Download Summary-Senate Energy Bill (S

Summary-Senate Energy Bill (S. 517)
On April 25, 2002, the Senate passed comprehensive energy policy legislation (Energy
Policy Act of 2002-S. 517), by a vote of 88 to 11. The House passed its energy legislation
(Securing America's Future Energy Act of 2001-HR 4) on August 2, 2001. The Senate
bill now goes to a conference committee to be reconciled with the House version. It is
expected that the process of reconciling the House and Senate versions could take several
months. After the final version of the Senate legislation is sent to the House, House
leaders will announce their own conferees and set a date for the first conference meeting.
Senate conferees were chosen based on overall seniority in the Senate, in accordance with
a unanimous consent agreement. The agreement calls for eight Democrats, eight
Republicans and one independent, and two of the chosen Democrats sit on neither
committee. The Senate has announced 17 conferees for the upcoming energy bill
conference - Chairman Jeff Bingaman (D-N.M.), Majority Whip Harry Reid (D-Nev.),
and Sens. Max Baucus (D-Mont.), John Rockefeller (D-W.Va.), John Breaux (D-La.),
Joe Lieberman (D-Conn.), Fritz Hollings (D-SC) and John Kerry (D-MA). The
Republican conferees include committee ranking member Frank Murkowski (R-Alaska)
and Pete Domenici (R-N.M.), Chuck Grassley (R-Iowa), Don Nickles (R-Okla.), Larry
Craig (R-Idaho), Ben Nighthorse Campbell (R-Colo.), Craig Thomas (R-Wyo.) and
Minority Leader Trent Lott (R-Miss.). The final conferee is Jim Jeffords (I-Vt.).
The major issues addressed in the Senate bill include:
Electricity
The electricity title of the bill includes provisions that amend the Federal Power Act to
address FERC authority over utility mergers, market-based rates, open access
transmission by unregulated entities and electric reliability standards. The bill also
repeals PUHCA and provides that the mandatory purchase requirement of PURPA will
be repealed upon a FERC determination that competitive wholesale markets exist.
Finally, the bill establishes a national renewable portfolio standard under which investorowned utilities will be required to generate 10 percent of their electricity from renewable
sources by the year 2020.
Hydropower
The bill modifies the hydropower relicensing process under the Federal Power Act by
requiring that federal resource agencies with authority to impose mandatory conditions
on licenses (i.e. conditions that FERC must accept) approve more cost effective
alternative conditions submitted by hydroelectric facility license applicants, so long as the
proposals meets the agency's conditions for environmental protection.
Nuclear Power
The bill reauthorizes the Price-Anderson Act for commercial nuclear power plants and
Department of Energy contractors until 2012.
1
Alaska Gas Pipeline
Provisions designed to promote construction of a pipeline to deliver Alaskan natural gas
to lower 48 markets. Provisions include mechanisms for expedited permitting provisions,
a $10 billion loan guarantee for costs of construction, and a tax credit for the production
of Alaska gas.
Corporate Average Fuel Efficiency
The bill requires the National Highway Traffic and Safety Administration establish new
CAFE standards within 15 months of the date of enactment of the bill. During the debate,
the Senate defeated an amendment that would have increased CAFE standards from 27.5
miles per gallon for cars and 20.7 miles per gallon for light trucks to a combined fleet
average of 35 miles per gallon by 2015.
Alternative and Renewable Fuels
The bill contains a renewable fuels standard that mandates an increase in the use of fuels
such as ethanol and biodiesel from 1.8 billion gallons today to 5 billion gallons by 2012.
The bill also repeals the Clean Air Act's requirement that reformulated gasoline contain
two percent oxygenate and bans the use of methyl tertiary butyl ether (MTBE) by 2004.
Climate Change
The bill establishes a White House office tasked with formulating a national strategy to
stabilize GHG emissions. The strategy is to address four main objectives — reduction of
GHG emissions, technology development, climate change adaptation research, and
climate science research.
The bill also establishes a GHG emissions inventory and GHG emission reduction
registry that will be voluntary but then will become mandatory if less than 60 percent of
the nation's GHG emissions are registered after five years.
Energy Research and Development
The extensive research and development components of the bill authorize R&D programs
in renewables, climate change, natural gas, oil, coal, hydropower, and nuclear power as
well as energy conservation and efficiency. Included is a provision for continued research
and development of clean coal technology programs, authorizing a $2 billion/10 year
clean coal demonstration program.
Tax Provisions
A $14.5 billion tax title includes provisions to encourage the purchase of hybrid-electric
and alternative-fueled vehicles, production credits for electricity generated from clean
coal technology units, credits for investment in clean coal technologies, and tax
incentives for renewable energy, energy efficiency programs, oil and natural gas
production, Indian reservations, and electricity restructuring initiatives.
2
Comparison of House and Senate Versions
Issue
Electricity
Hydropower Licensing
Nuclear Power
Arctic Drilling
Alaskan Natural Gas Pipeline
Corporate Average Fuel
Efficiency
House (H.R. 4)
No electricity restructuring
provisions.
Allows consideration of alternative
conditions in licensing process.
Orders FERC to revise data
collection procedures in an effort to
reduce the time and cost of the
process
Funding for nuclear research
options, measures support the
uranium and uranium enrichment
industries. Allocates $10 million for
research into spent fuel
reprocessing. Renewal of the
Price-Anderson Act passed later as
a stand-alone measure.
Opens the Arctic National Wildlife
Refuge (ANWR) to oil and gas
exploration.
Language that would prohibit
construction of any so-called ‘over
the top’ route that would go under
the Beaufort Sea and down
through Canada to the lower 48
states
Directs National Highway Traffic
and Safety Administration to
reduce the gasoline consumption
of the light duty fleet by 5 billion
gallons by 2010.
Alternative and Renewable
Fuels
No alternative and renewable fuels
provisons.
Climate Change
No climate change provisions.
Senate (S. 517)
Reliability language and
efficiency language added,
clearly defines state
jurisdiction over retail
electricity.
Requirement that 10 percent
of electricity comes from
renewable sources by 2020.
Approved similar alternative
conditions. Would also extend
time for relicensing
applications to be filed from
two years before expiration to
three years, and broaden
environmental standards on
fish protection.
Endorsement of programs to
bring new nuclear power
plants online by 2010.
Establishes a Department of
Energy Office of
Spent Nuclear Fuel Research.
Includes Price-Anderson
renewal.
Measure to open ANWR failed
Loan guarantees to spur
interest in the project.
Specifies a ‘southern’ route
through
Alaska.
National Highway Traffic and
Safety Administration establish
new CAFE standards within 15
months of the date of
enactment of the bill.
Mandates an increase in the
use of fuels such as ethanol
and biodiesel from 1.8 billion
gallons today to 5 billion
gallons by 2012. The bill also
repeals the requirement that
reformulated gasoline contain
two percent oxygenate and
bans the use of methyl tertiary
butyl ether (MTBE) by 2004.
White House office formed
tasked with formulating a
3
Issue
House (H.R. 4)
Senate (S. 517)
national strategy to stabilize
GHG emissions. The bill also
establishes a voluntary GHG
emissions inventory and GHG
emission reduction registry.
Energy Research and
Development
$3.3 billion in tax incentives
$1.9 billion in tax incentives
Tax Provisions
Approximately $33.5 billion in tax
breaks, mostly aimed at promoting
production, with only $10 billion
targeted for conservation.
Approximately $14.5 billion, in
tax breaks for conservation
and efficiency programs.
4