McConnell and Grassley offer "Compromise" to Extend Tax Breaks
On July 1, Senate Minority Leader Mitch McConnell (R-KY) and Finance Committee Ranking Republican Chuck Grassley (R-IA) sent a strong letter to Majority Leader Harry Reid (D-NV) and Finance Committee Chairman Max Baucus (D-MT) calling on the Senate to work to find a bipartisan solution to extend expiring (or expired) tax provisions, including clean energy tax incentives, an extension of the alternative minimum tax (AMT) "patch," and the research and development (R&D) tax credit, before the month-long August recess.
The sticking point on the measure is whether the bill needs corresponding revenue offsets, given the Democrat commitment to pass only "revenue neutral" tax provisions that do not add to the budget deficit and Republicans insistence that the omnibus tax extension bill does not need to be offset.
On July 3, McConnell sent a separate letter to Reid and House Majority Leader Nancy Pelosi (D-CA) offering a "compromise" in breaking the impasse. In his letter, McConnell recommended that, in exchange for Senate Republicans agreeing to offsets to the bill, the House and Senate Democratic Leadership agree to pay for the cost of extending expiring tax relief by reducing non-defense discretionary spending.
In a July 8th letter, Sen. Reid rejected McConnell's offer. Reid stated he wanted to advance a bi-partisan bill, but insisted it be offset and remained committed to the offsets included in H.R. 6049, which affect hedge fund operators and are non-controversial within that industry. Speaker Pelosi has not yet responded, but she will likely reply in kind.
Hearing on Boucher's Carbon Capture and Storage Bill; Mark-up Possible
On July 10, the House Energy and Commerce, Energy and Air Quality (E&AQ) Subcommittee Chairman Rick Boucher (D-VA) will hold a hearing on H.R. 6528, the Carbon Capture and Storage Early Deployment Act, a bill that would create a multibillion-dollar fund to accelerate the employment of carbon capture and storage (CCS) technology.
The bill is a bipartisan effort by E&AQ Chairman Boucher (D-VA) and Ranking Member Fred Upton (R-MI) to provide significant financial support for large-scale CCS technology projects, rather than relying on the limited funds currently available -- or wait for the billions of dollars that might exist from auction revenues 10 to 15 years from now if a cap-and-trade bill is enacted.
The bill essentially requires power companies that use coal, natural gas and oil to pay fees to set up the 10-year $1 billion annual fund. According to Chairman Boucher, utilities could pass on those fees to their customers, which could add about $10 to $12 to residential customers' annual rates. The bill sets up a Carbon Storage Research Corporation -- after approval by two-thirds of fossil-fuel based utilities - that would be managed by the Electric Power Research Institute (EPRI). If established, the Corporation would operate outside the federal government as a part of the EPRI and would not be subject to the annual budget or appropriations process. Once established, the new entity would be authorized to assess fees on consumers of fossil fuel based electricity. EPRI would be responsible for distributing the funds which demonstrate carbon capture and storage technologies, to projects by private, academic and government organizations.
The legislation also does not address the tricky issue of liability for storing millions of tons of carbon dioxide under the ground, which is untested on a large scale and that utilities say is a significant hurdle in the decision to deploy CCS technology.
Organizations testifying at Thursdays hearing include: American Electric Power; Carnegie Mellon University; EPRI; North Carolina Utilities Commission; the United Mine Workers of America; and the Natural Resources Defense Council.
Boucher has consistently said the bill is a "necessary first step" toward implementing an effective cap-and-trade bill. Boucher has said he expects to unveil a cap-and-trade bill later this year. It is possible, however, that H.R. 6528, could move through the subcommittee later this year, while the larger effort will not start in earnest until the 111th Congress.
NEPPA Endorses Sanders LIHEAP Bill
As was reported last week, Sen. Bernie Sanders (I-VT) introduced S. 3186, the Warm in Winter and Cool in Summer Act, which would provide $2.53 billion in FY 08 emergency funding for the Low-Income Home Energy Assistance Program (LIHEAP). Majority Leader Reid has committed to "fast-track" the bill to the Senate floor sometime in July.
NEPPA, along with Burlington Electric Department (BED) and the Kennebunkport Light and Power District (KLPD) sent letter of support for S. 3196. The bill has also been endorsed by: the Alliance for Rural America, the National Conference of State Legislatures; the National Community Action Foundation; and the National Association of Energy Officials.
Currently the bill is co-sponsored by Sens. Patrick Leahy (D-VT), Olympia Snowe (R-ME), John Kerry (D-MA), Susan Collins (R-ME), Ed Kennedy (D-MA), John Sununu (R-NH), Sherrod Brown (D-OH), Ben Cardin (D-DE), Norm Coleman (D-MN), Mary Landrieu (D-LA), Gordon Smith (R-OR), Maria Cantwell (D-WA) and Chuck Schumer (D-NY).
DOE Announces Solicitations for $30.5 Billion in Federal Loan Guarantees
On June 30, the Department of Energy (DOE) announced a second round of solicitations of up to $30.5 billion in federal loan guarantees for projects that would employ "advanced energy technologies that avoid, reduce or sequester air pollutants or greenhouse gas emissions." The solicitations will cover three areas: energy efficiency, renewable energy and advanced transmission and distribution technologies (up to $10 billion); nuclear power facilities (up to $18.5 billion); and advanced nuclear facilities for the "front-end" of the nuclear fuel cycle.
New Zogby Poll Shows Support for Nuclear Power
A recent Zogby international poll found that 69 percent of those surveyed supported building more nuclear power stations to meet future energy needs and 70 percent said nuclear power technology is safer than it was 30 years ago. Among the 69 percent, 69 percent said they would support a nuclear reactor in their community, and half said they would accept underground storage of waste within their state. However, 86 percent of those polled were somewhat or very concerned about storage and disposal of nuclear waste, while 69 percent said they were somewhat or very concerned about the safety of plant operations.