energy bills 2007

Bills in Brief

With a Democratic Congress in charge, 2007 at first looked like it would see a host of energy bills to rev up alternative energy use and ease up on fossil fuel dependence. Both the Senate and House passed a number of energy bills, but ended up with a final - pared down - bill that the president might signed into law right before Christmas.

The original Senate bill

The Senate passed a swath of energy measures, as part of S 1419, in June including:

  • Fuel efficiency standards (also known as Corporate Average Fuel Economy or CAFE standards). S 1419 would increase minimum gas mileage to 35 mpg by 2020. (WP)

  • Renewable electricity and biofuels. S 1419 requires that 36 billion gallons of fuel come from biofuel by 2022. (WP)

  • Price gouging. The Senate bill includes anti-price gouging measures to protect Americans at the pump during national emergencies. It also gives the US the right to sue oil cartels for price fixing. (WP & NYT)

  • Climate change. S 1419 throws a small bone to global warmers (on top of the reforms listed above) by authorizing $300 million to study and develop "carbon sequestration" technology.

  • Nuclear energy. The bill would also offer up billions in loan guarantees to build new nuclear reactors (NYT).

A couple of amendments that were hotly debated didn't make it in to the final bill:

  • Green energy. Senators battled over whether to include a requirement that 15% of all electricity come from renewable sources by 2020. (Note: it's unclear to cJ what exactly counts as "renewable" - we know solar and wind energy do for sure, but we're not sure about biomass and hydropower.) They also tried to tag on a tax bill that would give tax incentives for alternative fuels, paid for by taxes on the oil industry. (NYT) Both measures failed to get into the final bill.

  • Coal come-back: Senators also considered whether to include loans or other incentives for building coal-to-liquid plants - and how much to require those plants scrub their carbon output. (NYT) Those measures also didn't make it in, although WaPo says senators okayed "test projects" for clean coal. (WP)

House Bills

The House is taking on energy reform in driblets: passing a set of mini reforms in January, voting on price gouging in May, voting on another swath of minor changes in July, and possibly hitting measures on gas mileage and carbon controls in the fall.

January: As part of its opening 100-hour agenda, the House approved a couple of small measures to reneg on oil industry perks, including:

  • taking back 2004 tax incentives for oil exploration,

  • putting pressure on oil companies to renegotiate deep water leases that accidentally forgot to add a clause saying royalties would hike up if gas prices did (a standard part of lease deals), and

  • using the money saved to give tax incentives for alternative energy development.

May: A price gouging bill, HR 1252, passed in May, would let the FTC define price gouging and set up fines for businesses that - allegedly - take advantage of disasters to pump up their gas prices.

Summer: Before heading off for vacation, House leaders passed a weak roster of measures (WP & LAT):

  • Efficiency standards for appliances (including light bulbs which would have to be 3 times as efficient by 2020) and new constructions as well as incentives for more efficient consumer electricity use;

  • Small grants and incentives to build ethanol cars and pumps and develop cellulose ethanol;

  • a requirement that utilities get 15% of their output from renewable energy (states could instead reach up to 4% of that goal through higher efficiency);
  • A repeal of $16 billion in tax incentive for the oil and gas industry - to be used instead to promote renewable energy;

  • Close the "hummer loophole" which some said gave businesses an incentive to buy the alleged gas-guzzlers.

Down the line: What could get voted on in the fall - or may just get worked into a joint bill with the Senate:

  • Coal credits. The House may vote to give incentives to the development of coal-to-liquid.

  • Increasing gas mileage standards to 36 mpg for passenger vehicles by 2021 and 30 mpg for non passenger vehicles by 2024 - or an alternative bill that would get both cars and light trucks up to 35 mpg by 2019.

  • Carbon caps: with no details out there, there's talk of placing a cap on carbon emissions to slow global warming.

The Compromise in action

Eager to have some energy cred to show for in '07, congressional leaders pushed to find common ground on a final bill that could pass muster in the House and Senate and make it past a presidential veto.

They're almost there. A House first passed a compromise bill that didn't get past the 60 senator threshold that's needed to pass in the Senate. That bill included:

  • a 40% uptick in gas mileage standards, requiring car makers average 35mpg by 2020 (up from 25mpg today)
  • incentives and requirements to get 36 billion gallons of biofuels into our gas tanks by 2022. 24 billion of those gallons would have to come from "cellulosic" biofuel, which is made from grasses and (many hope) will be a cheaper and cleaner alternative to corn based ethanol
  • a requirement that 15% of electricity come from alternative energies (wind, solar, biofuel, etc.)
  • energy efficiency standards for appliances that would, for one, phase out regular high energy light bulbs
  • renegging on tax breaks for oil companies to the tune of $13.5 billion to help pay for the $21 billion cost of the rest of the bill, including incentives and perks for renewable energy

The final bill

Senators tried a second time with a scaled down version of the bill, which was passed in early December. That bill kept the gas standard hikes, efficiency standards and biofuel mandates while dropping the 15% green energy requirement for electric companies and the rollbacks on oil tax perks. It later passed in the House and was signed into law. (WP) The National Commission on Energy Policy says the bill should bring down oil use at home by 5 million barrels a day by 2030 and cut carbon emissions by 320 million metric tons by 2020.

The president's recommendations.

Not that Congress listened to any of the president's suggestions, but for what it's worth, during his State of the Union speech, President Bush recommended:

  • requiring that 35 billion gallons of renewable fuels be used by 2017,

  • decreasing projected gasoline consumption by 20% in 10 years (which is the same as saying an 8% decrease in gas consumption from today - using EIA's projections for transportation energy use).

On the regulatory side

While Congress considers energy legislation, the National Highway Traffic Safety Administration has also been given the go ahead to draft new gas mileage standards for small cars. Don't fasten your seatbelt; it'll be a slow ride.

Updated December 24, 2007

Did we miss something, let some slant slip in, lose a link - or do you just have something to say? Drop a line below! In the spirit of open dialogue, cJ asks you keep it civil, keep it real and keep it focused on the message, not the messenger. See our policy page for more on what that all means.

nuclear power

What the heck the government is going to spend billions on nuclear power but not renewable energy like solar and wind power which makes no toxic waste along giving loans to coal plants. This year were going to spend more then $400,000,000,000 thats 400 billion dollars just in interest on our national debt which we usually borrow from China. All that money what could we do with all that money we probable could pay for every ones health care along with solar panels on every home and building making us 100% independent from phoren oil. Think of the money we spend on phoren oil along with the national debt interest. We could afford to cut the taxes like Bush already did and we cant afford it. I don't know how you feel about our more then $9,000,000,000,000 debt but im out raged by it. Were suppose to be the richest country in the world how come we need to keep borrowing so much money.
I hope I spelled all the words correctly if not sorry I'm in a rush.

jimmymak | November 24, 2007 - 3:43am