 151, Number 106 (Friday, July 29, 2005)]
[Senate]
[Pages S9335-S9367]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
ENERGY POLICY ACT OF 2005--CONFERENCE REPORT
Mr. DOMENICI. Mr. President, parliamentary inquiry: Is the Energy
bill now before the Senate?
The PRESIDING OFFICER. Under the previous order, the Senate will
resume consideration of the conference report to accompany H.R. 6,
which the clerk will report.
The assistant legislative clerk read as follows:
Conference report to accompany H.R. 6, an act to ensure
jobs for our future with secure, affordable, and reliable
energy.
The PRESIDING OFFICER. The Senator from New Mexico.
Mr. DOMENICI. Mr. President, might I ask, is the bill under
controlled time?
The PRESIDING OFFICER. Thirty minutes evenly divided.
Mr. DOMENICI. On behalf of the leader, I am going to ask consent
regarding the stacking of votes. It has not been done. I ask unanimous
consent that we now resume consideration of the energy conference
report--which is the regular order--for the final remarks; I further
ask consent that following that 30-minute period, the Senate proceed to
votes in relation to the Interior conference report, Legislative Branch
conference report, and the two votes in relation to the Energy
conference report, as provided under the order, with 2 minutes equally
divided between the votes.
The PRESIDING OFFICER. Is there objection?
Hearing none, it is so ordered.
Mr. BYRD. Mr. President, will the Senator yield to me?
Mr. DOMENICI. Yes.
Mr. BYRD. Mr. President, I have some remarks to make, about 10
minutes of remarks. I want to commend Senator Burns and Senator Dorgan
for their work on the Interior appropriations bill. When might I make
those remarks?
Mr. DOMENICI. I say to the Senator from West Virginia, there is a
unanimous consent agreement here that has
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the time allotted until we are finished with the Energy bill, and the
votes thereon. That will not be a long time. But everybody knows we
have 30 minutes right now for the Energy bill, and after that we will
commence voting on three bills that are before us. I would think the
Senate would want to stay to that order.
The PRESIDING OFFICER. If the Senator will suspend, the Senator from
West Virginia was granted a unanimous consent order that he would have
5 minutes before the Interior conference report was voted on, which
will take place after the 30 minutes allocated for final debate on H.R.
6.
Mr. BYRD. Very well. Will the Senator yield further?
Mr. DOMENICI. Please. Surely.
Mr. BYRD. May I make a further inquiry? Then, I am correct in
understanding the Chair to say that I will have 5 minutes prior to the
vote?
The PRESIDING OFFICER. The Senator is correct.
Mr. BYRD. That vote will be on what?
The PRESIDING OFFICER. The Interior conference report.
Mr. BYRD. The Interior conference report.
Mr. President, with the indulgence of the distinguished Senator from
New Mexico, I ask unanimous consent that at that time I have 10 minutes
rather than 5.
The PRESIDING OFFICER. Is there objection?
Hearing none, it is so ordered.
Mr. BYRD. Mr. President, I thank the Senator from New Mexico.
The PRESIDING OFFICER. The Senator from New Mexico.
Mr. DOMENICI. Mr. President, I see Senator Bingaman in the Chamber.
He is going to proceed, first, with the allocation of some of the time
on his side of the aisle.
I yield the floor.
The PRESIDING OFFICER. The Senator from New Mexico is recognized.
Mr. BINGAMAN. Mr. President, I yield 5 minutes to the Senator from
Florida, Mr. Nelson.
The PRESIDING OFFICER. The Senator from Florida is recognized for 5
minutes.
Mr. NELSON of Florida. Mr. President, I thank the chairman of the
committee and the ranking member, Senator Domenici and Senator
Bingaman. They made a statement on the floor of the Senate in a
colloquy with this Senator when the Energy bill was on the floor, and
those two Senators kept their word. It had to do with drilling off the
coast of Florida. I have said to those Senators how much I appreciate
what they, in fact, have done, under considerable pressure in the
conference committee.
I want them to know personally how appreciative I am that they held
fast and prohibited, in the conference committee, for an issue to be
injected that was neither in the House bill nor the Senate bill that
would cause the drilling off the coast of Florida.
Why is this important to us? This Senator has made this statement
many times, but there is a new wrinkle that I wanted to explain to the
Senate, not having to do with geology that shows that there is not much
oil and gas off of Florida, not having to do with the delicate
ecosystem, not having to do with the $50 billion-a-year tourism
industry that depends on pristine beaches, but a reason for the
preparation of our U.S. military in a time when we are at war.
We have these ranges that are off the coast of Florida. Is it any
wonder that, in fact, when Vieques was shut down off the coast of
Puerto Rico, they sent most of that training off of the Gulf of Mexico,
off the coast of Florida, because of this Joint Gulf Range Complex. It
is joint with all branches of Government. It involves land-, sea-, and
air-coordinated training. If drilling were allowed in what is known as
lease sale 181, that is what would happen. Smack-dab in the middle of
that restricted airspace, that training area that is 180,000 square
miles in the eastern Gulf of Mexico. Smack-dab in the middle of it
would be the drilling for oil and gas. This portion in red was already
agreed to back in 2001. This portion in the red hatch is the additional
4 million acres that would be added smack-dab in the middle of our
military training complex.
The significance of it is that it has 724 square miles of additional
land range. It has 3,200 square miles of airspace over adjacent land
area. It has 17 miles of Government shoreline, with connected
prohibited and restricted water areas. The combination of air, land,
and water is the best location for the United States for extremely
long-range precision weapons testing, such as the high-performance
combat aircraft live-fire testing and training and large-scale complex
joint training exercises and experimentation.
Given the thrust of DOD's recent BRAC recommendations, there will be
more testing, training, and operations in the eastern Gulf, not less.
So oil drilling in the eastern Gulf, as proposed by the administration,
is the greatest encroachment threat to the Nation's largest
unrestricted air and sea space for weapons testing and combat training.
The PRESIDING OFFICER. The time of the Senator has expired.
Mr. NELSON of Florida. I ask unanimous consent for 30 additional
seconds.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. NELSON of Florida. Oil drilling is not compatible with weapons
testing and combat training. Military leaders have been fighting this
for years. Yet here we go again. The encroachment this time is even
more serious because we are at war. This Senator, on behalf of the
people of Florida--and, I hope, on behalf of the U.S. military
establishment--will continue to oppose this. I thank the chairman and
the ranking member for their holding fast in the conference committee.
The PRESIDING OFFICER. The Senator from New Mexico.
Mr. BINGAMAN. Mr. President, I yield 8 minutes to the Senator from
Wisconsin, Mr. Feingold, to explain his motion.
Mr. FEINGOLD. Mr. President, I thank the Senator from New Mexico. I
have a number of concerns about the conference report we debated last
night and that we will vote on today. I intend to raise a point of
order that it violates the Budget Act. I do, however, want to recognize
the hard work that Chairman Domenici and Ranking Member Bingaman have
put into this process. We all know that they have spent many long days
and late nights to reach this point. The bipartisan manner in which
they work is a definite improvement over previous Energy bills. I
applaud their efforts.
Mr. President, Energy policy is an important issue for America and
one which I can tell you my Wisconsin constituents take very seriously.
Crafting an energy policy requires us to address important questions
about, for example, the role of domestic production of energy resources
versus foreign imports, the importance of ensuring adequate energy
supplies while protecting the environment, the necessity for domestic
efforts to support improvements in our energy efficiency, and the
wisest use of our energy resources. Given the need for a sound national
energy policy, a vote on an Energy bill is a very serious matter and I
do not take a decision to oppose such a bill lightly. In my view,
however, the conference report we consider today does not achieve the
correct balance on several important issues, which is why I have to
oppose it.
I have four fundamental concerns. This bill digs us deeper into a
budget black hole. It fails to decrease our dependence on foreign oil.
It rolls back important consumer protections. And finally, it
undermines some of the fundamental environmental laws that our citizens
rely upon.
First, Mr. President, the costs of this conference report are
staggering. The Congressional Budget Office estimates that enactment
will increase direct spending by $2.2 billion between 2006 and 2010,
and by $1.6 billion between 2006 and 2015. Additionally, the CBO and
the Joint Committee on Taxation estimate that this bill will reduce
revenues by $7.9 billion between 2005 and 2010 and by $12.3 billion
from 2005 to 2015. On top of the direct spending, the conference report
authorizes more than $66 billion in Federal spending, according to the
watchdog groups The National Taxpayers Union, Taxpayers for Common
Sense, and Citizens Against Government Waste. Our Nation's budget
position obviously has deteriorated significantly over the past few
years, in large part because of the massive tax cuts that were enacted,
and we now face years of projected budget deficits. The only way we
will climb out of this deficit hole is to return to the fiscally
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responsible policies that helped put our Nation on a sound fiscal
footing in the 1990s, and that simply means that we have to be sure
that the bills we pass are paid for. To do otherwise is to simply dig
our deficit hole even deeper, thus adding to the massive debt already
facing our children and grandchildren.
Mr. President, second, the conference report we consider today will
do nothing to reduce U.S. dependence on foreign oil. I cannot return to
my home State of Wisconsin this weekend and say that I participated in
a rushed effort to accept a 1,700-plus page conference report that will
not do a thing to increase our oil independence. The conference did not
accept the 10-percent renewable portfolio standard passed by the
Senate, nor did it accept an amendment instructing the President to
develop a plan to reduce U.S. oil dependence by 1 million barrels per
day by 2015. I supported efforts to reduce our dependence on foreign
oil when the Senate debated its bill, and I am extremely disappointed
that the conference committee could not accept a reduction of 1 million
barrels per day through 2015.
Third, the bill rolls back important consumer protections. The
conference committee retained repeal of the pro-consumer Public Utility
Holding Company Act, important New Deal-era legislation which has
protected electricity consumers. My State of Wisconsin is acutely
interested and concerned about the repeal of PUHCA and about ongoing
abuses involving the unregulated corporate affiliates of regulated
utilities. In addition to hearing from Wisconsinites, I have heard from
contractors and other small businesses across the Nation that have been
harmed by this unfair competition by affiliates of public utilities. I
must say that I don't understand how we can give the nuclear industry
loan guarantees and over $2 billion in risk insurance, but we can't
even give small businesses the assurance that unregulated affiliates of
public utilities will not unfairly outcompete them.
I do, however, recognize the efforts of the chairman and the ranking
member to protect language providing the Federal Government more
oversight of utility mergers, which is important and I support. I am
grateful for their willingness to further look into my concerns on
unfair competition by public utility affiliates.
Fourth and finally, Mr. President, the energy conference report
includes provisions that significantly weaken our commitment to the
environment and to the health of U.S. citizens. Section 328 of the
Energy conference report weakens the Clean Water Act by exempting
certain oil and gas industry activities from compliance with both phase
1 and phase 2 storm water programs and, in the process, rolls back 15
years of protection. This is not an insignificant issue. Storm water
runoff is a leading cause of impairment to our streams, rivers, and
lakes.
The bill also exempts hydraulic fracturing from the Safe Drinking
Water Act, and by doing so, risks contaminating drinking water
supplies. Over 95 percent of Wisconsin communities and about 75 percent
of Wisconsin residents rely on groundwater for their supply of drinking
water. Nationally, approximately half of the U.S. population obtains
its drinking water from underground water sources, according to the
Government Accountability Office. Wisconsin citizens and all U.S.
citizens deserve more than exemptions that could threaten the water
they drink.
There are provisions of the bill that I fully support, and I am
pleased that the conference committee included, but I can't support
this conference report. According to estimates by the Congressional
Budget Office, the Energy bill conference report includes direct
spending of more than $2.2 billion over the 2006-2010 period, exceeding
the amount allocated by the budget resolution. I hope my colleagues
will note this and will join me in sustaining a budget point of order.
Mr. President, I make a point of order that the pending conference
report violates section 302(f) of the Congressional Budget Act of 1974.
The PRESIDING OFFICER. The Senator's point of order must come at the
conclusion of debate.
Mr. FEINGOLD. I will defer.
The PRESIDING OFFICER. Who seeks time?
The Senator from New Mexico.
Mr. DOMENICI. Has the Senator concluded?
Mr. FEINGOLD. I have.
Mr. DOMENICI. I assume that Senator Bingaman has another person he
would like to yield to. I will yield to one of his, Senator Cantwell or
Senator Salazar.
Mr. BINGAMAN. Mr. President, how much time remains?
The PRESIDING OFFICER. The ranking member has 2 minutes and 2
seconds.
Mr. BINGAMAN. In light of that, I know there are other Members,
particularly on the Democratic side, who wish to speak. I believe
Senator Domenici has some time to provide.
Mr. DOMENICI. Mr. President, I yield 3 minutes to Senator Cantwell.
The PRESIDING OFFICER. The Senator is recognized.
Ms. CANTWELL. Mr. President, I thank my colleagues for their hard
work on this important legislation. We are here to talk about passing
an Energy bill that is not a complete answer to all our energy needs.
This is not the end of discussion about energy independence and getting
off our overdependence on foreign oil, but it is an important first
step. My colleagues need to understand that the provisions in this bill
are nuts-and-bolts important for our energy economy, moving forward. As
a Senator who supports this legislation, there are certain
technologies, certain investments in this legislation that I hope will
win the day and will help us build a different kind of energy economy,
based on newer technologies and energy supplies than the ones we have
today. But this bill represents a compromise that was forged in the
Senate and was fought hard for by my colleagues, both Democrats and
Republicans, when they went to conference.
I am proud that it has an extension of renewable production tax
credits so that our utilities can continue to invest in even more
renewable energy; that for the first time it has a renewable clean
energy bond section, so that local governments and public power can
make greater investments in renewable energy; that it has an extension
of the renewable energy production incentive program for public power;
that there are efficiency provisions in the bill for appliances and
other types of standards that will save 3.5 quads of energy.
That is the same as building 85 powerplants. It has a hybrid vehicle
incentive provision. It has a biodiesel incentive program. It
reinstates the oil spill liability trust fund, which was going broke
and which helps us clean up oil pollution, and taxes those who are the
polluters. It has research on the smart grid technology that is going
to get us more efficiency in our transmission system, and it has
incremental steps to push the States toward better standards on net
metering. For the Northwest, the electricity title in this legislation
is clearly a victory, and I would say the efficiency title in this bill
is also a victory.
We are moving closer to the key tools we need to upgrade our
transmission system. We will have many more debates about what this
body can do, though, to continue to diversify off of foreign oil. But
we should take the step today to secure that transmission system and
get reliability standards in place, something this body has debated now
for more than 5 years. After a Western blackout, after a New York
blackout, after people in Ohio and Michigan have been affected, the
least we can do is push this legislation to improve the security and
reliability of our electricity grid.
I ask my colleagues to support this legislation as a first step, a
short stroke of success, and get about going back to the broader
decisions we need to make truly start moving in the direction toward
energy independence.
The PRESIDING OFFICER. The Senator's time has expired.
Who seeks time?
The Senator from Louisiana.
Ms. LANDRIEU. I seek 5 minutes under the majority time.
The PRESIDING OFFICER. The majority time remaining is 11 minutes 44
seconds.
Mr. DOMENICI. I yield 4 minutes to the Senator from Louisiana.
The PRESIDING OFFICER. The Senator from Louisiana is recognized for 4
minutes.
Mr. DOMENICI. Parliamentary inquiry.
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The PRESIDING OFFICER. The Senator from New Mexico.
Mr. DOMENICI. Is it not correct that the point of order is going to
be made? Can that point of order be made so the Senator will not have
to wait? Can it be made just before the vote on the Energy bill?
The PRESIDING OFFICER. By consent, it can be made now.
Mr. DOMENICI. Otherwise it will be made then?
The PRESIDING OFFICER. The Senator is correct.
Mr. DOMENICI. The Senator can make it just before the Energy bill
vote and we have 2 minutes on each side then. So the Senator will not
have to wait now on that.
Mr. FEINGOLD. I appreciate that and I intend to make that point.
The PRESIDING OFFICER. The Senator from Louisiana.
Ms. LANDRIEU. Mr. President, I rise today to support this Energy
bill. I heard my colleague from Washington State speak beautifully and
passionately about many of the important aspects of this bill. There
are Members who can come to this floor and pick out one or two things
they had hoped to get in that did not make it. We had a lot of
arguments about this bill, a lot of debate, but overall it is very
balanced legislation. It does look to the future, as well as holding on
to some of the things in the past that have served us well.
It seeks to increase independence of the United States of America so
we can produce more energy on our shore, under our control, to not only
help boost our economy, make our industries more competitive, but most
importantly make this Nation more secure when it comes to international
involvements. Americans want lower prices at the pump, but they want to
know that this Congress is taking action to make them more secure
nationally. By being more self-reliant, we can.
Now, yes, we have to open up our shores to liquefied natural gas
because our price is going through the roof, and unless we increase
supply substantially and rather quickly, that price will remain high.
It will put almost every industry in this country at a very serious
disadvantage for international competition.
As Senator Cantwell stated, it does give new protections for
consumers from market manipulation. Senator Dorgan has led the fight
with regard to hydrogen, with Senator Bingaman's help. It has opened up
new frontiers for that. We have opened up new frontiers for renewable
energy sources. As a Senator from an oil-and-gas-producing State, we do
need to get beyond petroleum and this bill is helping us to do that.
Under Senator Domenici's leadership, we are expanding in an
extraordinary way the nuclear industry, which is going to help Japan,
France, and others who have been leading the way. It is time for
America to get with the program.
In my last 1 minute, let me compliment these leaders. We have not had
an energy bill for 13 years. For 5 years, we have literally been
laboring mightily to get a bill. Senator Domenici, Senator Bingaman,
Chairman Barton, and Mr. Dingell, ``the big four'' as they have been
called, have worked tirelessly, their staffs have worked tirelessly,
and I might say with the patience of Job. This bill is balanced because
these two leaders said they were going to build a bill together for the
future of our country. As a Senator on that committee, I am so proud of
the honesty in which they built this bill, the openness in which they
built this bill, and the fact that no deals, to my knowledge, were cut
behind closed doors. It was all open and actually on television so
people could see the results of this work.
I commend that process to the Senate and the whole Congress and thank
them for their extraordinary leadership and thank them, too, on behalf
of the people of Louisiana and the Gulf Coast States for recognizing
the contribution we have made of offshore oil and gas drilling and to
get a very robust coastal impact assistance program that is going to
mean a great deal to us and to the wetlands of America.
I yield back.
The PRESIDING OFFICER. The Senator yields back.
The Senator from New Mexico.
Mr. DOMENICI. Mr. President, I yield 2 minutes to the distinguished
junior Senator from Colorado.
The PRESIDING OFFICER. The Senator from Colorado is recognized for 2
minutes.
Mr. SALAZAR. Mr. President, I rise today in support of the Energy
bill. I start first by congratulating my colleagues, the two Senators
from New Mexico, the Land of Enchantment, Mr. Domenici and Mr.
Bingaman, for their leadership in helping us get together what has been
a true bipartisan effort. I commend them both for the process as well
as for the end result of this legislation.
As I look at this legislation, it seems to me what we are embracing
today is a vision for energy independence. I think Democrats and
Republicans all agree what we need to do is to get to a point where
this country gets rid of its overdependence on foreign oil. We need to
do that for national security reasons, we need to do that for economic
reasons for our country, and we also need to do it for environmental
reasons.
From my point of view, this legislation is based on four
cornerstones. One of those cornerstones is conservation and efficiency.
There are more important measures in this bill that deal with
conservation and efficiency. It is a new ethic for the 21st century.
Secondly, embracing renewable energies from the ethanol provisions to
dealing with the development of cellulosic ethanol, this bill gets us
on the right direction where America can grow its way toward energy
independence. Third, technology, research and development, we have lots
of resources in America we can use to make sure we are having the
energy we need for our country. The new technology that includes coal
gasification and other kinds of technologies will help us move in that
direction. And finally, balanced development, we need to continue to
develop our natural resources in this country.
So from my point of view, this bill is a good bill and is moving us
in the right direction. It is not a perfect bill and there are aspects
of this bill some of us advocated for that we hoped would have been a
part of this bill, but they are issues we can continue to work on. We
can use this as a foundation from which to build. There is the issue of
the renewable portfolio standard which was adopted by this Senate and
we need to move forward continuing to try to address that issue in the
way it has been addressed in my State. Finally, the issue of global
warming and how we deal with that issue in the future is very
important.
With that, again I commend the Senators from New Mexico, Mr. Domenici
and Mr. Bingaman.
The PRESIDING OFFICER. The Senator from New Mexico.
Mr. DOMENICI. Mr. President, I ask unanimous consent that Senator
Obama be given 2 minutes and it not be included in the majority time.
The PRESIDING OFFICER. Is there objection to the Senator from
Illinois being granted 2 additional minutes beyond the time originally
granted to both sides?
Without objection, it is so ordered.
The Senator from Illinois.
Mr. OBAMA. Mr. President, I rise to commend the chief sponsors of
this bill in the Senate, Senators Domenici and Bingaman, who I think
have displayed the sort of statesmanship and civility in working out
this difficult legislation that I think all of us expect from this
body. I also want to indicate the degree to which this bill takes
significant steps in the right direction on energy policy. It helps us
realize the promise of ethanol as a fuel alternative by requiring 7.5
billion gallons to be mixed with gasoline over the next few years. It
provides a tax credit for the construction of E85 stations all over
America--E85, a blend of ethanol and gasoline that can drastically
increase fuel efficiency standards for our cars.
It will provide funding for the clean coal technologies that will
move America to use its most abundant fossil fuel in a cleaner,
healthier way, including more low emission transportation fuels, and it
will support the development of what we hope ultimately will be a 500-
mile-per-gallon automobile technology.
All of these things are wonderful and worthy of support. But I do
have to say we have missed an opportunity and
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that is not the fault of the sponsors of this bill who have done
yeoman's work. Rather, I think it is the timidity of all of us as a
body in not addressing what has to be one of the most significant
problems we face as a nation.
The Department of Energy predicts that American demand for fossil
fuels will jump 50 percent over the next 15 years. The Heritage
Foundation says this bill will do virtually nothing to reduce our
dependence on foreign oil. Even President Bush and supporters of the
bill in Congress concede as much.
As we debate this bill today, the price of crude oil has surpassed a
record high of $60 a barrel, and gas is now up to $2.28 per gallon. At
this price, the United States is sending $650 million overseas every
single day.
As demand continues to skyrocket around the world, other countries
have started to realize that guzzling oil is not a sustainable future.
What is more, these countries have realized that by investing early in
the energy-efficient technology that exists today, they can create
millions of tomorrow's jobs and build their economies to rival ours.
China now has a higher fuel economy standard than we do, and it has
200,000 hybrids on its roads. Japan's Toyota is doubling production of
the popular Prius in order to sell 100,000 in the U.S. next year, and
it is getting ready to open a brand new plant in China. At the same
time, Ford is only making 20,000 Escape Hybrids this year, and GM's
brand won't be on the market until 2007.
So here we are. People paying record prices at the pump and America
sending billions overseas to the world's most volatile region. We have
countries like China and India using energy technology to create jobs
and wealth, while our own businesses and workers fall further and
further behind. And we have the energy bill that is before us today.
So I ask, is this the best America can do? The country that went to
the moon and conquered polio? The country that led the technological
revolution of the 1990s?
It would be one thing if the solutions to our dependence on foreign
oil were pie-in-the-sky ideas that are years away. But the technology
is right at our fingertips. Today, we could have told American car
companies, we will help you produce more hybrid cars. We could have
made sure there were more flexible fuel tanks in our cars. And so
America has a choice.
We can continue to hang on to oil as our solution. We can keep
passing energy bills that nibble around the edges of the problem. We
can hope that the Saudis will pump faster and that our drills will find
more. And we can just sit on our hands and say that it is too hard to
change the way things are and so we might as well not even try.
Or we could accept and embrace the challenge of finding a solution to
one of the most pressing problems of our time, our dependence on
foreign oil. It will not be easy and it will not be without sacrifice.
Government cannot make it happen on its own, but it does have a role in
supporting the initiative that is already out there.
I vote for this bill reluctantly today, disappointed that we have
missed our opportunity to do something bolder that would have put us on
the path to energy independence. This bill should be the first step,
not the last, in our journey towards energy independence.
I close by saying I hope we do not wait another 5 years before we
work on the important issue of energy independence. I plan to support
this bill because of the fine work that was done by the sponsors, but I
would insist that in the next year or two we immediately address the
issue of how we can wean ourselves off of Middle Eastern oil.
Mr. LEAHY. Mr. President, I firmly believe our 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. The Senate sent a good energy bill to conference, and
we got back a frog. This conference report fails to reduce our
dependence on imported oil, fails to address the threat of global
warming, fails to make much needed new investments in clean energy
production and fails to provide any help to consumers that are
suffering from record high gas prices.
Specifically, this conference report does not include the Senate's
mandatory oil savings clause, which would have reduced oil use by 1
million barrels per day. The bill also deletes the renewable energy
standard that would have required utilities to obtain at least 10
percent of their electricity from renewable sources by 2020. Increasing
the production of electricity from renewable energy sources will help
improve the quality of our country's water and air. Instead of
supporting the advancement of renewable energy technologies to create
jobs and reduce pollution, we have a bill that gives oil, gas, ethanol,
and nuclear companies enormous subsidies.
In addition, the bill does not include any provisions to address
global warning. I believe we have a responsibility to act now to curb
greenhouse gases; thus, I was pleased the Senate bill agreed on the
need for mandatory programs to address greenhouse gases. Two major
scientific reports released last fall warned that global warming is
occurring more rapidly than previously known, and that the effects of
such warming trends are widespread. In Vermont, we will also see
ecological and economic consequences of these alarming trends.
Vermonters working in our ski and maple syrup industries have already
reported changes they have been forced to make in recent years to
adjust to climate change. This bill's refusal to take any steps to
combat global warming is not only disappointing, but dangerous to our
future generations. One hundred years from now, it may turn out that
global warming was the single most important problem that the United
States almost totally ignored. At that stage I will not be able to say
``I told you so,'' but some academic scholars might note my timely
warmings. Indeed, when I was chairman of the Agriculture, Nutrition,
and Forestry Committee, I included a provision on the impacts of global
warming in U.S. food production in the 1990 farm bill--15 years ago.
The bill also contains a number of anti-environmental provisions that
were not included in the Senate's bill. It threatens drinking water by
allowing the underground injection of diesel fuel and other chemicals
during oil and gas development and exempts oil and gas construction
activities from the Clean Water Act. It also includes a seismic
inventory of oil and gas resources in sensitive Outer Continental Shelf
areas.
In addition, I am disappointed that this Energy Bill doesn't take a
single concrete step to address the high and rising cost of gasoline
for American consumers. The Senate unanimously adopted my amendment to
allow the Federal Government to take legal action against any foreign
state, including members of OPEC, for price fixing and other
anticompetitive activities. It is high time we say, ``no!'' to OPEC's
illegal price fixing schemes. Yet, due to opposition from the Bush
administration, under whose tenure the average price of gasoline has
skyrocketed from $1.45 per gallon to more than $2.30 per gallon, this
provision was deleted from the Energy bill conference report.
This bill fails on almost every count. Yet, almost unbelievably, it
could have gotten much worse. Under the leadership of my friend from
New Hampshire, Senator Gregg, we were able to stop the House GOP
leadership from letting MTBE polluters off the hook for contaminating
our ground water and drinking water. I understand that the conferees
came to an agreement which in no way impacts the rights of citizens and
local governments to pursue all available State and Federal remedies
where there is environmental harm and other injury that results from
leakage of MTBE into the ground water. While I was concerned about any
effort to alter the subject matter jurisdiction of these cases, I am
relieved to learn that they did not do so in conference. I understand
that nothing in the current language will alter the substantive law
that courts currently apply in these cases and that they will apply to
future claims.
After a colloquy between conferees on the record, Representative
Stupak did not offer his amendment clarifying their unanimous
understanding of the relevant section. The amendment that he withheld
would have simply added the phrase ``under applicable state or federal
law'' to the permissive removal provision. I am told by Senator
Bingaman that the conferees found this amendment unnecessary because it
was
[[Page S9340]]
clear to them, as it is to me, that the relevant language adopted does
not change the substantive law that applies and it does not change the
current law that applies in consideration of removal petitions.
This administration and this Congress had a real opportunity to
produce a bill that would lead the Nation towards balanced,
sustainable, clean energy production. Instead, we have 1,700 pages
worth of policies that will increase our dependence on fossil fuels,
provide billions to wealthy energy corporations, and threaten
environmental and public health. I do not see how my Republican
colleagues can any longer justify their drastic cuts to vital social
programs while pushing through this multibillion dollar legislation
that does nothing to secure our energy future.
Mr. AKAKA. Mr. President, I rise to today in support of the Energy
bill and to provide some perspective on the conference report for H.R.
6, the Energy Policy Act of 2005.
I have been in Congress since 1976, serving first in the House of
Representatives, and since 1990 in the Senate. I have served with many
outstanding Congressmen, Congresswomen, and Senators who have advanced
my knowledge and appreciation for comprehensive energy policy in the
long-term. I served with Representative Jim Lord, who was my mentor in
the House when I first arrived. I saw him again just before I stepped
into last Sunday's conference committee meeting in Rayburn. I served
with my good friend and colleague, John Dingell, from Michigan, and I
served with the dedicated and ever-insightful Congressman from
Massachusetts, Ed Markey. Both of them have made enormous contributions
to this year's energy bill, as have all the House Members.
I have served on the Senate Committee on Energy and Natural Resources
for more than 10 years. I was here when the Senate passed the last
energy bill, the Energy Policy Act of 1992. That bill was a benchmark
that established a range of energy efficiency, conservation, renewable
energy, research and development, and regulatory frameworks for energy
that are still in place today.
My observation is that the compromise that we have now may be the
best we can get in the next 5 to 10 years, given the regional nature of
energy and the partisan nature of politics. Energy is an issue with
regional, special interest, and State and local ``tugs'' and ``pulls''
unlike other national issues. The breadth of this energy bill is almost
incomprehensible. An energy policy sounds simple, but it is a complex,
interlocked patchwork of agreements, prohibitions and incentives.
If we do nothing, we will be worse off than when we started. We will
not advance energy conservation, efficiency, or production of
alternative fuels if we do not pass the bill. I urge members to
remember that we have spent over 5 years debating an energy bill and we
have seen bills that are much, much worse. This bill represents a
victory in many ways.
It is victory of democratic process over regional politics. This bill
was fully heard by the committee and fully debated and amended in the
Senate. It was a bipartisan effort on which we spent 3 months exploring
the topics making a comprehensive bill. We spent another 2 weeks
debating and changing this bill in the Committee on Energy and Natural
Resources. We accepted many amendments on the Democratic side. The
Senate debated the bill for another 2 weeks, changing it and improving
it again.
I applaud the efforts of Senators Domenici and Bingaman, the chair
and ranking member of the Energy Committee, for upholding the promise
of the Senate energy bill in the conference discussions. They showed
great leadership in holding firm to the Senate bill, rejecting House
provisions that were unacceptable. Their staffs were determined to
provide us an energy bill that did not include excessive spending or
destructive environmental compromises.
The energy conference report is not perfect, but its a good bill. I
know the bill does not have provisions for fuel efficiency standards
for cars, SUVs, and trucks, provisions which I supported in the
Committee and on the floor. It does not have controls on carbon dioxide
or standards for renewable electricity, although the latter was
approved in the Senate.
In many respects, these are small steps, but important ones, in the
right direction to meet our energy challenges. It encourages cleaner
alternative energy initiatives such as hydrogen, solar, wind,
geothermal, and natural gas resources. It emphasizes greater use of
renewables. It promotes greater efficiency in the way we currently use
appliances, home heating and cooling, with more stringent standards. It
encourages more efficient cars, homes, and commercial appliances such
as dishwashers. It strengthens the reliability of our electricity grid,
encourages more transmission lines, and protects ratepayers from market
abuses. These are things that are needed now, not in another 5 years
when the composition of Congress or the White House might change.
The bill does not go as far as I would have liked to address some of
the biggest energy problems our Nation faces. It seems Congress cannot
mobilize the political will to take the difficult steps needed to
reduce our reliance on foreign oil, improve vehicle fuel efficiency or
deal with global warming. I supported those amendments, both on the
Senate floor and in conference committee deliberations, but we lost in
fair votes in an open process.
What we have before us, in the long run, is a bill that is balanced
in terms of production of energy from a variety of sources and it uses
appropriated funds and tax expenditures to encourage research,
development, and production. There will always be detractors who can
find problems with particular pieces of this far-reaching energy bill.
The comprehensive bill is so broad that I do not believe it will ever
satisfy the positions of every interest group. The bottom line is that
this bill does not include the onerous provisions of an MTBE liability
waiver, an ozone bump-up, and it does not include categorical waivers
for NEPA for oil and gas developments.
It does include many tax provisions to encourage alternative and
renewable fuels, nuclear energy, and oil and gas industries. But the
proportions allocated to the renewable sector, clean coal, and energy
efficiency are greater than the tax credits and royalty relief for oil
and gas, particularly when you consider that a large portion is for a
refining capacity incentive, badly needed to increase the efficiency of
oil and gas refineries. I greatly appreciate the efforts of Senators
Grassley and Baucus, and their staffs, who bore the responsibility of
crafting the finance portion of the bill under great pressure with
grace and generosity.
In this era of alarming Federal budget deficits and declining
domestic discretionary spending, we have to look to tax incentives and
loan guarantees to mobilize capital investment in new and cleaner
energy. For the Nation to maintain our leadership in technology and
engineering, we must spend money. Because of many circumstances, namely
the war in Iraq, the war on terrorism, and future extensions of tax
cuts, we do not have adequate funds to spend on this effort. The only
place we can find revenue to encourage the adoption of new technologies
is through tax incentives. To me, this is an innovative way to create
opportunity out of hardship.
The bill the Senate will consider today, on balance, improves our
energy policy and deserves to be enacted. Enormous credit for the
success of the conference and the development of the bill goes to my
colleagues from New Mexico, Senators Pete Domenici and Jeff Bingaman,
and their staff, who worked long and hard around the clock to bring
this bill to fruition. Senator Domenici has taken a fresh look, from
the beginning of the 109th Congress, and changed his entire approach to
the energy bill. I greatly appreciate his orientation and his strategy
working with his colleagues on this energy bill. I also extend my great
appreciation to Chairman Joe Barton and Ranking Member John Dingell for
their openness and willingness to work with members on the special
needs of their States. Their leadership ensured that the conference was
fair, open, and bipartisan from start to finish. I look forward to
voting for this bill and I urge my colleagues to support it.
[[Page S9341]]
Clarification Of Section 1287 Of The Energy Policy Act Of 2005
Mr. JOHNSON. Mr. President, would the gentleman from New Mexico yield
to me for purposes of engaging in a colloquy?
Mr. DOMENICI. I would be happy to yield to the gentleman for that
purpose.
Mr. JOHNSON. I thank the gentleman. Section 1287 of the conference
report to accompany H.R. 6 includes rulemaking authority for the
Federal Trade Commission to adopt rules protecting the privacy of
electric consumers in connection with their receipt of electric utility
services. Am I correct in understanding that it was the conference
committee's intent to grant the FTC rulemaking authority with respect
to the information practices of ``traditional'' utility companies and
not financial institutions regulated by the Gramm-Leach-Bliley Act?
Mr. DOMENICI. The gentleman is correct. We did not intend to revisit
issues regulated under the GLBA, or provide the Commission with
rulemaking authority over financial institutions regulated under Gramm-
Leach-Bliley.
Mr. JOHNSON. Am I further correct that it was not your intention that
utility companies be restricted in their ability to report payment
history information to consumer reporting agencies, as such information
can be very beneficial to consumers, such as those consumers with
``thin'' files at credit bureaus?
Mr. DOMENICI. The gentleman is correct.
Mr. JOHNSON. Am I further correct that it was not your intention that
the FTC be given broad rulemaking authority with respect to the goods
or services that can be offered to any utility customer, but rather the
FTC has the authority to regulate the products or services offered by
``traditional'' utility companies and not financial institutions
regulated by the GLBA?
Mr. DOMENICI. The gentleman is correct.
Mr. JOHNSON. I thank the gentleman for his clarifications.
Mr. DOMENICI. I thank the gentleman for bringing these issues to my
attention.
Mr. GRASSLEY. Mr. President, today we have the opportunity to finish
a very long journey in the quest to build a dynamic, comprehensive
energy policy for the United States of America. I can say with pride
that this Congress, through many trials and tribulations, has now
performed admirably in its duty to the American people. This is a
balanced energy bill that focuses as much on the future as it does the
present. We have the opportunity with the passage of this legislation
to safely produce more energy from more sources and with more
infrastructure security then ever before.
On June 21st, the Senate passed H.R. 6 which included the Energy
Policy Tax Incentives Act of 2005. The tax provisions were a bipartisan
product formulated with Senator Baucus, after consultation with many
Members of the Senate.
In my estimation, the energy policy tax incentives reflected in this
conference agreement are a fair balance of the interests of the Members
and effectively supports the development of energy production from
renewable and environmentally beneficial sources.
I would like to briefly describe these tax incentives that are
included in the final energy Conference agreement.
For years, I have worked to decrease our reliance on foreign sources
of energy and accelerate and diversify domestic energy production. I
believe public policy ought to promote renewable domestic production
that uses renewable energy and fosters economic development.
Specifically, the development of alternative energy sources should
alleviate domestic energy shortages and insulate the United States from
the Middle East-dominated oil supply. In addition, the development of
renewable energy resources conserves existing natural resources and
protects the environment.
Finally, alternative energy development provides economic benefits to
farmers, ranchers and forest landowners, such as those in Iowa who have
launched efforts to diversify the State's economy and to find creative
ways to extract a greater return from abundant natural resources.
Section 45 of the Internal Revenue Code currently provides a
production tax credit for electricity produced from renewable sources
including wind, biomass, and other renewables. The final Energy Tax
Incentives Act extends the section 45 credit through the end of 2007.
I have been a constant advocate of alternative energy sources. Since
the inception 13 years ago of the wind energy tax credit, wind energy
production has grown considerably. In addition, wind represents an
affordable and inexhaustible source of domestically produced energy.
Extending the wind energy tax credit until 2008 will support the
tremendous continued development of this clean, renewable energy
source.
The conference agreement supports a maturing green energy source.
Experts have established wind energy's valuable contributions to
maintaining cleaner air and a cleaner environment. Every 10,000
megawatts of wind energy produced in the United States can reduce
carbon monoxide emissions by 33 million metric tons by replacing the
combustion of fossil fuels.
In addition, this agreement helps to empower our rural communities to
reap continued economic benefits. The installation of wind turbines has
a stimulative economic effect because it requires significant capital
investment which results in the creation of jobs and the injection of
capital into often rural economic areas.
In addition, for each wind turbine, a farmer or rancher can receive
more than $2,000 per year for 20 years in direct lease payments. Iowa's
major wind farms currently pay more than $640,000 per year to
landowners, and the development of 1,000 megawatts of capacity in
California, for example, would result in annual payments of
approximately $2 million to farm and forest landowners in that State.
Environmentally friendly biomass energy production is a proven,
effective technology that generates numerous waste management public
benefits across the country.
The biomass definition covers open loop biomass. Open loop biomass
includes organic, nonhazardous materials such as sawdust, tree
trimmings, agricultural byproducts and untreated construction debris.
The development of a local industry to convert biomass to electricity
has the potential to produce enormous economic benefits and electricity
security for rural America.
In addition, studies show that biomass crops could produce between $2
and $5 billion in additional farm income for American farmers. As an
example, over 450 tons of turkey and chicken litter are under contract
to be sold for an electricity plant using poultry litter being built in
Minnesota. This is a win-win. Not only do the farmers not have to pay
to dispose of this stuff, they get paid to sell the litter. You could
find similar examples throughout the Midwest and other farm regions
across America.
Finally, marginal farmland incapable of sustaining traditional yearly
production is often capable of generating native grasses and organic
materials that are ideal for biomass energy production. Turning tree
trimmings and native grasses into energy provides an economic gain and
serves an important public interest.
I am very proud of a long history of supporting new alternative
energy concepts in the production of electricity. The energy conference
agreement continues that commitment.
By using animal waste as an energy source, an American livestock
producer can reduce or eliminate monthly energy purchases from electric
and gas suppliers and provide excess energy for distribution to other
members of the community.
Swine and bovine energy is truly green electricity, as it also
furthers environmental objectives.
Specifically, anaerobic digestion of manure improves air quality
because it eliminates as much as 90 percent of the odor from feedlots
and improves soil and water quality by dramatically reducing problems
with waste runoff. Maximizing farm resources in such a manner may prove
essential to remain competitive in today's livestock market. In
addition, the technology used to create the electricity results in the
production of a fertilizer product that is of a higher quality than
unprocessed animal waste.
[[Page S9342]]
The Energy Tax Incentives Act is important to agriculture, rural
economy and small business. It is also important for domestic supply
and energy independence.
Rural America can play an important part in energy independence and
domestic supply. In addition to the production of electricity, this
agreement includes additional tax incentives for the production of
alternative fuels from renewable resources.
We continue the small producers credit for the production of ethanol.
We continue the incentive for the production of biodiesel. Biodiesel is
a natural substitute for diesel fuel and can be made from almost all
vegetable oils and animal fats. Modern science is allowing us to slowly
substitute natural renewable agricultural sources for traditional
petroleum. It gives us choices for the future and it can relieve the
strain on the domestic oil production to fulfill those important needs
that agricultural products cannot serve.
Renewable fuels like ethanol and biodiesel will improve air quality,
strengthen national security, reduce the trade deficit, decrease
dependence on the Middle East for oil, and expand markets for
agricultural products.
This package is fiscally responsible. The conference report provides
a net $11.5 billion in tax relief over 10 years. That figure aligns
with the budget resolution. Over 5 years, the package loses only about
$6.9 billion.
The Energy conference agreement is a balanced package. I would like
to note, with some satisfaction, that today we have performed the
people's business in the way they want us to do business. This Energy
Tax Incentives Act was crafted in a bipartisan, bicameral way on an
important initiative, in a way that reflects the diversity of our views
and the diversity of our Nation.
Mrs. FEINSTEIN. Mr. President, I thank Senators Domenici and Bingaman
for insisting upon a more open, bipartisan conference than we have seen
in a number of other important bills.
Chairman Domenici deserves great credit for making sure that this
conference report does not include some of the most egregious House
provisions, particularly retroactive liability protection for MTBE
producers and broad Clean Air Act exemptions.
However, I am extremely concerned that this bill does nothing to
address global warming and fuel economy standards. I believe that
climate change is the most urgent energy-related problem of my
lifetime.
This bill refuses to accept responsibility or chart a course to deal
with the United States' profligate use of emissions-producing energy
sources.
The United States is the largest consumer of energy, yet this bill
does nothing to reduce our energy consumption. This bill deletes a very
modest oil savings provision that would have required us to save 1
million barrels of oil per day in 2015.
Nor does it include a renewable portfolio standard that I would have
required that 10 percent of the nation's electricity come from
renewable resources by 2020. California will achieve a renewable
portfolio standard of 20 percent by 2017. It is doable nationally.
Climate change is the most important energy and environmental issue
facing us today. The earth's temperatures are expected to rise between
2.5 degrees and 10.4 degrees Fahrenheit over the next century.
During the same time period, the American Southwest could see a rise
of 14 degrees or more.
Glaciers are melting, sea levels are rising, and water supplies in
the West are at severe risk.
By not acting to aggressively reduce our emissions, we are putting
California's water supplies at severe risk.
California depends on the Sierra Nevada snowpack as its largest
source of water. It is estimated that by the end of this century, the
shrinking of the snowpack will eliminate the water source for 16
million people--equal to all of the people in the Los Angeles Basin.
We must act now. Carbon dioxide emissions accumulate in the
atmosphere--the more we emit, the worse the impacts on our environment.
If we curb our emissions now, we may have a chance to limit the damage
we are causing to our fragile ecosystem.
Yet this bill does not include the Sense of the Senate on climate
change that recognizes that climate change is being caused by man-made
emissions, and that Congress must pass legislation that establishes a
mandatory cap on emissions.
The lack of action on climate change and fuel economy is an enormous
deficit of the bill.
Increasing fuel economy standards is the single most important step
we can take to reduce our dependence on oil. We have the technology now
to increase the fuel economy of our vehicles.
GM, DaimlerChrysler and Honda have already developed something known
as cylinder cut-off technology that provides the fuel efficiency
similar to a vehicle with a smaller engine, but with all the power of a
big engine. The auto manufacturers could use a more fuel efficient
design, using lighter materials that increase fuel economy without
sacrificing safety.
The list goes on and on, yet the auto manufacturers will not act
unless Congress forces them to. We are missing a huge opportunity to
address the real problem that consumers are facing--rising gas prices.
Those gas prices are not going to fall until or unless we reduce our
demand for oil by increasing our fuel economy.
I am also concerned about the following provisions in the bill:
Ethanol--the bill has an egregious 7.5 billion gallon mandate for
ethanol. My State does not need the fuel additive to meet clean air
standards.
I thank the conferees for retaining an amendment I offered to protect
California's air quality. It waives the requirement that California use
ethanol in the summer months when it can end up polluting the air more
than protecting it.
However, I believe that this mandate will raise gas prices for
Californians. So far, ethanol in California's gasoline has increased
the cost of our gasoline by 4 to 8 cents per gallon.
Further, the ethanol mandate maintains the 54 cent-per-gallon import
duty that prevents oil producers from buying ethanol on the global
market, or wherever it is cheapest.
Moreover, ethanol receives a tax credit of 51 cents per gallon. A 7.5
billion gallon mandate means an almost $2 billion loss to the U.S.
Treasury over today's receipts. I believe this mandate is an
unnecessary giveaway.
In addition, increasing the use of ethanol will not decrease our use
of oil. When this mandate is fully implemented in 2012 it will only
reduce U.S. oil consumption by less than one-half of one percent.
I believe this is bad public policy and that it is an unnecessary,
costly mandate that should not be in the energy bill.
LNG Siting--this bill gives the Federal Energy Regulatory Commission
exclusive authority over siting LNG terminals. There are three projects
proposed in California. It seems to me that the location of these
projects should be left up to the State, not to the Federal Government.
The Federal Energy Regulatory Commission should ensure that the
technicalities of natural gas delivery are taken care of, not where
these facilities are located on the coastlines of our states.
Outer Continental Shelf--this bill provides for an inventory of the
resources off our shores. This is not necessary unless we plan on
drilling, to which I remain very much opposed.
I strongly oppose lifting the moratoria on drilling on the Outer
Continental Shelf and my State is unified in its opposition as well.
Our coast is too important to California's economy and to our quality
of life.
Environmental Rollbacks--the bill exempts the underground injection
of chemicals during oil and gas development from regulation under the
Safe Drinking Water Act, and waives the storm water runoff Clean Water
Act regulations for oil and gas construction sites.
These are unnecessary environmental rollbacks that should not have
been included in the Energy bill conference report.
I reluctantly voted for the Energy bill when it was considered on the
Senate floor. The reason I voted for it was because it included strong
consumer protections, and great energy efficiency tax incentives that
Senator Snowe and I have been pushing for the past several years.
[[Page S9343]]
While I am pleased that the strong consumer protections are still
included in the bill, I am extremely disappointed with the energy
efficiency tax incentives.
The tax incentives for energy efficiency in the Senate bill were the
cornerstone of a sensible energy policy to address high natural gas
prices, peak power reliability, and global warming. It would have saved
over 180 million metric tons of carbon emissions annually in the year
2025--some 10 percent of U.S. emissions for all purposes, while saving
consumers over $100 billion annually.
But the Energy bill conference report cut these incentives back by
over two-thirds, leaving the Nation with only the skeleton of an
effective energy efficiency tax program. While it is possible that this
hobbled program could still work, it is so under-funded that it could
also fail.
The Senate bill provides performance-based incentives of up to $2,000
for retrofits made to homes that would achieve a 50 percent energy
savings, and applied to all types of homes, whether owner-occupied or
renter-occupied, whether owned by families or by businesses, and
whether the tenant or the landlord performs the retrofit.
The conference report gutted this program--providing cost-based
incentives limited to 10 percent of the cost of the retrofit, or a
maximum of $500. This is problematic because nearly identical cost-
based tax incentives for home retrofits were tried in 1978. They cost
the Treasury over $5 billion and not a single study has found that they
produced any energy savings.
The Senate bill also provided 4 years of eligibility for high
technology air conditioners, furnaces, and water heaters. The
conference report cut this eligibility back to 2 years.
This is a big problem because an equipment manufacturer has to make a
large investment to mass-produce the efficient equipment.
If that investment must be fully amortized over two years of
incentivized sales, manufacturers may be unwilling or unable to make
it.
A 4-year amortization period would cause much more manufacturer
interest and spur the energy efficiency that we want to promote with
these tax credits.
In other words, these energy efficiency tax credits may be
meaningless when it comes time to implement them. That would be a
terrible shame--energy efficiency has been a huge success in reducing
California's demand for energy.
In California, efficiency programs have kept electricity consumption
flat for the past 30 years, in contrast to the rest of the United
States, where consumption increased 50 percent.
During the Western energy crisis, California faced energy shortages
and rolling blackouts, but it could have been much worse. Ultimately,
the State was able to escape further blackouts because Californians
made a major effort to conserve energy. This reduced demand for
electricity and helped ease the crisis.
Unfortunately, the conference report dramatically reduced the
effectiveness of the most important step this nation could take to
reduce our energy usage--incentivizing energy efficiency.
By not including the oil savings amendment, the renewable portfolio
standard, the Sense of the Senate on climate change, and by gutting the
energy efficiency tax incentives, this bill preserves the status quo
and does nothing to reduce our dependence on oil or on other fossil
fuels.
This bill will not solve our Nation's energy problems, lower gas
prices, or reduce emissions. And while I thank Senators Domenici and
Bingaman for the fair, open process by which they brought us this bill,
I will cast my vote against the conference report.
Ms. CANTWELL. Mr. President, I rise today to discuss the conference
report on H.R. 6, the Comprehensive Energy Policy Act of 2005. I stand
before my colleagues today with very mixed feelings about this
legislation. This conference report has many meaningful achievements
and measures that can help provide this Nation, our researchers, and
innovators, with the basic tools to start moving America forward toward
a new energy strategy for the 21st century. Yet it is far from perfect.
It sidesteps many of the most fundamental energy security challenges we
face--challenges like our dependence on foreign oil and global climate
change, which grow more intractable the longer we wait to address them.
It contains provisions that I simply do not support. It is certainly
not the Energy bill that this Senator would write if I alone held the
drafting pen--the kind of legislation that would put this Nation on a
far more ambitious path toward greater energy security in the global
economy. I know many of my colleagues feel exactly the same way.
And yet I believe all Senators must clearly acknowledge that this
legislation is in many ways superior to the Energy bill conference
report we considered during the 108th Congress. And that is true in
some very meaningful ways for my region, the Pacific Northwest.
When the Senate, last month, approved its version of this
legislation, I noted that I appreciated the skill and thoughtfulness
with which the chairman and ranking member of the Energy Committee,
Senators Domenici and Bingaman, had navigated a path forward for this
bill. I suggested at the time that they would need every bit of that
skill in coming to resolution with the House of Representatives, on a
piece of legislation worthy of this Senate's support. Frankly, I
doubted very much that it could be done.
But I stand here today ready to vote for this conference report--with
reservations, of course--but in recognition of the fact that this
legislation is probably better than many of us had reason to expect;
and as good as the current political will of Congress would allow. For
that, I give enormous credit to the chairman and ranking member. As a
member of the Senate Energy Committee, I want to say that I have
appreciated the bipartisan nature in which they have handled this bill
from the outset. At every turn, they have treated this Senator--and her
constituents' interests--with complete fairness. The process by which
this legislation was assembled should serve as a model for this body.
I want to talk briefly about what I view as some of the most
important achievements of this legislation--particularly for my region
and the great State of Washington. These are some of the basic tools
that can help serve as building blocks to a more ambitious energy
strategy for America.
First and foremost, it is important to understand that the Pacific
Northwest is a region completely unique when it comes to our energy
system. More than 70 percent of the electricity production in
Washington State is derived from hydroelectric sources--designed around
our great river, the mighty Columbia. This was a system built as part
of President Franklin Delano Roosevelt's efforts to electrify the West.
As a result, we are a region with a rich and diverse energy history, an
uncommon collection of public and private institutions, a large Federal
presence that starts with the Bonneville Power Administration, BPA, and
a diverse array of stakeholders rightly concerned about the river's
multiple uses. I know all of my colleagues from the Northwest who sit
on the Energy Committee--there are five of us, in fact--appreciate this
tremendous heritage, our region's history of cost-based power, and the
valuable asset that we inherited from our predecessors, great leaders
like Senators Jackson, Hatfield, and Magnuson.
That is why we worked hard, in a bipartisan manner at every turn, to
safeguard the Northwest's system of cost-based power--the engine of our
regional economy. That is why the electricity title of this legislation
is so important to my region, and to the ratepayers of Washington
State.
I am proud this legislation specifically protects the Northwest's
transmission system, by prohibiting the Federal Energy Regulatory
Commission, FERC, from converting the Bonneville Power Administration's
existing system of cost-based, firm transmission contracts to a market-
based auction of financial transmission rights.
Now, this auction of financial transmission rights was a central
tenet of FERC's controversial and ill-fated standard market design,
SMD, proposal. All of us from the Northwest were united in our
opposition to SMD because we recognized right away that it was a scheme
with the potential to result in tremendous amounts of cost-
[[Page S9344]]
shifting onto our ratepayers, and to substantially undermine our cost-
based system. The provision that protects the Northwest's existing
system is thus an important achievement because it slams the door on
any sort of future FERC-imposed proposal like standard market design. I
would also note that the Senate-passed Energy bill would have slammed
the door on SMD once and for all. This became unnecessary, however,
when FERC's new chairman officially terminated the commission's SMD
proceeding earlier this month. I think that was a very wise choice and
think it speaks quite well of the commission's new leadership.
Also important to my region are provisions that this bill does not
contain. Specifically, this conference report omits the
administration's legislative proposals--unveiled earlier this year--to
hamstring BPA's ability to invest in regional infrastructure and upend
Bonneville's system of cost-based power sales. The Northwest Power and
Conservation Council has estimated the administration's proposal would
raise regional power rates by $1.7 billion. That would translate to a
$480-a-year rate hike for families in some of Washington's most rural
communities. Again thanks to the bipartisan efforts of Northwest
Senators, those legislative proposals were dead on arrival.
When it comes to protecting Washington State consumers, I must also
mention a number of other provisions. At long last, the bill
establishes mandatory, enforceable reliability rules for operation of
the Nation's transmission grid. This effort also began in the Pacific
Northwest--after an August 1996 blackout resulting from two overloaded
transmission lines near Portland, OR which caused a sweeping outage
that knocked out power for up to 16 hours in 10 States, including
Washington. As a result, both a DOE task force and the industry itself
in 1997 recommended mandatory reliability rules for operating the
transmission grid. The Senate first passed this legislation just over 5
years ago, in an effort begun by my predecessor, Senator Slade Gorton.
It is legislation that I have championed since I have arrived in the
Senate, an effort that gained more urgency with the Northeast blackouts
of two summers ago; and I will be very pleased to see this measure
through to the end.
This bill also takes steps to respond to the disastrous western
energy crisis, which extracted billions of dollars and hundreds of
thousands of jobs from our regional economy. As I have recounted many
times on this floor, the illegal and unethical practices of Enron and
others sent Washington power rates through the roof. This Energy bill
puts in place the first ever broad prohibition on manipulation of
electricity and natural gas markets. These provisions are modeled on a
measure that I have authored that has now passed the Senate twice, and
I am pleased that they are included in this conference report--
particularly given the far inferior provisions contained in the House
legislation, which would have in many ways gone in the entirely
opposite direction.
In light of the now-infamous audiotapes of Enron traders and others
conspiring to gouge consumers, the legislation also gives Federal
regulators new authority to ban unscrupulous energy traders and
executives from employment in the utility industry. In addition, it
substantially increases fines for energy companies that break the
rules. And importantly for my constituents, this legislation prohibits
a Federal bankruptcy court from enforcing fraudulent Enron power
contracts, including $122 million the now-bankrupt energy giant is
attempting to collect from Snohomish PUD. That would translate to more
than $400 from the pockets of every family in Snohomish County, WA, who
have already seen their utility bills rise precipitously as a result of
the western energy debacle.
For all these provisions, I am tremendously grateful to the chairman
and ranking member. I know they faced a steep uphill battle with the
House in retaining these measures, and I applaud and thank them for
their efforts in ensuring that the Senate positions prevailed.
I should also mention the renewable fuels provisions of this bill,
which I believe will help put Washington State farmers and
entrepreneurs in the biofuels business. Today, production of biofuels
is dominated by the midwestern region of the country, as traditional
policies have supported corn- and soy-based fuel production and helped
that technology gain maturity. However, the key to lowering costs and
establishing a truly national strategy is to make an investment in new
technologies that will diversify biofuels production in the United
States.
Researchers at Washington State University estimate that our State
has the capacity to produce 200 million gallons of ethanol from wheat
straw, and up to 1.2 billion gallons with technology improvements.
Meanwhile, biodiesel is another emerging opportunity for Washington
State farmers, using canola or yellow mustard. These crops are
particularly well-suited to Washington State, providing high yields
without irrigation.
Around Spokane, it is estimated that 500,000 acres a year could be
put into oil seed production, enough oil to produce 25 million gallons
of biodiesel. Statewide, at least 2 million acres could be put into
oilseed production for biodiesel.
There are a number of very important provisions in this bill that
will help my State capitalize on the promise of biofuels, including an
Advanced Biofuel Technology Program I authored, to help demonstrate
these new technologies; important market-based incentives for refiners
to diversify the types of biofuels they use; and financial support in
many forms for cellulosic ethanol and biodiesel production.
These are very important achievements that will help transform
biofuels from a boutique regional industry to something that can become
part of a truly national strategy to help supplant our Nation's
petroleum imports--lowering costs and helping provide greater economic
security to our farmers at the same time.
But in addition to renewable fuels, we should acknowledge the
provisions of this legislation promoting renewable electricity
generation. Obviously, this legislation does not go as far as I would
like. I vigorously support a renewable portfolio standard--even a more
aggressive standard than what passed the Senate. It is unfortunate,
indeed, that the House would not accept this provision, and those of us
who strongly advocate it will continue to attempt to move the RPS
forward.
But this legislation does extend through the end of 2007 the existing
production tax credit for renewable energy, such as wind resources. It
is estimated that this credit can help save Washington State ratepayers
$260 million over the next 10 years. As Northwest utilities add wind
resources to help bolster regional power supplies, these investments
are also helping fill the coffers of local communities. For example, a
new wind project near Ellensburg, WA, has generated an additional $2
million in revenue for Kittitas County. Similarly, wind energy is
helping provide another source of income for Northwest farmers. Growers
in Columbia County, WA, home to the new 150 Megawatt Hopkins Ridge wind
project, receive about $5,000 per turbine located on their land. One
farmer estimates the revenue generated by the project will equal the
income generated by 250 acres of harvest.
For the first time, the Energy bill creates clean renewable energy
bonds, to support investment in renewable energy resources by
governmental entities, including tribes, agencies such as BPA and other
public power entities. I am also pleased that for 20 years the
Renewable Energy Production Incentive, REPI, Program, which provides a
direct payment to public power entities, which do not qualify for tax
credits, for renewable electricity production. Eligible resources are
expanded to include ocean energy. The REPI Program has already been
used by multiple Washington State public utilities to make renewable
energy investments.
Washington State is also home to the Pacific Northwest National Lab,
and for that reason, the research and development title of this
legislation bears mentioning. The Energy bill conference report
authorizes hundreds of millions of dollars of investment in research
ongoing at the Pacific Northwest National Lab and Washington State
universities, including systems biology research, distributed and smart
energy technology research and development; bio- and nanotechnology
related to the production of bioproducts; and advanced scientific
computing.
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The Energy bill's ``personnel and training'' title is also worth
noting, since it will help provide a skilled energy workforce for the
21st century, as the energy industry braces for a critical shortage.
Washington State is poised to help train the next generation of
engineers and innovators in this area. The legislation requires the
Secretaries of Energy and Labor to monitor workforce trends in the area
of electric power and transmission engineers and identify critical
national shortages of personnel. It also authorizes the Secretaries to
establish a grants program of up to $20 million a year to enhance
training--including distance-learning, such as the program now being
pioneered at Gonzaga University--in electric power and transmission
engineering fields. While fewer than 15 universities nationwide offer
world-class, Ph.D.-level programs in power engineering, both Washington
State University and the University of Washington offer strong programs
in this area. In addition, Gonzaga University this year established a
specialized masters of science degree and certification program in
transmission and distribution engineering.
This conference report also streamlines technology transfer rules for
national labs such as PNNL, and extends the 20 percent R&D tax credit
to energy research done by nonprofit consortiums involving small
businesses, National Labs, and universities to promote interaction and
collaboration between public and private researchers. The research and
development and workforce provisions of this bill hold some of the most
promise in putting in place the building blocks for a real, innovative
energy strategy for the 21st century.
Years in the making, the Energy bill also includes bipartisan reform
of the hydroelectric relicensing process. The hydro provisions included
in this legislation are designed to improve the accountability and
quality of Federal agencies' decisions. At the same time, the
compromise restores the rights of the public to participate in the
process on equal footing with license applicants--provisions that have
been missing in previous versions of the bill. Over the next 15 years,
70 percent of Washington State's non-Federal hydro must go through the
hydro relicensing process.
Another provision of importance to my State is this legislation's
reinstatement of the oil spill liability trust fund, OSLTF. Earlier
this year, a Coast Guard report found that the OSLTF--which has been
used to clean up spills in the Puget Sound--would run out of money by
2009. The OSLTF was established in the 1990 Oil Pollution Control Act,
and has been funded through a per-barrel fee on oil companies until it
reached its statutory cap of $1 billion. The fund was designed to be
maintained from interest on that original $1 billion, but increasing
cleanup costs and low liability caps have eroded the principal amount.
The Energy bill would reinstate the fee in April 2006 or thereafter,
once the Secretary finds that the balance in the account falls below $2
billion. The bill authorizes application of the fee through 2014.
Lastly, I want to mention this legislation's provisions to provide
energy assistance to some of our Nation's neediest families. The Energy
bill would boost authorization for the Low-Income Home Energy
Assistance Program, LIHEAP, from its traditional level of $2 billion to
$5.1 billion, for 2005-2007. LIHEAP funding is critical for some of
Washington State's most vulnerable citizens. As a result of the western
energy crisis, electricity rates have gone up more than 20 percent
statewide while 72 percent of low-income families in Washington use
electricity to heat their homes. And already, the 105,000
Washingtonians with incomes below 50 percent of the Federal poverty
level spend 34 percent of their entire annual pay on home energy bills.
In recent years, less than 30 percent of Washington's eligible families
have been able to receive energy assistance--as demand has for LIHEAP
dollars has far outpaced their availability. More than doubling
available LIHEAP funding would provide a much-needed boost to local
organizations in Washington struggling to meet the needs of their
communities.
As my colleagues can see, this legislation is tremendously complex. I
have listed many of the provisions important to my constituents. Of
course, there are a number of other measures with which I simply
disagree. Perhaps that is to be expected of a 1,700-page piece of
legislation that touches every sector of the American economy. For
example, the inventory of Outer Continental Shelf oil and gas resources
is wrong-headed, and I oppose it. I would note, however, that in order
for the inventory to move forward, it must be funded. I know this
Senator believes any such inventory would constitute a tremendous waste
of taxpayer funds, and the fight is far from over on this issue.
Similarly, I oppose the liquefied natural gas provisions of this bill
because I believe States and local communities need a bigger role in
these decisions. Some of the nuclear provisions of this bill are
particularly offensive, in that they create an inherent conflict of
interest at the Nuclear Regulatory Commission, which should not be
subject to the cross pressures of protecting public safety and the
public interest, at the same time the commission is under fiscal
pressure to unwisely accelerate its proceedings under the guise of some
new form of ``risk insurance.''
I oppose the Clean Water Act and Safe Drinking Water Act rollbacks in
this bill. The National Energy Policy Act provisions are similarly
unnecessary. But I recognize that they are far less sweeping than those
originally proposed by the House. If this Senator had her way, we would
not be repealing the Public Utility Holding Company Act. Yet I am at
least comforted by the fact this legislation hews closely to the
compromise on utility mergers reached by the Senate.
Moreover, the tax package does not resemble the tax package I would
have written. On this point, I agree with the President: The oil and
gas industry does not need these incentives, given where prices are at
today.
I am not the first Senator to say it, and I won't be the last. This
bill is not as I would have written it. It has the flaws that I have
listed. It is also incomplete. It is a status quo bill when it comes to
one of the most difficult challenges to our economic and national
security faced by this generation: America's dangerous dependence on
foreign oil. This bill does not address this festering problem. It will
not provide relief to consumers at the gas pump. Any suggestion to the
contrary would be simply false.
It is clear to this Senator that if this body is truly serious about
putting in place a framework that will allow the United States to
compete in the global marketplace; a framework that will allow America
to control its own destiny in the coming decades as it relates to our
energy security, our work is not done. Tomorrow isn't soon enough to go
back to the drawing board and get serious about our dependence on
foreign oil. And this Senator will keep fighting to do just that. Our
work on energy security has hardly begun--it is far from finished if we
want to live up to our responsibilities to future generations of
Americans. We must not leave to them a Nation crippled by its addiction
to foreign sources of oil--an over-dependence that jeopardizes our
economic future and national security.
On the contrary, it is our responsibility to face up to a simple
fact: The accidents of geology make it impossible for this Nation to
drill its way to energy independence, since we are situated on just 3
percent of the world's proven oil reserves. We must recognize that fact
and read the economic indicators. We must consider emerging competitors
such as China and India, and recognize the seismic shifts that are
likely to occur in the dynamics of world energy markets.
I firmly believe that future generations of Americans will measure us
on how we choose to address the challenges of energy security and
climate change. They are that vital to this Nation's security and our
economic future.
But this Senator also recognizes that the leadership of this Congress
is not yet prepared to take that step; that my colleagues and I who
believe so fundamentally in the importance of enhancing our oil
security have more work to do to change the hearts and minds of our
colleagues. The American people must also demand better leadership from
their elected officials when it comes to energy security. And this
Senator stands ready to work across
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the aisle to do what is necessary to make meaningful progress on these
issues.
This bill is not perfect. We have much more work to do to bolster our
energy security, and this Senator is ready to roll up her sleeves and
do it. But on the whole, this bill provides some basic building blocks
toward a better energy future. For that reason, I will support the
Energy bill conference report and urge my colleagues to do the same.
Mrs. CLINTON. Mr. President, I rise to speak on the Energy bill that
the Senate will be voting on today. Unfortunately, I cannot support
this bill.
The bill does include some worthy provisions. For example, the bill
includes the major provisions of the Hydrogen and Fuel Cell Technology
Act of 2005 that I have worked on for years with Senator Dorgan. It
includes my Dirty Bomb Prevention Act of 2005, as well as a provision
that I authored to require backup power for emergency sirens around the
Indian Point nuclear powerplant. It extends and expands the wind
production tax credit, and includes a provision to help us continue to
develop and commercialize clean coal technology. It will push energy
efficiency standards of air conditioners and other appliances forward.
It will establish mandatory, enforceable reliability standards,
something that I have been pushing for since the August 2003 blackout.
And it includes a bill I introduced with Senator Voinovich to create a
grant program at the U.S. Environmental Protection Agency to promote
the reduction of diesel emissions.
In spite of these positive measures, I oppose the bill for two
reasons. First, it contains a number of highly objectionable
provisions. Second, it simply ignores several of our most pressing
energy challenges, such as our dependence on foreign oil.
I won't list all of the problematic provisions here, but I want to
highlight a couple of the most troubling. The bill includes billions in
subsidies for mature energy industries, including oil and nuclear
power. These are giveaways of taxpayer money that do nothing to move us
toward the next generation of energy technologies. The bill accelerates
the siting procedures for liquid natural gas terminals and weakens the
State role in the process, something I am very concerned about, given
the Broadwater proposal looming off the Long Island shores. As ranking
member of the Water Subcommittee of the Environment and Public Works
Committee, I object to the provisions that exempt hydraulic fracturing
from coverage under the Safe Drinking Water Act and exempt oil and gas
construction sites from stormwater runoff regulations under the Clean
Water Act. Despite a long-standing moratorium on oil drilling off most
of the U.S. coast, including the New York coast, the bill authorizes an
inventory of oil and gas resources there.
None of these provisions should be in the bill. But the main reason
that I must oppose this bill is that it simply doesn't address the most
pressing and important energy challenges that we face. It is a missed
opportunity to reduce our dependence on foreign oil, spur the
development of renewable resources, and address climate change.
While the Senate-passed bill did not go as far as I would like in
terms of reducing our dependence on foreign oil, it did contain a
provision that would reduce U.S. oil consumption by 1 million barrels
of oil per day by 2015. That was dropped in conference.
The Senate bill had a modest provision to increase the percentage of
electricity generated from renewable sources to 10 percent by the year
2020. That, too, was dropped in conference.
In addition, the Senate went on record as supporting a mandatory
program to start reducing the greenhouse gas emissions that are
contributing to climate change. That is gone as well.
So as I look at the bill as a whole, I see a major missed
opportunity. By the President's own admission, this bill won't do
anything to reduce gasoline prices, but we know for a fact that it will
give billions in tax breaks to companies like Exxon Mobil. It doesn't
do nearly enough to push the development and commercialization of
clean, next-generation energy technologies, but it gives huge tax
breaks to nuclear power, a technology that has been with us for 50
years. And given what we now know about the looming threat of climate
change, it makes no sense to make energy policy without integrating a
cost-effective strategy to reduce greenhouse gas emissions. But that is
exactly what this bill does.
In short, this bill simply misses the mark. It ignores our biggest
energy challenges, subsidizes mature energy industries like oil and
nuclear, and rolls back our environmental laws. I know it will pass
today, but I will not be voting for it.
Mr. JEFFORDS. Mr. President, I want to share my views on the final
Energy bill conference report now before us. I regret that I will be
unable to support this legislation, and I will explain my substantive
concerns about the bill in greater detail. But, first, I want to
comment on the process that brought us to this point because the
process has been very different than the last energy conference report.
The last energy conference report to come before the Senate in the
108th Congress contained more than 100 provisions in the jurisdiction
of the Environment and Public Works Committee. In my role as the
ranking member, I came to the floor to share with the Senate that the
EPW Committee was not consulted in the development of any of those
provisions.
That closed-door process did not occur with this conference report,
and I believe that was due to the efforts of Senators Domenici and
Bingaman. Though neither Senator Inhofe nor I were conferees, we were
apprized of conference discussions. Our staff reviewed and provided
technical assistance on provisions. For example, we agreed to revise
the House's nuclear title to incorporate three nuclear bills reported
by the Environment and Public Works Committee. We also worked closely
on the ethanol provisions, given their implications for the Clean Air
Act.
The Senators from New Mexico worked hard to limit the items in the
conference report in the EPW Committee's jurisdiction. They faced a
very uphill task. The House bill had many troubling environmental
provisions that were strongly supported by House conferees.
Unfortunately, though, many troubling environmental provisions were
removed during conference negotiations, several provisions of concern
to me and to several other Democratic members of the EPW Committee
remain in the final conference report.
I say all this to make clear to the Senate that I am not opposing
this bill on process, but on policy. It contains bad environmental
policy. It is a missed opportunity with respect to our energy policy.
It contains the wrong fiscal priorities with $80 billion in giveaways
to the oil, gas, coal, and nuclear industries. And, for those reasons,
I feel it is not the right energy policy for America today, and
certainly not for the future.
I am deeply concerned that the conference report before us does not
represent the kind of forward looking, balanced energy policy that our
Nation needs. It does not go far enough in reducing our country's
reliance on imported oil. Provisions to set a goal to curb our Nation's
oil use, overwhelmingly supported in the Senate, were defeated.
Provisions in the Senate bill to set a national goal to obtain 10
percent of our Nation's electricity from renewable sources were also
stripped in the conference.
I have spent my congressional career promoting the use of renewable
energy in our country. This Nation has abundant renewable energy
sources, from wind to animal methane to geothermal, in every State, and
it is in our economic and environmental interest to use them. It is
very disappointing to me, as we stand here on the threshold of passing
an energy bill that will likely serve as our country's energy policy
well into the next decade, that many of the same polluting coal-fired
power plants that were operating when I came to Congress are still
operating without modern pollution controls. Though this conference
report takes an important step by asking the Federal agencies to get
roughly 8 percent of their energy from renewable sources in 2020, this
should have been an economy-wide goal.
It also fails to substantively address many other important issues,
such as climate change and the need to improve vehicle fuel economy to
give consumers more affordable and less-polluting choices when they buy
their family's next automobile.
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But worst of all, this bill seriously harms the environment. During
the conference, along with the majority of Senate Environment Committee
minority colleagues, I wrote the conferees listing six of what I
believed to be the most troubling environmental provisions of the
House-passed bill. Several remain in this bill.
I am disappointed that the renewable fuels provisions in the
conference report continue to differ significantly from the provisions
that were reported by the Environment and Public Works Committee in the
last three Congresses. The provisions that my committee reported were
the ones contained in the energy legislation that the Senate passed
this year and last year.
Though we know methyl tertiary butyl ether, or MTBE, is
environmentally harmful, the conference report does not phase out its
use.
The Senate bill would have phased out MTBE use nationwide over 4
years. The conference report contains no such ban. In addition,
critical language allowing the U.S. Environmental Protection Agency to
pull future gasoline additives off the market if they caused water
pollution problems was eliminated.
The conferees have included language similar to a provision in the
House-passed bill that exempts oil and gas exploration and production
activities from the Clean Water Act storm water program.
The Clean Water Act requires permits for storm water discharges
associated with construction. The conference report changes the act to
exempt oil and gas construction from these permits.
The scope of the provision is extremely broad. Storm water runoff
typically contains pollutants such as oil and grease, chemicals,
nutrients, metals, bacteria, and particulates.
According to EPA estimates, this change would exempt at least 30,000
small oil and gas sites from clean water requirements. In addition,
every construction site in the oil and gas industry larger than 5 acres
are exempt from permit requirements. Some of those sites have held
permits for 10 years or more. This is a terrible rollback of current
law and an unneccessary one. These permits have not been hampering
production by these drilling sites, but they do protect the fragile
water resources around them.
Section 327 of this conference report exempts the practice of
hydraulic fracturing to extract coalbed methane from the Safe Drinking
Water Act. This practice involves injecting a fluid under pressure into
the ground in order to create fractures in rock and capture methane.
The primary risk with hydraulic fracturing is drinking water
contamination that occurs when fluids used to fracture the rock remains
in the ground and reach underground sources of drinking water.
According to the U.S. Government Accountability Office, approximately
half of the U.S. population obtains its drinking water from underground
water sources. In rural areas, this percentage rises to 95 percent. In
its June 2004 study, the EPA reported studies showing that 18-65
percent of injected chemicals can remain stranded in hydraulically
fractured formations.
This is wrong. The American people do not want enhanced energy
production at the expense of the environment, particularly if it
jeopardizes their drinking water wells.
And, they also do not want enhanced energy production at the expense
of their own pocketbook, especially in these times of high energy
prices. This bill contains several very costly provisions that are more
of a giveaway to energy companies than a guarantee of new energy for
the American people. One of the most concerning of these are new
provisions that provide risk insurance for the construction of six new
nuclear power plants.
Now, I agree that siting an energy project is a risky and time-
consuming investment. But this provision, in my view, goes too far.
This provision would allow the Secretary of Energy to enter into a
contract with private interests for the construction of six advanced
nuclear reactors. Further, it authorizes the payment of costs to those
private interests for delays in the full operation of these facilities.
The payments are up to 100 percent of the delay costs, or a total of
$500 million each for the first two facilities. The next four plants
would get a payment of up to 50 percent of the delay costs, up to a
total of $250 million for each facility. This is a total of $2 billion.
The ``delays'' for which private interests can be compensated include
the inability of the Nuclear Regulatory Commission to comply with
schedules that it sets for the reviews and inspections of these
facilities.
If the NRC finishes its work on time, but the full operation of one
of these facilities is delayed by parties exercising their democratic
right to seek judicial review to ensure the safe operation of a nuclear
facility in their community, the plant owners can be compensated while
the case is litigated.
Nuclear powerplants are large capital investments and risky
investments. But so are other energy projects. Just ask anyone who
drills for oil, sites a windmill, or seeks to deploy a new energy
technology. We do not provide any other type of energy facility this
type of guarantee. And what a guarantee, while the Federal Government
processes your permit, or if the Federal Government gets sued, the
taxpayers will pay you, not for generating energy but for doing
nothing.
This is an enormous Federal spending commitment, and one we really
are not likely to be able to afford. The intent really is to put
pressure on the NRC to approve these new reactors and get them on line.
If that is our intent, we should do so without obligating taxpayers to
pay for the appropriate process to get them sited and built.
I also am disappointed that the recycling tax credit provisions I
authored to preserve and expand America's recycling infrastructure were
stripped from the final bill. In a bill that provides $14.5 billion in
tax incentives for energy production, these modest provisions would
have gone a long way to encourage energy savings and job creation
through investment in state-of-the-art recycling technology.
In conclusion I try not to support legislation that exploits our
natural resources and pollutes our environment. This bill contains too
many provisions that represent real departure from current
environmental law and practice to garner my support. Other Senators who
believe that we can obtain energy security for America while preserving
our environment should vote no as well.
I ask unanimous consent that some additional materials clarifying my
views on several bill provisions in the jurisdiction of the Environment
and Public Works Committee be printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:
Additional Views of Senator Jeffords on the Conference Report
Accompanying H.R. 6, the Energy Policy Act of 2005
Mr. JEFFORDS. Mr. President, as I indicated to the Senate
in my remarks, this conference report fails to properly
balance the need for energy exploration and production with
important environmental and conservation concerns. There are
a number of environmental provisions in this bill that were
either considered by the Senate Environment and Public Works
Committee or are in the jurisdiction of that Committee, on
which I serve as Ranking Member. Given that the conference
report contains no detailed statement by the conferees
regarding how these provisions are to be implemented by the
relevant federal agencies, I felt it important to provide
additional comment on these provisions to serve as
legislative history.
MTBE and Motor Vehicle Fuels and Fuel Additives
The conference report fails to ban methyl tertiary butyl
ether (MTBE), an important and constant element of the Senate
bill reported by the Environment and Public Works Committee
in the 109th Congress. While I am pleased that an MTBE
liability waiver is not included in this bill, I am concerned
that MTBE will continue to be used in gasoline, leak from
underground storage tanks and continue to pose significant
and costly drinking water problems.
The elimination of the oxygen-content requirement for
reformulated gasoline and the new ethanol mandate (Section
1504) may result in oil companies reducing the amount of MTBE
used, but it is unlikely to eliminate its use entirely since
it was used as an octane enhancer and anti-knock agent by
petroleum refiners long before the Clean Air Act requirements
of 1990. The continued use of MTBE in gasoline means that
drinking water supplies will continue to be in jeopardy.
Therefore, the Environmental Protection Agency and state
regulatory agencies should continue with their efforts to ban
and limit the use of MTBE.
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I am pleased to see that the bill includes several
provisions from the bill, S. 606, which was reported out of
the Environment and Public Works Committee, that are intended
to protect public health and the environment. Perhaps most
important of these is the toxics anti-backsliding language to
ensure that the elimination of the oxygenate requirement and
the growing number of States' MTBE bans will not encourage
refiners to use toxic replacement materials. The baseline
against performance is judged is set at the average of the
years 2001 and 2002, though EPA has evidence of continued
improvement in toxics reduction performance in later years.
Thus, setting a baseline even a few years old may allow
refiners to backslide on performance and increase toxic air
emissions from fuels.
For unknown reasons, the conferees failed to adopt an
important Senate provision that would prevent MTBE-like water
contamination problems from occurring in the future. As was
recommended in 1999, by the Blue Ribbon Panel on Oxygenates
in Gasoline, the Senate provided EPA the clear authority
under the Clean Air Act to regulate fuels and fuel additives
due to their impact on water quality and resources. Sadly, we
will be doomed to repeat the mistakes of the past on into the
future, because the conferees have apparently not learned
enough from the $25-85 billion remediation costs facing
municipal and residential water systems around the country.
Another Senate bill improvement to current law which was
retained in the conference report was making EPA regularly
require manufacturers registering fuels or fuel additives to
conduct tests publicly to determine public health and
environmental effects before registration and use. The report
also requires EPA within two years of enactment to conduct a
study of the effects on air and water and sensitive
subpopulations of fuel additives (Section 1505). Today there
are a dozen or so different types of fuel additives and
little is known about the toxicological effects of these
chemicals on human health and the environment. These studies
will help us better understand where MTBE and other fuel
additives have leaked and contaminated water resources and
how these chemicals are affecting our nation's water
resources.
As in the Senate bill, the conference report provides that
EPA must update its complex emissions model to reflect
vehicles in the motor vehicle fleet from the 1990 baseline to
a more accurate 2007 fleet, and study the permeation effects
of increased ethanol use on evaporative emissions.
Unfortunately, in section 1513, the conferees opted for the
less protective House provision on blending and comingling.
The Senate bill, consistent with the recommendations of the
Government Accountability Office June 2005 report on
``Gasoline Markets,'' directs EPA to study the air quality
and public health impacts of reducing the number of fuel
formulations in the market, as well as looking the effects on
refiners and gasoline supply and price. This report is due in
mid-2008. The conferees wisely included this useful provision
in the report, which will provide the information necessary
for EPA, the States and Congress to eventually make sound
judgments about reducing the number of fuel formulations.
However, the conference report also includes an illogical and
unnecessarily complex system in section 1541 for limiting the
fuel formulations in advance of data to be collected pursuant
to the Senate report and the GAO recommendation. That same
section also provides unnecessarily expansive and confusing
waiver authority for the Administrator to allow increases in
pollution from fuels and fuel additives.
Coal (Title IV)
This bill authorizes $3 billion in grants and loans through
the Department of Energy and $2.9 billion in tax credits to
assist coal-fired power plant owners in installing more
modern pollution control equipment and to develop better
control technologies. Unfortunately, most of these funds are
not directed at truly advanced and significantly cleaner and
more efficient electricity generation from coal. As a result,
taxpayers will be heavily subsidizing only incremental
improvements, rather than the substantial and radical
improvements that need to be made in thermal efficiency to
combat global warming and in state-of-the art technology to
reduce other harmful air pollutants, like mercury, ozone, and
particulate matter. This Title will not prepare the United
States to live up to its responsibility to be a global
leader in reducing greenhouse gas emissions from our
heavily coal-based electricity-generating base.
Underground Storage Tank Compliance (Title 15, Subtitle B)
Leaking underground storage tanks present a significant
threat to drinking water supplies nationwide. EPA estimates
that there are approximately 150,000 leaking underground
storage tanks currently needing cleanup. While I feel that
the twenty-year old law needs more comprehensive changes, I
am pleased with many of the underground storage tank
provision included in this bill.
This bill will for the first time set a mandatory
inspection frequency for all federally regulated underground
storage tanks. Unfortunately, this requirement falls short of
the every two-year inspection requirement unanimously
approved by the Senate in the 108th Congress. Instead, tanks
that were last inspected in 1999 may be able to evade re-
inspection until 2010 or 2011. EPA believes tanks should be
inspected at least once every three years to minimize the
environmental damage caused by undetected leaks. I encourage
EPA and the states to meet the three-year inspection
frequency upon enactment of this legislation.
I am pleased with the increased authorization provided from
the Leaking Underground Storage Tank (LUST) Trust Fund and
the flexibility given to EPA and the states to use the money
not just for cleanups but also for compliance activities.
Increased authorization is meaningless, however, unless the
President and Congress fulfill their responsibilities to
appropriate adequate resources to carry out these activities.
To ensure that adequate money is provided in the future, I
encourage EPA to work with the states to improve data
collection to demonstrate the public health and environmental
benefits of increased funding.
The bill contains an important new provision to protect
groundwater by requiring secondary containment of new tanks
within 1,000 feet for a community water system or potable
drinking water well. I'm concerned, however, about an
exemption from this modest secondary containment provision
that allows owners and operators to install underground tanks
without secondary containment if the manufacturer and
installer of the new tank system maintain evidence of
financial responsibility to pay for cleaning up a potential
spill. This exemption foolishly emphasizes cleanup over leak
prevention. In addition, this financial responsibility
requirement is likely to lead to delayed cleanups while
owners, manufacturers and installers fight in court over who
is responsible for the leak.
EPA and the states should work closely to encourage owners
and operators of underground storage tanks to opt for the
secondary containment of new underground storage tank systems
rather than face potential legal complications in the future
when the less protective systems leak. EPA should also work
with the states and owners and operators to identify whether
this provision results in litigation or delays cleanups and
to identify, address and share information about common
manufacturing and installation problems with the states and
other owners and operators.
I also question the wisdom of limiting the secondary
containment requirement to systems within 1,000 feet of a
community water system or potable drinking water well as
leaks, especially MTBE, which quickly moves beyond 1,000 feet
radius of the facility. A broader provision requiring
secondary containment on all new tanks has proven very
effective in Vermont. EPA and the states should carefully
identify all potable drinking water sources in these areas
and monitor whether the 1,000 feet radius is adequate to
protect public health.
Western Michigan (Title IX Research and Development--Section 996)
Hidden as a demonstration project in the Research and
Development Title is a provision that provides an exemption
from any new specifically ozone-related requirement or
sanctions under the Clean Air Act for counties in
southwestern Michigan that have been designated as non-
attainment for the 8-hour ozone standard. These areas are not
given a free pass from any existing Federal or State
requirement or enforcement of such existing requirement,
including any that the counties may face as ozone maintenance
areas or as part of any conditions in the state's ozone
implementation plan in place at the time of enactment of this
Act. No pollution source in those counties is provided any
exemption of any kind from requirements or sanctions related
to any other pollutant except as it directly relates to
ozone.
The two-year hiatus in enforcement or application of new
requirements is unwisely provided to several counties with
large populations that are contributing to or causing
nonattainment in areas downwind from those counties. This is
in direct contradiction to the purposes of the Clean Air Act,
particularly as amended in 1990, which recognize the need for
all states and areas to be sensitive to the transported
pollution that they inflict on downwind areas. The Senate
Committee on Environment and Public Works, which has
jurisdiction over matters such as this and on which I serve
as the ranking member, has never had a hearing on this
provision, nor would I have supported such a broad and poorly
drafted temporary exemption.
I expect that in the ``demonstration'' project process over
the next two years, EPA and the Governor of Michigan will not
only assess the difficulties such areas may experience in
meeting the 8-hour ozone standard because of transported
ozone pollution, but also the extent of the downwind damage
and pollution caused by this ``demonstration'' project
exemption and the adequacy of the EPA's SIP review process
under section 110(a)(2). In addition, I would note for any
electric generating unit or any similar major stationary
source in these counties, that the ``demonstration'' period
designation does not permit evasion of existing New Source
Performance Standard requirements in these counties or any
other such programs.
Refinery Revitalization (Title III Oil and Gas--Section 391/392)
I refute the implication in the findings that environmental
regulations have limited the U.S. refining capacity.
Therefore, I find the Refining Revitalization provisions in
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this bill to streamline environmental permitting unnecessary,
preferential treatment for the oil and gas industry.
While it is true that 175 refineries closed in the last 22
years and no new refineries opened, it is also true that at
the same time refining capacity has grown steadily from 6.2
billion to 8.2 billion barrels per day. In fact, the Energy
Information Administration earlier this year projected that
refining capacity will increase and that refining costs are
expected to remain stable or decline.
Despite industry attempts to cut costs and achieve greater
efficiencies through rampant mergers--over 2,600 oil
companies merged in the 1990s--low returns on investment
inhibited expansion in the refinery sector, not overly
burdensome environmental regulations.
Proponents of streamlining environmental permitting argue
that a large number of closed or idle refineries seeking to
reopen are having difficulties obtaining environmental
permits. Yet, neither EPA nor the states currently have
permits pending to restart refineries.
To address this perceived problem, this energy bill
encourages Governors to request that EPA and the state
regulatory agencies streamline environmental permitting by
accepting consolidated permit applications and tells EPA to
find ways to better coordinate among state and federal
agencies and to provide additional financial assistance,
without providing EPA and the states additional resources to
accomplish this task. I am also concerned that this focus on
refinery permitting without additional resources will be done
at the expense of other important environmental priorities.
Refineries are getting preferential treatment that other
energy sectors will not be getting and just another example
of how this bill is just a transfer of taxpayer dollars to
the wealthiest energy companies in the country.
When submitting its budget for next year, EPA should
include a large enough request to ensure that adequate
resources will be available to conduct expedited review of
new and expanding refinery capacity in the United States. Due
to the serious environmental impacts these facilities have on
our nation's air and water, EPA and the States must ensure
that adequate resources are available at the Federal and
State level to conduct expedited, but comprehensive and
complete reviews to ensure that the American people are
protected from the hazards these facilities present.
Nuclear Title (Title VI)
This title adopts the majority of the provisions of Senate
Environment and Public Works Committee reported nuclear bills
in the 109th Congress: the Nuclear Fees Reauthorization Act
of 2005 (S. 858), the Nuclear Safety and Security Act of 2005
(S. 864) and the Price Anderson Amendments Act of 2005 (S.
865).
In particular, Section 651 of the conference report
includes provisions of S. 864 that would regulate
accelerator-produced material, discrete sources of radium-
226, and discrete sources of naturally occurring radioactive
material (NORM) under the Atomic Energy Act. The section does
so because these materials pose a ``dirty bomb'' risk. There
is wide agreement that radium, accelerator-produced materials
and naturally occurring radioactive materials could be used
in a dirty bomb and therefore should be regulated by the
Nuclear Regulatory Commission. Even so, some have raised
questions about why we need to address the disposal of these
materials in the conference report.
The conference report addresses the waste disposal issue
because some of the materials which are not now regulated
under the Atomic Energy Act can currently be disposed of
under the authority of Acts such as the Resource Conservation
and Recovery Act, as long as their activity levels are
sufficiently low. Since the provisions agreed to by the
conferees place these materials under the jurisdiction of the
Atomic Energy Act, they would no longer be able to be
disposed of under the authority of Acts such as the Resource
Conservation and Recovery Act without the additional
provisions we included in the language.
Though the conferees included this language, neither the
NRC nor the Environmental Protection Agency and the states
should conclude that the intent of the disposal provisions is
to expand or alter the waste disposal requirements associated
with these materials. This language is not intended to alter
current disposal practices in any way, but is rather intended
only to preserve the disposal options that are currently
available under existing authority for this material.
In all discussions with the conferees, it was my intent
that these provisions to remain neutral on the issue of waste
disposal, and to ensure that there are no new restrictions
and no new authorities granted by this language. To make it
clear, these provisions would in no way result in granting
new authority for materials that are currently regulated
under the Atomic Energy Act to be disposed of in facilities
not licensed to accept radioactive waste by the Nuclear
Regulatory Commission or an Agreement State under the Low
Level Radioactive Waste Policy Act (LLRWPA).
Bringing accelerator-produced material, discrete sources of
Radium-226, and discrete sources of naturally occurring
radioactive material (NORM) under the Atomic Energy Act
because they pose a dirty bomb risk, without making special
provision for their disposal, would mean that in accordance
with the LLRWPA, as amended, these materials would have to be
disposed of at low-level radioactive waste disposal
facilities licensed by either the NRC or an Agreement State.
Because of interstate import and export restrictions adopted
by compacts under the LLRWPA, bringing radium 226,
accelerator-produced materials and NORM under the
jurisdiction of the Atomic Energy Act could eliminate for
generators in the majority of States a disposal capability
for these materials that is currently available to and being
used by generators across the nation. In addition, regulating
these materials under the Atomic Energy Act might result in
making any Act that excludes Atomic Energy Act material from
the Act's coverage (such as the Solid Waste Disposal Act,
popularly referred to as the Resource Conservation and
Recovery Act (RCRA)) inapplicable. These provisions are
intended only to preserve the disposal options that are
currently available under existing authority for this
material, such as those that are available under the
authority of the Resource Conservation and Recovery Act,
and would not affect the disposal of Atomic Energy Act
materials not covered by this section.
Hydraulic Fracturing Title III/Section 327
By excluding hydraulic fracturing from the definition of
underground injection, Section 327 changes how the
Environmental Protection Agency can regulate this practice
under the Safe Drinking Water Act. Hydraulic fracturing
involves injecting diesel fuel or potentially hazardous
substances such as benzene, toluene, and MTBE underground to
fracture rock and release oil and gas. It is clear this
language allows the EPA to restrict the use of diesel as a
hydraulic fracturing fluid, and the agency should continue to
use its existing authorities under the Clean Water Act and
the Safe Drinking Water Act to reduce loadings of these
pollutants associated with these activities from reaching
surface and drinking water.
Hydraulic fracturing has historically been performed in
very deep wells. Today, it is also used in coalbed methane
extraction that occurs at much shallower depths. This
practice leaves hazardous substances in the ground that leach
into groundwater and jeopardize drinking water. Groundwater
provides drinking water for half the U.S. population. In
rural areas, 95 percent of drinking water comes from
groundwater.
More than 167,000 oil and gas-related injection wells are
currently regulated under the Safe Drinking Water Act and
pose no impediment to oil and gas production. As they
implement this regulation, EPA and the States should continue
to monitor these activities to ensure that drinking water
sources are protected and report to Congress and the public
all incidences where harmful chemicals from hydraulic
fracturing leach into drinking water sources.
Stormwater (Title III/Section 328)
Title III of the conference report also changes how the
Environmental Protection Agency is able to regulate oil and
gas construction activities under the Phase I and Phase II of
the Clean Water Act Stormwater Program. Since 1990, the Phase
I Stormwater Program has required permit coverage for large
municipal separate stormwater systems and 11 categories of
industrial discharges, including large construction sites
disturbing five or more acres of land. In 2005, GAO reported
that over a one-year period, in three of the six largest oil
and gas producing states, 433 oil and gas construction
activities obtained Phase I Stormwater Permits. Some of those
sites have held permits for ten years or more.
Phase II of the program, adopted in 1999, requires permits
for small municipal separate stormwater systems and
construction sites affecting one to five acres of land. EPA
extended the Phase II permitting deadline, originally March
10, 2003, to June 12, 2006 for just the oil and gas industry.
EPA's rationale was that it needed more time to complete its
legal and economic analysis of the rule.
The water quality implications from exempting the oil and
gas industry from stormwater permitting are significant. Over
a short period of time, storm water runoff from construction
site activity can contribute more harmful pollutants,
including sediment, into rivers, lakes, and streams than had
been deposited over several decades. Sediment clouds water,
decreases photosynthetic activity, reduces the viability of
aquatic plants and animals; and can ultimately destroy
animals and their habitat. These permits have not been
hampering production by these drilling sites, but they do
protect the fragile water resources around them.
The EPA should construe any exemption for oil and gas
construction activities contained in this conference report
as very limited. The agency should continue, as appropriate,
to require stormwater discharge permits for oil and gas
construction activities that are similar to those performed
at other construction sites such as the construction of
roads, clearing, grading, and excavating. The Clean Water Act
requires that construction sites of all types obtain
stormwater discharge permits. When oil and gas construction
activities are similar to other construction activities they
should continue to be regulated.
Mr. President, it is my hope that I have clarified for my
colleagues how these provisions were developed and the effect
of these provisions on the environment. It is my hope
[[Page S9350]]
that the Nuclear Regulatory Commission and the Environmental
Protection Agency will review and incorporate my statement as
they implement the Energy Policy Act of 2005.
Mr. CONRAD. Mr. President, I rise today to support the Energy bill
conference report.
For many years, I have supported passage of a comprehensive national
energy policy. Such a policy is necessary to reduce our increasing
dependence on foreign energy sources. A comprehensive energy policy
will help lower energy prices in the long run. Furthermore, any far-
reaching bill will move us toward newer technologies that will keep our
economy growing strong while making us more energy independent.
Although not perfect, this Energy bill moves us in the right
direction. It will expand our electricity transmission system and make
it more reliable. The bill contains incentives for renewable energy,
including the renewable energy production tax credit that I helped
include. It will also spur an increase the production and use of
domestic biofuels such as ethanol and biodiesel. Because of this bill,
our coal-burning plants will improve their efficiency and emit less
pollution. Finally, the bill provides needed incentives to increase
natural gas infrastructure, measures that will lead to lower prices for
natural gas consumers in the long run.
Equally important, this bill benefits North Dakota for a number of
reasons. The transmission incentives will enable my State's power
producers to export electricity to distant markets. In this way,
transmission incentives benefit the lignite and wind energy sectors in
my State. The clean coal production incentives will make it easier to
build advanced clean coal power plants. The inclusion of the wind
energy production tax credit will help North Dakota realize its
potential to be the biggest producer of wind energy in the country. The
Renewable Fuels Standard and tax incentives for ethanol and biodiesel
will aid my State's farm economy, create more jobs, and reduce our
dependence on foreign oil. In addition, the bill will assist my state
in developing exciting new technologies, such as coal-to-liquid fuel
plants.
I believe we still have a lot of work to do in order to make our
Nation less dependent on foreign energy. However, this bill takes
positive steps to address our energy needs. As I just mentioned, this
bill will provide significant benefits to my State.
For these reasons, Mr. President, I support the conference report.
Mrs. MURRAY. Mr. President, today I rise in opposition to H.R. 6, the
Energy Policy Act of 2005.
I do so because this bill fails to move us beyond the status quo of
today's energy situation. Congress rarely steps forward to address our
Nation's energy policy, and I believe when we do so we should provide
real direction that addresses real problems. Unfortunately, that is not
the case here.
I voted for the bill as reported by the Senate, but only narrowly. A
few provisions in the Senate bill attempted to address our need to
promote renewable energy resources and decrease our consumption of
foreign oil. Those few forward-looking provisions have been dropped
from this final bill, leaving me with little choice but to vote no for
our failure to truly provide some new direction to our Nation's energy
policy.
Crafting comprehensive energy policy should offer the opportunity to
address the most difficult issues facing our country. The bulk of this
bill sidesteps those tough issues and in place of solutions it offers
bandaids. Moving toward independence from foreign oil should be a top
priority, but it is not addressed meaningfully.
Climate change is a serious issue that Congress simply refuses to
address. While some voluntary measures are included, these are simply
not enough. We must have meaningful action if we are to protect our
health, environment, and economy of our country.
Gone from this bill is the renewable portfolio standard promoted by
the Senate. The Senate's provision would have increased the penetration
of alternative energy sources. This bill also fails to take adequate
steps to develop conservation and efficiency technologies, and yet it
offers substantial subsidies to the fossil fuels industry.
This is not the bill I would have written, and this is no longer a
bill I can support.
There are sections of the bill that are positive. For example, I am
pleased that the conference bill contains provisions protecting the
Pacific Northwest's electricity system from unwarranted interference by
the Federal Energy Regulatory Commission, FERC, and protects Washington
ratepayers from excessively high electricity rates. I am also pleased
that the current bill contains a fair and balanced hydroelectric
relicensing process and sets new grid reliability standards. I commend
my colleague, Senator Cantwell, who championed Washington State
interests.
This bill in particular supports cutting edge research and
development at the Pacific Northwest National Laboratory and Washington
State universities in the areas of smart energy, advanced scientific
computing, and systems biology.
I am equally pleased to see that the bill does not provide MTBE
liability protections.
As the world's leading energy consumer, the United States should lead
by example and innovation. However, this bill stops short of taking
commonsense measures that would truly reduce foreign oil dependence and
mitigate the looming threat of climate change. To diversify energy
sources in America, fossil fuel use must be offset by conservation,
energy efficiency, and clean and renewable fuels.
Yet proposals to set ambitious, yet achievable, targets for reduced
oil imports, tighter fuel economies for cars and trucks were defeated.
Instead, oil and gas companies will be allowed to scour our fragile
coastlines for more oil and gas reserves. Furthermore, this bill awards
multimillion dollar tax breaks to those same companies, which are
reaping windfalls from record-high oil prices at the expense of
Washington consumers, to continue us down the path of fossil fuels,
which are a key contributor to climate change. This bill also rolls
back significant clean water laws that keep our water safe to drink.
Despite ample protections for Washington ratepayers, it is hard to
ignore that this bill, this national energy blueprint, does absolutely
nothing to improve energy security or reduce dependence on foreign oil.
We need a national energy policy but one that acknowledges the needs
for the future, sets a plan, and moves us forward, not a bill that
delivers the status quo.
Mr. JOHNSON. Mr. President, today the Senate is poised to pass the
Energy Policy Act of 2005, the most sweeping comprehensive Energy bill
in over a decade. We need a comprehensive set of policies to attack the
energy crunch facing Americans on multiple fronts.
Electricity systems on the West Coast are strained as electrical
transmission lines lack capacity and interconnection to move power
throughout regions. The dependence of our economy on foreign sources of
energy continues to climb unabated, with close to 60 percent of the oil
used to power the economy originating from foreign ports and oil
fields.
As a Member of the Senate Energy and Natural Resources Committee and
as Member of the conference committee charged with hammering out an
agreement, I have steered my colleagues in the House and in the Senate
to look toward the Heartland as a rich land ready to contribute to our
energy security. The Energy Policy Act of 2005 incorporates many of the
ideas I have long championed to spring forward South Dakota and the
Great Plains as a key future energy producer.
First and foremost, the Energy Policy Act of 2005 establishes a
robust Renewable Fuel Standard that will lessen imports of foreign
sources of energy and encourage the use of clean-burning renewable
fuels.
Beginning in 2006, the Energy bill establishes a robust renewable
fuels standard requiring refiners to blend 4 billion gallons of
renewable fuels, such as ethanol and biodiesel. That standard would be
increased over the next several years until 2012, when refiners would
be required to blend a total of 7.5 billion gallons of renewable fuels.
Just in South Dakota alone, over 8000 farm families are invested in
ethanol facilities through direct deliveries of corn or in more
indirect paths, such as equity shares. The Nation's economy will get a
significant and positive boost from enactment of the RFS.
There are several other provisions in the bill that bring South
Dakota's
[[Page S9351]]
strength to solving the Nation's energy challenges.
Key tax incentives included in the final version of the Energy bill
extend the tax credit for small ethanol producers and expand the
eligibility of that credit to plants with an annual capacity of up to
60 million gallons is a major victory.
The conference report also provides incentives for bio-diesel.
Ethanol is not the only renewable fuel that can be produced in the
United States soybean-based bio-diesel holds great promise for use in
the Nation's fuel supply.
We focused also on tapping wind energy resources by extending for 2
additional years the production tax credit for wind energy facilities.
The production tax credit is a tool used by developers of wind energy
projects, such as the wind energy farm near Highmore, SD.
One final tax provision that I feel holds particular promise is the
authorization of $800 million in tax credit bonds to finance the
construction of renewable energy projects by not-for-profit utilities
and rural electric cooperatives.
I have heard from dozens of electric cooperative and municipal
utilities that want to undertake the construction of wind energy
projects. However, until this bill, these non-profit entities were
excluded from some of the incentives provided for Investor-Owned
Utilities pursuing similar renewable energy projects. Now, rural
cooperatives can finance, construct, and operate clean energy projects,
such as wind turbines and geo-thermal facilities.
The conference report does not include what I believe is an important
provision to set benchmarks and targets for producing electricity from
renewable energy resources. Like a renewable fuels standard, a
renewable portfolio standard would not only reduce the use of fossil
fuel sources, but increase economic activity in South Dakota through
wind energy and biomass projects.
A modest renewable portfolio standard of 5 or 10 percent is
achievable and can be done without increasing retail electricity rates.
The benefits of balancing traditional energy sources, such as coal,
nuclear, and natural gas, with new technologies will reduce air
emissions and spur the creation of jobs in developing energy technology
sectors. I include clean coal technologies, such as Integrated
Gasification Combined-Cycle as an emerging clean coal technology that
along with wind and geothermal plants hold the promise of producing
clean-burning electricity.
As Congress and the States and cities move forward on addressing the
energy challenges of the 21st Century, policy-makers and industry
leaders can lose sight and leave behind developing renewable energy
sources. As the Nation and world strain finite fossil fuel resources
the need to bring on-line these technologies will only become more
acute and practical.
I intend to vote for the Energy Policy Act of 2005. As a Member of
the Senate Energy and Natural Resources Committee, I am proud of the
job we did in fashioning a bill that will make strong strides forward
in tackling the disparate parts of energy supply, transmission, and
distribution. The bill also holds strong promise for making South
Dakota a substantial energy producer of clean energy and renewable
fuels. I urge my colleagues to support the Energy Policy Act of 2005.
Mr. LIEBERMAN. Mr. President, I commend Senators Domenici and
Bingaman for their efforts in securing an energy bill that retains many
features important to the Senate. Had I been present for the final vote
on the Senate bill 1 month ago, a vote I missed because of the passing
of my mother, I would have voted ``yes'' because I believed that the
Senate bill took positive early steps toward development of a
comprehensive energy policy, including an important initiative for
renewable energy development.
I consulted urgently with Senator Bingaman during the House-Senate
Conference on an issue that was put before the conferees by the House
that would have undermined the Clean Air Act and worsened air pollution
in Connecticut and a number of other States. Senator Bingaman was able
to keep that proposal out of the conference report and I thank him for
that. I learned, through that bit of first-hand experience, how hard
both Senator Domenici and Senator Bingaman worked to keep faith with
the Senate in producing a conference report that reflected some of the
Senate's chief concerns. For that I believe we owe them both a debt of
gratitude.
Senators Bingaman and Domenici are to be commended for recognizing
the deep concerns that public officials across New England have about
the LICAP proposal and for including a sense-of-the-Congress resolution
in the bill directing FERC to reevaluate this proposal in light of
their concerns. I note that the sense-of-the-Congress resolution
specifically draws to FERC's attention the objections of all six of New
England's governors--both Democrats and Republicans.
(See Exhibit 1.)
Mr. President, I ask unanimous consent that two letters, from those
governors to the Chairman of FERC expressing their objections to LICAP,
be inserted in the Record following my remarks.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. LIEBERMAN. I cannot emphasize enough the need for FERC to
reconsider this deeply flawed proposal--a proposal that would cost New
England ratepayers more than $12 billion over the next 5 years. The
governors rightly argue that there are much more cost-effective
alternatives to achieving the goal of ensuring our region of the
country has adequate electricity that FERC should consider. And I am
pleased that conference report directs FERC to address the governors'
objections and recommendations.
While I am disappointed with many of the changes made in the final
version of the bill emerging from conference, and feel that we are
still far from developing the bold national energy policy we so
urgently need, I am voting ``yes'' today because this bill at least
starts the process of changing the status quo.
Still, it is my strong hope that having addressed issues of
conventional energy supply through this legislation, we will turn, in
the very near future, our urgent attention to the most pressing
issues--the clear and inextricable linkage between energy supply and
national security, the resulting urgent need for aggressive development
of a portfolio of alternative and renewable fuels and conservation
strategies, and the need to take comprehensive steps to set mandatory
caps on greenhouse gas emissions. Solving these problems--and soon--is
a responsibility that we have to today's public as well as our children
and grandchildren, an obligation that we will not have fulfilled when
this legislation passes.
When this bill becomes law, new energy efficiency standards for
appliances will be put into place and businesses, homeowners and
consumers will see a range of new incentives to invest in and adopt in
their homes, factories and automobiles, clean technologies, such as
fuel cells, solar energy, alternative fuel vehicles and hybrids. All
this will be done without forcing the Senate and the States to accept a
number of provisions that would have done damage to the environment and
to the treasuries of State and local governments contending with
groundwater contamination, from MTBE. Finally, the bill offers some
hope that we will get at least a little bit further in developing some
of the technologies that can help combat climate change. Again, it
includes a sense-of-the-Congress resolution regarding LICAP, an issue
now important to the State of Connecticut but potentially important to
us all.
There is also good news to be found in what this bill does not do. It
does not include provisions for drilling in the Arctic National
Wildlife Refuge. It avoids rollbacks to the Clean Air Act, rollbacks
harmful to not just the Northeast, but to all who live and work in
areas downwind of pollution sources.
Despite these positives, I am disappointed by the missed
opportunities for setting a bold, forward-looking 21st century energy
policy. Opportunities to establish a renewable portfolio standard.
Opportunities to protect the Outer Continental Shelf fully from
potential exploration and drilling. Opportunities to develop clear
steps to reduce our dependence on oil. Opportunities to protect our
drinking water from possible contamination by toxic hydraulic
fracturing fluids. Opportunities to take our first real steps to reduce
greenhouse gas emissions.
[[Page S9352]]
I urge my colleagues to consider this a beginning, and to continue in
earnest our work to reduce the dependence on oil that is so undermining
of our national and economic security, to develop alternative and
renewable energy sources as well as conservation techniques, and to
address the problem of climate change with mandatory steps that are so
clearly required, as clearly expressed in the sense-of-the-Senate
resolution passed by this body last month.
Exhibit 1
The Commonwealth of
Massachusetts,
Boston, MA, June 24, 2005.
Re ISO-New England LICAP Proposal, Docket No. ER 03-563,
NESCOE Petition, Docket No. EL04-112.
Hon. Patrick Wood, III,
Chairman, Federal Energy Regulatory Commission, Washington,
DC.
Dear Chairman Wood: As you know, Massachusetts has been
closely monitoring the proposal of ISO-New England (ISO-NE)
to develop and implement a locational capacity (LICAP) market
in the New England region. Recently, my New England
colleagues wrote to you on this important issue expressing
their concerns, and I want to take this opportunity to do the
same.
While Massachusetts shares the Federal Energy Regulatory
Commission's (FERC) interest in an effective capacity
mechanism to secure an adequate supply of electricity to
serve our region, it is our view that the LICAP proposal is a
broader, more costly approach than is necessary to assure the
region's reliability. Cost estimates of the LICAP proposal
range from $10 to $13 billion across New England over the
next five years, or approximately a 25 percent increase in
the energy portion of the average ratepayer's electricity
bill--both residential and commercial customers. This figure
translates to approximately $6.4 billion over five years for
Massachusetts alone, which is simply unacceptable. This type
of rate shock will have a detrimental effect on Massachusetts
and the region's economy.
Massachusetts strongly believes that the ISO-NE has
prematurely pursued the development of a LICAP market, rather
than first pursuing the development of other solutions that
may be less costly for our consumers. The ISO-NE is in the
process of developing a locational reserves market to address
specific, targeted operating reserve needs that would support
fewer required generators. The development of an appropriate
capacity market to address regional adequacy issues should be
viewed in the context of a regional market plan that
considers the existing locational energy market and the
development of the locational reserves market, in addition to
other contemplated mechanisms. If after the implementation of
more cost-effective solutions a resource adequacy issue
persists, a further intervention can be developed to solve
these problems, while minimizing consumer costs and market
disruption.
Given the significant cost associated with this issue to
our region, it is important that the FERC consider the other
proposals currently under development that may in fact
provide a more cost effective solution, while ensuring the
adequacy of the region's electricity supply. As always, we
look forward to working with the FERC on these important
matters so that our consumers and businesses are well served
by these important policy initiatives.
Respectfully submitted,
Mitt Romney.
Governor.
____
New England Governors'
Conference, Inc.,
Boston, MA, June 23, 2005.
Re ISO New England LICAP Proposal, Docket No. ER 03-563,
NESCOE Petition, Docket No. EL04-112.
Hon. Patrick Wood, III,
Chairman, Federal Regulatory Commission, Washington, DC.
Dear Chairman Wood: The New England states, through their
regulatory agencies, have been litigating the proposal of ISO
New England (ISO-NE) to develop and implement a specific type
of locational capacity market in the region (LICAP). We share
the Commission's interest in an effective capacity mechanism
to assure an adequate supply of resources to serve the
region's load. It is we governors, after all, on whom
citizens ultimately rely to provide for the public health and
safety. However, we do not believe that ISO-NE's LICAP
proposal is that mechanism. ISO-NE's proposal: (1) does not
provide any assurance that needed generation will be built in
the right place at the right time; (2) is not linked to any
long-term commitment from generators to provide energy; and
(3) is extremely expensive for the region. In short, ISO-NE's
LICAP is a costly scheme that offers little in terms of true
reliability benefits.
The Administrative Law Judge's (ALJ) recommended decision,
issued on June 15th, adopted the ISO's proposal and rejected
the arguments of state regulators with little or no
discussion of the rationale for rejecting the arguments and
despite extensive evidence provided in support of their
positions. As you can see, we have serious reservations about
the efficacy of the demand curve mechanism, we are alarmed by
the financial impact on our citizens and businesses, and we
are troubled by the process that was employed to arrive at
this result. Accordingly, we are obliged in the best
interests of our constituents to oppose this decision.
Late last year we answered your invitation and presented a
proposal to you for a regional state committee (RSC). Per
your suggestion, we identified resource adequacy assurance as
a core area of policy leadership we would provide. Many
months have passed since we filed our proposal but the
Commission has yet to act on the matter. The purpose of this
letter is to urge you to defer action on ISO-NE's deeply
flawed LICAP proposal, to issue an order authorizing the RSC,
and to direct the RSC to develop a proposal that serves the
region.
Deferring immediate action on ISO-NE's LICAP proposal will
not undermine system reliability. Short-term contractual
arrangements are available to ensure reliability in any sub-
regional zone that may, during peak periods, require
additional support. In addition, New England currently has
adequate overall capacity and a surplus of generation in some
states.
ISO-NE's LICAP proposal is only one of many capacity market
proposals that could assure long-term resource adequacy in
the region. The specific proposal before the Commission is
based on an administratively set pricing system that we fear
will set capacity charges too high. This fear appears well
grounded in light of estimates we have seen that show
increased costs in the vicinity of $10 billion for the
region's constituents over the next five years. In isolation
these numbers are disturbing enough but imposition of LICAP
charges of this magnitude on top of the increases we are
already experiencing in energy commodity prices will place
serious stress on our state economies. Indeed, in Maine alone
up to 1,500 jobs could be lost as a result of the decrease in
consumer spending resulting from LICAP price shock. In
Connecticut, there is a significant risk that large
industrial customers will relocate out of state due to the
projected massive price increase resulting from the LICAP
charge. Given these high cost estimates and the lack of any
assurance that new capacity will indeed be built, it is
essential to allow the states, through the regional state
committee, to fully consider all alternatives to the ISO-NE
proposal--something which has not been allowed in the current
proceeding.
We write today not only to highlight the real world effects
that your decision in this case may have on our constituents.
As governors of the New England states, we also stand ready
to assist the Commission in developing a sensible approach to
New England's capacity needs through the vehicle you
identified as responsible for formulating resource adequacy
policy--namely the RSC. We, through the regional state
committee, are prepared to lead.
We are hopeful that you will take our concerns to heart by
deferring action on this matter until you have permitted the
regional state committee to have the opportunity to propose a
more effective, less costly approach.
Sincerely,
Governor Donald L. Carcieri,
Chairman, Rhode Island.
Governor John Lynch,
New Hampshire.
Governor M. Jodi Rell,
Connecticut.
Governor James H. Douglas,
Vermont.
Governor John E. Baldacci,
Maine.
____
Ms. MIKULSKI. Mr. President, the United States needs an energy plan
that balances traditional sources of energy with alternative energy
sources and conservation. The energy conference report is not a perfect
bill, but it is the result of true bipartisan compromise that managed
to put some of the most harmful provisions on the cutting room floor.
On balance, I support this bill because it moves us towards a more
stable, reliable electricity grid, protects our consumers, and includes
much needed investments in renewable sources of energy.
I am especially pleased that this bill strengthens the reliability of
our electricity grid and protects ratepayers from market abuses,
particularly in the wake of Enron and the massive blackouts that struck
parts of the Midwest and Northeast 2 years ago. I am also pleased that
the bill reauthorizes the Low Income Home Energy Assistance Program,
LIHEAP. This program protects our most vulnerable citizens by assisting
them with their heating and cooling bills.
I am also pleased that the conference report does not contain many of
the most harmful provisions that were included in this legislation in
the past. The bill does not allow for drilling in the Arctic National
Wildlife Refuge, ANWR. The bill also does not include provisions that
would shield producers of gasoline additives from lawsuits. I strongly
opposed these provisions in the past and am pleased they are not
included in this bill.
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Unfortunately, the bill does contain some questionable environmental
provisions. I am also disappointed that the bill does not include
important provisions I supported in the Senate bill, particularly the
renewable portfolio standard, steps to deal with global warming, and
requirements that would have lessened our dependence on foreign oil.
In the end, this is not the bill that the Democrats would have
written. It doesn't address the most pressing issues facing our country
today: sky-high gas prices, global warming, and our growing dependence
on foreign oil. But the bill does take important steps to strengthen
the reliability of our electricity grid, protect consumers from market
abuses, and move us towards greater use of renewable sources of energy.
This is just the beginning of a serious debate that will continue in
the halls of Congress and in communities all across the country in the
days to come.
Mr. LEVIN. Mr. President, I am supporting the conference report on
the Energy bill. The conference report includes provisions that will
increase the diversity of our Nation's fuel supply, encourage
investment in infrastructure and alternative energy technologies,
increase domestic energy production, take steps to improve the
reliability of our electricity supply, and improve energy efficiency
and conservation. This conference report is far from perfect but on
balance it moves toward a sounder energy policy that will lead the way
to greater energy security and efficiency for the United States.
Our policies have long ignored the problem of U.S. dependence on
foreign oil, and we remain as vulnerable to oil supply disruptions
today as we have been for decades. Taking the steps necessary to reduce
our dependence on foreign oil is an important objective for this
country. We need a long-term, comprehensive energy plan, and I have
long supported initiatives that will increase our domestic energy
supplies in a responsible manner and provide consumers with affordable
and reliable energy.
There are some positive provisions included in the conference report
in this regard, particularly those provisions that address energy
efficiency and will lead us toward greater use of advanced vehicle
technologies and alternative fuels such as ethanol and biodiesel. I
have also long advocated Federal efforts that will lead to
revolutionary breakthroughs in automotive technology that will in turn
help us reduce our oil consumption. We need a level of leadership
similar to the effort of a previous generation to put a man on the
moon.
The conference report includes a wide-range of energy efficiency
provisions that will make conservation and efficiency a central
component of our Nation's energy strategy. These provisions address
Federal, State, and local energy efficiency programs, provide funding
for important programs such as home weatherization, and establish
efficiency standards for a wide variety of consumer and commercial
products. I am particularly pleased that the conference report
authorizes both the weatherization program and the Low Income Home
Energy Assistance Program, LIHEAP, at higher levels of funding than the
Congress has provided in recent years.
The conference report takes critical steps to improve the reliability
of our electrical grid and promote electricity transmission
infrastructure development. Our economy depends upon electric power,
and, in some cases, electric power literally saves lives. Failures in
the electric system interrupt many crucial activities, and the need for
improvement was underscored painfully by the August 2003 blackout.
There were 2 key lessons from the blackout--the need for strong
regional transmission organizations to ensure that reliability
standards are carried out and enforced, and the need for additional
transmission upgrades to maintain reliability. I regret that it has
taken 2 years to legislate on these issues, but I am pleased that the
conference report includes the steps necessary to ensure there will be
mandatory and enforceable reliability standards.
The conference report also puts increased emphasis on diversity of
supply and includes a range of provisions intended to encourage the use
of new and cleaner technologies, particularly for power generation.
Nearly 60 percent of electricity generation in Michigan is generated
from coal, which will remain a vital resource well into the future.
Programs authorizing research in clean coal-based gasification and
combustion technologies will ensure that the most advanced technologies
are developed for power generation. Other provisions of the conference
report also encourage the use of innovative technologies for both power
generation and other end-uses.
Increased emphasis on diversity of fuel supply will help to take the
pressure off our tight natural gas supply, which is important for
States such as Michigan with a large manufacturing base. Over the past
6 years, the tight natural gas supply and volatile domestic prices have
had significant impacts on the U.S. manufacturing sector, which depends
on natural gas as both a fuel source and a feedstock and raw material
for everything from fertilizer to automobile components. As domestic
production of natural gas has declined, demand for natural gas has
increased dramatically, particularly in the area of power generation.
Today, U.S. natural gas prices are the highest in the industrialized
world, and many companies have been forced to move their manufacturing
operations offshore. More than 2 million manufacturing jobs have been
lost to overseas operations in the 5 years, in part no doubt because
natural gas prices jumped from $2 per million Btu to more than $7 per
million Btu.
I am pleased that the conference report includes significant
provisions from the Senate bill for research, development,
demonstration and commercialization effort in the area of hydrogen and
fuel cells. I believe that this program will help us make critical
strides toward realizing the goal of putting hydrogen fuel cell
vehicles on the road over the next 10 to 15 years. The conference
report also includes an amendment I offered in the Senate to have the
National Academy of Sciences conduct a study and submit a budget
roadmap to Congress on what level of effort and what types of actions
will be required to transition to fuel cell vehicles and a hydrogen
economy by 2020. If hydrogen is the right answer, we will need the
equivalent of a moon shot to get there. We will need a significant
Federal investment--well beyond anything we are doing today--in
conjunction with private industry and academia to reach that goal. This
study and roadmap will be an important step toward determining if that
is the right path to follow.
We also need to put greater Federal resources into work on other
breakthrough technologies such as advanced hybrid technologies,
advanced batteries, advanced clean diesel, and hybrid diesel
technology. Federal Government investment is essential not only in
research and development but also as a mechanism to push the market
toward greater use and acceptance of advanced technologies. Expanding
the requirements for the Federal Government to purchase advanced
technology vehicles will help provide a market for advanced
technologies. Encouraging and supporting State and local efforts is
also important in the effort to push these advanced technologies
forward. Therefore, I am pleased the conference report includes the
amendment offered by Senator Voinovich in the Senate to authorize $200
million annually for 5 years to fund Federal and State grant and loan
programs that will help us to replace older diesel technology with
newer, cleaner diesel technology. These initiatives will help the U.S.
to develop advanced clean diesel technology, which can make a major
contribution toward our meeting stricter emissions standards in a cost-
effective manner.
Finally, the conference report also includes important tax incentives
for advanced technology vehicles--including advanced clean diesel, as
well as hybrid and fuel cell vehicles--that are critical to encourage
consumers to make the investment in these technologies. I would have
liked for the tax package to have included more generous tax credits
for consumers and to have included an investment tax credit to
manufacturers to help defray the cost of re-equipping or expanding
existing facilities to produce advanced technology vehicles. The tax
incentives included in the conference report are a modest first step. I
will continue to
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press for an investment tax credit for manufacturing of advanced
technology vehicles because I believe it is necessary to offset the
high capital costs of such an investment and to ensure that these
vehicles will be made in the U.S.
I am pleased that the conference report includes an amendment that I
offered in the Senate with Senator Collins to direct the U.S.
Department of Energy to develop and use cost-effective procedures for
filling the U.S. Strategic Petroleum Reserve. This provision requires
DOE to consider the price of oil and other market factors when buying
oil for the SPR and to take steps to minimize the program's cost to the
taxpayer while maximizing our energy security. Since early 2002, DOE
has been acquiring oil for the SPR without regard to the price or
supply of oil. During this period the price of oil has been very high--
often over $30 per barrel--and the oil markets have been tight. Many
experts have stated that filling the SPR during the tight oil markets
over the past several years increased oil prices. With this provision,
the conference report directs DOE to use some common sense when buying
oil for the SPR.
I am also pleased that the conference report provides at least a
short-term approach to some air quality issues in West Michigan.
Interstate pollution from upwind areas such as Chicago and Gary, has
resulted in several Michigan counties being designated by the EPA as in
nonattainment with the National Ambient Air Quality Standards. This
interstate pollution not only has environmental and health
ramifications, but also has economic development implications because
nonattainment regions are required to comply with more stringent
regulatory standards. The 2 year respite from these additional
regulatory provisions for West Michigan counties whose air quality
problems were caused by upwind sources will provide temporary
regulatory relief. However, these counties are still burdened with air
pollution they did not cause. I am hopeful that EPA's 2 year
demonstration study of the long-range transport of ozone and ozone
precursors required in the Energy bill will provide helpful information
for addressing the source of the pollution and result in improved air
quality for downwind areas. Until the source pollution is addressed,
West Michigan will continue to be plagued by pollutants from upwind
areas. I am hopeful that this study and 2 year delay in regulatory
requirements will provide the motivation for addressing the broader
problems of interstate air pollution.
I am pleased that the conference report contains a ban on future
drilling in the Great Lakes. Millions of people rely on the Great Lakes
for drinking water, and it is simply irresponsible to risk
contamination of this source of drinking water, tourism and recreation.
Preventing future drilling does not jeopardize more than a minute
amount of our energy supply, and the bill does that for a very good
cause, which is the protection of one of the world's truly great
natural assets, the source of about 20 percent of the world's fresh
water.
The conference report puts some increased emphasis on renewable
energy technologies, such as wind, biomass, and solar power. These
technologies are becoming more economical every year. In fact, in some
areas of the country these technologies are competitive with
traditional fuels such as coal and natural gas. However, I regret that
the conference report deleted the Renewable Portfolio Standard, which I
supported in the Senate bill that would have pushed the sellers of
electricity to obtain 10 percent of their electric supply from
renewable energy sources by the year 2020. I believe that these goals
could have been met and that an increased use of renewable technologies
will both reduce our dependence on foreign oil and lead to the creation
of tens of thousands of new jobs.
I regret that the conference report does not include a comprehensive
effort to adequately address the impact of global climate change. For
years, almost all scientists have agreed that human actions are causing
temperatures around the world to increase. Experts also agree that this
global climate change will lead to environmental problems and economic
hardship, but there has been no consensus in the United States about
what we should do to stop climate change.
The threat is real and growing, and the longer we wait to reach a
reasonable consensus, the more painful the solutions will be. I believe
two major policy changes are needed at the Federal level: support for a
new, binding international treaty that includes all countries, and a
massive new Federal investment in research, development and
commercialization of new technologies. Both of these steps would
provide real environmental and economic benefits while being fair to
American workers. The Senate considered several well-intentioned
proposals on this issue, though I did not believe they would have taken
us in a comprehensive direction. I supported a Sense of the Senate
resolution that acknowledges the problem and calls on the
administration to work with the Congress to enact a comprehensive
national program to address this issue. I regret that the conference
report did not include such a modest provision.
Finally, I am disappointed the provision allowing continued export of
highly enriched uranium was included in the conference report. The
amendment that Senator Kyl and Senator Schumer offered to strike this
provision from the Senate passed bill was adopted by the Senate by
rollcall vote. It is unfortunate that this provision, which is a
special interest provision, granting relief to one Canadian company was
reinserted in the final agreement. This provision undermines
longstanding U.S. efforts to eliminate highly enriched uranium in
commerce, and increases the possibility that highly enriched uranium
could be stolen by terrorists and used in a nuclear weapon or
radiological device.
The energy bills considered by the Congress over the last couple of
years have been doomed by a heavy-handed, partisan approach. We lost
valuable time in putting us on the course toward a sounder energy
policy. The conference committee pursued a different approach this
year, and as a result, was able to produce a bill with bipartisan
support, which, while far from perfect, on balance, is an improvement
over current policy.
Mr. DURBIN. Mr. President, first, I would like to thank both the
chairman and the ranking member of the Energy and Natural Resources
Committee, Senators Domenici and Bingaman, for working together in a
more open and bipartisan way in developing the bill we are considering
today.
While there are many provisions that should be in this bill but
aren't and many other provisions in here that I don't agree with, this
bill could have been worse. There are numerous extraneous and
environmentally harmful provisions that were in previous energy bills
but are not included here. I appreciate both of my colleagues' efforts
to avoid those pitfalls and produce the Energy bill we are now
considering.
However, there remains one very large and glaring omission in this
bill. While framed as a ``comprehensive national energy policy,'' this
bill completely ignores the most important energy issues facing
America, our growing dependence on foreign oil and the impact this
dependence has on our economic security and national security.
I have no doubt that our Republican colleagues will go home and hold
press conferences claiming victory. They will say that they finally
broke through the obstructionism and passed an energy bill that will
reduce America's dependence on foreign oil; a bill that will make
America more secure.
I wish that were true--but it is not. This is not an energy policy
for America in the 21st century. And that is very unfortunate.
The price of a barrel of oil is above $60 and rising, gas prices are
again reaching record highs, yet this bill offers no solution. In all
of the pages of text, there is no meaningful program or plan to reduce
our dependence on foreign oil. There is no provision that increases
fuel efficiency or promotes oil conservation. There is no provision to
create a comprehensive, long-term program for the development of
renewable, sustainable fuels.
This bill could have been a roadmap to a new energy future in
America, but instead it leaves us stuck in our current energy mess.
Supporters of this bill will claim that it can reduce America's
dependence on foreign oil by increasing domestic oil production. But I
would point out a
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well-known fact--the U.S. contains only 3 percent of the known global
oil reserves in the entire world. No matter how much we drill here, we
will never drill enough to meet our growing thirst for oil.
As long as we continue to consume as much oil as we do today, without
addressing the hard issues such as fuel economy standards, we will
become more, not less, reliant on foreign oil. With global demand for
oil steadily increasing, this continued dependence on imported oil
could have devastating economic consequences.
Today we import 58 percent of our oil. The Department of Energy's
Energy Information Administration projects that the U.S. will import 68
percent of our oil by 2025--more than \2/3\ of our oil consumption.
Former CIA Director James Woolsey, Robert McFarlane, former President
Reagan's National Security Adviser, and other national security experts
have created a group they call the Set America Free Coalition.
According to them, ``It is imperative that the nation's energy policy
address the national security and economic impacts of growing oil
dependence.''
Imagine what would happen to the U.S. economy if there were a major
disruption in oil supplies in a foreign producing country--perhaps in
the Middle East. Can you imagine what could happen to our economy?
I can. Thirty years ago, war in the Middle East caused oil prices in
the U.S. to increase by 70 percent. Overnight, the price of oil rose
from $3 per barrel to $5.11 per barrel. Just a few months later, oil
prices more than doubled again to $11.65 per barrel.
At the time of the 1970s oil embargo the U.S. imported less than a
third of our oil. This embargo hit Americans hard, as many remember
well. Back then, Congress recognized the economic impact of oil
dependence and took steps to address oil consumption in America. Among
other actions, Congress passed national fuel economy standards, raising
passenger cars from an average 12.9 miles per gallon in 1973 to 27.5
miles per gallon by 1985.
Increasing fuel economy standards for cars is one of the most
effective steps we can take to reduce oil dependence. Unfortunately,
this Congress has rejected that goal.
Listen to this, from an article published in BusinessWeek about a
month ago:
As Congress puts the final touches on a massive new energy
bill, lawmakers are about to blow it. That's because the bill
almost certainly won't include one policy initiative that
could seriously reduce America's dependence on foreign oil: A
government-mandated increase in the average fuel economy of
new cars, SUVs, light trucks and vans.
BusinessWeek was right, Congress did blow it.
Congress has blown it at a time when the National Academy of Sciences
and many other energy and engineering experts tell us the technology is
available today to reduce our need for oil by 3 million barrels per day
by 2015.
Not only is there no new fuel economy standard, the energy conferees
even rejected a modest provision that would have reduced oil
consumption by 1 million barrels per day by 2015--just 4 percent of the
petroleum it is projected we will use by 2015.
Incredibly, it is President Bush's stated policy to oppose any fuel
savings measures.
Does this make any sense?
There is only one provision in this entire bill that may--may--reduce
America's dangerous dependence on foreign oil: a renewable fuels
provision that requires a doubling in ethanol production by 2012. This
provision will reduce oil consumption by about 1 percent over the next
7 years.
But does this limited 1-percent reduction in imported oil over 7
years represent the best we can do for America's energy security?
Economic security? National security?
Senate Democrats believe that Americans can do better than we are
today.
We offered a plan to reduce America's dependence on imported oil by
40 percent by 2025. This goal was a realistic goal--with realistic
changes in the way we use energy, advance the production and
application of energy technology, and promote energy efficiency and
conservation.
Nearly half of the Members of this body voted for our plan.
But big oil companies, car companies, and their allies in the White
House and Congress rejected even setting a goal.
How is it that the same administration that talks about sending a man
to Mars does not have enough faith in American genius and American
know-how to believe that our scientists and engineers can determine how
to increase the fuel efficiency of our automobile fleet safely?
Almost 3 months ago, I spoke to an auditorium of scientists at the
Argonne National Energy lab--America's first national energy lab just
outside of Chicago. The scientists there do not think that decreasing
America's over-reliance on foreign oil is impossible. They think it is
imperative.
Instead of shoveling billions of dollars at oil and energy companies,
we ought to be investing in the work of those and other scientists.
Yet, the Republican leadership, from the White House on down, is
cutting public investments in scientific research and providing
billions of dollars in tax incentives to big oil companies that have
been recording record profits.
This bill takes much of the $11.5 billion in tax incentives that
could have been used to develop renewable and alternative energy
sources and instead gives it to big oil and energy companies.
For instance, there are generous royalty payment relief provisions
for energy companies that drill on Federal lands. A better bill would
have maintained royalty payments and used these funds to extend the
production tax credit for wind generation beyond the 2 years written in
this bill. Unfortunately the 2-year extension will continue the boom
and bust cycle we've witnessed in the investment of wind generation.
The President himself says that oil and energy companies do not need
tax cuts--but he will sign this bill anyway, even if they are included.
Think about that: the upcoming reconciliation bill will contain $10
billion in cuts in health care for the poor while this bill provides
over $10 billion in tax breaks, mostly for big oil and energy
companies.
Talk about a Congress out of touch with America.
And we will have to borrow the money to pay for those tax breaks and
pay interest on that money too, so the true cost is even higher.
This is a failure in leadership.
From the day they took office, the Bush administration made passing a
new national energy bill a top priority. The President put the Vice
President in charge of getting the job done. We still don't know how
much of this bill can be traced back to the Vice President's secret
energy task force because the administration has gone to extraordinary
lengths--all the way to the U.S. Supreme Court--to keep all of its
records about the task force secret.
There are at least two things the big oil and energy companies wanted
that are not in this bill.
For 5 years, MTBE manufacturers prevented the passage of an energy
bill by demanding that they be shielded from liability for groundwater
contamination caused by their product. Thankfully, the liability waiver
is not in this bill--so Americans won't have all the cleanup costs
shifted onto the taxpayers.
Oil companies also fought hard against increasing ethanol
production--knowing that this renewable fuel would replace some of
their products. The oil companies wanted only a token nod toward
ethanol.
Thankfully, this bill contains a renewable fuel standard that
increases the use of domestically produced renewable fuels to 7.5
billion gallons by 2012. This change will be good for America's
economy, good for our energy security and good for Illinois farmers.
Illinois farmers grow corn that provides 40 percent of the total
ethanol consumed in the U.S. annually. They stand ready and eager to
meet the new challenges in this bill.
I believe the renewable fuels standard can lead to greater energy
security for our Nation.
I will vote for this bill for one reason. After 4 years of fighting
this battle, it is clear we are not going to get an energy plan for the
21st century as long as Texas oil men are in charge of the Federal
Government. This is as good as we are going to get.
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It has been 13 years since the last time America passed a national
energy plan. I can guarantee you, it will not be another 13 years
before this plan is abandoned and replaced with a more visionary and
responsible plan.
We should have increased America's national and economic security by
reducing our reliance on oil imported from Saudi Arabia and other
politically volatile nations. We have the scientific ability to meet
that challenge. Unfortunately, we lack the political leadership to do
so.
The price we will pay for this failure of leadership in rising gas
prices and increased risk to our national economy and national security
will far exceed the cost of the wasteful tax breaks this bill gives to
big oil.
This bill does not reduce gas prices at the pump, it does not reduce
dependence on foreign oil, it does not address fuel efficiency and
conservation, and it does not increase America's economic and national
security. It is not an energy plan for the 21st century.
And it is definitely not the end of the energy debate--only the
beginning.
Mr. HATCH. Mr. President, as the Senate is poised to pass the Energy
Policy Act of 2005 and send it to the President, Utahns should sit up
and take notice, because our State is at the heart of this legislation.
So many of the problems in our energy structure have solutions that can
be found in Utah, whether it is the need for more clean coal, more
clean geothermal energy, more natural gas, better hydroelectric, more
refining capacity, or more major sources of domestic oil, Utah will
play a major part in the solution.
I want to talk more about some of these solutions, but first, let me
take a moment to thank Chairman Domenici and Senator Bingaman of the
Senate Committee on Energy and Natural Resources for leading us to this
point. The Senate Finance Committee, on which I sit, has made a major
contribution to the bill with its tax incentives title. Chairman
Grassley and Senator Baucus deserve just as much praise for their
outstanding coordination and hard work on that important part of this
bill.
As the ranking member of the Finance Committee and as a Conferee on
this legislation, I was able to watch all 4 of these men work together
under pressure, and I could not be more impressed with their leadership
and the work their excellent staffs have provided to our nation at this
critical time. Working together, they have given us what I consider to
be one of the most important bills to be enacted in a long time.
I have, at times, been criticized for reaching across the aisle to
accomplish important policy goals. Some believe that compromise signals
weakness. Well I just plain disagree, and after 4 years of failing to
pass a major Energy bill with a simple majority, I think the Senate has
proven that we stand the strongest when we stand together. And our
energy situation calls for this type of leadership and strength.
Over the last decade, American consumers have increased their demand
for oil by 12 percent, but domestic oil production has grown by less
than \1/2\ of 1 percent. Is it any wonder that we rely on foreign
countries for more than half our oil needs? We import 56 percent of our
oil today, and it is projected to be 68 percent within 20 years.
On the larger scale, global demand for oil is growing at an
unprecedented pace--about 2\1/2\ million barrels per day in 2004 alone.
While global oil production is increasing, the discovery of new oil
reserves is dropping off at an alarming rate. Moreover, trends indicate
that the global thirst for petroleum will continue to grow, especially
in Asia.
If our Nation must rely on oil imports to meet our future energy
needs, we are headed for trouble, because, unless something changes, a
sufficient oil supply will not be there. We should keep in mind that
the transportation sector in the U.S. accounts for nearly \2/3\ of all
of our oil consumption, and that sector is 97 percent dependent on oil.
It could not be more clear: if we want to improve our energy security,
we must focus on our transportation sector, and we must focus on
diversifying our transportation fuels.
Recently, we heard President Bush call on our Nation to ``develop new
ways to power our automobiles,'' and he spoke of his proposal to
provide $2.5 billion over 10 years in tax incentives for the purchase
of hybrid technologies. The President also called for a better
alternative fuel infrastructure and the need to develop hydrogen fuel
cell vehicles.
As for these policies the President addressed, my legislation, S.
971, the Clean Efficient Automobiles Resulting from Advanced Car
Technologies Act, or CLEAR ACT, is exactly where the rubber meets the
road. The CLEAR ACT, now a part of this Energy bill, is the most
comprehensive and effective plan put forward by Congress to accelerate
the transformation of the automotive marketplace toward the widespread
use of fuel cell vehicles. And it does so without any new Federal
mandates. Rather, it offers powerful market incentives to promote the
advances in technology, in our infrastructure, and in the alternative
fuels that are necessary if fuel cells are to ever reach the mass
market. With the CLEAR ACT we accomplish this goal, but in the
meantime, we also get cleaner air, we reduce our dependency on foreign
oil, and we help lead our Nation into the future.
Historically, consumers have faced three basic obstacles to accepting
the use of alternative fuels and advanced technologies. These are the
higher cost of the vehicles, the lack of an infrastructure of
alternative fueling stations, and the higher cost of alternative fuels.
The CLEAR ACT will lower all three of these market barriers through the
use of tax incentives.
First, we provide a tax credit for the purchase of alternative fuels.
Next we promote a new infrastructure of alternative fuel filling
stations by extending an existing tax deduction for the purchase of the
necessary equipment and providing a new tax credit for the cost of
installing it.
Finally we provide a Clear Act Credit to consumers who purchase
alternative fuel and advanced technology vehicles. This includes fuel
cell, hybrid electric, alternative fuel, and battery electric vehicles.
All of the technologies promoted in the CLEAR ACT--whether they be
battery or electric motor technologies or advances in fuel storage and
alternative fuel infrastructure--lead us closer to the hydrogen fuel
cell vehicle. I believe fuel cells are in our future. However, even if
the widespread use of fuel cell vehicles never becomes a reality,
advances in these other technologies provide a dramatic social benefit
on their own.
I have heard from some who question the need for incentives for
hybrid vehicles when they are popular in some areas. It may be true
that demand for these vehicles is high in a few regions. However, these
high-demand areas tend to have local or state incentives in place for
the purchase of these vehicles. Where incentives are not in place,
hybrid sales are minimal. This demonstrates that incentives can indeed
provide a market breakthrough to consumer acceptance of alternative
vehicles.
With the CLEAR ACT, we are trying to provide that breakthrough on a
national scale. And the numbers show that a breakthrough is desperately
needed. It may be true that hybrid sales have doubled in the last
couple of years, but they still represent a minuscule 0.48 percent of
cars that were sold in 2004. So I am very pleased, Mr. President, that
the energy bill will lead us into the future in this regard.
We should also be using more clean alternatives when we generate
another form of energy--electricity. I am very pleased that the Energy
bill includes S. 1156, my legislation that extends and expands the
production tax credit for electricity from renewable sources, including
geothermal. This is particularly important to my home State of Utah,
which has vast potential for the creation of electricity from
geothermal sources, along with other renewable energy sources, such as
wind and biomass.
While this production tax credit has been in the tax code for some
time, it had an unfair feature that provided the tax credit for 10
years for electricity produced from wind, but only for 5 years for
electricity produced from most of the other renewable resources. This
inequity has skewed investment in these resources unfairly and in a way
that has not led to the best use of these national assets.
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I am happy to see that this provision has survived in conference.
This should result in a better-balanced and higher output of
electricity from all our renewable resources.
And, I have highlighted just two among many important provisions in
this bill that will promote the greater use of alternative and
renewable sources of energy.
We cannot escape the fact that our nation remains reliant on oil and
gas, and we absolutely must increase our supply of these resources in a
big way.
It is a little known fact that the largest hydrocarbon resource in
the world rests within the borders of Utah, Colorado, and Wyoming. I
know it may be hard to believe, but energy experts agree that there is
more recoverable oil in these 3 states than there is in all the Middle
East. In fact, the U.S. Department of Energy estimates that recoverable
oil shale in the western United States exceeds 1 trillion barrels, but
it is not counted among world reserves, because it is not yet
commercially developed. If anyone is wondering what the significance is
of that number, he or she should know that the world's oil reserves
stand at just about 1.6 trillion barrels. That means we have almost as
much unconventional oil in Utah, Colorado, and Wyoming as the rest of
the world's conventional oil combined.
Companies have been waiting for the Federal government to recognize
the potential of this resource and allow access to it. My legislation,
S. 1111, the Oil Shale and Tar Sands Development Act, will do just
that, and more.
Some have been understandably hesitant to develop this resource.
During the 1970s, there was a very large and expensive effort in
western Colorado to develop oil shale there. When the price of oil
dropped dramatically, though, the market for oil shale went bust and
the region suffered an economic disaster.
We need to remember that our past failure in this area was not
necessarily a failure of technology, but was due to a dramatic slump in
gas prices. We now have a different scenario. Today, the world is
reaching peak oil production of conventional oil, and cheap oil prices
are nowhere in sight.
We have already seen that a shift in focus to unconventional fuels
such as tar sands produce mind-boggling results. Only a few years ago,
Alberta, Canada recognized the potential of its own tar sands deposits
and set forth a policy to promote their development. As a result,
Canada has increased its oil reserves by more than a factor of 10,
going from a reserve of about 14 billion barrels to its current reserve
of more than 176 billion barrels in a very short period. And just
think--we are sitting on a similar resource of oil shale and tar sands
in the United States.
It is frustrating to learn that Utah imports about one-fourth of its
oil from Canadian tar sands, even though we have our own very large
resource of tar sands in our own state sitting undeveloped. I look
forward to the day in the not-too-distant future, when Utah's oil shale
and tar sands are developed to their potential. If it happens, and I
believe that it will, Utah will become a world leader in oil
production.
But even if we do solve the oil importation issue, we still have
another problem. Our Nation is so lacking in refining capacity for
crude, that we are forced to import 10 percent of our refined fuel. We
could produce all the domestic oil in the world, but until we can
refine it, we cannot use it.
It is clear that one of the reasons we currently have sharply higher
gasoline prices is that we simply do not have enough refining capacity
in this country. This is both a short-term and a longer-term concern
for our economy and national security.
Regrettably, gasoline, diesel, jet fuel and home heating oil supplies
are simply too tight in America today. There is not a lot that can be
done in the very near term to address the higher cost of fuel that is
attributable to refining bottlenecks. However, ensuring the long-term
viability of the U.S. refining industry should be at the very heart of
a smart national energy policy.
One of the major problems with our refining capacity is that industry
profitability has been poor over the past several decades. This has
contributed to the steady decline in the number of operating refineries
in America from more than 300 in 1980 to less than 150 today. I am told
the last major refinery to be built in America came on line in the
1970s.
Earlier this year, the National Petroleum Council reported that U.S.
refining capacity growth was not keeping pace with demand growth, that
poor historic returns in the refining sector was impeding further
investment, and that major expenditures in new regulations were
limiting the funds available for capacity expansions. This was bad news
crying out for a solution.
Another problem mentioned in the report is that the 10-year
depreciation schedule prescribed by the current tax law for refining
assets is much longer than the write-off periods for similar process
equipment in other manufacturing industries. Also, the tax code does
not contain any incentives to encourage new investment in refining
capacity, which is an endeavor that carries high costs and risks.
With these facts in mind, I introduced S. 1039, the Gas Price
Reduction Through Increased Refinery Capacity Act of 2005. S. 1039
would adjust the depreciation period for assets used in refining from
10 years to 5 and would allow an immediate write-off of these assets if
companies made an early and firm commitment to invest in new capacity
within a relatively short time.
I thank Senator Grassley for including the temporary refinery
expensing provisions of S. 1039 in the Chairman's mark of the tax title
to the Energy bill. This provision passed the Senate as part of the
energy tax package. I am pleased the Conference Committee accepted this
provision even though cost constraints forced us to limit the incentive
to 50 percent expensing.
This is the first provision passed by Congress in the past half
century that gives the U.S. refining industry a specific tax incentive
designed to spur investment in increased refining capacity. The
National Petrochemical & Refiners Association, which represents
virtually all U.S. refineries, has indicated this measure will help
stimulate facility expansions and output. It is the only provision in
the entire Energy bill that encourages refining capacity growth and
increased gasoline, diesel and jet fuel supply for consumers. This
provision alone should make a significant difference in fuel supplies.
Utah is a major gas producer. But most of Utah's natural gas lies
under our vast public lands. Utah has a large supply, but as you might
guess, Federal red tape is the number one obstacle to supplying the
country with the natural gas it demands.
One example is the natural gas found within Utah's tar sands.
Historically, extracting natural gas from tar sands has required a dual
application requiring both a permit for gas extraction and mineral
extraction. I introduced a bill that amends the Mineral Leasing Act to
allow a company only going after the gas to forgo the permitting for
mineral extraction, while fully leaving in place every relevant
environmental law and regulation. This legislation, S. 53, was included
in the energy bill.
In another effort to create a lose-lose situation, the Department of
the Interior recently published a rule that would tack on a new and
expensive fee on new Applications for Permit to Drill (APDs) for
natural gas development. As members of the Conference Committee,
Senator Craig Thomas and I joined forces to put an end to this fee for
at least 10 years.
We do not need another hurdle to obtaining gas from our public lands.
The Federal government receives about $1.6 billion every year in
royalties from gas production on public lands. With every new well in
Utah, gas companies pay a generous royalty to Federal and State
governments. It is simple math--in the long run, Utah and the Nation
loses money when wells are stopped because of fees. We also suffer from
the resulting slow down in the supply of natural gas.
Finally, I was a proponent of an item in the Energy bill that reduces
the depreciable lives of natural gas gathering and distribution lines.
By being able to depreciate their equipment more quickly, companies are
better able to invest in future production activity. This provision
should help spur investment in more exploration and production of this
clean and important fuel.
As I mentioned at the beginning of my remarks, the Energy Policy Act
will have a very large impact on Utah,
[[Page S9358]]
not only in positive economic growth and jobs, but also in the benefits
of cheaper and cleaner energy costs for families and businesses. Again,
I thank the leaders in the Senate who have brought us to this point,
along with their counterparts in the House of Representatives. I think
we have proven today, that Congress can respond to the needs of the
nation and our citizens when we work together with that goal in mind.
Mr. BYRD. Mr. President, 13 years have passed between the time
Congress passed national energy legislation and the conference report
we are taking up today. This conference report is not perfect, and it
does not go as far as I would have hoped in terms of moving the U.S.
down a different energy path. It does, however, include a number of
positive elements, including several relating to coal and clean coal
technologies that I have supported for a number of years. But, if we
wait another 13 years and continue to ignore the looming energy threats
that remain unaddressed, we may find ourselves woefully behind the rest
of the world.
If the U.S. is to remain competitive and keep pace with our growing
energy demands, then we must take stock, as a Nation, of our energy
security and make it a top national priority. We cannot achieve energy
independence with continued incremental, piecemeal efforts. It is time
to devote new innovation and ingenuity to energy policy and blaze a
path forward. We need to be free of the chains of foreign oil. To do
that, we must invest in the energy resources that we have here at home.
Coal is at the heart of that effort.
By encouraging the cleaner, more efficient use of coal in powerplants
and other facilities, we help to ensure jobs in West Virginia's coal
communities for many years to come. At the same time, we must find more
ways to utilize coal as an energy source in the 21st century. West
Virginians know that, for the United States to be free of our heavy
reliance on Middle Eastern oil, we must make investments in coal,
biomass, and other domestic, power-producing resources. We must be
prepared to make the hard decisions to make energy security a national
priority, not a mere afterthought.
For many years, the Middle East has been a hotbed of tumult and
strife. An underlying reason for our continued presence in this region
is the protection of our oil lifeline. Unfortunately, even if the
Congress passes this energy legislation, it will do little, if
anything, to reduce our dependence on foreign energy. In fact, we will
continue to become more dependent by the day. Instead of disentangling
ourselves from this foreign oil dependency, we will be sinking our
military and energy fortunes deeper and deeper into the sands of the
Middle East.
West Virginians and Americans everywhere should understand that there
are some very good features of this conference report, but they should
not be fooled. Our citizens will see little change in terms of gas
prices or natural gas prices. There will likely be few changes in our
production or use of energy. I fear the U.S. will continue to ride down
the same rocky road for years to come.
Regrettably, House Republicans also objected to including in the
Energy conference report my commuter tax benefit to help rural workers
who are paying exorbitant prices at the fuel pump. Big Oil, which is
reaping huge windfalls from fuel prices this year, is denying modest
relief to working Americans. This is but one of the many examples of
how this bill sidesteps the difficult decisions that ultimately must be
made to address energy costs, to reduce our reliance on foreign energy,
to substantially improve our domestic energy supply and energy
efficiency needs, and to deal with global climate change. We are doing
little, if anything, to address seriously these critical challenges.
I am delighted to support the inclusion of certain targeted tax
incentives that will help promote the next generation of clean coal
technologies. I have been working on these issues for more than 6 years
and am delighted that the Congress has recognized their value. This
would include, for the first time, $1.3 billion to help fund the
deployment of the ``next generation'' of powerplants, including
integrated gasification combined cycle and advanced combustion-based
powerplants. There is also $350 million for a new program to accelerate
the use of coal and other domestic resources at industrial gasification
facilities. I note that several important coal research, development,
and demonstration programs, especially the clean coal technology
demonstration program, have been reauthorized and improved upon in this
conference report.
This legislation makes many promises to the country on energy policy.
It makes promises to the men and women who pull the coal from the
ground and to those who are finding ways to use that coal more cleanly
and more efficiently. To make good on those promises, the
administration must be willing to put financial support behind these
initiatives. Will this administration do that? Is the President going
to request the funding required in his budget to make the clean coal
and other important energy programs a reality? In the end, the
President will likely have a Rose Garden ceremony and press releases
touting its accomplishments. But, given this administration's track
record, is this energy bill simply a soapbox to stand on?
The final legislation before us is only a way station on a long
journey and more work remains ahead. This bill is not the whole answer.
It is a start, and I am committed to continuing to work toward that
goal. I want to thank Senators Domenici and Bingaman for their
continued diligence and hard work in this endeavor. I applaud their
efforts to ensure that the consideration of this legislation was open
and bipartisan from start to finish. I will vote to support H.R. 6, the
Energy Policy Act of 2005.
tax incentives for commercial buildings
Ms. SNOWE. Mr. President, I want to thank you for your dedicated work
in defending the Senate-passed Energy bill language in conference,
particularly concerning the energy efficiency tax incentives. For the
first time, there will be energy efficiency tax incentives for
commercial buildings for each of the three energy-using systems of the
building--the envelope, the heating, cooling and water heating system,
and lighting. Each is eligible for one-third of the $1.80 per square
foot tax incentive if it meets its share of the whole-building savings
goal. This will apply to buildings that cut energy use by 50 percent,
an ambitious but very important target as buildings account for 35
percent of our Nation's energy usage, and commercial buildings are a
large part of that percentage.
My concern is that, because the eligibility period was cut back from
the end of 2010 to just 2 years, this shorter window of effectiveness
could undercut the program, since the time it takes to design and
construct these large buildings and skyscrapers could take longer than
the 2 years of eligibility. This is especially a concern as the
incentives for commercial buildings is one of the fastest ways in the
entire Energy bill that we can cut down the Nation's energy usage in
the short term.
Mr. GRASSLEY. We are committed to this as the correct policy for
large scale commercial projects. In addition, we are committed to
seeing energy-efficient skyscrapers in the sky and recognize that these
types of projects take years to design and build. We will continue to
work with you to make this a long-term policy of the Tax Code.
Ms. SNOWE. Again, your assistance is greatly appreciated and I look
forward to working with you on this matter in the Finance Committee in
the coming months.
clarifications relating to the section 29(c)(1)(c)
Mr. SANTORUM. Mr. President, I wish to confinn that certain language
in the Conference Report to the Energy bill, with respect to the
Internal Revenue Service stopping the issuance of private letter
rulings and other taxpayer-specific guidance regarding the section 29
credit, actually refers to a solid fuel produced from coal and ``coal
waste sludge,'' a waste product composed of tar decanter sludge and
other byproducts of the coking process. This fuel is commonly referred
to as ``steel industry fuel'' because it is a superior feedstock for
the production of coke that is used by the domestic steel industry.
Steel industry fuel provides significant energy benefits by recapturing
the energy content of the coal waste sludge and significant
environmental benefits because the Environmental Protection Agency
classifies
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coal waste sludge as a hazardous waste unless it is processed with coal
into a solid fuel product. The conference report expresses the
conferees' understanding and belief that the Internal Revenue Service
should consider issuing such rulings and guidance on an expedited basis
to those taxpayers who had pending ruling requests at the time the
moratorium was implemented. I would like to confirm the understanding
and belief of the conferees that this language in the conference report
actually refers to steel industry fuel and the requests for private
letter rulings that the producers of steel industry fuel submitted in
Fall 2000.
Mr. GRASSLEY. Mr. President, Yes, the distinguished Senator is
correct. The conferees understand that there are requests for private
letter rulings with respect to the process the Senator from
Pennsylvania has described. Moreover, these requests were submitted in
Fall 2000. The conferees expect that the Internal Revenue Service would
consider issuing these rulings immediately, with due diligence, and
without delay.
Mr. SANTORUM. I would also like to ask the distinguished Chairman of
the Committee on Finance to confirm that steel industry fuel is a
``qualified fuel'' that is eligible for the section 29 nonconventional
fuel tax credit through 2007 when one, the production facility was
placed in service after 1992 and before July 1, 1998, pursuant to a
binding written contract--including a supply or service contract for
the processing of coal waste sludge--and, two, the steel industry fuel
is sold to an unrelated party.
Mr. GRASSLEY. The Senator from Pennsylvania raises an important and
time-sensitive question. When we considered the section 29 changes, the
conferees were aware of the process described by the Senator. As the
senior conferee for the Committee on Finance, I urge the Internal
Revenue Service to consider that process as a qualified fuel that is
eligible for the section 29 credit under such circumstances.
Mr. SANTORIUM. I thank the distinguished chairman for these
clarifications.
clarifying section 703 of the Energy Policy Act
Mr. DORGAN. Mr. Chairman, can I ask you to clarify something
regarding Section 703? It is my understanding that by creating an
alternative compliance mechanism that essentially we are creating a
system that will allow more technologies to receive credit under the
EPAct program without specifically naming them.
Mr. DOMENICI. That is correct.
Mr. DORGAN. So, for instance, neighborhood electric vehicles or low
speed electric vehicles would now qualify under this program even
though they are not specifically named?
Mr. DOMENICI. That is correct.
Mr. DORGAN. I thank the chairman and yield the floor.
foreign utility--section 203
Mr. BINGAMAN. Mr. President, I would like to engage the chairman of
the Energy and Natural Resources Committee--Senator Domenici--in a
colloquy.
Mr. DOMENICI. Certainly.
Mr. BINGAMAN. Mr. President, it has come to my attention that section
1289 of the Domenici Energy Policy Act of 2005 could be interpreted as
requiring FERC approval of certain foreign transactions wholly outside
of the United States.
I am a strong supporter of section 1289 because I believe it is
vital, especially since we are repealing the Public Utility Holding
Company Act, that FERC be given the authority it needs to protect U.S.
consumers. In my opinion, section 1289 gives FERC the appropriate
authority to ensure that utility mergers and acquisitions do not
adversely impact consumers. I also think it is appropriate for FERC to
be able to ensure that retail customers in the United States do not
subsidize foreign acquisitions.
However, Section 1289 could also be interpreted as requiring FERC
approval of a holding company's acquisition of a foreign utility where
the holding company has no retail customers in this country. A company
that has a subsidiary that simply owns generation assets in the United
States for wholesale electric sales is also defined as a holding
company. As a result, that holding company's acquisition of an electric
utility company operating entirely overseas could be interpreted as
being subject to FERC's purview as a result of section 1289 of the bill
we are considering today.
Subjecting foreign utility acquisitions by holding companies without
any U.S. retail customers to FERC oversight could potentially have a
chilling effect on investment here in the United States. At a time that
we are trying to encourage investment in U.S. generation, we may be
dissuading investments coming into the United States if a foreign-based
holding company believes its next transaction in Great Britain is going
to be subject to a FERC merger review proceeding. Moreover, the
``public interest'' test present in section 203 of the Federal Power
Act does not readily fit the situation present with respect to foreign
transactions.
I note that section 1289 does give FERC the authority to, by
rulemaking, identify types of transactions that will receive expedited
Commission review. I certainly believe that the acquisition of a
foreign utility company by a holding company with no retail customers
in the United States should fall in that category. Other categories of
foreign transactions that could possibly be interpreted as being
covered by section 1289 also may fall into this category.
Mr. DOMENICI. Mr. President, I agree with my colleague--Senator
Bingaman--that FERC, if it determines that certain foreign transactions
are covered by the language of section 1289, should provide expedited
review and approval to the acquisition of a foreign utility by a
holding company that has no retail customers in the United States and
other transactions that raise no significant U.S. consumer issues.
These types of transactions don't require FERC's scrutiny in order to
ensure that American consumers are adequately protected.
Mr. BINGAMAN. I thank my colleague.
Mr. BAUCUS. Mr. President, for 4 years, Congress has failed to enact
a comprehensive Energy bill. Today, however, I am confident we can
change that record.
The conference committee has assembled a well-balanced package. It is
right for America. We should send it to the President's desk.
The House and the Senate gave the conferees a difficult task. The
House and Senate Energy bills took two very different approaches to tax
policy. The two bills had very little in common. Thus, we could not
include everything in both bills without busting our budget.
Most of the provisions in the House bill promoted investment in
traditional energy infrastructure. It favored pipelines, electricity
lines, and oil and gas production.
In contrast, the Senate bill--which I helped develop with my good
friend Senator Grassley--advanced new technologies. It encouraged
conservation efforts, improved energy efficiency, and expanded use of
alternative fuels.
Conference negotiations were hard fought. We made some tough
decisions.
But overall, the process was very positive. We kept within our
budget, and we worked with a spirit of compromise and cooperation.
The energy tax incentives that the conference has recommended take an
evenhanded approach to an array of promising technologies.
For example, the bill provides a uniform period for claiming
production tax credits under section 45 of the Tax Code. This
encourages production of electricity from all sources of renewable
energy.
The bill recognizes the value of coal and other traditional energy
sources to our economy. It provides investment tax credits for clean-
burning coal facilities and projects. It provides substantial tax
incentives to facilitate much needed expansion of refinery capacity.
And it promotes expansion of American energy delivery systems.
The bill recognizes the need for a diverse energy portfolio, it
fosters energy production from wind or coal in Montana to geothermal
sources in California, and it will help create jobs by promoting
domestic energy production.
[[Page S9360]]
The bill also rewards energy conservation and efficiency. It includes
incentives for energy-efficient homes, alternative fuel vehicles, and
development of fuel cell technology. These incentives are
environmentally responsible they reduce pollution, and they help
improve people's health.
These energy tax incentives are good for America. They will promote
the delivery of reliable, affordable energy to consumers. They will
help to create jobs through domestic energy production, and they make
meaningful progress toward energy independence.
I am proud of the bipartisan effort that produced the conference
agreement. I encourage my colleagues to support this important
legislation.
Mr. CONRAD. Mr. President, I rise today to support the Energy bill
conference report.
For many years, I have supported passage of a comprehensive national
energy policy. Such a policy is necessary to reduce our increasing
dependence on foreign energy sources. A comprehensive energy policy
will help lower energy prices in the long run. Furthermore, any far-
reaching bill will move us toward newer technologies that will keep our
economy growing strong while making us more energy independent.
Although not perfect, this energy bill moves us in the right
direction. It will expand our electricity transmission system and make
it more reliable. The bill contains incentives for renewable energy,
including the renewable energy production tax credit that I helped
include. It will also spur an increase in the production and use of
domestic biofuels such as ethanol and biodiesel. Because of this bill,
our coal-burning plants will improve their efficiency and emit less
pollution. Finally, the bill provides needed incentives to increase
natural gas infrastructure, measures that will lead to lower prices for
natural gas consumers in the long run.
Equally important, this bill benefits North Dakota for a number of
reasons. The transmission incentives will enable my State's power
producers to export electricity to distant markets. In this way,
transmission incentives benefit the lignite and wind energy sectors in
my State. The clean coal production incentives will make it easier to
build advanced clean coal powerplants. The inclusion of the wind energy
production tax credit will help North Dakota realize its potential to
be the biggest producer of wind energy in the country. The Renewable
Fuels Standard and tax incentives for ethanol and biodiesel will aid my
State's farm economy, create more jobs, and reduce our dependence on
foreign oil. In addition, the bill will assist my State in developing
exciting new technologies, such as coal-to-liquid fuel plants.
I believe we still have a lot of work to do in order to make our
Nation less dependent on foreign energy. However, this bill takes
positive steps to address our energy needs. As I just mentioned, this
bill will provide significant benefits to my State.
For these reasons, I support the conference report.
Mr. CORZINE. Mr. President, I thank Senator Shelby and Senator
Sarbanes for their hard work on H.R. 3, the Safe, Accountable,
Flexible, and Efficient Transportation Equity Act of 2005 (SAFETEA). I
know how much time, effort and energy went into completing that bill
and I commend the chairman and ranking member. I especially appreciate
their willingness to work with me to get language included in the bill
in support of a full funding grant agreement for the New Jersey Trans-
Hudson Midtown Corridor.
The New Jersey Trans-Hudson Midtown Corridor project entails
construction of a 5-mile commuter rail extension from Secaucus, NJ to a
new station in midtown Manhattan. The centerpiece of the project is a
new trans-Hudson rail tunnel. This project will benefit transit riders
from the New York and New Jersey region and will relieve congestion on
the existing tunnels for intercity rail riders of the Northeast
corridor, the Nation's busiest passenger railroad. A recent economic
impact analysis indicates that the entire project will create 44,000
new jobs and increase gross regional product by $10 billion. The
project's estimated cost is approximately $5 billion.
The Federal contribution would be matched by comparable local
contributions from the State of New Jersey and the Port Authority of
New York and New Jersey. New York's Governor Pataki, who along with New
Jersey's Governor Codey controls the Port Authority governance,
recently declared his support of this project--bolstering prospects for
future funding from the Port Authority for local share. In addition,
the State of New Jersey will soon be reauthorizing its transportation
trust fund, which will provide New Jersey with the funding capacity for
its own contribution to the project.
Currently, the project is undergoing environmental review, which
should be completed in 2006. It is expected that preliminary
engineering will start in fall 2005 and construction will begin in
2007.
The language in the SAFETEA bill will be a significant boost to this
project. I would like to take a moment to clarify the intent of a
couple of points in that provision in the bill. First of all, it is the
intent of the language to include the funding expended for the New
Jersey Transit river line and the bi-level railroad cars New Jersey
Transit purchased for its lines as part of the non-Federal contribution
for the New Jersey Trans-Hudson Midtown Corridor project.
Second, the language says that the Secretary of Transportation must
give ``strong consideration'' to the Trans-Hudson Midtown Corridor
project when it comes time to awarding a full funding grant agreement,
since it will be a crucial link for the Northeast corridor and benefit
the region's mobility, security, economy and environment. The term
``strong consideration'' indicates that the New Jersey Trans-Hudson
Midtown Corridor project is a high priority for the Secretary and
encourages the Secretary to award a full funding grant agreement
provided it meets the FTA's New Starts criteria. I appreciate the
opportunity to clarify these important points, and I look forward to
further progress on the tunnel project.
Mr. McCAIN. Mr. President, I am afraid that the heralded passage of
this energy bill against years of failure by the Congress to legislate
a comprehensive energy policy has created a false sense of
accomplishment in Washington today. As my colleagues are well aware,
oil prices are hovering near the infamous $60 per barrel mark; the
greenhouse effect is beginning to have a substantial measurable impact
on the global climate; and American families are being gouged at the
pump while their tax dollars are carelessly spent on Federal subsides
for big oil and gas companies. As leaders, we cannot claim that we have
successfully addressed these real-life challenges by enacting this
latest incarnation of special interest influence in policymaking.
I do want to acknowledge the work of the Senate conferees for keeping
out a few of the most objectionable provisions that prevented passage
of the bill during the last Congress, particularly the MTBE liability
waiver and the proposed drilling in ANWR. They took the right action in
preventing the inclusion of those provisions. Unfortunately, after all
the time and effort spent on this issue during the past several years,
when it comes to solving America's pressing energy problems, this bill
simply does not go far enough. It will not reduce our dependence on
foreign oil, it won't assure the growing threat of global warming is
addressed in a meaningful way, and it wont effectively reduce the price
of gasoline at the pump.
The estimated cost of this energy bill has ballooned far beyond the
original $6.7 billion in the President's proposal. The conference
agreement provides an estimated $14.5 billion in corporate subsidies
and tax credits. And the tax package provides more than twice as many
incentives to the oil, gas, coal and nuclear industries as it does to
energy efficiency and renewable energy--a significant change from the
Senate-passed bill.
Indeed, big oil, coal and gas companies seem to be disproportionally
favored under this bill as most of the tax breaks going to traditional
industries. Only about 36 percent of the estimated tax package would go
to renewable energy and cleaner burning vehicles. Even then, some of
the programs to promote renewable energy and alternative fuels are
questionable. A loan guarantee program that would cover up to 80
percent of the cost of developing new energy technologies was scored at
$3.75 billion for the first 5 years. These
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loans carry a 20- to 60-percent risk of default according to the CBO,
and after the 5 years there are no limits on the amount of loans that
can be guaranteed, thus leaving the taxpayer to cover the losses when
such endeavors fail. Perhaps more alarming, the estimated costs of the
bill are estimates at best, and don't take into account some of the
hidden costs associated with program authorizations and future tax
credit extensions.
And then there is the ambiguous realm of alternative fuels for
vehicles. Rather than addressing the gas mileage interests of
consumers, this energy conference report would boost ethanol production
by requiring 7.5 billion gallons of the corn-derived fuel be added to
the domestic gasoline supply by 2012. This is double the current
ethanol mandate and while it will be a boon for the ethanol producers,
it will have a negligible effect on oil imports. While I fully
recognize and support efforts to promote clean energy sources, the
costs also need to be weighed against any presumed benefits. And at
this juncture, the beneficiaries are still the producers, not the
consumers and not the environment.
Let me mention some of the more ``interesting'' provisions in the
conference report:
Section 134. Energy Efficiency Public Information Initiative.
Authorizes a total of $400 million, $90 million for Fiscal Years 2006
through 2010, for the Secretary of Energy to carry out a national
consumer information program to encourage energy efficiency through
disseminating information to the American public addressing, among
other things, the importance of proper tire maintenance. I am fully
aware that it is important to rotate your tires, and to take other
actions to preserve energy, but do we really need to spend almost half
a billion on such a campaign?
Section 138. Intermittent Escalator Study. Requires the GSA to study
the advantages and disadvantages of employing intermittent escalators
in the United States. I can't imagine many of my colleagues would
support removing ``Senators Only'' features in the Capitol Complex and
be content to wait for an elevator to intermittently show up, but maybe
the rest of the American public is more patient.
Section 207. Installation of Photovoltaic System. Authorizes $20
million for the GSA to install a photovoltaic system, as set forth in
the Sun Wall Design Project, for the Department of Energy headquarters
building. Of all the sunny places in this country where solar power is
viable, the Energy Department Building in DC would not be the first
place that comes to mind.
Section 208. Sugar Cane Ethanol Program. Establishes a new $36
million program under EPA that is limited to sugar producers in the
States of Florida, Louisiana, Texans and Hawaii for 3 years.
Section 224. Royalties and Near-Term Production Incentives. Under
this section, all monies received by the U.S. on all lands except for
the State of Alaska, from sales, bonuses, rentals and royalties on
leased Federal lands or geothermal resources shall be paid into the
Treasury of the U.S. and a percentage of such funding is then partially
redistributed to the State within the boundaries of which the revenues
were generated. But in the case of Alaska, seems that they will get to
keep all of the monies generated.
Section 237. Intermountain West Geothermal Consortium. Establishes an
Intermountain West Geothermal Consortium that focuses on building
collaborative efforts among universities in the State of Idaho, other
regional universities, State agencies and the Idaho National
Laboratory, must be hosted and managed by Boise State University, and
have a directed appointed by the Boise State University. Why do we need
a federal law to promote collaboration at Boise State?
Section 244. Alaska State Jurisdiction Over Small Hydroelectric
Projects. Amends the Federal Power Act with respect to certain
authorities for the State of Alaska, allowing the State to completely
ignore any recommendations received from the National Marine Fisheries
Service, the U.S. Fish and Wildlife Service, and State fish and
wildlife agencies concerning conditions for the protection, mitigation,
and enhancement of fish and wildlife in constructing small
hydroelectric projects.
Section 245. Flint Creek Hydroelectric Project, located in Granite
and Deer Lodge Counties, Montana. The bill basically extends the
project's permit for an additional 3 years. And, notwithstanding other
laws and regulations regarding payment to the U.S. for the use of
Federal lands, such payments surrounding this project would be
specified in the bill. I can only assume this payment is less than what
would otherwise be required.
Section 354. Enhanced Oil and Natural Gas Production Through Carbon
Dioxide Injection. Establishes a $3 million demonstration program
solely for 10 projects in the Willistin Basin in North Dakota and
Montana and 1 project in the Cook Inlet Basin in Alaska.
Section 356. Denali Commission. Authorizes $55 million annually for
fiscal years 2006-2015 for a seven-member commission created in 1998
comprised entirely of Alaska interests to support Alaska interests.
This funding would be used to carry out energy programs.
Section 365. Pilot Project to Improve Federal Permit Coordination.
Establishes a pilot that only the States of Wyoming, Montana, Colorado,
Utah, and New Mexico can participate in.
Section 412. Loan to Place Alaska Clean Coal Technology Facility in
Service. This section authorizes a direct Federal loan for up to $80
million for a plant near Healy, Alaska. One of the few protections
under this section for the American taxpayer is extremely lax. It
states that prior to providing the loan, the Secretary determine that
``there is a reasonable prospect that the borrower will repay the
principal and interest on the loan.'' That sure doesn't sound like the
type of stringent criteria and risk assessment that would be weighed by
many lending institutions that I am aware of. And why does this
particular facility merit a Federal loan over other clean energy
technologies?
Section 416. Electron Scrubbing Demonstration. Directs the Secretary
to use $5 million to initiate, through the Chicago operations office, a
project to demonstrate the viability of high-energy electron scrubbing
technology on commercial-scale electrical generation using high-sulfur
coal.
Section 628. Decommissioning Pilot Program. This section authorizes
$16 million for a pilot program to commission and decontaminate the
sodium cooled fast breeder experimental test site reactor located in
northwest Arkansas.
Section 755. Conserve by Bicycling Program. Provides $6.2 million to
establish a pilot program to be known as the ``Conserve by Bicycling
Program'' and study the feasibility of converting motor vehicle trips
to bicycle trips, including whether such factors make bicycle riding
feasible: weather, land use and traffic patterns, the carrying capacity
of bicycles and bicycle infrastructure. I find it difficult to support
spending $6.2 million to encourage Americans to ride bicycles when we
are running a deficit of $368 billion this year and a 10-year projected
deficit of $1.35 trillion, according to the Congressional Budget
Office.
Section 756. Reduction of Engine Idling. Authorizes $139.5 million to
study the environmental impact of engine idling from heavy-duty
vehicles and locomotives at truck stops, ports of entry, rest areas and
private terminals. Is there any doubt that engine idling may be
contributing to air quality problems? Do we need to expend almost $140
million on such a study? It might be cheaper to pay the truckers and
engineers to shut off their engines.
Section 955. Department of Energy Civilian Nuclear Infrastructure and
Facilities. Requires the Secretary to develop a comprehensive plan for
facilities at the Idaho National Laboratory to avoid duplicative
efforts at other national laboratories and establish or consider plans
to establish or convert various areas into user facilities.
Section 980. Spallation Neutron Source. Requires the Secretary
develop an operational plan for the Oak Ridge National Laboratory in
Oak Ridge, TN, to ensure the facility is employed to its full
capability. It further authorizes the Spallation Neutron Source Project
at Oak Ridge at $1,411,700,000 for total project costs.
Section 997. Arctic Engineering Research Center. It directs the
Secretary of Transportation to provide annual grants, worth $18 million
total, to ``a
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university research center to be headquartered in Fairbanks''--that
must be the University of Alaska-Fairbanks according to its Web site--
to establish and operate a university research center to research
improved performance of roads, bridges, residential, commercial, and
industrial structures in the Arctic region.
Section 1511. Renewable Fuel. The section authorizes a total of $12
milliom--$4 million for 3 years--for a resource center to further
develop bioconversion technology at the Center for Biomass-Based Energy
at the Mississippi State University and the Oklahoma State University.
Section 1811. Coal Bed Methane Study. Directs the DOE and EPA to
collaborate with the NAS on a study on the effect of coalbed natural
gas production on surface and ground water aquifers in Montana,
Wyoming, Colorado, New Mexico, North Dakota, and Utah.
Now that we know a little about some of the provisions contained in
the conference agreement, let's talk about one very important issue
that is not addressed--an issue of worldwide significance: global
warming.
Earlier this month, the leaders of the G8 nations met and issued an
agreement with respect to climate change. The agreement among the G8
nation states that: ``We will act with resolve and urgency now to meet
our shared and multiple objectives of reducing greenhouse gas emissions
[.]''
This agreement followed the joint statement that was issued in June
in which the U.S. National Academy of Sciences and national academies
from other G8 countries, along with those of Brazil, China, and India,
which concluded that: ``The scientific understanding of climate change
is now sufficiently clear to justify nations taking prompt action. It
is vital that all nations identify cost-effective steps that they can
take now, to contribute to substantial and long-term reduction in net
global greenhouse gas emissions.''
It is very disappointing that the climate change provisions in the
conference report fail to address the necessary commitment for taking
urgent actions and making substantial reductions in greenhouse gas
emissions.
The conference report requires the Department of Energy to develop
greenhouse gas intensity technologies and strategies. Such requirements
are a waste of time and effort as we already know that using the
greenhouse gas intensity does not work. How do we know it doesn't work?
We know because the Department of Energy has shown us and because
climate change science tells us that the climate system does not
respond to greenhouse gas intensity, but rather to greenhouse gas
concentration levels in the atmosphere.
Recently, the Energy Information Administration at the Department of
Energy released a statement indicating that preliminary data for the
year 2004 revealed that energy-related carbon emission intensity fell
by 2.6 percent, while energy-related carbon dioxide emissions grew by
1.7 percent. This is an early reality check for those who argue that we
can control greenhouse gas emissions by only controlling carbon
emission intensity.
Again this clearly shows how our efforts to address climate change
are misfocused and without substance. If we continue down this path,
the $5 billion per year that we are currently investing in the climate
change science and technology programs will not provide the return on
investments that the American people deserve.
Furthermore, if you look at any credible scientific report on climate
change, it speaks of the impact of greenhouse gases on the climate
system, not the impact of greenhouse gas intensity. In all the hearings
that we have held in the Commerce, Science, and Transportation
Committee over the past few years, I don't recall a single scientist
indicating that if we control our greenhouse gas intensity, then we can
mitigate the impacts of climate change.
If we are to address climate change consistent with the sense-of-the-
Senate resolution passed by this body just over a month ago, then we
must pursue solutions that will truly have an impact on the climate
system, not those that are no more than ``smoke and mirrors.'' Of
course, the conferees failed to agree to even include the modest
resolution in the final conference agreement.
If it weren't for the pressing need to show the American public that
we are acting in at least some way to address our Nation's energy
problems--action that every person is reminded of every time they pay
yet a higher price at the pump--I doubt many of my colleagues would be
so rushed to pass this bill. Quite frankly, it seems as though the
Congress is grasping at straws to address our energy quandary,
unwilling or unable to use the foresight necessary to plan for a future
America that is less reliant on foreign oil, cleaner under renewable
energy generation, or leading in cutting-edge energy efficiency
technology. And in our failure, the American people will be
disappointed.
Ms. COLLINS. Mr. President, I rise today in support of the Energy
bill conference agreement. The final version of this legislation is
imperfect, but it takes important steps forward in addressing some of
this Nation's energy problems. This bill will strengthen electric
reliability, further develop our renewable energy resources, and
improve energy efficiency.
I would like to begin by thanking Chairman Domenici and ranking
member Bingaman for their long and arduous work on this subject. We
have now been working on comprehensive energy legislation for nearly 5
years, under three different Congresses and three different Energy
Committee chairmen. I know it has been a very difficult path. I express
my sincere appreciation to Chairman Domenici for his dedication,
leadership, and willingness to accommodate a great diversity of views
on the subject of energy policy.
I am very pleased that the Energy bill provides nearly $3 billion for
wind, biomass, and other renewable energy sources. This credit could
help a major wind energy development project move forward in Aroostook
County and will help Maine's forest products industry by providing an
important revenue stream for waste forest products. Developing Maine's
wind and biomass resources creates jobs in rural areas, provides
additional revenue to farmers and struggling industries, reduces
greenhouse gas emissions, and helps diversify our energy supply. While
I am disappointed that the bill does not contain the provision which I
authored, along with Senator Bingaman, to require that 10 percent of
our electricity come from renewable energy sources by the year 2020,
the bill nevertheless makes important strides forward in developing our
renewable energy resources.
This bill will also help improve our electricity reliability by
creating new standards for the national electric transmission grid and
creating incentives to spur the creation of a stronger and more robust
grid. This bill also provides for improved market transparency, the
first ever broad prohibition on market manipulation and filing false
information, and new consumer protections for utility customers.
I am also pleased by a number of provisions included in the bill to
help spur greater energy efficiency. Consumers will be able to take
advantage of tax credits for hybrid cars, solar water heaters, and
energy efficient improvements to existing homes. Additional tax credits
will spur energy-efficient appliances and alternative fueled vehicles,
which will not only reduce smog and greenhouse gas emissions but also
reduce oil imports. In addition, a number of new Federal programs and
15 new product standards will reduce natural gas use in 2020 by 1.1
trillion cubic feet, and reduce peak electric demand by an amount
equivalent to that produced by 85 power plants. All of these programs
will not only help protect the environment, but also help consumers
save money on their energy bills.
Several other provisions bear mentioning. I am pleased that the final
legislation retains the amendment which Senator Levin and I offered
regarding the Strategic Petroleum Reserve. This amendment requires the
Department of Energy to develop procedures for using the Strategic
Petroleum Reserve in such a way as to reduce the impact on taxpayers
and energy consumers, while maximizing oil supplies and improving U.S.
energy security. This amendment will help mitigate the impact of the
Department of Energy's misguided policies on the Nation's gasoline
prices.
I am also pleased that the bill includes language regarding ISO New
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England's misguided Locational Installed Capacity plan, also known as
LICAP. This language requires the Federal Energy Regulatory Commission
to very carefully weigh the concerns of Maine and other New England
States regarding this proposal. I am very concerned that the LICAP
proposal would unnecessarily raise electricity rates in Maine, and I
urge FERC to consider this issue very carefully.
While I believe the bill makes important progress in some areas, I am
extremely concerned that this bill fails to stop our growing and
increasingly dangerous reliance on foreign oil. Regretfully, a
provision requiring that we save 1 million barrels of oil per day by
2015 was dropped from the bill. This provision, which I co-authored,
was included in the Senate-passed bill, but removed by the House. In
addition, I am disappointed that the bill does not require any increase
in fuel economy standards for automobiles. Although the energy
efficiency provisions for hybrid automobiles and alternative fuel
vehicles are important steps forward, they are not enough. Four years
ago I released a report predicting that crude oil prices would hit $60
per barrel by the year 2010 unless we took aggressive action to
increase our energy efficiency and reduce our reliance on foreign oil.
Without greater energy efficiency measures, I am concerned that prices
are likely to go even higher.
I am also concerned by a provision in the bill that would allow for
an inventory of offshore oil and gas resources on the Outer Continental
Shelf, OCS. I am strongly opposed to oil exploration on restricted
areas of the OCS, and I believe this inventory is pointless since this
Congress has no intention of allowing drilling in these areas.
I would note that this bill is much improved over the 2003 conference
report which I could not in good conscience support. First, I am
pleased that this legislation does not include a very harmful liability
waiver for the manufacturers of MTBE. MTBE is a noxious chemical which
has polluted drinking water supplies in Maine and many other States. I
saw no justification for allowing the manufacturers to be let off the
hook in terms of cleaning up this chemical, and I am grateful to
Chairman Domenici and Ranking Member Bingaman for refusing to give in
to those advocating for the waiver.
I am also very pleased with the improvements to the electricity title
in this bill. The electricity provisions in this bill are good for the
Northeast and have the potential to promote competitive markets which
are more efficient, more reliable, and lower priced than we have now. I
am pleased that the Carper-Collins provision to promote combined heat
and power was retained in the bill.
While the legislation before us does not address our dangerous
reliance on foreign oil, it nevertheless takes important steps to
increase our use of renewable energy, improve energy efficiency, and
strengthen our electricity grid. While I am disappointed at some of the
things that were included in the bill as well as many things that were
not included, I nevertheless believe that the bill is a step in the
right direction. Given our extremely high energy prices and an even
more dire energy crisis looming just over the horizon, I believe we
simply cannot afford to block needed improvements out of fear that they
do not go far enough, and I therefore intend to vote in favor of this
legislation. However, I ask my colleagues to consider this legislation
as a first step, and to again address these issues next year and the
year after, until we finally begin to reduce our reliance on foreign
oil and provide a secure energy future for the United States.
Mr. BAUCUS. Mr. President, after 4 years, the Senate is on the verge
of passing a comprehensive Energy bill. This important legislation will
lessen America's reliance on foreign sources of energy, boost renewable
resources, and provide reliable energy for the nation.
Putting this legislation together and keeping it within budget
constraints took hard work and perseverance. First, I thank the
chairman and ranking member of the Energy and Natural Resources
Committee, Senator Domenici and Senator Bingaman, respectively. They
provided excellent leadership, and I know their staff stayed up many a
sleepless night. They played an important role developing this bill.
I also thank my good friend Senator Grassley, the Chairman of the
Finance Committee, for his commitment to taking a balanced approach to
energy tax policy.
Let me take a moment and speak about the hard work of the Finance
Committee staff. The House and Senate bills took two very different
approaches to tax policy. Conference negotiations were hard fought. We
made some tough decisions. But we got it done within budget limits
largely because we worked with a spirit of compromise and cooperation.
I also thank some staff members in particular. I appreciate the
cooperation we received from the Republican staff, especially Kolan
Davis, Mark Prater, Elizabeth Paris, Christy Mistr, and Nick Wyatt.
I thank the staff of the Joint Committee on Taxation and Senate
Legislative Counsel for their service.
I thank Chairman Bill Thomas and his staff for their hard work,
cooperation and continuing willingness to work with us through the
difficult negotiations that produced this important legislation.
I also thank my staff for their tireless effort and dedication,
including Russ Sullivan, Patrick Heck, Bill Dauster, Ryan Abraham, and
Wendy Carey. I especially want to thank Matt Jones. He is the tax
counsel on our staff who has worked for years on the tax legislation in
this bill. His hard work and perseverance on this legislation went
above and beyond the call of duty. I owe him a deep debt of gratitude.
I also thank our dedicated fellows, Mary Baker, Jorlie Cruz, Cuong
Huynh, Richard Litsey, Stuart Sirkin, and Brian Townsend.
Finally, I thank our hard-working interns: Rob Grayson, Jacob
Kuipers, Heather O'Loughlin, Andrea Porter, Ashley Sparano, Julie
Straus, Danny Shervin, Katherine Bitz, Drew Blewett, Adam Elkington,
Julie Golder, and Paul Turner.
This legislation was a team effort that really paid off.
I yield the floor.
Mrs. LINCOLN. Mr. President, I rise to announce my support for the
Energy Policy Act of 2005. I want to thank Chairmen Grassley and
Domenici and Senators Baucus and Bingaman for working with me to
include renewable energy and energy efficiency provisions in the bill
that are important to my home State of Arkansas.
Some may say this bill is not perfect, but I believe it is a step
forward toward reducing our dependence on foreign oil and increasing
the use of renewable resources in this country. This bill makes an
effort to address energy concerns in every sector of this industry. In
Arkansas, we have investor-owned utilities and co-operatives. This bill
will help both of these providers serve their customers in a more
efficient and reliable manner.
And while this bill may not go as far as some would like in the
direction of renewable energy, there are many provisions in this
package which will help the United States begin the long process of
eliminating our dependence on foreign oil. I look forward to the
further growth and development of the biodiesel industry that will be
spurred by the extension of the production tax credit provided in the
bill that I have fought for during my time in the Senate.
Another provision of which I am particularly proud relates to the
cleanup of the Southwest Experimental Fast Oxide Reactor, a
decommissioned nuclear reactor near the community of Strickler, AR, in
the northwest corner of my State. The site is contaminated with
residual radiation, liquid sodium, lead, asbestos, mercury, PCBs, and
other environmental contaminants and explosive chemicals. The Federal
Government helped create these contaminants and should pay to help
clean them up. This is great news for northwest Arkansas, because this
site has threatened public health and the environment there for too
long.
Finally, I would like to thank the staff on both the Finance and
Energy Committee, majority and minority, for all of their help in
crafting this bill. Elizabeth Paris and Matt Jones have been patient
and helpful with any idea or request I have come to them with. Sam
Fowler and Lisa Epifani have been equally accessible when I had
questions or concerns on the nontax portion of
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the bill. I would also like to take this opportunity to thank Todd
Wooten of my staff who has done an incredible job of helping ensure my
priorities for Arkansas were included in the final bill. This body
would be nothing without the tireless work of our staff, and I wanted
to make sure they knew how much I appreciate their hard work.
In conclusion, our current global situation shows us how important it
is that we take steps to reduce our dependence on foreign oil. We all
know this bill is not a comprehensive solution, but a step in the right
direction. We must continue to look toward more useful and progressive
technology that brings us to our goal.
Much more work needs to be done if we ever expect this country to
lose its dependence on fossil fuel and foreign sources of energy, and I
urge my colleagues to continue to work hard until we achieve this goal.
Mr. BUNNING. Mr. President, I rise today to talk about the Energy
bill conference report.
I have spoken on this floor many times before on Energy bills. I hope
the bill before us is the last one I come to the floor to speak on for
a long time.
While not perfect, this is a good bipartisan bill.
I want to thank Chairmen Domenici and Grassley and Ranking Members
Bingaman and Baucus for working hard in a bipartisan manner to produce
the bill before us.
This Energy bill strikes a balance between conservation and
production.
And while passing an Energy bill might not help energy prices in the
short term, it will make a difference over the long term by affecting
how much our energy costs increase. This bill's increased domestic
energy production, coupled with increased conservation provisions, will
slow the astronomical price increases we have seen lately.
Without a new national Energy policy, though, there is not much we
can do about the rising energy prices.
Many oil producers are working at full capacity.
And with China and India starting to increase their demands for oil,
the world's oil supply will continue to decrease while prices continue
to increase.
This means that we cannot just try and conserve our way out of any
kind of energy problem.
We have to reduce our reliance on foreign oil and do a better job of
taking care of our own energy needs.
The bill contains some good policy provisions.
It includes electricity provisions that are a good start to help
update our electricity grid.
America has outgrown its electricity system and some changes need to
be made to it.
One of the provisions included in the bill is PUCHA repeal, which
will go a long way in helping our electricity system meet increasing
demands.
The bill also makes strides to increase the reliability of the
electricity grid.
We also desperately need new transmission lines built, and I hope
that the provisions in this bill will ensure that this happens.
It also contains an incentives title which will encourage the design
and deployment of innovative technology to increase energy supply and
also protect the environment. These incentives cover projects such as
clean coal, electric transmission and generation, and fuel efficient
vehicles.
I am glad that the Senate Energy bill contains clean coal provisions
which I wrote to help increase domestic energy production while also
improving environmental protection.
Coal is an important part of our energy plans. It's cheap and
plentiful, and we don't have to go far to get it.
For my home State, this means more jobs and a cleaner place to live.
Clean coal technology is estimated to create 62,000 jobs nationwide and
cut emissions from coal drastically.
The Energy bill encourages research and development of clean coal
technology by authorizing over $1 billion for the Department of Energy
to conduct programs to advance new technology that will significantly
reduce emissions and increase efficiency of turning coal into
electricity.
Almost $2 billion will be used for the clean coal power initiative,
where the Department of Energy will work with industry to advance
efficiency, environmental performance, and cost competitiveness of new
clean coal technologies.
And $3 billion will be used to help coal companies comply with
emission regulations by providing funding for pollution control
equipment.
The energy tax package also contains tax credits for companies to
implement clean coal technology.
The bill provides $1.6 billion in tax credits for investment in clean
coal facilities. It also provides over $1 billion in tax credits for
amortization of pollution control equipment to help clean up the
emission from existing coal facilities.
Coal plays an important role in our economy, providing over 50
percent of the energy needed for our Nation's energy.
The 21st economy is going to require increased amounts of reliable,
clean, and affordable electricity to keep our nation running.
With research advances, we have the know-how to better balance
conservation with the need for increased production.
I think this bill makes a good start in ensuring that coal remains a
viable energy source that can provide cheap power to consumers.
And the other tax provisions from the Finance Committee will do a
good job to promote conservation and energy efficiency further by
encouraging the use of cleaner burning fuels.
I am pleased the bill contains ethanol and biodiesel tax credits.
These expanded tax credits will further encourage the use of these
alternative fuels to help increase domestic production and lessen our
dependence on foreign oil. This also is good for farmers and is good
for jobs.
We have deliberated and discussed for far too long the need for
America to follow a sensible, long-term energy strategy.
I am glad the Senate acted to pass an Energy bill.
This is good for our environment, economy, and national security.
Thank you, Mr. President.
Mrs. BOXER. Mr. President, I will vote against this energy bill
because it does not do enough to reduce our dependence on foreign oil
through the promotion of alternative forms of energy or by encouraging
energy efficiency.
I was very disappointed that the conference committee eliminated the
Senate's renewable portfolio standard, under which utilities would have
provided 10 percent of their total sales from renewable resources by
2020. In addition, the conference also eliminated the Senate provision
that called on the President to find ways to reduce oil use by 1
million barrels per day by 2025, as well as the provision promoting
hybrids for use in Federal, State, and other vehicle fleets.
I am also very concerned about an authorization for an inventory of
energy resources in America's Outer Continental Shelf, which is
damaging in itself and may lead to future oil and gas development in
some coastal areas.
Overall, this bill is very imbalanced. The bill provides $5.7 billion
in tax incentives over 10 years for the fossil fuel industry and $1.5
billion in subsidies and tax breaks for the nuclear industry. Compare
this to tax incentives for renewable electricity, alternative vehicles
and fuels, energy efficiency, and energy conservation, which were cut
from $11.4 billion in the Senate bill to $5.8 billion in the final
bill.
With all of these bad provisions, I am pleased that a few good
provisions survived, such as my amendment calling on the Federal Energy
Regulatory Commission to conclude action on energy crisis refunds by
the end of the year or report to Congress explaining what it has done
and specifying a timetable for the rest of their process
I am also pleased that this energy bill will exempt California from
the proposed new ethanol mandate during the summer months, when ethanol
usage in gasoline can increase air pollution, and that it included my
original proposal to encourage the production of ethanol from
agricultural waste.
Republicans removed many provisions from the Senate bill that would
have put us on a more energy-efficient path, and unfortunately we were
left with a bill that does not offer the sound and innovative policies
we need to reduce our dependence on foreign
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oil, protect the environment, and improve our energy and fuel
efficiency.
Ms. SNOWE. I rise today not only to cast my support for the
conference report to H.R. 6, an energy bill that touches on nearly
every aspect of domestic energy production, consumption, and savings,
but especially to compliment Energy and Natural Resources chair,
Senator Domenici, for once again showing what a truly superb leader he
is. He and Senator Grassley, chair of the Finance Committee, have been
successful in reaching bipartisan agreement on comprehensive energy
legislation--something that we have not been able to do since 1992,
even though we have actively attempted to do so in the last three
Congresses.
I would have written a more ambitious bill that would have more
aggressively reduced our Nation's dependence on foreign oil, but this
is an improvement over the status quo. What this legislation does
include is essential energy efficiency and conservation tax incentives
that will make our Nation's energy policy more balanced. As a Nation,
we must recognize that we must do more than just produce our way out of
an energy crisis, we have an obligation to consume less as well.
For instance, by improving fuel economy standards of our cars and
trucks, we could have saved our Nation 1 million barrels of oil a day,
as Senator Feinstein and I have attempted to do for these last several
years. Also, by keeping Senator Bingaman's provisions for Climate
Change and Renewable Portfolio Standards in the conference report, we
would have had a much stronger bill to address our future energy,
environmental, and economic needs. But this bipartisan energy
legislation is a reflection of what was possible. These important
issues will not go away, we will be addressing them another day--and in
the not-too-distant-future, I will predict.
While the report came out of conference far from perfect, the
question we need to ask ourselves at the end of the day is, Does the
legislation begin to take the Nation forward for responsible energy
policy to help decrease our dependence on foreign oil from the most
volatile areas of the globe as we begin the 21st century? And this bill
does take at least that small step forward, especially for provisions I
believe in--greater energy efficiencies and energy from renewable
sources that begin to wean the Nation off of its thirst for oil.
For instance, I am extremely pleased that I could secure $1.7 billion
through the energy efficiency and conservation provisions from my
original bills, the Efficient Energy Through Certified Technologies and
Electricity Reliability, or EFFECTER, Act of 2005. I would like to
express thanks for assistance over the past 5 years in drafting these
energy efficiency tax incentives to Dr. David B. Goldstein of NRDC, a
2002 MacArthur fellowship winner who has worked on energy efficiency
and energy policy since the early 1970s, both domestically and
internationally.
Also provided are tax incentives from the Lieberman-Snowe fuel cell
bill that provide a 30-percent business energy credit for the purchase
of qualified fuel cell power plants for businesses, along with a 10-
percent credit for the purchase of stationary microturbine power
plants. A fuel cell is a device that uses any hydrogen-rich fuel, such
as natural gas, methane, or propane, to generate electricity and
thermal energy through an electrochemical process. Since no combustion
is involved, fuel cells produce almost no air pollution and reduce
emissions of carbon dioxide, the major greenhouse gas blamed for
climate change. The tax incentive will accelerate commercialization of
a wide range of fuel cell technologies for a distributed source of
power.
As a senior member of the Senate Finance Committee, I worked with
Chairman Grassley to also secure $2.7 billion in alternative energy
production tax credits in this energy legislation. Included for the
first time is a tax credit for biomass, which is extremely important to
those who work at our Maine biomass plants, which provide good paying
jobs in rural areas all over Maine. In addition, the tax credit
extension for wind power is essential for wind projects in Maine, for
instance the one planned in Mars Hill. This legislation will decrease
the project's costs by 30 percent.
Also included in H.R. 6 is the permanent authorization of the
Northeast Home Heating Oil Reserve that was established in 2000. The
NHOR holds 2 million barrels of emergency fuel stocks stored at
commercial tank farms that would give Northeast consumers adequate
supplies for approximately 10 days, the time required for ships to
carry heating oil from the Gulf of Mexico to New York Harbor. The
reserve is essential for cold winter States like Maine--especially at a
time when fuel prices continue to be sky high. While we are in the
midst of a very warm summer, our winters are never that far off, and
this provision ensures that emergency fuel stocks are made available in
times of need.
And speaking of cold weather, the conference report reauthorizes the
Low Income Home Energy Assistance program, or LIHEAP, until 2007, and
reauthorizes State weatherization grant and energy programs at $2.1
billion through fiscal year 2008. I cannot emphasize strongly enough
how important these programs are to my State of Maine where winters
come early and can stay well past the start of spring.
There is an extension 5 years for my original legislation, the
National Oilheat Research Act; NORA which expired in February.
Also, the conference report puts in place enforceable electricity
reliability standards that were included in my EFFECTER Act and other
bills that would further improvements in the electricity grid at a time
that the surging demand continues to stress the Nation's power grid.
One only needs to recall that in August 2003, a big Northeast blackout
disrupted service to 50 million people, and 2 years earlier, soaring
prices and isolated blackouts rolled across California.
One of the International Climate Change Taskforce, ICCT
recommendations, for which I am a cochair with the Right Honorable
Stephen Byers of the United Kingdom, called for incentives for
Integrated Gasification Combined Cycle; IGCC, a process that allows
CO2 to be extracted for storage more easily and at less cost
than from conventional coal-burning plants. Clean coal technology helps
to address climate change by capturing CO2 rather than
allowing it to be released into the atmosphere and has immediate
benefits health benefits in terms of reduced emissions of toxic
pollutants that cause respiratory and cardiovascular illness. The bill
provides a 20-percent credit for clean coal power plants for IGCC
plants while other advanced clean-coal projects get the 15-percent
credit.
There disappointments to me in this bill, most certainly, as they
could affect my State. In particular was the vote loss that would have
given States equal say on the siting of Liquified Natural Gas, LNG,
siting decisions, but the language in H.R. 6 has been enhanced to give
the States a more consultative role, even though FERC still has
exclusive jurisdiction. A pre-NEPA National Environmental Policy Act
filing process is included in the bill so the FERC will have to work
with States on problems before moving any projects forward. Also
included is a cost-sharing provision calling for both the industry and
communities to share the cost for emergency response plans. Originally,
only the communities had to pay for these plans.
I will continue to work to ensure that States have greater authority
over LNG siting decisions. I believe this is clearly a States rights
issue--and given how contentious these decisions are, it only makes
sense to have State input into the process. As I have said before, this
is a Liquified Natural Gas facility siting we are talking about, not a
Wal-Mart.
Another issue I plan to actively work on with my colleagues from
other coastal States is the deletion of a provision that calls for an
inventory of oil reserves off the Outer Continental Shelf. I believe
those of us from coastal States did everything in our power to strip
this potentially environmentally dangerous provision out of the Energy
bill. Our amendment during Senate consideration of the Energy bill--
despite our best efforts--failed. We did everything we could to have
this provision removed--we presented our case to our colleagues and had
a fair up-or-down vote. It is a terrible policy that imperils our
fragile coastal ecosystems and fisheries around Georges Bank, a
veritable nursery for sea life.
Mr. Chairman, what we have here is a step forward as we begin the
21st century and great energy needs that will
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have to be met, and we continue to craft national energy policy--we
have only begun to do so with many steps ahead of us to take.
I thank the Chair.
Mr. GRASSLEY. Mr. President, today we have the opportunity to finish
a very long journey in the quest to build a dynamic, comprehensive
energy policy for the United States of America. I can say with pride
that this Congress, through many trials and tribulations has now
performed admirably in its duty to the American people. This is a
balanced energy bill that focuses as much on the future as it does the
present. We have the opportunity with the passage of this legislation
to safely produce more energy from more sources and with more
infrastructure security then ever before.
Among the many people whose hard work has made the difference, I must
first thank the chairmen and ranking members of all the appropriating
committees that have been involved in this process.
Credit must also go to all members of my staff, who spent many hours
sifting through the nuts and bolts of this bill. Kolan Davis, Mark
Prater, Elizabeth Paris, Christy Mistr, Kurt Kovarik, John Good, and
Nick Wyatt showed great dedication to the tasks before them.
As is usually the case, the cooperation of Senator Baucus and his
staff was imperative. I particularly want to thank Russ Sullivan,
Patrick Heck, Bill Dauster, Kathy Ruffalo-Farnsworth, Matt Jones, and
Ryan Abraham.
I also want to mention George K. Yin, the chief of staff of the Joint
Committee on Taxation and his staff, especially the fuel fraud and
energy team of Tom Barthold, John Navratil, Deirdre James, Roger
Colinvaux, Allen Littman, Gray Fontenot, and Gary Bornholdt as well as
the always invaluable assistance of Mark Mathiesen, Jim Fransen and
Mark McGunagle of Senate legislative counsel.
This conference agreement is infused with the spirit of bipartisan
and bicameral cooperation. It is my commitment that spirit will be
influential to the entire ongoing legislative process.
Mr. FRIST. Mr. President, we are about to vote on final passage of
the most comprehensive energy bill in decades.
After years of careful and patient negotiation, we have before us an
energy plan that promises to make America safer and more secure, and
our energy supply cleaner and more reliable.
It is a forward-looking plan. And it is a plan that will increase
both our economic and national security.
Anyone who has been to the gas pump, or turned on their AC for some
relief from the current heat wave, knows that energy prices are
skyrocketing.
Suddenly, instead of the lowest energy prices in the industrialized
world, we have the highest.
Because of high natural gas prices, manufacturing and chemical jobs
are moving overseas. Farmers are taking a pay cut. Consumers are paying
too much to be comfortable in their own homes. Small businesses are
struggling to pay their bills.
Communities across the country are suffering. And as many as 2.7
million manufacturing jobs have been lost.
All the while, we have grown dangerously reliant on foreign sources
of energy. And some of those foreign sources do not have our best
interests at heart.
In the 1960s and early 1970s, the U.S. produced almost as much oil as
we consumed. Imports were relatively small. But since then, U.S. oil
production has been on the decline, while consumption has steadily
increased. As a result, we have become more and more dependent on
imported oil.
Twenty years ago, 75 percent of crude oil used in American refineries
came from American sources. Only 25 percent came from abroad.
Today, that equation is nearly reversed. We have become dangerously
dependent on foreign sources of oil and natural gas. As a result,
America is more vulnerable than ever to the use of energy as a
political weapon.
Many nondemocratic and corrupt governments maintain their hold on
power by spending the oil profits they earn from selling to us.
We see this happening in Venezuela, We currently import over 1
million barrels of oil a day from Venezuela. Meanwhile, its dictatorial
President, Hugo Chavez, actively opposes the Umted States, supports
rogue states such as Cuba, and is destabilizing Latin America.
Many of these same dynamics are also at work in the Middle East.
Nondemocratic regimes in the Middle East are using their oil revenues
to tighten their grip on the reins of power.
As a result, the conditions that breed hatred, violence, and terror
have been allowed to fester and spread terror all over the world.
London, Madrid, Russia, Bali, Iraq, and, of course, the United States
have all suffered terribly at the hands of the terrorists.
Passing the energy bill today will be a major step forward in
addressing these serious national security challenges by putting us on
a path to energy independence.
It will also be a major step forward for our economic productivity
and prosperity.
The energy bill promises to deliver exciting new technologies to
increase our efficiency and lessen our dependence, Hydrogen fuel cells
are one example.
If just 20 percent of cars used fuel cell technology, we could cut
oil imports by 1.5 million barrels every day.
The energy bill authorizes $3.7 billion to support hydrogen and fuel
cell research and the infrastructure we need to move toward this goal.
Last month, Senator Hatch and I had the opportunity to attend a
hydrogen car demonstration here at the Capitol. The cars were stylish.
They drove well. The technology was very promising.
Hybrid cars are already gaining in popularity. Nissan recently
announced that its first hybrvehicle will be built at their plant in
Smyrna, TN.
This is one example of how technology can simultaneously promote
conservation and efficiency, and boost the manufacturing sector.
In addition, the energy bill's conservation and energy efficiency
provisions far exceed those of other energy bills considered by the
Congress in recent years.
According to the American Council for an Energy Efficient Economy,
the Energy bill will save $1.1 trillion cubic feet of natural gas by
2020, equivalent to the current annual consumption of the whole State
of New York.
It will reduce peak electric demand by 50,000 megawatts by 2020, the
equivalent of 170 new power plants.
This bill encourages the use of home-grown renewable fuels such as
ethanol and biodiesel, as well as wind and solar and geothermal energy.
The ethanol mandate will require fuel manufacturers to use 7.5
billion gallons of ethanol in gasoline by 2012. This provision alone
will reduce oil consumption by 80,000 barrels of oil a day by 2012;
create over a quarter of a million new jobs; increase U.S. household
income by $43 billion; all adding $200 billion to the GDP between 2005
and 2012.
It provides incentives to facilitate the development of cutting-edge
technologies like coal gasification and advanced nuclear plants, which
will produce clean, low-carbon energy to help address the issue of
global climate change.
And it will modernize and expand our Nation's electricity grid to
enhance reliability and help prevent future blackouts.
This change in particular is long overdue. We are once again seeing
the strain on our aging electrical grid as people turn up the AC to
deal with the current heat wave.
In fact, the Tennessee Valley Authority reported that yesterday's
demand for electricity reached an all-time record level of almost
32,000 megawatts, breaking a record that had been set just the day
before.
The Energy bill will help us both conserve more energy, and produce
more energy. It will also help produce more jobs.
It is estimated that the Energy bill will save over 2 million jobs
and create hundreds of thousands more.
As I mentioned, the ethanol provision is expected to generate over
230,000 new jobs.
Incentives for wind-generated energy are expected to create another
100,000 jobs.
The investment in clean coal technology will create 62,000 jobs. And
40,000 new jobs in the solar industry will come on line These are good
jobs, well paying, and right here at home.
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The Energy bill is good for America. It will move our country toward
a more reliable supply of clean, affordable energy.
I thank my colleagues for the hard work and leadership. Special
recognition goes to the Energy Committee chairman, Senator Domenici,
and his ranking member, Senator Bingaman.
Senator Domenici's expertise on energy issues is unparalleled in the
U.S. Senate, as he has demonstrated for a number of years on both the
Energy Committee and the Energy and Water Appropriations Subcommittee.
His determination to produce a comprehensive national energy policy,
and his hard work with Senator Bingaman, as well as members of the
Energy Committee, is the reason why we stand here, today, on the cusp
of final passage of a balanced, bipartisan Energy bill.
And finally, special recognition goes to President Bush for his
unwavering commitment to delivering an energy plan for the 21st
century.
He came into office determined to deliver an energy plan that makes
America safer and more secure. And soon he will have a bill to sign
into law that does just that.
Every day we are working hard to deliver meaningful solutions to the
American people. The Energy bill promises to keep America moving
forward.
The PRESIDING OFFICER. The Senator from New Mexico.
Mr. BINGAMAN. Mr. President, with regard to this bill, I want to
acknowledge, of course, all of the very complimentary statements many
colleagues have made about the good work Senator Domenici and I did on
this bill. Clearly, I have myself complimented Senator Domenici for his
leadership in this regard many times. The fact is this bill is the
result of much good work by many Members, much good work by the staffs
of our committee and the staffs of many Members individually, and work
that has occurred over a very long period of time. So I think some of
the relief some of us are feeling as a result of seeing this finally
come to completion is because of the multiple years that have gone into
this effort to get a bill we could agree upon.
Every time a bill, particularly a bill of this size and
comprehensiveness, comes to the Senate floor, it requires a balancing
of those provisions which are positive and constructive with those that
are less so, and in some cases are negative. I feel very strongly that
the positive outweighs the negative in this bill. There are many
provisions that will move us in the right direction.
My colleagues have been alluding to those this morning in many of
their statements and there are things we need to come back and try to
correct in the future, and we will have that opportunity. There are
issues we were unable to address in this bill that we will hopefully be
able to address in the coming months that I think also need to be
mentioned. All of the discussion has been useful. All of the good work,
particularly of the Energy and Natural Resources Committee members, has
been appreciated.
I again appreciate very much the process that has been followed in
getting us to this point. I compliment all colleagues, and I yield the
floor. I know Senator Domenici wishes to make a final statement.
The PRESIDING OFFICER. The Senator from New Mexico.
Mr. DOMENICI. I ask unanimous consent that a list of staff men and
women who helped put this conference together be printed in the Record.
I commend them.
There being no objection, the material was ordered to be printed in
the Record, as follows:
Judy Pensabene, Karen Billups, Dick Bouts, Kathryn Clay,
Kellie Donnelly, Lisa Epifani, Marnie Funk, Frank Gladics,
Angela Harper, Colin Hayes, Frank Macchiarola, John Peschke,
and Clint Williamson.
Mr. DOMENICI. Mr. President, this bill will produce more jobs for our
country, more secure jobs, and we will be using cleaner energy in the
future. This will happen across America, and it will happen in the
State of Wisconsin.
Also, I would like to say to everyone here, our electrical system
will be safer and more sound. We may very well have nuclear powerplants
built anew for the first time in years. Renewable energy will be
advanced and enhanced dramatically. Some do not believe ethanol will be
a significant contributor to less dependence on foreign oil. They are
mistaken. We will, within the next 7 or 8 years, make a major
contribution to jobs, stability of the agricultural community, and the
production of ethanol as a substitute for gasoline.
In addition, we will enhance our supply of natural gas, thus
stabilizing the price, which is one of the most significant things for
America's future. If we cannot do that and the reverse happens, we will
export hundreds of thousands of jobs. While everyone thinks that the
only problem is gasoline, the problem is far bigger than gasoline
prices tomorrow morning; it is what will be the state of energy 5 and
10 years from now in the United States.
I can tell my colleagues, we will be safer, we will have more jobs,
we will have an electric system that is safe and sound. We will have
diversity of energy sources and supplies built in our country, spending
our money, creating jobs, and much more.
Frankly, it is very easy to criticize a bill of this magnitude, and
it is very easy to say we did not solve everything.
I close by saying there is criticism that we did not do anything to
alleviate our great dependence on crude oil. I think we did. Hybrid
cars are accentuated and pushed ahead by tax credits. I just explained
ethanol. But if anybody thinks right now we can pass in the Congress a
bill to substantially change the American way of using automobiles, I
ask them to stand up, and we will put it on the Senate floor next week
and see if they can do it. We cannot order Americans to buy smaller
cars, little tiny cars, and we cannot order them to stop buying cars.
That will happen. It is going to happen, and we are going to have more
efficient ones clearly in short order in this country, but we cannot do
everything in this bill. We have done a great deal.
My compliments to Senator Bingaman. I am glad this was a totally
bipartisan bill, totally open in every respect. I think we have proved
that on a major, contentious bill, we can have open, above-board, total
participation by any Senator who wants to participate. In conference,
the same with the press of having all of the amendments and everything
we do so they can do what they would like with the American people and
yet get an agreed-upon bill.
That is a pretty good accomplishment on the part of Senator Bingaman,
myself, as the leaders in the Senate, and Congressman Barton and
Congressman Dingell in the House.
I yield the floor and thank the Senate for permitting me to produce
this bill.
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