[Congressional Record Volume 155, Number 73 (Wednesday, May 13, 2009)]
[Senate]
[Page S5431]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                IDAHOANS SPEAK OUT ON HIGH ENERGY PRICES

  Mr. CRAPO. Mr. President, in mid-June, I asked Idahoans to share with 
me how high energy prices are affecting their lives, and they responded 
by the hundreds. The stories, numbering well over 1,200, are 
heartbreaking and touching. While energy prices have dropped following 
the submissions, those prices are now on the way back up and the 
concerns expressed remain very relevant. To respect the efforts of 
those who took the opportunity to share their thoughts, I am submitting 
every e-mail sent to me through an address set up specifically for this 
purpose to the Congressional Record. Today marks the last of the 
submissions, a process that has taken approximately ten months to 
complete. But this concern--our national energy policy--is not an issue 
that will be easily resolved, but it is one that deserves immediate and 
serious attention, and Idahoans deserve to be heard. These stories not 
only detail their struggles to meet everyday expenses, but also have 
suggestions and recommendations as to what Congress can do now to 
tackle this problem and find solutions that last beyond today. I ask 
unanimous consent to have today's letters printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

       Not too long ago, I was considering purchase of a 
     residential solar array. I have read examples about people in 
     other states (California, Massachusetts, etc.) who had 
     implemented a solar array at home (including an inverter), 
     which enabled them to generate some of their own power/
     electricity. Most importantly, they are able to sell their 
     excess power via the inverter to the grid when they are not 
     using it. This is an equal rate, meaning that the utility 
     company would buy it at whatever their current rate was at 
     that time of day. Basically, your electricity meter spins 
     backwards according to the amount you contribute to the 
     utility. In this way, people are able to ``bank'' kilowatts 
     into the grid so that the power they used at night was 
     somewhat paid for (depending on the size of their array, rate 
     of usage and amount of sunshine available, obviously).
       After talking to some people locally, I have heard that 
     Idaho Power does not have anything remotely like this policy 
     in place. In fact, it sounded like they are only required to 
     pay 50% the value of the power your array might generate and 
     feed to the grid via your inverter, and only for a set 
     volume. After reaching a particular level, the utility would 
     be capturing a lot of that resident provider's power for 
     free. This appears to be an unfair practice to me, and really 
     tramples on any incentive for buying and implementing a 
     residential solar array. There is a federal tax credit 
     available, but that just addresses start-up costs, not long-
     term usage and maintenance.
       I am no energy expert and do not claim to have validated 
     all of the data I put forth above, but I am very interested 
     in pursuing a solar-energy based solution to cut my long-term 
     energy costs. Given the days of sun per year in southwest 
     Idaho, this seems like a no-brainer.
       Please tell me about your position on residential solar 
     energy implementation practices here in Idaho, and 
     specifically how you would vote on a bill that would require 
     our local energy provider (read: Idaho Power) to fairly 
     compensate residential energy providers, using the scenario I 
     mentioned above. This will directly impact how I vote in the 
     future.
     John, Boise.
                                  ____

       Senator Crapo, this information seems to be right on. I 
     hope you will take the time to read it.
                                                  Mary, Sandpoint.

       Dear Mary,
       On several occasions in the past few months, I have written 
     about the impact of skyrocketing fuel prices on airline 
     customers--in their daily lives and when they travel (Final 
     Approach May 1 and Final Approach May 28). In the long run, 
     to lower oil prices for all Americans, we need to increase 
     domestic supply, increase exploration, alternative energy 
     sources and conservation. However, one near-term solution to 
     the problem is for government to investigate and rein in oil 
     speculators.
       What is the Commodities Market?--Commodities are raw 
     materials purchased by manufacturers of finished products 
     such as food manufacturers, oil refiners or builders. 
     Businesses that are highly dependent on oil--refineries, 
     heating oil dealers, airlines and trucking companies among 
     others--lessen their risk of significant price fluctuations 
     by purchasing future delivery contracts at predetermined 
     prices in what is known as the commodities or futures 
     markets. The two largest U.S. commodities markets or futures 
     exchanges are the Chicago Mercantile Exchange and the New 
     York Mercantile Exchange, where people trade standardized 
     futures contracts; that is, a contract to buy specific 
     quantities of a commodity at a specified price with delivery 
     set at a specified time in the future.
       What is the Problem with Oil?--There is a significant 
     disconnect between the paper market for oil (speculators) and 
     the physical market for oil (consumers). In recent years, 
     speculators have taken advantage of actual consumers of oil 
     by bidding up the price for futures contracts. If a 
     speculator purchases a contract for delivery of oil at a high 
     price six or 12 months in the future but has no intention of 
     actually taking delivery of the oil in that contract, then a 
     physical customer who needs that oil--to deliver home heating 
     oil, to operate trucks or airplanes, or even to process in a 
     refinery--will be forced to pay the higher price in order to 
     obtain the oil that is needed.
       How Do They Get Away with That?--Increasingly, 
     sophisticated institutional investors have managed to 
     manipulate the rules and regulations governing commodities 
     transactions through a series of exemptions and waivers, 
     including the so-called ``Enron loophole,'' low margin 
     requirements and the dodging of U.S. public disclosure 
     requirements. These complex arrangements have a similar 
     impact: They put people engaged in oil-related businesses at 
     a disadvantage with those who gamble relatively small sums 
     that the price of oil will increase out of proportion to 
     marketplace demands. If that happens, as it has regularly 
     over the past few years, those who need oil for their 
     businesses pay a premium, which is passed on to you--the 
     consumer.
       What Can Government Do Now?--In the near term, Congress 
     needs to address the impact of unchecked speculation in the 
     commodities market.
       Commodities trading is overseen by a small, but very 
     powerful government agency known as the Commodities Futures 
     Trading Commission (CFTC). Congress can require the CFTC to 
     implement a host of controls such as imposing limits on the 
     quantity of commodities contracts speculators may purchase, 
     closing the loopholes that allow speculators to trade exempt 
     from any government oversight or regulation, and requiring 
     reporting by those who are engaging in speculation.
       Experts say that closing regulatory loopholes in the 
     trading of commodity futures will result in a significant 
     reduction in fuel prices.
       What's Next?--Congress is expected to debate some of these 
     issues in the next few weeks and it is urgent that they hear 
     your voice. To facilitate public participation in the debate 
     over speculators, we have launched a broad-based coalition, 
     S.O.S. NOW, that provides a wide array of information on 
     speculation and its impact on the price we all pay for oil. 
     S.O.S. NOW stands for Stop Oil Speculation Now, and we 
     urge you to go to the Web site www.stopoilspeculationnow.com 
     and send a message to Congress about oil speculation.
     Air Transport Association.

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