Washington (Platts)--6Dec2007
The US House of Representatives voted 235 to 181 Thursday to pass a major
energy bill that would boost fuel economy standards for passenger vehicles,
increase production of renewable motor fuels, set a renewable energy standard
for electric utilities and take away from the largest oil companies $13.7
billion in tax credits to pay for new and expanded renewable and alternative
energy programs.
The vote largely followed party lines, with 221 Democrats supporting the
measure, and 174 Republicans opposing it.
Supporters of the bill said it would reduce US dependence on foreign oil
and help lower America consumers' energy bills. "This bill today is a signal
to OPEC that we really mean business. This bill today is a signal to the rest
of the world that we are serious about global warming," Representative Edward
Markey, Democrat-Massachusetts, said on the floor.
Republicans attacked how Democrats went about bringing the legislation to
the floor. "We got this 1,000 page bill just 12 hours ago," even though House
rules generally require at least 24 hours for review, Representative Jeff
Flake, Republican-Arizona, complained. "Few if any in this body have read this
bill," making it difficult to spot "unfunded mandates or earmarks hidden in
this bill," he added.
Texas Representative Joe Barton, the top-ranking Republican on the House
Energy and Commerce Committee, complained that Republicans were given no
opportunity to amend the Democratic-crafted legislation. He also specifically
questioned Democrats' decision to increase the federal renewable fuels
standard and require use of advanced biofuels technology that does not yet
exist. "Why doesn't this bill have off-ramps?" Barton asked, saying such
options are necessary in case technologies do not come through as expected.
Barton also complained that the renewable electricity standard only
addresses investor-owned utilities, leaving municipal utilities and others
out. "It also doesn't allow all forms of renewables"--including hydropower and
clean coal--to be counted toward meeting the standard, Barton added.
The bill will now move to the Senate, where its prospects are uncertain.
Some Senate Republicans have vowed to block the measure because of the
renewable electricity standard, which would require utilities to derive 15% of
their generation from renewable sources by 2020, starting at 2.75% in 2010.
Opponents, including New Mexico Republican Senator Pete Domenici, believe the
RES would penalize states that do not have plentiful renewable sources.
The legislation also faces a veto threat by the White House, which
opposes the RES, the tax package and the way Congress crafted its compromises
to raise fuel economy standards to a fleet average 35 miles per gallon by 2020
and to boost the renewable fuels standard to 36 billion gallons/year by 2022.
Two other provisions adamantly opposed by the White House, which would
have made price gouging a federal crime and foreign oil producers subject to
US antitrust laws, were not included in the bill, even though both had been
approved by the House and Senate earlier in the year. The price-gouging
measure would have threatened companies with legal action if they charged
"unconscionably high" gasoline prices during declared emergencies, while the
so-called "NOPEC" provision would have changed international law to make
members of oil cartels liable in US courts.
The bill includes a requirement that the US reduce its oil use by 2.5
million b/d by 2016 from baseline levels by 2016 and by 10 million b/d by
2031.
Despite the president's veto threat, House Speaker Nancy Pelosi told
reporters before floor debate began that she is "pleased" with conversations
she has had with the White House about the measure.
Shortly after Pelosi spoke, Senate Majority Leader Harry Reid he supports
the House bill "as it is," calling it an "extraordinarily sound and good"
measure. He added, however, that he is prepared to divide the bill into two
parts to ensure quick passage of less controversial issues. "If we can't get
it all, we'll get part of it," the Nevada Democrat said, adding that he is
committed to have a bill "by the time we leave here."
--Cathy Landry, cathy_landry@platts.com
--Jean Chemnick, jean_chemnick@platts.com
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