Energy panel OKs bill to drill offshore

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By Edward Felker

The Senate Energy and Natural Resources Committee Wednesday approved an energy bill that would boost renewable energy use and expand offshore oil and gas drilling.

But the measure faces an uncertain future.

The committee, which met 11 times since late March to debate amendments, voted 15-8 to send the bill to the full Senate.

Chairman Jeff Bingaman, New Mexico Democrat, called the bill "a solid piece of work" that reflected bipartisan viewpoints. Ranking member Lisa Murkowski, Alaska Republican, lauded some of the pro-drilling provisions in the bill and said the measure will face a number of amendments on the Senate floor to expand nuclear power, drilling in the Arctic National Wildlife Refuge, and other issues.

The bill was opposed by two Democrats. Democratic Sen. Mary L. Landrieu of Louisiana, who sought greater offshore oil and gas royalty sharing with coastal states and a greater use of nuclear power, voted against it, as did Sen. Robert Menendez of New Jersey. He said the bill does not go far enough to promote renewable energy and does not protect homeowners from arbitrary transmission line-siting decisions by the Federal Energy Regulatory Commission.

Sen. Bernard Sanders, Vermont independent, said he voted for the bill reluctantly because he considered the renewable energy mandate in the measure to be too weak and he planned to work to increase it on the Senate floor.

Sen. Evan Bayh, Indiana Democrat, said he would vote for the bill because it included a provision that allows states to keep penalties imposed when a state does not meet the renewable energy mandate.

Four Republicans voted for the bill: Mrs. Murkowski, Sen. Sam Brownback of Kansas, Sen. Jeff Sessions of Alabama and Sen. Bob Corker of Tennessee.

The next step, however, is up to Senate Majority Leader Harry Reid, Nevada Democrat, who may combine the legislation with a proposed global warming bill, which has not yet been produced in the Senate or by the full House.

The U.S. Chamber of Commerce's Institute for 21st Century Energy commended the committee for producing a comprehensive energy policy. It said the bill is not perfect but offers the chance to increase energy security, create jobs and improve the environment.

"This is not a perfect bill but overall this legislation is a positive step. It does not include oil and gas revenue sharing for states, and it contains a renewable electricity mandate that excludes some resources, like nuclear. It also doesn't recognize significant regional differences across our country. We look forward to working with the full Senate on these and other important issues in the coming months," said Karen Harbert, president and CEO of the institute, in a statement.

The bill's key provisions include:

• A mandate imposed on utilities to generate or acquire at least 15 percent of their energy from renewable sources, such as wind, biomass or solar sources, by 2021, with up to a 4 percent credit for efficiency improvements. Environmental groups have said the target, known as a renewable energy standard, is too low.

• Opening the eastern Gulf of Mexico to offshore oil and gas drilling, including the Destin Dome natural gas reservoir near Pensacola, Fla. The provision is expected to face a filibuster threat on the Senate floor from Florida Democratic Sen. Bill Nelson.

• New "smart grid" electricity transmission standards intended to move renewable energy from remote locations to cities, and new federal authority to use eminent domain for new high-voltage-line sites.

• New manufacturing and building efficiency standards.

• A new 30-million-barrel gasoline and diesel fuel reserve to moderate regional shortages caused by hurricanes that interrupt refinery production.

• A new Clean Energy Deployment Administration to finance renewable energy technology.