- The Washington Times - Tuesday, July 29, 2003

Before the Senate leaves for the August recess, it could wind up three years of debate by passing its comprehensive energy bill (S. 14). For all the measure’s complexity, the question of whether it should be passed comes down to a simple question: If fully enacted, would the bill provide America with more energy than it currently has? At the moment, the answer seems to be a conditional “yes.”

While the Senate bill contains no provision for opening a small portion of the Arctic National Wildlife Refuge (ANWR) for energy exploration (to avoid derailing the bill, Energy and Natural Resources Committee Chairman Pete Domenici did not include it), it does contain other measures that will encourage energy development, such as speeding up the permitting process for oil and gas drilling. The bill also contains provisions encouraging the building and reconstruction of the nation’s energy infrastructure, with authorization of the Alaska Natural Gas Pipeline being the prominent example. The legislation will also rein in the Federal Energy Regulatory Commission’s ambitious ideas for restructuring electrical markets. Also, it is likely to increase the nation’s nuclear energy resources, no small matter with the stream of nuclear power plant licenses that will expire over the next decade. With its loan guarantees, the measure could help put 8,400 new megawatts of electricity on the grid, and its reauthorization of the Price-Anderson Act on nuclear liability insurance is needed.

However, there’s a great deal of bad in the bill as well. Its expanded ethanol mandate is little more than an agricultural subsidy and could drive up fuel prices in northeastern states. There are numerous questionable subsidies. The White House underscored this in a Statement of Administration Policy, which noted that the tax provisions approved by the Senate Finance Committee could cost more than $15 billion, almost double the administration’s request.

Moreover, several amendments are pending, any one of which might be sufficient to tip the bill from being marginally productive to prohibitively expensive. Sen. Jeff Bingaman, New Mexico Democrat, is expected to present a provision requiring utilities to generate 10 percent of their energy from renewable sources, such as solar and wind, by 2020 — the renewable portfolio standard (RPS). Using Mr. Bingaman’s numbers, the Energy Information Agency (EIA) said the provision would cost less than $5 billion to effect. However, a later EIA estimate, using assumptions provided by Mr. Domenici, put its potential cost far higher. The administration properly opposes a national renewable standard, and there’s no such requirement in the House-passed bill. Other Democrats are expected to offer amendments that have no place in the energy bill.

If such costly pitfalls can be avoided, then the Senate energy bill is worth passing, according to Myron Ebell, director of Global Warming Policy at the Competitive Enterprise Institute. Besides, the costs of waiting another term before an energy bill can make it onto the Senate calendar must also be considered. So long as it makes marginal improvements in energy access and energy production, the Senate should pass its energy bill.

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