Senate Rejects Auto Fuel Rules, Delays Energy Vote
USA: June 27, 2005


WASHINGTON - The US Senate rejected a Democratic plan to require better mileage for cars and gas-guzzling sport utility vehicles Thursday but put off a final vote on energy legislation until next week.

 


Lawmakers wrapped up debate on the bill late on Thursday, hours after US crude oil prices soared to a new record high of $60 a barrel.

Majority Leader Bill Frist had aimed for a final vote on the bill on Thursday, but delayed it until Tuesday. Some lawmakers left earlier on Thursday to attend home-state hearings on proposed military base closings.

The Senate rejected 67-28 a plan by Democrat Dick Durbin of Illinois to boost the fuel economy of passenger cars to 40 miles per gallon by 2016, and sport utility vehicles (SUVs) to 27.5 miles per gallon.

Gasoline demand accounts for about two of every five barrels of oil consumed in the United States, but neither the Senate bill nor a version passed by the House in April moves to improve corporate average fuel economy, or CAFE standards.

The White House opposes legislative CAFE mandates on the grounds that they could impact jobs and vehicle safety.

The massive bill to overhaul US energy policy stretches more than 700 pages and includes $14.1 billion in tax breaks and incentives to boost domestic production of oil, natural gas, coal and other energy sources.

Lawmakers approved 64-31 a less stringent CAFE amendment sponsored by Republican Christopher Bond of Missouri and Democrat Carl Levin of Michigan that requires the government to study standards and raise them as fast as technology allows.

Current regulations require US cars to average 27.5 miles per gallon and SUVs and mini-vans to get 21 miles per gallon.

Durbin said US automakers fought previous requirements to install seat belts and air bags and said they can make cars more fuel-friendly with existing hybrid technology.

"Detroit is so wedded to the concept of selling these monster SUVs that they won't use the technology that is already there," Durbin said.

Ford Motor Co and its larger rival General Motors Corp. are both reeling from a dramatic slowdown in SUV sales and ensuing job cuts.

The former profit engines for Detroit automakers have entered the slow lane of U.S vehicle sales as consumers vote with their wallets for mostly Japanese-made hybrid gasoline-electric cars in the face of high gasoline prices.

Bond said stricter CAFE rules will bring further woes upon hard-pressed US automakers and impose "Soviet-style mandates" for them to build lighter, flimsier models.

Durbin's plan "costs lives, costs jobs and deprives consumers of their basic free will," Bond said.

The US House approved an energy bill in April with $8.0 billion in tax breaks. Both versions of the legislation exceed the White House target of $6.7 billion.

The Senate legislation has several significant differences from the House version approved in April, which will make it difficult for negotiators to produce a final package that can be passed by both chambers.

Absent from the Senate legislation are measures to allow drilling in an Alaskan wildlife refuge and to shield oil companies that make a water-polluting gasoline additive from some lawsuits. The latter issue is a "a poison pill for any legislation that comes to the Senate," said Senate Minority Leader Harry Reid.

President George W. Bush has repeatedly urged Congress to send him a final energy package before lawmakers adjourn for their summer recess around Aug. 1.

 


Story by Chris Baltimore and Tom Doggett

 


REUTERS NEWS SERVICE