WASHINGTON Mar 12, 2007 (Dow Jones Newswires)
Senator Jeff Bingaman, the U.S. Senate's top lawmaker on energy policy, is aiming to unveil a bill later this month that would address what he describes as "the royalty mess down in the Gulf of Mexico" followed by one in April that would address global warming.
"I hope in the next week or two we'll have some legislation to propose" regarding the royalty issue, the New Mexico Democrat told reporters Monday at a morning press briefing in Washington sponsored by Platts.
The Senate Energy and Natural Resources Committee, which Bingaman leads, has been holding hearings since January in effort to create new energy and tax policies that would boost renewable energy, biofuels, efficiency and limit emissions of greenhouse gases.
But another key goal of the panel is to address problems at the U.S. Department of Interior that have made way for oil and natural gas companies to drill in federal waters without paying royalties to the federal treasury.
The House earlier this year passed an aggressive bill that aims to strip Big Oil of major subsidies and force the industry to fix old 1998 and 1999 leases that allowed them to drill for oil and gas without paying royalties.
The Senate has yet to act.
But Bingaman on Monday told reporters he has been evaluating the House's plan, and is aiming to offer his own bill on royalties later this month.
"The problem with the House bill is the question about the legality of it," said Bingaman.
The House-passed bill, championed by House Speaker Nancy Pelosi, D-Calif., would bar companies from signing future leases with the federal government if they didn't first fix oil leases that don't require them to pay royalties during times of high energy prices.
That provision would likely be subject to challenges in court which would be difficult to overcome, Bingaman said.
"I don't doubt there will be a challenge no matter what you do," said Bingaman.
Still, he said he wants his royalty legislation to be less subject to lawsuits.
Bingaman also said he would be open to supporting the House provision to roll back certain oil industry tax breaks that were included in the Energy Policy Act of 2005. The question is whether the rollbacks reduce the development of domestic fossil fuels. If the answer is no, "I'm not opposed to rolling back" those incentives, the senator said.
Climate Proposal In April
Bingaman also plans to soon introduce a bill that would limit greenhouse gas emissions through a mandatory cap-and-trade program.
The senator earlier this year circulated a draft proposal he authored with Republican Sen. Arlen Specter of Pennsylvania.
But critics argued that the relatively modest proposal, although having only a minimal impact on the economy, would not do enough to slow down emissions and address global warming. Several other key senators have introduced anti-climate-change bills that have tougher emissions-reductions requirements.
However, opponents of the stricter plans argue that the coal industry, which emits substantial amounts of carbon into the air from power plants, would be adversely impacted. They also say the economy, as a whole, would suffer while developing countries like China and India continue to release significant greenhouse gases into the atmosphere.
Bingaman said he hopes to put forward "a new and improved version" of that anti-global warming bill in April.
The senator suggested that the bill could include stronger targets for emissions reductions, among other things.
The goal, he said, "is to do as much as we can without doing overall damage to the economy."
Bingaman applauded actions by states in the West and Northeast to advance regional programs to reduce emissions of greenhouse gases.
But he also made clear that he thinks a federal cap-and-trade system should preempt state limits on greenhouse gas emissions. He noted that various companies are urging Congress to pass a uniform program mandating limits on carbon emissions because they fear a patchwork of state regulatory anti-global warming schemes.
Allowing the states to set different standards than the federal standard wouldn't "make much sense," he said.
"I commend all of the states trying to form regional partnerships," Bingaman said.
But when the federal government is able to adopt a federal climate change standard, it would be beneficial to "have that be the system for the country," he added.
The 'Neutral Observers'
Speaking on the outlook for global warming legislation this year, Bingaman was rather guarded, saying the House and Senate could possibly pass new climate policies either as stand-alone bills or as amendments to larger pieces of legislation.
The difficulty, however, will be getting cooperation from the White House, Bingaman said.
If the Bush administration continues "to oppose any and all limits on greenhouse gas emissions," it will be very difficult to get anything enacted, he said. "If the administration agrees to work with Congress ... then we have a decent chance of doing it."
Still, Bingaman said the administration seems "more willing to listen to the arguments" on climate policy today than in years prior.
"They are trying to determine what position they are going to take," he said, describing administration officials as "neutral observers."
Although the Bush administration has been pushing plans to advance the long-delayed plan to store highly-radioactive waste at Nevada's Yucca Mountain, Bingaman said he doesn't see nuclear waste policies moving forward in this Congress.
Senate Majority Leader Harry Reid, D-Nev., a strong opponent of the plan to store waste just 100 miles outside of Las Vegas, has made his opposition clear, Bingaman noted.
The Bush administration last week sent a bill to Congress that aims to help the government move forward on plans to submit an application for the Yucca project to the Nuclear Regulatory Commission before July 2008 in effort to open the repository in 10 years.
But Bingaman said he still has concerns about the legislation, which largely mirrors a bill the administration proposed last year.
"The Yucca Mountain issue remains unresolved," he said. "I'm not expecting that we will solve the Yucca Mountain issue here in the near-future. Congress is kind of in a holding pattern."
Copyright (c) 2007 Dow Jones & Company, Inc.
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