[Congressional Record (Bound Edition), Volume 149 (2003), Part 19]
[Extensions of Remarks]
[Pages 26131-26132]
[From the U.S. Government Publishing Office, www.gpo.gov]




               ANALYSIS OF THE COMPREHENSIVE ENERGY BILL

                                 ______
                                 

                            HON. MARK UDALL

                              of colorado

                    in the house of representatives

                       Tuesday, October 28, 2003

  Mr. UDALL of Colorado. Mr. Speaker, I would like to insert an article 
in the Record that takes a look at the latest shape of the 
comprehensive energy bill. The author of the article is Ken Bossong, 
coordinator of the Sustainable Energy Coalition, a coalition of 60 
national and state environmental, business, consumer, and energy policy 
organizations founded in 1992 to promote increased use of renewable 
energy and energy efficient technologies. The Renewable Energy and 
Energy Efficiency Caucus--of which I and Representative Zach Wamp are 
co-chairs--works closely with the Coalition to coordinate events and 
briefings and to otherwise spread the word in Congress and throughout 
the nation about the importance of clean energy.
  We're told there will be a vote on the conference agreement very 
soon, but few Members--even fewer on our side of the aisle--know what 
is in the final report. But from what has been reported in the press, 
it seems likely that the bad in the bill outweighs the good. By not 
taking into consideration opposing views, the Republicans have crafted 
an unbalanced bill--one that ultimately doesn't address the energy 
needs of this country today or into the future.

               [From SolarAccess.com News, Oct. 20, 2003]

                        A Faltering Energy Bill

                            (By Ken Bossong)

       Barring a major train wreck--which remains within the realm 
     of possibility--congressional conferees may have a final 
     energy bill ready for votes in the U.S. Senate and House of 
     Representatives by the end of this month. The final product, 
     representing more than three years' work, will undoubtedly be 
     described by its authors as ``comprehensive'' and 
     ``balanced.'' In reality, it will be neither.
       Among the pressing issues facing the United States today 
     are those of growing oil and natural gas imports--
     particularly from politically unstable regions of the world, 
     escalating environmental and economic damage from greenhouse 
     gas emissions that contribute to global climate change, and 
     an electrical generation and transmission system that is 
     unreliable and--due to its reliance on large central station 
     facilities--insecure. Yet the emerging energy bill will do 
     little to address any of these issues; in fact, it may very 
     well exacerbate all three.
       Among the best strategies for addressing these energy 
     problems are greatly expanded energy efficiency initiatives 
     and investments in decentralized renewable energy 
     technologies. Yet the energy bill will probably offer little 
     more than crumbs for sustainable energy while continuing and 
     expanding federal support for the mature, polluting fossil 
     fuels and nuclear power industries.
       It is supremely ironic that completion of work on the 
     energy bill may correspond to the thirtieth anniversary of 
     the OPEC oil embargo that began on October 17, 1973. Over the 
     past three decades, total U.S. oil imports have nearly 
     doubled with imports now accounting for more than half (54 
     percent) of the nation's oil consumption. Yet the energy bill 
     largely fails to address oil consumption in the 
     transportation sector--which now accounts for more than two-
     thirds of U.S. oil use--by not including provisions to 
     substantially raise automobile fuel economy standards. It 
     even fails to include the Senate bill's directive (passed by 
     more than 90 votes) that would set a goal of reducing oil 
     consumption by one million barrels per day by 2013 (a modest 
     5 percent of current consumption). Instead it opts for a 
     ``drain America first'' strategy that may include drilling 
     the Arctic National Wildlife Refuge, opening the door to 
     expanded oil exploration in moratorium areas, and 
     facilitating expanded development in other ecologically 
     sensitive areas as well as subsidies for an Alaskan natural 
     gas pipeline.
       It is true that the final legislation will likely 
     incorporate a Renewable Fuels Standard that will mandate that 
     5 percent of liquid fuels be derived from renewable sources 
     which could be a boon to the domestic ethanol and biofuels 
     industries. Yet these fuels will be burned in increasingly 
     inefficient cars and SUVs which means they will be wasted and 
     ultimately not reduce the nation's dependency on petroleum 
     imports.
       Similarly, natural gas imports have been inching upwards 
     and now exceed 15 percent

[[Page 26132]]

     of total U.S. consumption with future imports increasingly 
     likely to come in the form of expensive LNG shipments from 
     politically unstable sources such as Algeria, Nigeria, and 
     Oman.
       Presently, more than a quarter of the natural gas used is 
     burned in inefficient and wasteful electricity generating 
     stations. The most environmentally-sound approaches to 
     curbing this waste, and hence imports, include improving the 
     efficiency of (or reducing) electricity end-uses, expanding 
     the use of combined power and heating systems for electrical 
     generation, and displacing natural gas generating plants with 
     renewable electric technologies. A recent study by the 
     American Council for an Energy-Efficient Economy shows that 
     even modest gains in energy efficiency and renewable energy 
     production from these kinds of policies would help reduce gas 
     prices substantially.
       Yet the energy bill provides, at best, only limited support 
     for any of these strategies. Its efficiency title is expected 
     to include new standards to improve the efficiency of 
     building transformers, torchiere lighting fixtures, exit 
     signs, traffic lights, unit heaters, and compact fluorescent 
     bulbs, as well as directives to the U.S. Department of Energy 
     to set new efficiency standards on several other products. 
     Small tax incentives for combined heat and power as well as 
     efficient new homes, commercial buildings, refrigerators, 
     clothes washers, and fuel cells are also probable.
       While steps in the right direction, they fall far short of 
     the aggressive efficiency standards, tax incentives, and 
     public benefits fund to support efficiency programs needed to 
     make a serious dent in electricity consumption. That is, the 
     bill completely lacks aggressive measures needed to moderate 
     electricity demand that would reduce the risk of future 
     blackouts while cutting air pollution and greenhouse gas 
     emissions. Moreover, the tax provisions are likely to 
     eliminate incentives for hybrid vehicles, the nation's best 
     chance to save oil in the next twenty years.
       The most important provision to expand the use of renewable 
     electricity production and displace natural gas, a Renewable 
     Portfolio Standard (RPS), now appears certain to end up on 
     the conferees' cutting room floor. Even if a token RPS 
     somehow makes it into the final bill, it is apt to be a 
     provision significantly weaker than those already enacted by 
     many states and far below the projected technical and cost-
     effective potential for electricity generated from solar, 
     wind, geothermal, biomass, and hydropower resources (i.e., 20 
     percent or more by 2020).
       Failure to include a strong RPS coupled with weak or non-
     existent energy efficiency standards also insures that the 
     final energy bill will do very little to address the growing 
     problem of climate change. Indeed, a climate change title 
     does not even exist in the bill.
       Proponents of the bill suggest that it includes provisions 
     that will help reduce greenhouse gas emissions and point to 
     increased renewable energy authorization levels such as the 
     $300 million over five years to establish a solar electric 
     (photovoltaic) energy program for the procurement and 
     installation of solar electric systems in new and existing 
     public buildings. Left unsaid, though, is that an 
     ``authorization'' is merely permission to spend a certain 
     amount of money if the funds can be found; an 
     ``authorization'' is not an ``appropriation.''
       In reality, federal funding levels for renewable energy 
     programs--i.e., the appropriations--have been cut during each 
     of the last three budget cycles, notwithstanding 
     authorization levels that would allow for significantly 
     higher funding. Given the massive budget deficits now being 
     forecast as a result of the White House's tax cuts and the 
     war in Iraq, it is extremely dubious that the recent downward 
     funding trend will be reversed; in fact, it is highly 
     probable that renewable energy budgets will be slashed even 
     further regardless of the authorization levels included in 
     the energy bill.
       Moreover, the levels of federal support given to renewables 
     in the form of direct appropriations and tax incentives are 
     likely to be swamped by those being proposed for the fossil 
     fuels and nuclear industries which have been estimated to 
     total $18 billion. These include $1.1 billion to build a new 
     nuclear power plant, $400 million in loans for oil and gas 
     development loan, guarantees to build a new coal plant that 
     may cost $2-$3 billion, and $350 million for hydrogen 
     production from polluting sources. Not included in this 
     figure is the extension of the Price-Anderson Act which 
     shields nuclear utilities from most liability in the event of 
     a major accident; the precise dollar value of this is 
     incalculable but conservatively worth tens of billions of 
     dollars in saved insurance costs.
       Consequently, the unbalanced financial incentives provided 
     for in the energy bill for competing energy sources may 
     actually worsen the competitive position of renewable energy 
     technologies in the marketplace.
       That would further compound the problems with the 
     reliability of the nation's electrical grid as highlighted by 
     the August blackout in the Northeast and the long power 
     outages in the mid-Atlantic following Hurricane Isabel not to 
     mention the national security risks posed by excessive 
     reliance on highly-centralized and large-scale power 
     generating facilities. Distributed renewable energy electric 
     technologies are uniquely suited to lessening these problems. 
     However, the energy bill fails to create the regulatory 
     framework to tap this potential and, in fact, through 
     provisions such as the proposed revocation of the Public 
     Utilities Regulatory Policy Act (PURPA) as well as the Public 
     Utility Holding Company Act (PUHCA), could make the situation 
     worse.
       At the least, the energy bill should include mandatory net 
     metering and interconnection standards to enable renewable 
     energy generators to tie into the grid rather than the 
     essentially optional, advisory guidelines that it now 
     includes.
       It should also include a long-term renewable energy 
     production tax credit (PTC), including a tradable credit for 
     public power and rural cooperatives, that benefits the cross-
     section of renewable energy technologies. To provide some 
     stability and predictability in the marketplace, any such tax 
     incentive should be enacted for at least five to ten years. 
     By comparison, the proposed renewal of the Price-Anderson Act 
     is 20 years. However, the energy bill now provides for only a 
     three-year PTC extension. Such a short-term PTC threatens to 
     continue the start-and-stop cycle that has plagued the 
     renewable energy industry, particularly wind energy 
     developers, for more than a decade as investments dry up when 
     the existing PTC is set to expire and its supporters scurry 
     around madly trying to get another extension.
       Wind energy advocates may be tempted to support the pending 
     energy bill arguing that a three-year PTC is far better than 
     no PTC just as the solar investment tax incentives, 
     geothermal reforms, Renewable Fuels Standard, and hydropower 
     relicensing components are important and generally positive 
     provisions that will benefit their respective industries. 
     Similarly, advocates of energy efficiency can point to some 
     gains that may come from the bill if enacted as now written. 
     However, when weighed against the lopsided provisions to 
     advance fossil fuels and nuclear power, it is questionable 
     whether the end result will actually move this country closer 
     to a sustainable energy future.
       Moreover, the recent series of closed-door, Republican-
     dominated, conference meetings in which the House-Senate 
     energy bill is being finalized, and which have largely 
     excluded those Democrats who have championed the bill's 
     efficiency and renewable energy provisions, have provided 
     nuclear and fossil fuel lobbyists an opportunity to further 
     skew the bill the wrong way.
       Consequently, even if the Congress approves and the 
     President ultimately signs an energy bill this year, the 
     nation's energy policy work won't be done. The bill that is 
     likely to emerge is one that will evade the problems of 
     energy imports, global warming, and electric grid stability. 
     It is also one that will fail to incorporate an adequate 
     Renewable Portfolio Standard, auto fuel efficiency standards, 
     aggressive appliance and industrial efficiency standards, 
     mandatory net metering and transmission standards, and a 
     sufficient mix of tax incentives and federally-funded R&D 
     programs to move the nation away from its reliance on fossil 
     fuels and nuclear power.
       Under the circumstances, while many weary renewable energy 
     and energy efficiency advocates may wince at the prospect, it 
     would likely be far better to have no energy bill than the 
     one that seems to be nearing completion.

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