American motorists should not expect lower gasoline prices to follow quickly on the heels of this week's expected passage of legislation to overhaul U.S. energy policy, Energy Secretary Sam Bodman said on Wednesday.
WASHINGTON — American motorists should not expect lower gasoline prices to follow quickly on the heels of this week's expected passage of legislation to overhaul U.S. energy policy, Energy Secretary Sam Bodman said on Wednesday.
The energy bill, submitted to the House of Representatives for a vote on Thursday, includes $14.5 billion in tax breaks and incentives over a decade, according to the House Ways and Means Committee. Of that, nearly $9 billion is earmarked for oil and gas production, electricity reliability and coal technology projects.
"There are no magic bullets in this law that will change energy prices in the next day, week or month," Bodman told reporters on Capitol Hill, where the energy bill was formally introduced.
"It's going to take a number of months, if not years, to deal with energy prices," Bodman said. He said the legislation will encourage long-term investment by the private sector in new nuclear power plants, coal-fired electric generating facilities and drilling for more oil and natural gas supplies.
The national average gasoline price hit a record high of $2.33 a gallon two weeks ago, according to the Energy Department's survey of retail stations.
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The Senate is expected to approve the bill on Friday, so President George W. Bush can sign it into law next week.
Bush also came to the Capitol on Wednesday and spoke about energy policy during a private meeting with Republican lawmakers. People at the meeting said the president listed terrorism as the biggest threat to U.S. national security, with energy independence next.
NO CURBS ON OIL DEMAND
Environmental and consumer groups criticized the energy legislation for doing little to cut U.S. oil consumption, which averages close to 21 million barrels a day, or to reduce America's dependence on foreign oil suppliers.
"This bill funnels billions of taxpayer dollars to polluting energy industries, and opens up our coastlines and wildlands to destructive oil and gas activities," said Carl Pope, director of the Sierra Club.
"It's unfortunate that, as Americans head to the beach for summer vacation, their representatives in Congress are considering opening up these very coasts to destructive oil and gas drilling," Pope added, referring to a provision requiring an inventory of offshore oil and gas reserves.
Other green groups criticized the bill's incentives to cut down trees to use in ethanol and biomass production, and to allow federal land exchanges for oil shale development.
Democrats were expected to approve it, despite complaints that the final version dropped some environmentally friendly measures. Eliminated were proposals that U.S. utilities use more wind and solar power, a ban on the fuel additive and suspected carcinogen MTBE, and a requirement that the White House find savings of 1 million barrels of oil by 2015.
WHITE HOUSE WILL SIGN BILL
Texas Republican Joe Barton, chairman of the House Energy and Commerce Committee, said there was no way the energy legislation could have boosted domestic oil production enough to end crude imports. "We're going to have imported oil as part of our economy for a long, long time," he said.
Bodman said the administration was happy with the overall bill, although it opposed tax breaks for oil and gas companies. "The oil and gas companies don't need incentives with oil and gas prices where they are today," Bodman said.
To avoid a Senate filibuster and win approval of the energy bill, House lawmakers dropped their push to open Alaska's Arctic National Wildlife Refuge to oil drilling. However, that issue will be included this September in budget legislation to fund the federal government, which can't be filibustered.
Although the bill's incentives will cost $14.5 billion, negotiators inserted about $3 billion in budget "offsets" that should trim the final cost to about $11.5 billion. Most of the offsets are expected to come from reinstating a federal fund to clean up oil spills, which collects a per-barrel fee on oil imports and domestic production.
Source: Reuters
