Industry praises, environmentalists criticize House-passed energy bill

By the OGJ Online

HOUSTON, Aug. 2, 2001 – Industry groups said sweeping energy legislation passed by the US House of Representatives early Thursday will help avert the next national energy crisis, but environmental groups called the measure a “license to drill, burn, and pollute.”

Lawmakers took a major step last night toward promoting a stronger economy and a cleaner environment through increased use of natural gas by voting to pass the bill, the American Gas Association said. Now, attention turns to the Senate, which is considering its own version of an energy plan.

Rick Shelby, AGA executive vice-president, said HR 4 contains a number of provisions beneficial to natural gas customers by promoting expansion of the natural gas infrastructure.

He said it will help gas utilities meet rapidly increasing demand for more natural gas by providing 10-year depreciation for new natural gas distribution infrastructure. This will help utilities get the capital they need to build an additional 255,000 miles of local pipes during the next 20 years, Shelby said.

The measure also calls for study of existing rights-of-way on federal lands to determine if additional infrastructure can be supported within them. Tax incentives will stimulate additional supply, ensuring production from existing marginal wells.

It also will boost research and development to improve technologies such as small scale on site power plants, including microturbines and fuel cells, and other efficient heat and power systems, he said.

“We’re glad Congress recognized that this vote could not be put off because of a temporary lull in market conditions or because regional electricity blackouts have not occurred as had been expected,” Shelby said. “It is vital that the nation have a roadmap for meeting its long-term energy needs.”

National Mining Association CEO Jack N. Gerard said HR 4 will help avert the next national energy crisis by ensuring electricity is affordable, reliable, and increasingly clean, and electricity “makes maximum use of our nation’s most abundant domestic energy resource, coal.”

The American Public Power Association (APPA) said the legislation includes a number of provisions of interest to not-for-profit public power systems, including measures to modernize how cities and towns issue tax exempt bonds for electricity infrastructure.

“It includes a lot of provisions we have worked on for a long time,” said spokeswoman Madalyn Cafruny. APPA supported language in the bill that streamlines licensing and relicensing of hydroelectric facilities, clean coal technology, and reform of renewable energy incentives that will allow public power systems to receive incentives equal to those available to investor-owned utilities.

Unbalanced response
Environmental groups such as the Natural Resources Defense Council (NRDC) called the House energy bill a “grossly” unbalanced response to America’s energy problems that will “threaten the environment and public health, rip off taxpayers by subsidizing the worst polluting energy industries, despoil public lands, and exacerbate global warming.

“This bill is a license to drill, burn and pollute,” said Alyssondra Campaigne, NRDC’s legislative director. “Overall it represents a craven capitulation to the auto, oil, coal, and nuclear industries at the expense of the environment and public health. Politics trumped science in the House today.”

She particularly criticized $33.5 billion in subsidies with 75% going to the coal, oil, gas and nuclear energy industris. Despite references to “energy efficiency” and “conservation,” only a quarter of the bill’s tax credits would go to promote greater efficiency or renewable energy sources, she said.

David M. Nemtzow, president of the Alliance to Save Energy, said the bill puts OPEC back in the driver’s seat. “This imbalanced energy policy bill does virtually nothing to make our gas-guzzling nation more energy efficient – thereby guaranteeing us a future of even more imported oil, pollution, and high fuel bills. It’s now up to the Senate to address what the House has so forcefully neglected,” he said.

He criticized House members for squandering a vote on the most important energy efficiency measure to come before Congress since the 1980s, “an increase in the nation’s fuel efficiency standards that would have reduced US oil consumption by up to 1 million b/d in 2010.”

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