• E-mail
• Print
• Comment
• Font Size
• Digg
• del.icio.us
• Discuss article

Energy Bill Carries Implications for State

Posted on: Friday, 29 July 2005, 12:00 CDT

WASHINGTON -- While promising no immediate relief from record- high gas prices, Congress is poised to pass an energy bill that could have far-reaching implications for California.

The mammoth legislation, which passed the House on Thursday, would weaken the state's ability to block controversial liquefied natural gas, or LNG, facilities. But it made an exception for military posts, allowing the Pentagon to block nearby LNG projects, which some fear are possible targets for terrorists.

The bill also orders an inventory of offshore oil and natural gas reserves that are now off limits to drilling, mandates greater use of the gasoline additive ethanol and allows federal courts to assume jurisdiction over lawsuits against makers of another additive that has been banned in California, MTBE.

Consumer activists said the bill, which is expected to pass the Senate today barring a concerted effort to stall it, would do the state more harm than good.

"It's lights out for California consumers," said Doug Heller, executive director of the Santa Monica-based Foundation for Taxpayer and Consumer Rights. "They're weakening consumer protections and they're taking away the state's right to determine whether new energy facilities are safe and appropriate."

But supporters said the legislation would put the country on the road to stepped up energy production and, ultimately, lower energy prices. California motorists pay among the nation's highest gas prices.

"There is a lot that we need to do to have energy independence in this country and to lessen our dependence on foreign sources. It's a great start," said House Resources Committee Chairman Richard Pombo, R-Calif.

California's congressional delegation split largely along party lines on the 275-156 vote.

The legislation is the culmination of more than four years of debate. Shortly after taking office in 2001, President Bush called for a national energy policy that focused on increasing the production of coal, oil, natural gas and nuclear power.

That touched off a rancorous debate in Congress and several, ultimately futile, attempts to pass a bill. A combination of factors has helped the legislation along this year, including high oil prices, bigger Republican majorities in the House and Senate and the sidelining of controversial issues such as opening Alaska's Arctic National Wildlife Reserve to oil and gas drilling.

Rep. Jane Harman, D-El Segundo, said the nation's reliance on imported oil was a pressing national security concern, particularly with terrorism on the rise, and that the energy bill does not adequately address that.

"This bill does too little to set new goals and jump-start those strategies. It continues our addiction to oil to run 97 percent of our transportation economy," she said. "A stronger bill would have made it our top priority to diversify our energy resources -- potentially saving us from a major national security crisis."

Harman cited a simulated scenario in which political unrest in Nigeria and al-Qaida attacks in Saudi Arabia and Alaska cause a world oil shortfall that pushes prices to $161 a barrel, or $5.74 per gallon of gas.

South Bay Rep. Dana Rohrabacher was one of only 31 Republicans to oppose the bill, objecting to its $14.5 billion in energy tax breaks at a time when oil companies are making huge profits.

"With energy prices sky high, these oil companies should be doing things to help the American people rather than relying on taxpayer money," the veteran Republican lawmaker said through a spokesperson.

Some observers had predicted that the provision giving the Federal Energy Regulatory Commission, or FERC, final say on the siting of LNG facilities, which handle imports of the explosive fuel, would torpedo the bill again. But strong opposition to the move was largely limited to Democrats from the Northeast and the West Coast.

The provision grew out of a court battle between the California Public Utilities Commission and FERC over a proposed facility in Long Beach that would convert the liquefied fuel, which is shipped in tankers from overseas gas fields, back into a gas.

Demand for LNG is growing, but local opposition has stymied efforts to build some LNG terminals.

The legislation is "clarifying our exclusive authority to authorize an LNG import facility that is part of foreign commerce," said FERC Chairman Joseph T. Kelliher.

But Heller of the Foundation for Taxpayer and Consumer Rights questioned why lawmakers felt compelled to carve out an exception for military bases.

Some California officials are also alarmed about a provision in the bill that would require an inventory of offshore oil and natural gas reserves. House Minority Leader Nancy Pelosi, D-Calif., said the provision was "opening the door to oil and gas drilling in the protected areas off our shores."

But supporters said detailed information about the reserves was necessary to guide future policy over drilling in the areas.

Another potential spoiler provision, which would have granted liability protections to makers of the fuel additive MTBE, was stripped from the final version of the legislation.

MTBE, methyl tertiary butyl ether, is a fuel additive that was widely used in California and other states to reduce air pollution from automobiles. But the substance has fouled water supplies, prompting dozens of lawsuits.

Source: Daily Breeze

More News in this Category