StoryImage( ‘/Images/Story//Auto-img-11878058901476.jpg’, ”, ‘George W. Bush‘);
StoryImage( ‘/Images/Story//Auto-img-118780590631251.jpg’, ”, ‘Nancy Pelosi‘);
StoryImage( ‘/Images/Story//Auto-img-118780594831253.jpg’, ‘Photo courtesy of www.masonrymagazine.com‘, ‘U.S. Rep. Don Manzullo‘);
Bills aiming to increase production of renewable energy pass U.S. House; White House threatens veto
A week before more than 3,500 braved 90-degree heat to attend the Sixth Annual Illinois Renewable Energy & Sustainable Lifestyle Fair Aug. 11-12 in Oregon, Ill., U.S. Rep. Don Manzullo (R-16) voted against two measures aimed at increasing the production of renewable energy.
The Renewable Energy Conservation Tax Act of 2007 (H.R. 2776) and the New Direction for Energy Independence, National Security and Consumer Protection Act (H.R. 3221) both passed the House Aug. 4 by votes of 221-189 and 241-172, respectively. Manzullo voted against both bills.
According to summaries of the bills, H.R. 2776 would amend the Internal Revenue Code of 1986 to provide tax incentives for the production of renewable energy and energy conservation; and H.R. 3221 would aim to move the United States toward greater energy independence and security, develop innovative technologies, reduce carbon emissions, create green jobs, protect consumers, increase clean renewable energy production and modernize the countrys energy infrastructure.
Manzullo said during general discussion about the bills Aug. 4: I am extremely saddened that these bills, which according to the Democrat majority were meant to achieve energy independence, strengthen national security, grow our economy and create jobs, lower energy prices, and begin to address global warming, will in fact result in less domestic natural gas and oil production, higher taxes that are passed to consumers, and wasteful spending on duplicative government programs. …
The Department of Energy projects that the United States will use 28 percent more oil and 19 percent more natural gas in 2030 than was used in 2005, Manzullo added. To meet this rising demand and wean ourselves from foreign oil and natural gas, we must reduce regulatory burdens, invest in additional refining capacity, allow environmentally sound exploration, and support the development of alternative fuels. Unfortunately, the energy bills under consideration today do none of these things.
In an Aug. 3 statement of administration policy, the White House threatened to veto both bills. Because H.R. 2776 and H.R. 3221 fail to deliver American consumers or businesses more energy security, but rather would lead to less domestic oil and gas production, higher energy costs, and higher taxes, the presidents senior advisers would recommend that he veto these bills, the statement read.
About the bill
Full text of the 786-page bill can be found online at http://www.thomas.gov/cgi-bin/bdquery/z?d110:h.r.03221:. Project Vote Smart is working on a summary of the bill that should be available soon at http://www.vote-smart.org/issue_keyvote_detail.php?cs_id=14641. Meantime, House Speaker U.S. Rep. Nancy Pelosi (D-Calif.), who sponsored H.R. 3221, alleged on her Web site at www.speaker.gov that the legislation would do the following:
Create an Energy Efficiency and Renewable Energy Worker Training Program to train a quality workforce for good green jobssuch as solar panel manufacturers and green building construction workersthat are created by federal renewable energy and energy efficiency initiatives.
Reduce global greenhouse emissions worldwide by directing the federal government to promote U.S. energy exports in clean, efficient technologies to India and China and other developing countries.
Create a new position within the Department of State, the Ambassador at Large for Global Climate Change, to serve as the lead adviser to the President and Secretary of State on these issues.
Give small businesses tools they need to be more energy efficient and increase our energy independence. The bill increases loan limits to help small businesses develop energy-efficient technologies and purchases, and increases investment in small firms that are developing renewable energy solutions.
Include a measure to create an Energy Department agency to coordinate revolutionary, high-payoff energy technology research and development that private industry is not likely to pursue on its own.
Reorganize the Bush administrations climate change research program.
Include measures to bolster research on solar energy
Invest $2.2 billion to help rural communities, farmers, ranchers and small businesses by reducing their energy costs through energy efficiency and promoting renewable fuels, including cellulosic ethanol and biodiesel.
Continue funding for the Biodiesel Fuel Education Program to award competitive grants to nonprofit organizations that educate governmental and private entities operating vehicle fleets, and educate the public about the benefits of biodiesel fuel use.
Increase funding for the Renewable Energy & Energy Efficiency Improvements Program, which authorizes loans, loan guarantees, and grants to farmers, ranchers, and rural small businesses to purchase and install renewable energy systems and to make energy efficiency improvements.
Extend and fund the Biomass Research and Development Program to provide competitive funding for research and development projects on biofuels and bio-based chemicals and products.
Make the federal government a leader on reducing global warming, setting an ambitious goal requiring federal government operations to be carbon-neutral by 2050, with annual government-wide emissions targets. The federal government is the largest energy consumer in the United States, and these provisions will save taxpayers $7.5 billion through 2030.
Ensure greater accountability to the taxpayer from companies that do area drilling for oil and gas on federal lands. Among other provisions, it requires more audits to ensure American taxpayers arent being cheated out of the royalties they are due for the extraction of these publicly-owned resources.
Establish a national ocean observation system to gather information for climate change research, national defense, and marine commerce, a key recommendation of the Joint Ocean Commission Initiative.
Ensure the development of a national strategy to assist wildlife populations and their habitats in adapting to the impacts of climate change, and provides states with new funding to assist wildlife in adapting to global warming.
Ensure oil companies that were awarded the 1998 and 1999 royalty-free leases for drilling pay their fair share in royalties.
Take action to cut energy use and carbon emissions, by encouraging people to take mass transit, encouraging states to carry out transportation projects that reduce air pollution, and increasing federal help for local governments to purchase alternative fuel buses, locomotives and ferries.
Set new efficiency standards for appliances such as refrigerators and freezers, require more efficient lighting and promote green buildings in the federal and private sector, and work to speed up Energy Department action on new efficiency standards (after six years of reversal and delay of critical efficiency standards). These efficiency provisions will reduce energy costs to consumers by at least $300 billion through 2030, and remove as much as 10 billion tons of carbon dioxide from the atmosphere by 2030, more than the annual emissions of all of the cars on the road in America today.
Promote homegrown alternative fuels by providing assistance for the installation and conversion of E-85 fuel pumps and the production of flex-fuel vehicles that run on renewable fuel, and increase the amount of grants for cellulosic ethanol production to $1 billion.
Create a smart electric grid to modernize and strengthen the reliability and energy savings of our electricity supply, and improve the Department of Energy Loan Guarantee Program for projects that reduce greenhouse gas emissions and employ improved technologies.
Provide long-term incentives spurring the production of elect
ricity from renewable sources, including wind, solar, biomass, geothermal, river currents, ocean tides, landfill gas, and trash combustion resources.
Encourage the deployment of renewable energy by providing electric cooperatives and public power providers with new clean renewable energy bonds that will allow these entities to install facilities that generate electricity from renewable resources.
Help states leverage tax credit bonds to implement low-interest loan programs and grant programs to help working families purchase energy-efficient appliances, make energy-efficient home improvements, or install solar panels, small wind turbines, and geothermal heat pumps.
To pay for these renewable energy and conservation incentives, the bill repeals approximately $16 billion in tax breaks for oil and gas companies that were given during an era of record profits. To ensure that oil and gas companies are paying their fair share of taxes, it closes a tax loophole that allows big oil and gas companies to game the system by understating their foreign oil and gas extraction income. It also closes the Hummer Tax Loophole, fixing a serious mistake that provides an extra tax incentive for businesses buying luxury SUVs, while exempting vehicles that are used for legitimate business purposes.
Criticism of the bills
Both H.R. 2776 and H.R. 3221 received harsh criticism, including letters of opposition from the U.S. Chamber of Commerce, the National Association of Manufacturers (NAM) and the National Ocean Industries Association (NOIA).
The U.S. Chamber of Commerce argued: H.R. 3221 effectively turns off the lights on the countrys energy supply. It fails to produce a single Btu of new energy while scaling back energy production from both fossil fuels and renewables. … H.R. 2776 is no better. Although fossil fuels constitute 86 percent of the nations energy mixand alternatives, while promising, are not economically viablethis energy tax package unfairly and punitively singles out the oil and gas industry.
NAM Senior Vice President for Policy and Government Relations wrote in a letter to Congressmen: While we applaud Congress efforts to improve energy efficiency, expand alternatives and encourage conservation, we believe H.R. 3221 and H.R. 2776 fall far short of addressing our nations energy needs. In fact, we believe the bills, if enacted, would result in higher energy costs, fewer energy supplies, a weakened domestic energy industry and more job losses for U.S. factory workers.
Tom Fry, president of NOIA, added: By passing this bill, the House of Representatives has taken steps that undermine Americas energy future. At a time when energy demand is on the rise, the House bill will raise taxes on energy producers, inhibit the development of new domestic sources of oil and natural gas, and critically undercut the ability of the nations industries to grow and compete in the global marketplace.
Support for the bills
Pelosi said of the bill Aug. 4: The legislation…is just the ambitious first phase in what will be a series of revolutionary actions for energy independence. But it is a very serious first step that honors Gods creationour planetand creates a better world for our children. With confidence in American ingenuity and faith in our future, today we can declare a new direction in our energy policyone for our future generations.
Ways and Means Committee Chairman U.S. Rep. Charles B. Rangel (D-N.Y.), a co-sponsor of H.R. 3221, added: This bill makes an investment in Americas energy independence through long-term incentives for the production and use of renewable energy and energy conservation. This bill sets an example by closing loopholes and repealing generous tax breaks to oil and gas companies enjoying record profits, to help American companies and communities lead the way in developing technologies to reduce greenhouse gas emissions and combat the harmful effects of global warming. H.R. 2776 will also help cities and states provide bonds and grants to make sure that working families and businesses can do their share to purchase energy-efficient heat pumps, appliances and make home improvements to conserve energy.
U.S. Rep. Chris Van Hollen (D-Md.), another co-sponsor of H.R. 3221, said: The passage of this legislation is a major leap forward in our efforts to reduce reliance on foreign oil and reverse the growing problem of global warming. It requires us to develop more clean, homegrown sources of renewable energy, and use our energy more efficiently.
Manzullo's remarks on House floor
Manzullo said in his Aug. 4 House floor statements about the bill:
H.R. 2776 targets this vital sector of our economy with a $15.3 billion tax increase over 10 years. It also decreases the competitiveness of U.S. firms in global markets by adding a $3.6 billion tax increase on international oil and gas production income. Finally, it terminates a Lower Manhattan development program that will allow New York to spend $2 billion in federal income taxes that were withheld on New York City and state employees for any transportation infrastructure project they see fit. Im not quite certain why this provision is found in an energy bill.
To make matters worse, H.R. 3221 spends $18.7 billion over five years on many programs that have little or nothing to do with energy independence or reducing the rising cost of energy in America, Manzullo continued. H.R. 3221 contains extraneous provisions such as new anti-poverty programs, a program that authorizes $1 billion for clean energy and efficient technologies in other countries, the creation of a brand-new agency, and, my personal favorite, a section that will allow individuals to sue the federal government for damages caused by global warming. Unfortunately, I may have just described some of the less harmful provisions found in this bill because they only waste taxpayers money.
When the bill attempts to address domestic energy production, it does this by slowing the oil shale and tar sands commercial leasing program, abrogating contracts that will force an extra $5.5 billion for gas and oil exploration in the Gulf of Mexico, and prohibiting access to 4.2 trillion cubic feet of natural gas found in the Roan Plateau in Colorado. These additional restrictions on domestic production will lead to a shortage of supply, and drive the cost of energy up so that every home and every business will have to pay far more than they are currently paying now.
Between 1999 and 2003, the United States experienced nothing less than what many considered to be the demise of American manufacturing, Manzullo continued. Our manufacturing base has rebounded significantly since those days due largely to increases in productivity. But manufacturers face new and severe threats to the viability of their businesses in the United States. They face unfair foreign competition from foreign countries that do not honor their trade agreements and unfairly manipulate their currency. They face rapidly rising costs of health care. They face the largest regulatory burdens in the world. They face staggering increases in their energy costs. Please do not provide another incentive to move U.S. manufacturing overseas by exacerbating their energy bill.
I urge my colleagues join the National Association of Manufacturers (NAM) by opposing H.R. 3221 … and H.R. 2776 … to show your support for Americas manufacturers.
Debate about electric utilities how Congressmen voted
As reported in Foster Electric Report: One of the bills most intensely debated provisions requires electric utilities (municipalities and co-ops are exempt) to purchase 15 percent of their power from generation fueled by renewable resources by 2020. Despite strong opposition by the Edison Electric Institute and other electric utility interests, the amendment passed 220-190 in a vote that broke down along regional lines, with more than 30 members from each party switching sides.
None of the four repre
sentatives running for presidentDennis Kucinich (D-Ohio), Ron Paul (R-Texas), Tom Tancredo (R-Colo.) and Duncan Hunter (R-Calif.)voted on H.R. 3221. Kucinich voted for H.R. 2776, while the other three did not vote.
Illinois representatives voted as follows on H.R. 3221:
For the bill: Melissa Bean (D-8), Jerry F. Costello (D-12), Danny K. Davis (D-7), Rahm Emanuel (D-5), Luis V. Gutierrez (D-4), Phil Hare (D-17), Jesse Jackson Jr. (D-2), Timothy V. Johnson (R-15), Mark Steven Kirk (R-10), Daniel Lipinski (D-3), Bobby L. Rush (D-1) and Jan Schakowsky (D-9).
Against the bill: Judy Biggert (R-13), Manzullo, Peter Roskam (R-6), John Shimkus (R-19) and Jerry Weller (R-11).
Did not vote: Dennis J. Hastert (R-14) and Ray LaHood (R-18).
Illinois representatives voted as follows on H.R. 2776:
For the bill: Bean, Costello, Davis, Emanuel, Gutierrez, Hare, Jackson, Kirk, Lipinski, Rush and Schakowsky.
Against the bill: Biggert, Johnson, Manzullo, Roskam, Shimkus and Weller.
Did not vote: Hastert and LaHood.
White House's 'principal objections'
In the statement of administration policy, President George W. Bushs Office of Management and Budget alleged: [T]he combination of these two bills will result in less domestic oil and gas production, higher taxes to disadvantage a single targeted industry, and duplicative energy efficiency and R & D efforts that are largely under way already.
It makes little sense at a time of high energy costs to reduce domestic production or to otherwise make America more dependent on foreign sources of energy. Furthermore, these two bills do not include any of the key elements of the Presidents Twenty in Ten initiative that are a real opportunity to improve energy security, and reduce greenhouse gas emissions.
The Twenty in Ten initiative, designed to reduce projected gasoline usage in the United States by 20 percent in the next 10 years, is part of the administrations broader efforts, including the Advanced Energy Initiative, to move America toward a stronger, cleaner energy future. The Presidents Twenty in Ten initiative calls for: (1) an Alternative Fuel Standard requiring the equivalent of 35 billion gallons of renewable and other alternative fuels by 2017; and (2) a significant increase in automobile fuel efficiency (CAFE reform). The President also has emphasized the energy security need to expand the Strategic Petroleum Reserve (SPR), increase domestic production of oil and gas, and streamline the siting and expansion of domestic refineriesall helpful actions this bill ignores.
The White Houses statement of administrative policy described the administrations principal objections to the bills as follows:
Since 2001, the administration has directly invested over $12 billion in clean, safe advanced energy resources and supported billions more in tax incentives. The administration, however, strongly opposes raising taxes in a way that will lead to higher energy costs to U.S. consumers and businesses. Repealing the manufacturing deduction for only the oil and gas industry is a targeted tax increase that puts U.S. industries at a disadvantage to their foreign competitors. Changes to the foreign tax credit rules related to foreign oil and gas extraction income and foreign oil-related income will also disadvantage U.S.-based companies by reducing their ability to compete for investments in foreign energy-related projects. H.R. 2776 also includes $8 billion in expensive and highly inefficient tax credit bonds for renewable energy production and conservation efforts. Current law already provides sufficient Federal assistance to encourage these efforts. The administration has concerns with the structure and overall cost of some of the production and investment tax credit incentives in H.R. 2776 as well.
The administration strongly opposes provisions in both bills that would expand the application of Davis-Bacon Act prevailing wage requirements.
The administration strongly opposes language that would force holders of certain deep-water oil and gas leases issued in 1998 and 1999 by the Clinton Administration to either renegotiate the terms of the leases, pay an excessive fee, or face being barred from future oil and gas leasing in the Gulf of Mexico. This provision is likely to result in significant delays in lease sales in the event that the provision is litigated.
The administration strongly opposes provisions in Title VII of H.R. 3221 that would have a significant negative impact on current federal efforts to increase traditional and renewable domestic production and/or reverse production initiatives enacted in the Energy Policy Act of 2005.
The administration strongly opposes provisions that would be inconsistent with the Federal Credit Reform Act of 1990 and/or unduly constrain the administrations ability to effectively manage federal credit programs.
The administration strongly opposes H.R. 3221s unnecessary and duplicative new federal energy efficiency and R & D bureaucracy and global climate and worker training programs.
from the Aug. 22-28, 2007, issue