Energy Bill Focuses on Domestic Production

By Eric Pianin and Peter Behr

Friday, February 9, 2001

Opening a debate over energy policy, the chairman of the Senate Energy and Natural Resources Committee will unveil legislation next week to dramatically boost domestic energy production and permit oil and gas drilling in an Alaska wildlife refuge.

The bill, authored by Sen. Frank H. Murkowski (R-Alaska), contains many of President Bush's policy goals as well as billions of dollars of tax breaks and incentives for energy exploration and conservation that are not part of the tax bill Bush sent to Congress yesterday.

It will focus on increasing funding for "clean coal" technology, revitalizing the nuclear power industry and finding new sources of oil and natural gas -- including a proposal opposed by environmentalists and many members of Congress for drilling in the Arctic wildlife refuge.

The Murkowski legislation will be the opening salvo in what promises to be a major debate this year pitting those who favor increasing domestic energy production and others who fear it will come at the expense of environmental protection.

The debate is being spurred by California's power shortages and growing concern among Republicans and Democrats that the country is headed toward an energy crisis. During the campaign, Bush charged that the Clinton administration had failed to develop a comprehensive energy policy to reduce U.S. dependence on foreign oil.

While members of both parties agree something must be done, Democrats and environmental groups say that Bush and the Republicans are putting too much emphasis on oil and gas production at the expense of conservation and development of alternative fuels.

Murkowski said this week he discussed his proposal with Vice President Cheney, head of a presidential task force on energy, and that there was general agreement "we have an energy crisis in this country" that necessitates increased domestic production.

The bill likely will be merged with the broad energy proposals being discussed by the White House task force. That plan should be ready in six to eight weeks, Cheney told senators recently.

"This isn't going to be the bill that ultimately will be debated on the floor," Murkowski said. "It's designed to initiate the discussion."

Murkowski added: "What we intend to do is concentrate on increasing the supply of conventional energy -- clean coal, nuclear, gas and oil. We want to see an expanded use of alternative fuels and renewables. But we don't think we can conserve our way out of an energy crisis."

Philip E. Clapp, president of the National Environmental Trust, complained that Murkowski and the Bush administration are trying to "drill their way" out of the energy crisis, when a more balanced approach is required that includes incentives for energy conservation and development of cleaner-burning energy sources.

The Natural Resources Defense Council released a national energy proposal this week that calls for increased reliance on natural gas and development of alternative energy sources, while reducing dependence on oil and coal.

Democrats say they have no immediate plans for countering Murkowski's bill and instead will offer a series of short-term solutions for coping with the nation's energy needs. Those include expanding the availability of federal heating and air conditioning assistance to low-income families and some businesses.

"Frankly, [the Murkowski bill] tries to deal with so many different aspects of the energy situation that it's hard to get your arms around it," said Sen. Jeff Bingaman (N.M.), the ranking Democrat on the Energy and Natural Resources Committee. "We would need some real serious studies to see which of the proposals contained in this bill really merit serious consideration."

Environmental leaders said that proposals for drilling in the Alaska wildlife refuge would do nothing to address the short-term problems of rising gasoline and home heating prices and would have only a minor impact on reducing U.S. dependence on foreign oil. The U.S. Geological Survey concluded that the area likely holds about 3.2 billion barrels of economically recoverable oil, or less than what the nation uses in six months.

In addition to the soaring wholesale fuel prices in California, natural gas wellhead prices around the country have been three to four times above year-ago levels for most of the winter and may remain high entering next winter.

Gasoline supplies going into the summer travel season will be below normal, the Energy Information Administration projects, threatening a repeat of last year's gyrating pump prices.

Many Democrats in Congress and some Republican governors in the Northwest are calling for price caps to limit electricity prices and restrict record profits flowing to energy companies.

Rep. Joe Barton (R-Tex.), who chairs the House Energy and Commerce energy and air quality subcommittee, told reporters yesterday he will oppose any move to control energy prices. "I won't vote for it," he said.

© 2001 The Washington Post