From: Reuters
Published April 21, 2005 12:00 AM

Energy Bill Won't Ease Fuel Prices Quickly, Bush Says

WASHINGTON — House Democrats on Wednesday criticized an $8 billion energy bill they said favored big oil companies and President Bush acknowledged the legislation would do nothing to immediately ease record gasoline prices.


The White House faces public opinion polls showing voters are increasingly worried about high fuel prices. Last week, the average retail gasoline price hit a record $2.28 per gallon.


"An energy bill wouldn't change the price at the pump today. I know that and you know that," Bush said in a speech to the U.S. Hispanic Chamber of Commerce.


Costly imports of oil are affecting consumer spending, the U.S. trade balance and manufacturers' prices.


Bush asked Congress to send him by August a comprehensive energy plan that he said would expand U.S. supplies of oil, natural gas, coal, nuclear and other energy sources.


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"What I'm talking about is making sure that we leave our children and grandchildren a cleaner, healthier and more secure America ... that is less dependent on sources of energy from overseas," Bush said.


The House began debating an energy bill, which is expected to win approval Thursday.


Democrats and environmental groups criticized the bill for offering lavish tax breaks to energy companies while failing to curb U.S. demand for imported oil by imposing stricter fuel mileage standards on new vehicles.


Democratic lawmakers complained that they were denied the opportunity to try to modify the bill to remove a provision that protects big oil companies from certain lawsuits. "We have been shut out," said Rep. James McGovern of Massachusetts.


Protection for Oil Companies


While the House bill offers no short-term price relief for motorists, it would immediately protect oil companies from lawsuits over the water-polluting gasoline additive MTBE.


The protection is worth billions of dollars to MTBE makers such as Exxon Mobil Corp. and ConocoPhillips, which produced it to help gasoline meet clean air rules.


The liability waiver, backed by House Majority Leader Tom DeLay, helped doom energy legislation last year because the Senate refused to accept the provision. The chairman of the Senate Energy Committee said the House must find an MTBE compromise before the Senate will approve a final energy bill.


The House Rules Committee, which set the terms for debate on the energy bill, blocked an effort by Democrats to try to strip the MTBE protection language from the bill.


"We're working with our friends in the Senate and folks in the House to come up with that (MTBE) compromise," said Joe Barton of Texas. "We have an agreement to have an agreement."


Bush said the administration was willing to step in, if necessary, and help the House and Senate come up with a "reasonable compromise" on the MTBE dispute.


The House bill contains $8 billion in energy tax breaks and incentives to encourage energy-saving technology and more crude oil, natural gas, coal and nuclear production.


Bush said with the price of oil above $50 a barrel, energy companies don't need tax incentives to hunt for oil and gas. However, the president is seen as unlikely to veto a bill that includes lavish subsidies for the industry.


Barton said that price tag on the bill was "peanuts" compared to $166 billion spent for U.S. oil imports in 2004.


The House bill would also allow oil drilling in Alaska's Arctic National Wildlife Refuge (ANWR). House Democrats will to try to remove ANWR drilling from the chamber's energy bill during the House floor debate.


In the Senate, a coalition of Republicans and Democrats opposes giving oil companies access to the Arctic refuge and has enough votes to filibuster an energy bill over the issue.


Democrats will also attempt to add language to the bill to boost the fuel efficiency of cars and trucks to slow oil imports. The U.S. market consumes almost 21 million barrels of oil and petroleum products each day. Imports account for about three out of every five of those barrels.


An energy bill passed by the House would eventually have to be reconciled with the Senate's version before it could become law. The Senate Energy Committee is expected to write its energy bill in May, followed by a vote in the full Senate.


Source: Reuters


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