[House Report 104-712]
[From the U.S. Government Publishing Office]



104th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES

 2d Session                                                     104-712
_______________________________________________________________________


 
             ENERGY POLICY AND CONSERVATION ACT AMENDMENTS

                                _______
                                

 July 26, 1996.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

_______________________________________________________________________


  Mr. Bliley, from the Committee on Commerce, submitted the following

                              R E P O R T

                        [To accompany H.R. 3868]

    The Committee on Commerce, to whom was referred the bill 
(H.R. 3868) to extend certain programs under the Energy Policy 
and Conservation Act through September 30, 1996, having 
considered the same, report favorably thereon without amendment 
and recommend that the bill do pass.

                                CONTENTS

                                                                   Page
Purpose and Summary..............................................     1
Background and Need for Legislation..............................     2
Hearings.........................................................     2
Committee Consideration..........................................     3
Roll Call Votes..................................................     3
Committee Oversight Findings.....................................     3
Committee on Government Reform and Oversight.....................     3
New Budget Authority and Tax Expenditures........................     3
Committee Cost Estimate..........................................     3
Congressional Budget Office Estimate.............................     3
Inflationary Impact Statement....................................     4
Advisory Committee Statement.....................................     4
Section-by-Section Analysis of the Legislation...................     4
Changes in Existing Law Made by the Bill, as Reported............     5

                          Purpose and Summary

    H.R. 3868 extends certain programs under the Energy Policy 
and Conservation Act through September 30, 1996. Subsections 1 
and 2 of H.R. 3868 extend the authorities to buy or lease oil 
for, operate, and drawdown the Strategic Petroleum Reserves 
through September 30, 1996, and authorize such sums as may be 
necessary. Subsections 3 and 4 extend funding and authority for 
the United States to participate in the International Energy 
Agency (IEA) through September 30, 1996, and authorize such 
sums as may be necessary. Absent an extension, (1) the 
President's authority to drawdown the Reserve in an emergency 
might be insufficient or his ability to order a rapid drawdown 
if necessary could be delayed, and (2) the ability of oil 
companies to participate in oil sharing programs ordered by the 
IEA in an emergency would be severely limited.

                  Background and Need for Legislation

    The Energy Policy and Conservation Act (EPCA) was enacted 
on December 22, 1975, (Public Law 94-163) to deal with the 
chronic energy supply shortages, particularly petroleum supply 
shortages, experienced by the United States in the early 
1970's. Among other things, EPCA authorized the creation of a 
Strategic Petroleum Reserve (SPR or Reserve) capable of storing 
up to one billion barrels of oil to reduce the U.S.'s 
vulnerability in the event of a disruption in imported 
petroleum supplies. EPCA also authorized U.S. participation in 
the International Energy Agreement. Authorization of both of 
these programs expired June 30, 1996.
    The SPR presently consists of six sites on the Gulf Coast 
in Texas and Louisiana. These sites currently contain about 582 
million barrels of crude oil and have a total storage capacity 
of 750 million barrels. The current storage level is equivalent 
to approximately 71 days of U.S. imported oil consumption. By 
law, the SPR is required to contain one billion barrels of oil. 
However, recent budget constraints have forced the Department 
of Energy to end plans to expand the SPR's capacity and to stop 
buying and start selling SPR oil. In the 104th Congress, two 
sales of oil from the Reserve were authorized to meet budgetary 
goals.
    The purpose of the International Energy Agreement is to 
coordinate the responses of oil consuming nations to oil supply 
disruptions in order to minimize the global impact of those 
disruptions. The authorities being extended by H.R. 3868 allow 
the President to participate in the program and give U.S. oil 
companies a limited antitrust exemption for their participation 
in the program.
    Authority to undertake activities related to the Reserve 
and the International Energy Agreement expired on June 30, 
1996. Concerns have been raised that the expiration of this 
authority leaves the President without complete authority to 
drawdown the Reserve in an energy emergency and impairs the 
ability of U.S. oil companies to participate in the 
International Energy Agreement. This short term extension 
addresses these concerns and assures that these important 
authorities are continued when the Congress adjourns for the 
August recess. This short term extension also gives the 
Congress additional time to consider issues involved in a 
longer term extension.

                                Hearings

    The Subcommittee on Energy and Power held a hearing on H.R. 
2965, a bill to extend energy conservation programs under the 
Energy Policy and Conservation Act through Fiscal Year 1999, 
and for other purposes, on November 9, 1995. The Subcommittee 
received testimony from the following: Mr. C. Kyle Simpson, 
Associate Deputy Secretary for Energy Programs, U.S. Department 
of Energy; Mr. John Nunley, III, Director, Wyoming Energy and 
Conservation Office, representing the National Association of 
State Energy Officials; and Mr. Scott Sklar, Executive 
Director, Solar Energy Industries Association.

                        Committee Consideration

    On July 24, 1996, the Committee on Commerce met in open 
markup session and ordered H.R. 3868, a bill to extend certain 
programs under the Energy Policy and Conservation Act through 
September 30, 1996, reported to the House, without amendment, 
by a voice vote.

                            Roll Call Votes

    Clause 2(l)(2)(B) of rule XI of the Rules of the House 
requires the Committee to list the recorded votes on the motion 
to report legislation and on amendments thereto. There were no 
recorded votes taken in connection with ordering H.R. 3868 
reported. A motion by Mr. Bliley to order H.R. 3868 reported to 
the House, without amendment, was agreed to by a voice vote, a 
quorum being present.

                      Committee Oversight Findings

    Pursuant to clause 2(l)(3)(A) of rule XI of the Rules of 
the House of Representatives, the Committee held a legislative 
hearing and made findings that are reflected in this report.

              Committee on Government Reform and Oversight

    Pursuant to clause 2(l)(3)(D) of rule XI of the Rules of 
the House of Representatives, no oversight findings have been 
submitted to the Committee by the Committee on Government 
Reform and Oversight.

               New Budget Authority and Tax Expenditures

    In compliance with clause 2(l)(3)(B) of rule XI of the 
Rules of the House of Representatives, the Committee states 
that H.R. 3868 would result in no new or increased budget 
authority or tax expenditures or revenues.

                        Committee Cost Estimate

    The Committee adopts as its own the cost estimate prepared 
by the Director of the Congressional Budget Office pursuant to 
section 403 of the Congressional Budget Act of 1974.

                  Congressional Budget Office Estimate

    Pursuant to clause 2(l)(3)(C) of rule XI of the Rules of 
the House of Representatives, the following is the cost 
estimate provided by the Congressional Budget Office pursuant 
to section 403 of the Congressional Budget Act of 1974:

                                     U.S. Congress,
                               Congressional Budget Office,
                                     Washington, DC, July 25, 1996.
Hon. Thomas J. Bliley, Jr.,
Chairman, Committee on Commerce,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
reviewed H.R. 3868, a bill to extend certain programs under the 
Energy Policy and Conservation Act through September 30, 1996, 
as ordered reported by the House Committee on Commerce on July 
24, 1996. CBO estimates that enacting this bill would have no 
significant impact on the federal budget. Enacting H.R. 3868 
would not affect direct spending or receipts. Therefore, pay-
as-you-go procedures would not apply to the bill.
    H.R. 3868 would amend the Energy Policy and Conservation 
Act (EPCA) to extend the authorization of programs and 
activities related to energy emergencies from June 30, 1996, to 
September 30, 1996. This extension would authorize the 
Department of Energy (DOE) to continue to operate the Strategic 
Petroleum Reserve, participate in the International Energy 
Agency, and conduct related activities through the end of 
fiscal year 1996, and would authorize such sums as may be 
necessary for these purposes. Because funds have already been 
appropriated for all of fiscal year 1996, CBO estimates that 
enacting this bill would not have any significant impact on the 
federal budget. Federal spending over the next two months would 
be affected by the bill only in the event that an energy 
emergency necessitates additional DOE expenditures for actions 
authorized by EPCA.
    H.R. 3868 contains no private-sector or intergovernmental 
mandates as defined in Public Law 104-4 and would impose no 
costs on state, local, or tribal governments.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Kathleen 
Gramp.
            Sincerely,
                                         June E. O'Neill, Director.

                     Inflationary Impact Statement

    Pursuant to clause 2(l)(4) of rule XI of the Rules of the 
House of Representatives, the Committee finds that the bill 
would have no inflationary impact.

                      Advisory Committee Statement

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act were created by this 
legislation.

             Section-by-Section Analysis of the Legislation

    Subsection 1 of the bill authorizes such sums as may be 
necessary to carry out the Strategic Petroleum Reserve program 
through September 30, 1996. Funds for this program have already 
been appropriated through the end of the fiscal year.
    Subsection 2 of the bill extends the authorities to buy or 
lease oil for, operate and drawdown the Strategic Petroleum 
Reserves through September 30, 1996. Absent extension of this 
authority the President's ability to drawdown the Reserve in an 
energy emergency is incomplete.
    Subsection 3 authorizes such sums as may be necessary to 
participate in the International Energy Program through 
September 30, 1996. Funds for the program have already been 
appropriated through the end of the fiscal year.
    Subsection 4 simply extends the authority for the U.S. to 
participate in the International Energy Agency (IEA) through 
September 30, 1996. Absent such an extension, the ability of 
oil companies to participate in oil sharing programs ordered by 
the IEA in an emergency would be severely limited.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3 of rule XIII of the Rules of the 
House of Representatives, changes in existing law made by the 
bill, as reported, are shown as follows (existing law proposed 
to be omitted is enclosed in black brackets, new matter is 
printed in italic, existing law in which no change is proposed 
is shown in roman):

                   ENERGY POLICY AND CONSERVATION ACT

          * * * * * * *

        TITLE I--MATTERS RELATED TO DOMESTIC SUPPLY AVAILABILITY

          * * * * * * *

                  Part B--Strategic Petroleum Reserve

          * * * * * * *

                    [authorization of appropriations

  [Sec. 166. (a) There are authorized to be appropriated--
          [(1) such funds as are necessary to develop and 
        implement the Early Storage Reserve Plan (including 
        planning, administration, acquisition, and construction 
        of storage and related facilities) and as are necessary 
        to permit the acquisition of petroleum products for 
        storage in the Early Storage Reserve or, if the 
        Strategic Petroleum Reserve Plan has become effective 
        under section 159(a), for storage in the Strategic 
        Petroleum Reserve in the minimum volume specified in 
        section 154(a) or 155(a)(2), whichever is applicable;
          [(2) $1,100,000,000 to remain available until 
        expended to carry out the provisions of this part to 
        develop the Strategic Petroleum Reserve Plan and to 
        implement such plan which has taken effect pursuant to 
        section 159(a), including planning, administration, and 
        acquisition and construction of storage and related 
        facilities, but no funds are authorized to be 
        appropriated under this paragraph for the purchase of 
        petroleum products for storage in the Strategic 
        Petroleum Reserve;
          [(3) such funds for the fiscal year ending September 
        30, 1978, not to exceed $1,210,000,000, as are 
        necessary to permit the acquisition and storage of 
        petroleum products in the Strategic Petroleum Reserve, 
        in accordance with the storage schedule set forth in 
        the Strategic Petroleum Reserve Plan then in effect in 
        excess of the minimum volume specified in section 
        154(a), but not in excess of 500,000,000 barrels; and
          [(4) for the fiscal year ending September 30, 1982, 
        not to exceed $260,000,000 to carry out the provisions 
        of this part, except--
                  [(A) acquisition, transportation, and 
                injection of petroleum products for the 
                Reserve, and
                  [(B) the carrying out of any drawdown and 
                distribution of the Reserve.]


                    authorization of appropriations


  Sec. 166. There are authorized to be appropriated for fiscal 
year 1996 such sums as may be necessary to implement this part.
          * * * * * * *

                           Part D--Expiration

                               expiration

  Sec. 181. Except as otherwise provided in title I, all 
authority under any provision of title I (other than a 
provision of such title amending another law) and any rule, 
regulation, or order issued pursuant to such authority, shall 
expire at midnight, [June 30, 1996] September 30, 1996, but 
such expiration shall not affect any action or pending 
proceedings, civil or criminal, not finally determined on such 
date, nor any action or proceeding based upon any act committed 
prior to midnight, [June 30, 1996] September 30, 1996.

                  TITLE II--STANDBY ENERGY AUTHORITIES

          * * * * * * *

    Part B--Authorities With Respect to International Energy Program

          * * * * * * *
  Sec. 256. (a) * * *
          * * * * * * *
  (h) Authorization of Appropriations.--There are authorized to 
be appropriated to the Secretary for purposes of carrying out 
the programs under subsections (d) and (e) $10,000,000, to be 
divided equitably between the interagency working subgroups 
based on program requirements, for each of the fiscal years 
1993 and 1994, and such sums as may be necessary for fiscal 
year 1995 to carry out the purposes of this subtitle. There are 
authorized to be appropriated for fiscal year 1996 such ums as 
may be necessary to carry out this part.
          * * * * * * *

                           Part D--Expiration

                               expiration

  Sec. 281. Except as otherwise provided in title II, all 
authority under any provision of title II (other than a 
provision of such title amending another law) and any rule, 
regulation, or order issued pursuant to such authority, shall 
expire at midnight, [June 30, 1996] September 30, 1996, but 
such expiration shall not affect any action or pending 
proceedings, civil or criminal, not finally determined on such 
date, nor any action or proceeding based upon any act committed 
prior to midnight, [June 30, 1996] September 30, 1996.
          * * * * * * *