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By Ari Natter
July 2 — After months of listening sessions, hearings and negotiations, now comes the hard part for Senate Energy and Natural Resources Committee Chairman Lisa Murkowski (R-Alaska): whittling down more than 100 energy bills and weaving the rest into a comprehensive package.
Members of the committee introduced 114 bills ranging from measures that would allow big trucking rigs to qualify for the Energy Department's automotive loans program to legislation that would give states instead of the federal government the lead role for regulating hydraulic fracturing, in hopes that their measures would make it into the committee's final bill.
“See this book right here?” Murkowski said, holding up a binder several inches thick, after the committee held the last of four hearings on the bill in June. “I’ve got three more that are probably equal in size, and I’m going to have to figure out how to put them all in one binder here. We’ve got a lot of work to do now.”
The bill, which Murkowski is aiming to move through the committee prior to the August recess, would be the first comprehensive update of national energy policy since 2007 and could be a vehicle for lifting the 40-year-old ban on crude oil exports, easing existing restrictions on offshore drilling, advancing renewable energy projects and authorizing funding to modernize the U.S. electricity grid.
The challenge for Murkowski, who is working closely with ranking member Sen. Maria Cantwell (D-Wash.), will be hashing out a bill that can muster enough support to pass Congress and avoid being vetoed by President Barack Obama.
“We’ve got a long ways to go until we get to the thing that we can move through the Senate,” Cantwell said in a recent interview. “I think the key thing is, we both want to see something happen, not just a committee process. We both want to see a floor process.”
Cantwell, in coordination with the Senate Democratic Caucus, plans to release a minority version of energy legislation after the Fourth of July congressional recess “to emphasize our priorities as we go into the discussions,” she said.
“Obviously, we are very big supporters of clean energy and reauthorization of the tax credits and a plethora of energy efficiency efforts we think really grow jobs,” Cantwell said. “We’ve got a long way to go, but a process is happening.”
In a June 29 letter to governors, Cantwell, along with the rest of the caucus, laid out the Democrats' energy policy goals, offering a preview of what they are likely to push for in the bill.
Among the priorities spelled out in the letter were clean-energy investment, increased physical and cyber security, updating “energy infrastructure,” reducing pollution and waste and investing in research and development.
“We believe it is time for the U.S. Senate to consider the first update to our nation's energy policies in almost a decade,” the senators wrote.
Committee staff have been intensifying efforts to see where they can find common ground between the majority and minority, said Colin Hayes, the committee's majority deputy staff director.
“The hope is we will be in a position to circulate legislation that has both the support of the chair and ranking member and represents, at least as a starting point, what is possible within the Energy and Natural Resources Committee,” Hayes said during a conference call held by the American Council on Renewable Energy earlier in June. “We are spending this month determining what we can agree to and perhaps setting aside the things we cannot.”
Among the specific issues Hayes highlighted was legislation (S. 1228) from Sen. John Hoeven (R-N.D.) that would expedite the federal permitting process on future cross-border energy projects such as oil and gas pipelines and electricity transmission lines.
“What is a reasonable amount of time for people looking to invest in the United States to wait around on the answers regarding their permit applications, for example?” Hayes said. “This is encountered not only for pipelines in Canada that carry oil, but for transmission lines that would deliver renewable power.”
Among the more “controversial or hot topics in the debate” is the issue of expediting natural gas exports and lifting the ban on exporting crude oil put in place during the 1970s Arab oil embargo, said Chris Rauscher, an energy policy adviser for committee member Sen. Angus S. King (I-Maine).
Both ideas are supported by trade groups representing major energy companies such as Exxon Mobil, Chevron and Shell but opposed by some Senate Democrats and environmental organizations such as Friends of the Earth and the Sierra Club.
The addition of a tax title to the bill, which would be written by the Senate Finance Committee and likely added to the bill on the Senate floor, is the “giant elephant in the room,” Rauscher said, also speaking during the ACORE event.
Cantwell, who also serves on the Senate Finance Committee, has said she is “very interested” in having a tax component in the energy bill, and Murkowski has expressed an openness to doing so as well.
Such a move could be used to reinstate and extend a slew of energy tax credits that were allowed to expire at the end of 2014, such as the 2.3-cent-per-kilowatt-hour renewable production tax credit and an extension of the solar investment tax credit that would step down from 30 percent to 10 percent at the end of 2016.
Analysts such as ClearView Energy Partners have said the inclusion of a tax title in the bill is likely the best vehicle for legislation
Legislation (S. 1656) from Sen. Chris Coons (D-Del.) would give the renewable energy industry the right to form master limited partnerships, a tax break that has been limited to the fossil fuel industry. The bill, which is co-sponsored by Murkowski, is supported by companies such as NRG Energy and wind turbine manufacturer Vestas.
Sen. Orrin Hatch (R-Utah), the chairman of the Senate Finance Committee, has said in public that he has yet to formulate an opinion on the idea adding a tax title to the energy bill. Other analysts, such as Mark W. Menezes, a former congressional staff member and partner at law firm Hunton & Williams LLP, said the matter is up in the air.
“It still remains to be seen whether or not the House Ways and Means Committee or the Senate Finance Committee will seek to move any tax provisions on this bill,” he said.
Murkowski's effort to draft a broad energy bill is in tandem with counterparts on the House side, where Energy and Commerce Committee Chairman Fred Upton (R-Mich.) and Energy and Power Subcommittee Chairman Ed Whitfield (R-Ky.) are drafting a broad energy bill of their own.
That bill is expected to be released and marked up in July, and House Majority Leader Kevin McCarthy (R-Calif.) has cleared floor time for the legislation.
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