Energy bill: Drowning in Washington
Senators to convene at Capitol Hill energy summit on Friday but experts are skeptical as to whether Congress can agree on an energy bill by Sept. 26 deadline.
NEW YORK (CNNMoney.com) -- An energy summit is taking place Friday on Capitol Hill and all 100 senators - including the presidential candidates - are invited to attend. But with all the partisan sniping on The Hill, it's hard to tell if a comprehensive energy bill will be signed into law anytime soon.
There have been numerous attempts to get a bill passed to change America's energy policy in the face of high gas prices and an over-reliance on overseas energy sources - and all have succumbed to partisan politics.
Democrats and Republicans are still working on multiple bills, but none of them are close to being signed into law. Now, with an adjournment goal of Sept. 26, the Senate is facing crunch time.
The purpose of Friday's summit, according to the Senate Committee on Energy & Natural Resources, is to be a forum for discussion to "facilitate the development of comprehensive legislation to address America's many energy challenges." But it's not a workshop for cranking out an energy bill.
"The summit is designed really just to bring in the experts and let other senators come and listen to them say their piece," said Matt Letourneau, spokesman for Sen. Pete Domenici, (R-NM), a ranking member of the committee and summit leader, along with Sen. Jeff Bingaman (D-NM).
Meanwhile, the deadline looms.
Offshore drilling is one of the most contentious issues in the House of Representatives, where the Democrats hold a substantial majority, and the Senate, which they control by a razor-thin margin.
"While the Republican energy policy is focused more on increased supply ('drill baby drill') and nuclear power generation, the Democrats are more focused on energy conservation, improving the environment and taxing big oils ('tax baby tax')," wrote Fadel Gheit, energy analyst for Oppenheimer, in a Sept. 8 note to investors.
"Increased domestic drilling, in our opinion, is not the answer to the U.S. addiction to imported oil," he wrote. "Neither is taxing big oils."
House Speaker Nancy Pelosi (D-Calif.) said on Tuesday that Democrats were willing to compromise, by supporting a bill this week to allow some offshore drilling.
In a press conference that was slim on details, Pelosi said the bill "will protect consumers and taxpayers with strong action to lower the price at the pump and end taxpayer giveaways to Big Oil."
Meanwhile, the Democratic Senators are pushing for a bill to crack down on oil speculation, which they blame for soaring oil prices. Senators released a report on Wednesday which they say demonstrates the role speculators play in driving up energy prices.
But crude oil prices have actually dropped by more than $40 a barrel since their all-time high of $147.27 on July 11. This prompted a report from Kevin Book, energy analyst for Friedman, Billings, Ramsey & Co., who wrote: "[P]rices are correcting thanks to a well-functioning market assisted by speculators -- the answer is that the debate is not about energy policy at all, but bare-knuckle politics, pure and simple."
Lawmakers on both sides of the aisle have been discussing energy policy for months without much agreement. The different parties in the Senate and the House have not been able to push forward their partisan bills, and are now scrambling to pass legislation by the September 26 deadline. This prompted Senate Minority Leader Mitch McConnell, (R-Ken.) to call upon his fellow senators to "do right by the American people."
"So far, Congress has been unable to come together on a comprehensive solution to our nation's energy crisis," said McConnell, speaking on the Senate floor on Monday. "But the book hasn't closed yet on the 110th Congress. There is still time to act on this issue. And we should."
Which brings us to the so-called Gang of 16, a bipartisan group of senators led by Sen. Kent Conrad (D-N.D.) and Sen. Saxby Chambliss (R-Ga.) In what they call a "true compromise," the senators have proposed a $20 billion bill to transition the economy - and surface transportation in particular - so that it's powered on non-petroleum based fuels. The goal is to convert 85% of new motor vehicles over to non-petroleum fuels within 20 years, by funding R&D and the re-tooling of automobile plants.
The bill includes "interim" measures to conserve energy and increase domestic oil production. This would include tax credits for consumers who buy energy-efficient vehicles. It would also expand drilling by allowing more leasing in the Gulf of Mexico and off the coasts of Virginia, Georgia and the Carolinas. Export of domestic oil would be prohibited. The bill would also provide support to nuclear power and the development of coal-to-liquid fuel plants.
As part of its bipartisan approach, the Gang - equally divided with eight members of either party - proposed the energy summit being held on Friday. But even with this last-ditch effort to meet across the aisle, Congress is going to have a tough time squeezing out new energy legislation before America votes in its next president.
Also in blowing in the wind is a possible $50 billion loan package to embattled U.S. automakers that Detroit's Big Three - saddled with plunging auto sales and high gas prices - claim is key to their future success.
"I think chances are slim, and enactment would almost certainly require one chamber to adopt the bill of the other without changes," said Christine Tezak, senior vice president of energy policy research at the Stanford Group. "With four proposals in play and short time lines, that's no easy feat."
But not everyone feels that way. Paul Bledsoe, spokesman for the National Commission on Energy Policy, said there is enormous pressure from the American people for Congress to pass an energy bill.
"I know there's a lot of cynicism in trying to pass a bill within the timeline, but I think it can be done," said Bledsoe. "Congress wants to get something done on this before they go home. It's the number one voting issue in this country. It's subject to a great deal of public attention."