Advocate Summary

Issue:  PURPA repeal
Advocate:  DuPont – Michael S. Parr
Date of Interview: 6/25/02

Basic Background
The issue relates to the Energy Bills, that just went through the House and Senate and are now in conference and specifically to a small provision in the Energy bill. The background is there was a law that was passed in 1978 called PURPA – Public Utilities Regulatory Provisions Act. Part of what PURPA was intended to do was to protect a certain class of power generators from the utilities, the utilities are traditionally government protected monopolies, and monopolies don’t tend to play very well in the free market. And manufacturing industries, chemicals, paper, steal, aluminum and others operate something called co-generation which is sometimes called combined heat and power, CHP. For manufacturing you need a lot of thermal energy to run your processes and that’s usually in the form of steam. So you have boilers just like utilities to create steam, or to put in a fuel gas – coal, oil – combust it, boil water to make steam, and then you use that steam to run your plant. One of the things you can do to make yourself more efficient, manufacturing tends to be fairly energy intensive, energy that would cost you to run your business, you also, in addition to using that steam, you run it through a turbine first to generate electricity so you are using that same input energy twice, creating both steam and electricity. The nature of those operations is that occasionally you have more power than you need in your plant so you need to be able to put that into the grid, so in 1978 PURPA was created basically to require certain things from the monopoly utilities so that they couldn’t essentially force these co-generators to shut down, you know they can gain the system to make you shut down, because they view you as competition, if you weren’t generating that power they could sell it to you. 
Over the last fifteen years there’s been a lot of discussion about deregulation in the electricity sector, trying to move it away from monopoly toward a competitive market based system. The power companies have always hated PURPA because they don’t like the government telling them how they have to do business with customers, and so traditionally there have been two elements of electricity deregulation that move together, a piece of that was essentially competition in the market, so no longer would PECO own some territory and be regulated under a public utility commission but multiple companies could sell power to customers in PECO’s region, you know a competitive market. Always moving along with that was repeal of PURPA, because in a competitive market you no longer need to protections of PURPA. Well the House energy bill went through and it didn’t have an electricity title, it didn’t deal with it at all. The Senate bill, when it came through had an electricity title and it repealed PURPA but didn’t do anything about creating competition in the electricity markets; very good for the utility industry, not very good for the manufacturing sector. 

Prior Activity on the Issue 
None mentioned. 

Advocacy Activities Undertaken
So we set about a lobbying effort to try to amend the Senate energy bill, S517, to reinstate those protections for the co-generators. We faced a rather significant uphill climb in that utilities are relatively politically powerful, they are well connected, spend a lot of money on lobbying, two of their senior trade association people have pretty deep roots in the Republican party. The two managers of the bill, the Democratic manager, Mr. Bingaman (D-NM) and Mr. Craig (R-ID) on the Republican side really, these changes that got rid of PURPA came in, not through regulatory order, the leadership sort of went off did a little huddle and then came back and had amended the bill significantly, then essentially put out the message, no amendments, we don’t want to see any amendments we want the bill clean. So we had a problem here, we had the Republican and Democratic leaders saying “we don’t want any amendments” we had the White House in large part, because of their relationship with the utility industry, saying we’re not really going to help you on this, so we thought well we’re behind the eight ball here. So we started looking for natural allies, and that takes you immediately to the North-East for three reasons, one, lots of manufacturing, two, traditionally pretty moderate to liberal politics even amongst  Republicans and three they aren’t very fond of the old Mid-west coal burning power plants because those emissions go up, come across to the North-East and cause problems here, acid rain, so we first targeted North-East members to help us try to get some traction on this issue and then looked for the things that were going to resonate with those sorts of members. 

So we also looked at who in the manufacturing sector used co-gen, how’s it distributed, quite broadly – but the big players are the chemical industry, oil, paper and so that helped us pick our targets for champions, we went to Senator (Tom) Carper (D) of Delaware which is the home state to DuPont and a large manufacturing state and also going through the paper companies we went to Susan Collins (R) in Maine a big paper state. And we got them to co-sponsor for us an amendment to the Senate Energy bill. And then we had to decide, now that we’ve got the sponsors, what do we want this amendment to say. And we worked very hard working with the utility industry, with the White House and others, to tailor our language as much as we could to be responsive to what they’re concerned about the provisions of PURPA, you don’t want to give them a target to easy to shoot. And so we put together an amendment that basically said PURPA goes away once there is competition in the local market, once the need for PURPA goes away, it goes away. So we could say, “we’re not preserving it for all time, we are making it go away, we’re simply protecting these co-generator operators until the market is ready to treat them properly; with a competitive market PURPA goes away. We then set about getting as many co-sponsors as we could, but being somewhat careful to get the right co-sponsors. It is very easy to get the North-East Republicans and Democrats, we worked with various coalitions like the North-East Mid-West Institute, which is a coalition of like minded politicians who have a sort of coalition entity, and we could use that to reach out to all of them and educate them. We focused on getting some traditionally strong pro-business and not necessarily pro-environment republicans because that would essentially dissuade other Republicans from coming on, people who don’t necessarily want to be on a green vote, but if they can see it mostly as a business vote we can get them on. We also tried not to get any really strongly liberal green democrats on because a conservative republican is not going to want to co-sponsor a bill that Barbara Boxer’s on. So we really tried to work a pretty centrist group of members. And then we really worked hard on coalitioning from the business community side we would go in with paper, steel, aluminum, autos, chemicals, oil, hospitals, just a really broad swath of people, so we go to members and say this isn’t just good for the chemical engineers, this is broadly in the manufacturing sector. And we worked with the environmental community, we never got them to lobby actively but we could represent them as being in favor of co-generation and we went through a lot of there past reports and testimony and pull out statements very supportive of co-generation. And we bundled those up into papers and said the environmental community is supportive of co-generation. And then we just did traditional shoe leather lobbying, we talked to a lot of members and we talked to members repeatedly to the point were I think people would jump under there desk because they knew it was going to be me again. The amendment was ruled germane, and it came up on the floor, and there were a lot of amendments and so they were dispatching amendments pretty quickly on the floor, and a very brief colloquy, Mr. Carper said a few words and I think Mrs. Collins said a few words – very brief, and then the Republicans raised a motion to table, which is a motion to essentially set the amendment aside so if the motion to table had one the amendment would have been dead, and that was sort of the moment of truth. We had been whipping the bill pretty hard, and our nose count, we had 45 yeah votes, and we were pretty comfortable but that doesn’t get you there and so we were sort of wing and a prayer to get the other 6 or 7 votes we needed and on the motion to table it was defeated by 60-37 margin, that is 60 people voted to keep the amendment alive which was quite a significant vote margin.  And what it told us was that our message, you know, votes don’t get any easier than this, it’s a green, pro-manufacturing vote, how can you go wrong with that. So after the motion to table failed they then approved the amendment on a voice vote. So it then went into the Senate bill, and when the Senate bill passed, we got that amendment in. 

And one of the things we did early on that proved to be very effective tool, when we were trying to get interest on the issue, the Republicans were pushing back on it: “no, no we don’t want to deal with this” and we were members of a very traditional K Street lobbying coalition, by which I mean the White House says, we want this Energy Bill to go through, they come out to the business community and say set up a coalition, put a lot of money into it, you know, take adds, lobby in support of our bill – very traditional. And so we had formed along with a lot of other trade associations this business lobbying entity in support of the president’s energy policy, in support of the bill. We do that because politically it’s the smart thing to do if the White House tells you to do it and because we had a lot of interest in the Energy bill, so there’s a business reason. As we were trying to work with the utilities to try to find some acceptable middle ground on how we were going to deal with PURPA, and trying to get the White House to play a constructive role, the White House just kind of kept pushing us off  say well you go back to your coalition and talk to the utilities, and of course the utilities didn’t have much motivation to talk to us because the bill had everything that they wanted. And so we took a bit of a gamble, we stood up and said look folks if you don’t start dealing with us on this we’re going to walk on this coalition, we’ll blow the coalition up. And that got the White House’s attention, before we were just sort of a little dog in the back yapping but when we finally said this is important enough to us that we’ll threaten the viability of this coalition, which is important to the White House in getting this thing through, then they said alright we’ll talk to you. And that was a fairly high stakes strategy for us early on, but it worked, and the nature of Washington, because we won by 60 votes, there were no hard feelings of having used that strategy. It was pretty good, not bad. 

[Did the coalition have a name?]
Um...the Energy Alliance, it was sort of…I don’t even remember the name. You see these formed quite often all the big trade associations, what you’ll find is most of the big trade associations, the people that head them are political operatives, people that were in the Nixon White House, who were in Bush 1, and have been hired by the industries to run the associations because of the political connections, but that also means that if the White House comes and taps them on the shoulder and say we need you in this coalition, which means we need you to line up behind us and we need you to bring in a hundred thousand dollars in advocacy, money for ad running, - they tend to say yes, just the nature of that dynamic, so whether , it’s health care, energy, whenever there’s a really critical issue for the administration they tend to reach out to the business community to form an entity who can run the adds in the Wall Street Journal and the New York Times, run the ads in Role Call, Congressional Monitor that sort of thing to help move the issue forward in Congress.  

Future Advocacy Activities Planned
Now it goes over to a conference committee, and we have kept all our same coalition together and we are doing basically the same thing we did previously. We meet weekly with the coalition, we have our list of key members, previously it was all in the Senate now its conferees on the House and Senate side. And we sort of take lead responsibility, you know: you get a meeting, you get a meeting, you get a meeting, and then whenever a meeting gets set up that gets distributed to the entire coalition. You go to the meetings were you have constituent relationships, or relationship with the office or what have you. And so we are going around with a common set of talking points a common set of advocacy papers we developed in these meetings now with these conferees, trying to encourage them to keep the provisions of the Carper/Collins amendment in the conference report. The House and Senate bills are very, very different, there is at the moment no electricity title in the House bill although in conference committee anything can happen, we know that Mr. (?R-TX) Barton in the House has an electricity provision he’d like to put in which goes the other way on PURPA, it repeals PURPA and we are working very hard on Mr. Tauzin (R-LA), the chairman of the conference and while it’s a never-say-yes kind of environment for him, he has signaled that he is sympathetic but also signaled to us that we should not go over and simply ask the House to recede to the Senate language, so instead lobbying the Carper/Collins amendment, we are lobbying the principles that underlie it, the things that need to be done with regard to PURPA, and we are also lobbying the White House very hard, the White House was not very supportive of this amendment, they didn’t oppose it but weren’t very supportive and we are trying to get them in a position to be strongly supportive by pointing out - it’s  very consistent with your energy plan, it’s very consistent with your climate plan because it’s lower emission. So to try to get them to be supportive in the conference which is probably more important in the House then it was in the Senate, there’s a much more conservative Republican caucus and they look more to the White House then the more independent Senate. 

Key Congressional Contact(s)/Champions
So we also looked at who in the manufacturing sector used co-gen, how’s it distributed, quite broadly – but the big players are the chemical industry, oil, paper and so that helped us pick our targets for champions, we went to Senator (Tom) Carper (D) of Delaware which is the home state to DuPont and a large manufacturing state and also going through the paper companies we went to Susan Collins (R) in Maine a big paper state. And we got them to co-sponsor for us an amendment to the Senate Energy bill. 

Targets of Direct Lobbying
None mentioned. 

Targets of Grassroots Lobbying
None mentioned. 

Coalition Partners: Names/Participants
And then we really worked hard on coalitioning from the business community side we would go in with paper, steel, aluminum, autos, chemicals, oil, hospitals, just a really broad swath of people, so we go to members and say this isn’t just good for the chemical engineers, this is broadly in the manufacturing sector. And we worked with the environmental community, we never got them to lobby actively but we could represent them as being in favor of co-generation.

Most of the coalition folks are the major trades, and at the same time, we’ve got the coalition of people that operate co-gen, steel, paper, aluminum, auto, we’ve got chemical - the broad manufacturing sector, represented either by trade association folks and companies. Because Carpenter was the sponsor and DuPont is in Delaware we were very directly involved, kind of ran the lobbying effort from the Senate side. You’ll typically see in industry coalitions in town, the bigger industries you’ll have individual involvement on issues, the industries that are made up of smaller companies you’ll generally see the trade association folks. I would say on the chemical side, the very active included DOW, ExxonMobil, and OxyChem, we had pretty good engagement on the paper side; International Paper, Georgia Pacific, in particular, those were probably the most active. 

Other Participants in the Issue Debate
We were talking to various people in the administration, from the Vice President to Karen Canudson (sp?) in the Vice President’s office, to Jimmy Glodfelty, the DoE.

Ubiquitous Argument(s) and Evidence
There were two things, a good environmental message because in co-gen you use the same fuel input and create both steam and electricity, you are essentially twice as efficient as a utility which takes that energy and just creates electricity, the heat, the steam they just throw away into the air. So you are twice as efficient and thus half the emissions of normal utility generation. So we had a great green message we could send. And we had a great message of, this is an important thing for the manufacturing industry so you’ve a relatively rare thing, you can offer a member a vote that’s both pro-environment and a pro-manufacturing vote, they don’t come along all that often. 

Secondary Argument(s) and Evidence
None mentioned. 

Targeted Arguments, Targets, and Evidence
None mentioned. 

Nature of the Opposition
The utilities were primarily represented by EEI, Edison Electric (?)Insurance.

What they do well, when an issue comes up, they can just flood the Hill with lobbyists, so they can have, like we had 10 people working this issue, but they might have had fifty people if they really paid attention. And that just gives them more opportunity to talk to more members. And every state has utilities and so every legislator has a utility that’s going to come talk them. Fortunately, there were enough other things in the Energy bill, they didn’t focus on this a lot, they thought it was easy to kill, they didn’t bring their big guns out on it, I think they were as surprised as we were when it passed as strongly as it did. It will be a bigger fight in conference because they now have got their eyes on it.  

Ubiquitous Argument(s) and Evidence Articulated by the Opposition 
On the raw politics they were arguing “no we don’t like it.” And they are pretty good campaign contributors. Their substantive argument would depend upon who they were talking to but their greatest audience were conservative Republicans where they could simply say “this is government intervention in the market place, you’re against government intervention aren’t you?” Which I would counter by saying, alright you’re for government intervention when that government intervention would give them a monopoly but their against it when it’s to intervene and control the monopoly. Well hey, if you’re going to get a monopoly you’re going to have some controls on it. 

Secondary Argument(s) and Evidence Articulated by the Opposition
None mentioned. 

Targeted Argument(s) and Evidence Articulated by the Opposition (and Targets)
See above, target a government intervention argument to conservatives but that seems to be their main argument. 

Described as a Partisan Issue
Yes. 

Venue(s) of Activity
Senate
Energy Conference Committee

Action Pending or Taken by Relevant Decision Makers
The Energy bill is now in a conference committee

Policy Objective(s) and Support for/Opposition to the Status Quo
Working to pass an amendment to the Energy bill that would retain the protections of PURPA for co-generators until the market becomes competitive 

Advocate’s Experience: Tenure in Current Job/Previous Experience
I’m a scientist by background, I’ve worked in the energy industry, the environmental consulting industry and for DuPont since 1986, 16 years, with a range of roles in DuPont. In 1990 we formed a unit to manage superfund sites that sort of thing one of the roles I had was to develop and implement public policy advocacy related to clean up programs, and I worked with the DC office in doing that over a span of 10 years and then a couple of years ago they needed another environmental lobbyist on fairly short order, and because of my experience in Washington and the relationships I developed in this office, it was a logical thing. For DuPont it isn’t to strange for scienctists to move up into management sort of roles, but this office I think I’m the only technical person I think everyone else is an English major. 

Reliance on Research: In-House/External (Code for Organizational Advocates Only)
We have the benefit of having all our trade associations, so we use the associations as a source for data and information. And then we would use the associations as the horse power to write up the talking points and put together the position papers and that sort of thing.

Number of Individuals Involved in Advocacy (Code for Organizational Advocates Only)
Five

Units in Organization Involved in Public Affairs/Policy (Code for Organizational Advocates Only)
There’s my boss, VP of government affairs, and then we sort of break up duties according to issue areas, so for example I lobby energy, environment, and security related matter, I have a colleague that does trade, one who does tax, one who does agricultural and biotechnology issues, primarily from the perspective we have a seed company so that’s that view of the world, I have another colleague that does things from the agriculture pesticides view of the world and also works on security issues. So we kind of divvy up issue areas.

Advocate’s Outstanding Skills/Assets (Code for Organizational Advocates Only)

Type of Membership: None, Institutions, Individuals, Both (Code for Organizational Advocates Only)

Membership Size (Code for Organizational Advocates Only)

Organizational Age (Code for Organizational Advocates Only)

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