Senate bill would set targets for cutting US oil consumption

Senate bill would set targets for cutting US oil consumption

Washington (Platts)--4May2006

A bipartisan group of senators introduced a bill Thursday that would cut
US oil use by 10 million b/d -- roughly half the country's current
consumption -- by 2036.

The bill represents half of a measure (S. 2025) introduced last year to
promote energy conservation. Lawmakers decided to divide the earlier bill
because its provisions fell into two committees' jurisdictions, which could
have complicated its passage.

"Time is running out in this Congress to take action on energy" Senator
Jeff Bingaman of New Mexico, the ranking Democrat on the Energy and Natural
Resources Committee, said. "To be effective in responding to our current
energy crisis, we must be focused, we must be realistic, and we must be
bipartisan. The bill that we are introducing today accomplishes all three
goals, and will help consumers by making them more efficient in their use of
oil and natural gas."

"It is an American effort. It is not and shouldn't be a partisan effort,"
Senator Norm Coleman, Republican-Minnesota, said.

In addition to the provision to cut 10 million barrels of oil use, which
would be implemented starting with a cut of 2.5 million b/d by 2016, the bill
would require federal and state fleets to cut 1999 petroleum use 30% by 2016,
and utilities to produce 10% of their electricity from renewable sources by
2020. It would also would provide loan guarantees and grants to auto
manufacturers for retooling their plants to build more fuel-efficient cars.

Bingaman also said he would advocate tax portions of S. 2025, which would
extend production tax credits for renewable energy, energy efficiency and
alternative fuels, expand tax breaks for alternative vehicles, and establish a
tax credit for manufacturers of advanced cars. That bill would have to go
through the Finance Committee.

Energy and Natural Resources Committee Chairman Pete Domenici,
Republican-New Mexico, told Platts he does not support the new bill because
the oil-reduction target sends "a blanket mandate to the president without
suggesting how to meet it."

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