Washington (Platts)--9Mar2009

Wrapping a mandatory carbon cap-and-trade bill together with an energy
bill would make both difficult to pass in the US Senate and undermine
bipartisan attempts to reach a consensus on energy provisions, Alaska Senator
Lisa Murkowski said over the weekend.

Senate Majority Leader Harry Reid signaled late last week that he might
try that approach, after saying for weeks that he would move the two items
separately.

Murkowski, who serves as the top Republican on the Senate Energy and
Natural Resources Committee, said in a Saturday statement that "lumping two
very controversial pieces of legislation into a single-bill strategy will make
final passage very difficult.

"The energy committee is drafting a comprehensive energy bill that
already includes a number of areas where reaching consensus is challenging,"
Murkowski said. "Combining that energy bill with a controversial cap-and-trade
proposal will make getting to 60 votes on the floor an almost impossible
lift."

Murkowski's staff is working with that of Senate Energy and Natural
Resources Chairman Jeff Bingaman on a series of non-controversial draft
measures, including efficiency guidelines for appliances and buildings,
improvements to Energy Department research, transmission and other items of
consensus.

Both senators and other members of the energy panel plan to ask for votes
on a range of more controversial items during the committee markup, however.
Bingaman, a New Mexico Democrat, has introduced a renewable energy standard
for investor-owned utilities, which is unpopular with Republicans and some
members of his own party. Murkowski, meanwhile, may offer controversial
amendments dealing with nuclear waste disposal.

Aides to Reid, a Nevada Democrat, said late last week that the leader
might adopt a strategy proposed by US House of Representatives Democrats,
which calls for combining a climate bill with an energy bill and seeking to
pass both this year.

A composite bill would present a significant challenge in the Senate,
however, because 60 votes are needed to pass controversial legislation.
Democrats may hold 59 seats later this year, and several swing-state Democrats
have shown a reluctance to support climate mandates which might hurt
home-state manufacturing and energy industries.

--Jean Chemnick, jean_chemnick@platts.com