US Energy Bill Dead For Year, Frist Says

Legislation to overhaul U.S. energy laws is dead for the year, Senate Majority Leader Bill Frist said Monday, after a coalition of environmentalists and fiscal conservatives blocked the bill in the Senate. The development is a setback for President George W. Bush, who championed the bill as a top domestic priority.

"Although Senator Frist remains committed to the energy bill, in the short time we have left, we are unable to bring it up," Frist spokeswoman Amy Call said Monday evening. "We just couldn't get all sides to agree." The Senate is planning to adjourn for the year as early as Tuesday.

The bill, which tracked many priorities in Vice President Dick Cheney's energy task force, would have been the biggest overhaul of U.S. energy policy in a decade. The bill's main sponsor is Senate Energy Committee Chairman Pete Domenici, R- N.M., who vowed late Monday to bring the bill back for consideration in 2004 when Congress reconvenes. Analysts believe it may be even more difficult to move the bill then since Washington will be polarized even further by the presidential campaign.

The bill's demise is a setback for companies such as Archer Daniels Midland , a major ethanol producer which would have benefited from the bill's mandate to increase production of the corn-based fuel additive. A variety of renewable energy concerns, natural gas suppliers and utilities also stand to lose, since lucrative tax breaks and spending programs for their industries will not become law this year.

The bill would have more than doubled the use of the fuel additive ethanol in gasoline; enforce new standards of reliability on electricity grids; and offer incentives to build a natural gas pipeline from Alaska to Chicago. The bill also would restrict certain lawsuits against companies that the gasoline additive MTBE, or methyl tertiary-butyl ether, that has polluted ground water in 43 states.

The MTBE lawsuit restrictions, backed by House Majority Leader Tom DeLay, R- Texas, proved to be a rallying point for Senate opponents of the bill, such as Sens. Charles Schumer, D-N.Y., and Barbara Boxer, D-Calif.

Opposition gained momentum last week even after it passed the House by a comfortable margin of 246-180. Schumer linked up with fiscal conservatives such as Sens. John McCain, R-Ariz. and Judd Gregg, R-N.H., to condemn the bill's $ 25.7 billion in tax breaks or the $5.4 billion in spending provisions.

"You can't call yourself a fiscal conservative and vote for this profligate bill," McCain said last week.

In a dramatic vote Friday, Senate opponents prevailed. Supporters fell short by the two votes needed to break the opposition's stalling tactics.

"I warned our Republican friends that they were going to load up this bill to a point where it couldn't pass," said Senate Minority Leader Tom Daschle, D- S.D., who supports the bill. "That's exactly what happened. They ignored my warnings."

Quickly, after Friday's defeat, Domenici said he planned to modify the bill, by attaching amendments to other late-moving legislation, to win the last several votes. Sen. Larry Craig, R-Idaho, said Friday the MTBE provision might be changed to win support, but House leaders have rejected that idea.

"It appears that the House leadership is adamantly opposed to doing that (making changes), and because they are, no progress has been made," Daschle told reporters. The House passed a version of the energy legislation in April that closely reflected Cheney's controversial energy task force, which environmental groups said excluded them and relied heavily on suggestions from oil, gas and nuclear industry representatives. The Senate passed its version in July which reflected the Democrats' bill from last year. Domenici and House Energy and Commerce Chairman W.J. "Billy" Tauzin, R-La., formally began negotiating a compromise measure on Sept. 5. Democrats complained they were mostly excluded from the process. The bill met a barrage of criticism when it was released earlier this month for repealing aspects of the Clean Water, Clean Air and Safe Drinking Water laws.

Schumer called the bill "absurd" and said it was the "worst piece of legislation in a very long time."

Domenici said the bill represented a very careful compromise of divergent interests. He claimed it had support from more than 95 national groups and some 1,500 state, local and regional groups. "It comes from manufacturing groups, from the farming community, the electricity industry and more than a dozen labor unions," Domenici said last week.

"These groups recognize what this bill does for clean and renewable energy. They recognize the new steps we take to help Americans conserve more energy. They recognize that we are creating nearly 1 million jobs across all sectors of the economy." Domenici spokeswoman Marnie Funk said Monday night the Senate will try again next year to pass the bill. "We're not saying this bill is dead," Funk said. " We're brining it up again in January."