House Temporarily Adjourns Without Deal on Financial Bailout on Energy Tax Extenders
After an unexpected, failed vote on the
"financial bailout" bill, the House of Representatives adjourned for the Jewish
holiday until Thursday, October 2, hoping that compromise on an economic rescue
package can still be reached and enacted, post haste.
Also left unresolved is the fate of the energy
tax "extenders" bill. The extra days -
Congress had planned to adjourn on September 29 - could open the door for a
resolution, but given the current, tense partisan atmosphere, such prospects
appear dim.
As a reminder, last week the Senate passed a
bipartisan energy and business tax extenders bill (HR 6049) by an overwhelming
vote of 93-2. Then, the House passed a modified version of the package
(HR 7060), by a vote of 257-166. Both chambers refuse to consider the
other's bill, primarily because of the issue of which incentives would be "paid
for" and which would not, although there are other differences too. The
Administration issued two separate statements, saying it supports the Senate-passed
bill but would recommend a veto if the House-passed bill moved forward.
Of particular concern to NEPPA is
the removal of the extension of the Clean Renewable Energy Bonds (CREBs) from
the House bill, because of a disagreement with the Senate over "prevailing
wages" (i.e. the Davis-Bacon Act).
House Democrats have insisted that the Davis-Bacon standards be required
for construction of projects financed by CREBs, while Senate Republicans
consistently oppose its inclusion in any bill. To resolve the issue, House
Ways and Means Committee Chairman Charlie Rangel (D-NY) and Speaker Nancy
Pelosi (D-CA) decided to drop the CREB extension
altogether. The Senate bill still contains
a one-year extension of CREBs, $800 million in
new bonding authority, and the technical changes public power utilities are
seeking, but does not include the Davis-Bacon provisions.
Morgan Meguire, the American Public Power
Association, the Large Public Power Council, the National Rural Electric
Cooperative Association and others contacted the Ways and Means Committee,
House Leadership, and other House Members - including the Northeast
congressional delegation, on behalf of NEPPA - expressing strong disappointment
with House leadership's decision to strike CREBs from the House bill.
At a press conference yesterday (9/29), House
Majority Leader Steny Hoyer (D-MD) said he would not completely shut the door
on considering the extenders bill sometime later in 2008, and that he will
continue to work with Senate Majority Leader Harry Reid (D-NV) to see what can
be done with regard to energy and extenders, "even if it's next year."
Government
Accountability Office RTO Study Released
On September 26, Sens. Susan Collins (R-ME) and Joe Lieberman (I-CT) released a
Government Accountability Office (GAO) report that they jointly requested last year.
Lieberman and Collins are the Chairman and Ranking Republican,
respectively, of the Senate Homeland Security and Governmental Affairs
Committee.
The study found that, the Federal Energy
Regulatory Commission (FERC) has not conducted an empirical analysis or developed
a set of publicly available, standardized measures needed to evaluate the
performance of Regional Transmission Organizations/Independent System Operators
needed to determine whether the benefits they provide outweigh the costs. It recommended that FERC work with RTOs,
stakeholders and experts to develop standardized measures to track the
performance of RTO operations and markets and report the performance results to
Congress and the public. FERC reviewed a
draft of the report, as is customary, and "generally agreed" with the report
and recommendations.
In a press release that day, Sen. Collins said,
"Regional Transmission Organizations like ISO-New England were intended to
improve reliability of electricity service and lower costs, yet since their
inception more than 15 years ago, Mainers have only seen dramatic increases in
their electricity prices. I initiated
this investigation out of concerns that lax oversight by the Federal Energy
Regulatory Commission has meant that RTOs have contributed to increased costs
for consumers. GAO's conclusions
confirmed my concerns, and I will work to ensure that FERC quickly implements
this report's recommendations."
The American Public Power Association, in a news
release, stated that it agrees and shares the concerns raised by the GAO and
echoed its call for action by FERC to provide stronger oversight of RTO budgets
and to initiate performance measures.
APPA also highlighted GAO's finding that it has not been demonstrated
that savings from RTO-claimed efficiencies have been passed on to consumers and
called for a study of generator profits.
Congress
Approves CR into 2009; President will Sign
Congress has passed a Continuing Resolution (CR)
to fund the government at FY 2008 levels through March
6, 2009
and the President is expected to sign it.
The current fiscal year expires September 30, and no individual FY 09
appropriations bills have yet been approved.
While most of the CR sets spending at FY 08
funding levels, the bill includes language to fund the Low Income Home Energy
Assistance (LIHEAP) program at $5.1 billion - an increase over the FY 2008
level of $2.57 billion. It also includes
FY 09 funding for defense and military related appropriations.
Despite the fact that Congress has acted,
through the CR, to fund federal agencies and programs through March, 2009,
there is a growing expectation that Congress will return for a lame-duck
session after the election.
Cyber
Security Markup Cancelled; Issue Likely to Appear Next Congress
The House and Energy Commerce Committee
decided not to consider legislation last week (9/23) to give emergency powers
to the Federal Energy Regulatory Commission (FERC) to protect the nation's
power grid against cyber-attacks to the electric grid. The emergency authority
would apply to users, owners and operators of the bulk power system, which
excludes electric distribution facilities.
Committee Chairman John Dingell
(D-MI) and energy subcommittee chairman Rick Boucher (D-VA) attempted to
fast-track the bill in the last weeks before adjournment, but full committee
Ranking Member Joe Barton (R-TX) objected, because he believed the bill did not
go far enough in giving FERC new authority.
A coalition of electric utility
trade associations (including APPA, NRECA, EEI
and ELCON) had been negotiating with FERC to reach consensus, but they remained
at odds on a few critical matters. However, the most recent Committee
discussion draft contained language on these issues that the industry coalition
was comfortable with.
Although there will be no further
action on a cyber security bill this year, the issue could reappear early in
the next Congress, because House and Senate leaders are concerned about the
vulnerability of the electric grid.
In a related matter, on September
18, FERC proposed to improve cyber security and close what it considers a
"potential regulatory gap" by clarifying that the facilities within U.S.
nuclear generating plants that are not regulated by the Nuclear Regulatory
Commission (NRC) must comply with FERC mandatory reliability standards on
Critical Infrastructure Protection (CIP).
Bingaman Legislation Would Ease Banks'
Ability to Buy Bonds from Small Municipalities
On September 18, Senate Energy and
Natural Resources Committee Chairman Jeff Bingaman (D-NM) introduced
legislation to ease tax laws restricting the ability of banks to purchase
municipal bonds to help small municipalities raise cash for their
infrastructure projects. Under current
tax law, banks are prohibited from purchasing bonds from municipalities that
issue more than $10 million in debt per year in municipal bonds.
Bingaman's
Municipal Bond Market Support Act (S.
3518) would raise the limit to $30 million and create a "safe harbor"
that enables banks to invest up to two percent of their assets in municipal
debt.
"Municipalities have been innocent
bystanders to Wall Street's troubled financial
state, which is making it difficult for them to affordably borrow for such
important projects as building roads, schools, and hospitals. By allowing banks to play a greater role in
the bond market, more capital will be available to municipalities, particularly
small and rural ones, at lower interest rates," Bingaman said.
Emergency LIHEAP Funding
Released
On September 17, the Department of Health and Human
Service Secretary Micheal Leavitt announced the release of $121 million in
emergency LIHEAP funding to help offset home heating bills for low-income
individuals. A portion of the money - $96
million - will be distributed nationwide, while the remainder will go to states
who have a large number of individuals who depend on oil for heat.
According
to the National Energy Assistance Director's Association, the
national average cost to heat a home with oil this winter will be $2,524 -- up
from $1,962 last winter "This extra
money helps, but it is not nearly enough," said Mark Wolfe, the Association's
executive director.