Washington (Platts)--7Jan2008
With a new energy law on the books and a national election around
the corner, the US Congress appears unlikely to pass major energy and
environmental laws in 2008, even with oil prices flirting at or near
$100/barrel, Washington analysts say.
Still, actions that lawmakers take this year could help set the tone for
breakthroughs once voters choose a new president and Congress in November, the
analysts add.
"The first week of 2008 brought a taste of $100[/barrel] oil and the Iowa
caucuses, leaving little doubt that would-be presidents and returning
legislators will keep petroleum prices and the need for 'energy security' at
the forefront of debate," Kevin Book, an analyst with the investment firm
Friedman, Billings, Ramsey & Co., said Friday in a report.
"Does this mean another energy bill is on its way? Not so fast," Book
added.
Recent history shows how difficult it is for Congress to pass energy
laws, even when there are supply interruptions and a single party controls
Capitol Hill and the White House, Book said.
"This year, the odds are even worse," he said. "Democrats command a
narrow margin in Congress; a wide-open presidential race could ignite a
partisan brawl as soon as mid-February, if clear front-runners emerge from
early state primary elections and Democrats appear determined to continue
'pay-as-you-go' fiscal strictures, pitting Big Oil against clean and green
power in a battle for subsidy dollars."
Moreover, Book said, the Energy Independence and Security Act of 2007,
which Congress passed and President Bush signed in December, "encapsulated
virtually all areas of energy policy consensus among Washington's warring
factions."
Frank Verrastro, director of the Center for Strategic and International
Studies' energy program -- one of several analysts interviewed on the House
and Senate agendas for energy and the environment -- offered a similar
assessment.
"I'm thinking it's going to be very bare bones," he said. "I don't think
anything new is going to come unless they're responding to some sort of
crisis."
Still, some analysts say Congress likely will at least enact bills
extending production tax credits for renewable energy production, which are
scheduled to expire at the end of 2008, and the Senate and the House may give
more attention to climate change legislation, although probably will not pass
such bills.
--Bill Loveless, bill_loveless@platts.com
--Jean Chemnick, jean_chemnick@platts.com
--Alexander Duncan, alexander_duncan@platts.com
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