The Week Ahead (June 11-15)

June 11, 2007
02:43 PM
The energy bill moves to the Senate floor this week. ENR Chairman Bingaman and Ranking Member Domenici will floor-manage the legislation.  So, we have no hearings scheduled this week. Here is a summary of the new bill:
Title I: Biofuels for Energy Security and Transportation
Directs the President to increase the amount of motor vehicle fuel, home heating fuel, and boiler fuel made from renewable biomass from 8.5 billion gallons per year in 2008 to 36 billion gallons per year by 2022. 
This Renewable Fuel Standard includes a requirement for “advanced biofuels,” which does not include ethanol derived from corn starch, to meet 60% of the total renewable fuel requirement by 2022.  The bill includes incentives for advanced biofuels, including cellulosic ethanol, such as grants for infrastructure development, and financial support for research and development.
Title II: Energy Efficiency Promotion
Requires all general purpose replacement lighting in Federal buildings to be Energy Star products.  Sets efficiency standards for new incandescent and fluorescent light, for heating and cooling and water-using products, residential boilers and home appliances.  Requires the Secretary of Energy to revisit efficiency standards every five years and issue a final rule/determination on whether the standards should be amended.  Requires certain consumer electronic equipment efficiency labeling – for televisions, computers, etc.
Sets national goals for reducing gasoline usage and requires DOE to develop a strategic plan to meet those goals.  Includes research and development programs and loan guarantees for industrial efficiency, manufacturing of high efficiency vehicles and advanced batteries and energy storage.   DOE is required to conduct a national media campaign to increase energy efficiency and reduce oil consumption.
Requires each Federal agency to achieve at least a 20 percent reduction in consumption of petroleum by 2015, and increase alternative fuel consumption by 10 percent annually, and all Federal buildings to reduce energy consumption by 30% by 2015.  Mandates that the Federal government obtain not less than 15% of its electricity from renewable resources.  Extends energy savings performance contracts.  
Expands and extends the weatherization assistance program for low-income people.  Requires utilities to integrate efficiency into their resource plans.
Title III: Carbon Capture & Storage Research, Development, and Demonstration
Amends the Energy Policy Act of 2005 to direct the Secretary of Energy to: 1) carry out fundamental science and engineering research to develop and document new approaches to capture and store carbon dioxide; 2) ensure that fundamental research is appropriately applied to energy technology development activities and the field testing of carbon sequestration activities; 3) promote regional carbon sequestration partnerships to conduct geologic sequestration tests involving carbon dioxide in a variety of geological settings; 4) conduct at least seven initial large-volume sequestration tests for geological containment of carbon dioxide; 5) conduct a national assessment of geologic storage capacity; and 6) implement a new large-scale commercial carbon capture demonstration program.
Title IV: Public Buildings Cost Reduction
The bill directs the General Services Administration (GSA) and Environmental Protection Agency (EPA) to develop and aggressively implement programs to reduce by 20 percent the operating expense of Federally-owned or leased buildings in five years through use of more energy-efficient lighting, heating and cooling technologies and practices. It also authorizes EPA to conduct a $20 million matching grant program to assist local governments in making 40 percent reductions in energy use. 
Creates an office in the GSA to improve the energy efficiency, air quality and other environmental and health impacts of Federal buildings. Since the Federal government owns and leases thousands of buildings across the country, this provides an opportunity to significantly reduce energy use, air and global warming emissions, and health and environmental hazards.  Also, this section authorizes grants and develops voluntary guidelines for states to incorporate green design into schools. Three demonstration projects are authorized, to show off the cost-effectiveness and feasibility of green buildings.
Authorizes the construction of an array of solar panels on the exterior of the U.S. Department of Energy headquarters building.  This provision would direct GSA to build the project, known as the “solar wall,” and provide $30 million for its construction.
Title V: Corporate Average Fuel Economy Standards
Requires the National Highway Traffic Safety Administration (NHTSA) to achieve a nationwide fleet fuel economy average of 35 mpg by 2020 for passenger cars and light trucks up to 10,000 lbs.
After 2020 mandates NHTSA increase the average nationwide fleet fuel economy for passenger cars and light trucks by 4 percent per annum over the previous year.
Requires NHTSA to establish fuel economy standards for medium duty and heavy duty trucks.  After establishing the initial standards, NHTSA will increase medium and heavy duty fuel economy standards by 4 percent per annum over the previous year.
Allows NHTSA to prescribe fuel economy standards for passenger cars and light, medium and heavy duty trucks using a vehicle attribute system and to express the standards in the form of a mathematical function.
Provides the Secretary the discretion to lower the rate of improvement of the fuel economy standard for passenger cars and light, medium and heavy duty trucks, if her analysis leads her to find that the cost effectiveness and maximum feasible level of improvement is less than 4 percent for that model year.
Requires NHTSA to initiate a rulemaking in 2010 to issue standards to mitigate the difference in weight and size between the largest and smallest vehicles, and to improve bumper height compatibility between vehicles.  Final rule must be issued in 2012.
Mandates that the Secretary commission a National Academy of Sciences (NAS) study to update the NAS fuel economy technology study from 2002 and to evaluate how the technologies could be integrated to meet the reformed fuel economy attribute system.  The study will be commissioned as soon as practicable after the date of enactment and the NAS must report its findings with 18 months of the study being commissioned.  The study is to be updated every five years.
The Secretary of Transportation may establish, by regulation, a fuel economy credit trading program to allow manufacturers whose automobiles exceed the average fuel economy standards to earn credits to be sold to manufacturers whose automobiles fail to achieve the prescribed standards.  Automakers may carry forward earned fuel economy credits for 5 years as opposed to the 3 years as currently permitted.
Title VI: Price Gouging
Give the President the authority to declare a temporary national energy emergency, in instances where the President determines that a threatened or existing disruption of oil or petroleum supplies constitutes a danger to the health, safety, or welfare of the United States.  This is similar to the emergency authority triggered by a number of Governors in response to Hurricane Katrina.
Upon declaration of emergency, trigger a prohibition on price gouging, punishable by federal penalties, when an energy emergency has been declared.  This provision is modeled after anti-price gouging legislation on the books in about 28 states. It specifically relies on a standard established in New York state law, related to “unconscionably excessive” prices. It also gives state AGs authority to levy penalties at the retail level.
The legislation would apply to the oil industry a new statutory ban on manipulative practices in the wholesale petroleum markets;  new measures to ensure transparency for petroleum prices; and new civil and criminal penalties for companies that break the rules.
Title VII: Energy Diplomacy and Security

Expresses the sense of Congress respecting energy diplomacy and security.
States that the Secretary of State should seek immediately to establish: 1) strategic energy partnerships with the governments of major energy producers and major energy consumers, and with governments of other countries; 2) petroleum crisis response mechanisms with the governments of China and India; 3) a Western Hemisphere energy crisis response mechanism; and 4) a regional-based ministerial Hemisphere Energy Cooperation Forum.
States that the President should place on the agenda for discussion at the Governing Board of the International Energy Agency the merits of establishing an international energy program application procedure.
Urges the Hemisphere Energy Cooperation Forum (established in response to this Act) to implement: 1) an Energy Crisis Initiative; 2) an Energy Sustainability Initiative; and 3) an Energy for Development Initiative.
Directs the Secretary to approach other governments in the Western Hemisphere to seek cooperation in establishing a Hemisphere Energy Industry Group of industry and government representatives, coordinated by the U.S. Government.

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