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Senate Compromises with 2002 Energy Bill: What does it Really Mean for Energy Policy?

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The Senate With a Loaded Docket

A closely divided U.S. Senate attempted to handle a caseload of controversial judicial nominations and a pair of precedent-setting international trade agreements—all in the week before August recess.

Oh, and did we mention they were also trying to pass a comprehensive bill to create a national energy policy?

The Energy Policy Act of 2003, S.14, was, in the estimation of most in the environmental community, a thoroughly bad bill. From having no mention of a Renewable Electricity Standard (RES) to help foster a clean energy market, to increased subsidies for the nuclear industry, to regressive language holding back any meaningful addressing of fuel economy standards, S. 14 promised nothing but increased dependence on fossil fuels and decreased regulation of the energy industry.

Fuel Economy Amendments Take Center Stage

 
 
 
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  in this section
   Drilling in Detroit

Senate Majority Leader Bill Frist (R-Tenn.) and Energy and Natural Resources Committee Chair Pete Domenici (R-N.M.) publicly stated that they fully intended to finish consideration of all amendments and have a final vote on the energy bill by the August recess. However, few amendments were acted upon that week. Two were of particular note to energy security advocates:
  • An amendment offered by Senator Richard Durbin (D-Ill.) that would increase Corporate Average Fuel Economy (CAFE) standards for cars, SUVs, and light trucks to 40mpg by the year 2015. This forward-thinking bill touched off a retrograde debate on the Senate floor reminiscent of the first CAFE debate some thirty years ago. "What about choice? This is still America," said Senator Trent Lott, (R-Miss.). He brought to the Senate floor a picture of a European mini-car, declaring, "I don't think we should be forced to drive that automobile." Of course, the European car he was touting is designed to get 70mpg, not 40, and as Senator Durbin pointed out repeatedly, the technology already exists to make even today’s large American SUVs and pickups get significantly better fuel economy. Unfortunately, the amendment was defeated 65-32.  Find out how your senator voted: vote list

  • An amendment offered by Senators Kit Bond (R-Mo.) and Carl Levin (D-Mich.) that would leave the decision on increasing the standard entirely up to the National Highway Traffic Safety Administration (NHTSA). Undermining NHTSA’s ability to craft a reasonable standard, Levin/Bond also added a laundry list of criteria that NHTSA would be forced to consider before proposing increased fuel economy standards-essentially an attempt to red tape any changes out of existence. The amendment, unfortunately, passed by 66-30.  Find out how your senator voted: vote list

Surprise Compromise Means Mixed Bag for Energy Security

However, the overburdened Senate schedule and many amendments made the chances of completing S.14 before recess very slim. Then, in a surprise move, Senator Frist proposed a last-minute compromise. He accepted an offer by Minority Leader Tom Daschle (D-S.D.) to revert to the 2002 energy bill that was brokered under Democratic control of the Senate. Frist also gave a guarantee that bipartisan bills on curbing greenhouse gas emissions and strengthening enforcement of energy market manipulation would receive separate votes later this year. An amendment that was to be offered by Senators McCain and Lieberman would be brought up for a vote this fall. The McCain/Lieberman amendment—the Climate Stewardship Act—would require real reductions in greenhouse gas emissions. The compromise gave both Republican and Senate leadership an opportunity to "claim victory" and leave town for recess. The final bill was passed by a resounding 84-14.  See how your senator voted: vote list.

The end result of this debate represents a mixed bag for those seeking a sensible energy policy. Among the positive aspects of the final Senate Energy Bill Are:

  •  
     
     
    related links
     
     

      in clean energy
      Renewable Electricity Standard can save 
        millions of dollars
      The Senate Renewable Electricity 
        (Portfolio) Standard

     

    National Renewable Electricity Standard: A federal RES that requires major electric companies to obtain a minimum of 10 percent of their electricity from wind, solar, geothermal, and other renewable sources by 2020; this provision, along with an extension and expansion of tax credits for renewable electricity, should lead to a doubling of the amount of renewable electricity that would otherwise have been generated in 2020.

  • Strong Tax Credits for Clean Vehicles: Performance-based tax credits for hybrid, fuel cell, and true alternative-fuel vehicles; this will help consumers purchase vehicles that will be better for the environment and save them money at the gas pump.

  • Addressing Climate Change: A continuation of the voluntary reporting of greenhouse gas emissions for an additional five years, but creating a trigger mechanism making the registry mandatory if after that time it accounts for less than 60 percent of total U.S. emissions.

  • Clean School Bus Funding: A $300 million grant program for school districts around the country to replace older, high-polluting buses with clean-burning buses powered by alternative fuels or low-sulfur diesel.

Flaws in the Senate energy bill include:

  • Duel Fuel Loophole: Despite the increased production incentives to the ethanol industry, the bill does not address a key barrier to increased use of the fuel by extending a loophole that allows automakers to claim credit toward meeting fuel economy standards for vehicles that can—but almost never do—run on alternative fuels like ethanol.

  • Big Hit on Fuel Economy: Not only will the regressive Levin/Bond amendment as passed last year be included on this legislation, but the bill represents a permanent rollback on the fuel economy standard of pickup trucks to the current light truck standard of 20.7 mpg—saddling pickup drivers with unnecessarily high gasoline costs and miring almost 40 percent of the light trucks currently sold at an outdated fuel economy standard.

  • Nuclear Subsidies: The Senate continued to provide the industry with significant liability protection, and authorized the aggressive pursuit of a new nuclear plant by 2010.

Next Up: The House-Senate Conference

Senators Frist and Domenici are already saying that the House-Senate conference committee will work quickly upon their return in September and will carve out what the Majority Leader said, "will be, in essence, a Bush-Domenici-Tauzin energy bill." Despite the reputation of "closed door bargaining" of conference committee deliberations, we will be coming to you soon with actions to help you effectively weigh in with particular members of the energy bill conference to express your support for the few good elements of the bill and opposition to provisions drawn up primarily for the benefit of polluting energy industries.

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Page Last Revised: 08.22.2003