[Congressional Record (Bound Edition), Volume 161 (2015), Part 14]
[Senate]
[Page 18948]
[From the U.S. Government Publishing Office, www.gpo.gov]




                       CBO COST ESTIMATE--S. 2012

  Ms. MURKOWSKI. Mr. President, in compliance with paragraph 11(a) of 
rule XXVI of the Standing Rules of the Senate, the Committee on Energy 
and Natural Resources has obtained from the Congressional Budget Office 
an estimate of the costs of S. 2012, the Energy Policy Modernization 
Act of 2012, as reported from the committee. I respectfully ask 
unanimous consent that the summary of the opinion of the Congressional 
Budget Office be printed in the Congressional Record. The full estimate 
is available on CBO's Web site www.cbo.gov.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

               Congressional Budget Office Cost Estimate


                S. 2012--Energy Policy Modernization Act
                                of 2015

                           (October 15, 2015)

       Summary: S. 2012 would amend current law and authorize 
     appropriations for a variety of activities and programs 
     administered primarily by the Department of Energy (DOE). The 
     legislation also would:
       Expand and extend federal agencies' authority to use 
     certain types of long-term contracts to invest in energy 
     conservation measures and related services;
       Specify various energy-related goals and requirements for 
     federal agencies;
       Modify DOE's authority to guarantee loans under Title 17 of 
     the Energy Policy Act of 2005; and
       Establish a pilot program to streamline the review and 
     approval of applications for permits to drill for oil and gas 
     on federal lands.
       Assuming appropriation of amounts specifically authorized 
     and estimated to be necessary under S. 2012--roughly $40 
     billion over the 2016-2020 period (and an additional $3 
     billion in later years)--CBO estimates that implementing this 
     legislation would result in outlays totaling $32 billion over 
     the 2016-2020 period from those appropriations, with 
     additional spending of about $11 billion occurring after 
     2020.
       CBO also estimates that the bill would result in additional 
     direct spending. The estimated amount of direct spending 
     depends on the budgetary treatment of federal commitments 
     through certain types of long-term energy-related contracts, 
     which CBO expects would increase under the bill. In CBO's 
     view, commitments under such contracts are a form of direct 
     spending because agencies enter into such contracts without 
     appropriations in advance to cover their full costs. On the 
     basis of that view, CBO estimates that enacting S. 2012 would 
     increase direct spending by $659 million over the 2016-2025 
     period.
       However, for purposes of determining budget-related points 
     of order for legislation considered by the Senate, section 
     3207 of the Concurrent Resolution on the Budget for Fiscal 
     Year 2016 specifies a scoring rule for provisions related to 
     such contracts (referred to in this document as the scoring 
     rule for energy contracts). Specifically, that rule requires 
     CBO to calculate, on a net present value basis, the lifetime 
     net cost or savings attributable to projects financed by such 
     contracts and to record that amount as an upfront change in 
     spending subject to appropriation. Under that rule, CBO 
     estimates that S. 2012 would increase direct spending by $29 
     million over the 2016-2025 period.
       Enacting S. 2012 could affect revenues, but CBO estimates 
     any such effects would be insignificant in any year. Because 
     the bill would affect direct spending and revenues, pay-as-
     you-go procedures apply.
       CBO estimates that enacting S. 2012 would not increase net 
     direct spending or on-budget deficits by more than $5 billion 
     in any of the four consecutive 10-year periods beginning in 
     2026.
       S. 2012 would impose an intergovernmental and private-
     sector mandate, as defined in the Unfunded Mandates Reform 
     Act (UMRA), on public and private entities regulated by FERC, 
     such as electric utilities, by requiring them to pay fees in 
     some circumstances. The bill would impose two additional 
     mandates on public entities. One would require state and 
     tribal governments to certify to DOE whether or not they have 
     updated residential and commercial building codes to meet the 
     latest standards developed by building efficiency 
     organizations. The other would preempt state and local 
     environmental and liability laws if they conflict with 
     emergency orders issued by the Federal Energy Regulatory 
     Commission (FERC). The bill also would impose private-sector 
     mandates on electric transmission organizations and traders 
     of oil contracts and on individuals seeking compensation for 
     damages caused by utilities operating under certain emergency 
     orders. Based on information from DOE and analyses of similar 
     requirements, CBO estimates that the aggregate cost of 
     complying with mandates in the bill would fall below the 
     annual thresholds established in UMRA for intergovernmental 
     and private-sector mandates ($77 million and $154 million in 
     2015, respectively, adjusted annually for inflation).
       CBO has not reviewed some provisions of section 2001 and 
     section 4303 for intergovernmental or private-sector 
     mandates. Those provisions would provide the Secretary of 
     Energy with emergency authority to protect the electric 
     transmission grid from cybersecurity threats and would 
     protect entities subject to that authority from liability. 
     Section 4 of the Unfunded Mandates Reform Act excludes from 
     the application of that act any legislative provisions that 
     are necessary for national security. CBO has determined that 
     those provisions fall within that exclusion.

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