Renewable Hydrogen Passenger Vehicle Act of 2005

Mr. President, we are on the eve of a turning point in the energy future of our country. As we move closer to voting on a comprehensive energy bill, we have a truly historic opportunity to transform the way we think about energy. We have an opportunity to make a decisive step away from dependence on foreign imports and fossil fuels and toward an independent future based on the abundant natural human and technological resources found right here within our borders.

As we wean ourselves from the oil fields of the unstable Middle East and other parts of the world and rely increasingly on field crops and fuel cells produced in America's heartland, we will build an energy future that will make us more secure and a future of which we can be proud.

This is the bottom line. When we talk about moving toward energy independence in this country, we are talking primarily about reducing America's dependence on imported oil. Petroleum accounts for more than 85 percent of our energy imports. As everyone is acutely aware, much of the 85 percent comes from some of the world's most unstable and, in some cases, openly hostile countries.

Today, rising global demand for petroleum is driving prices for gasoline and home heating oil to record levels. This year, China passed Japan as the world's second largest consumer of energy. China's use of oil is expected to grow exponentially over the next few years. So the focus of any national energy strategy must be to reduce our dependence on foreign oil in a sustainable way and as rapidly as possible.

By far, the largest use of petroleum in this country is in the transportation sector, and 97 percent of today's transportation fuel comes from petroleum. Thankfully, we know the solution. It is technologically feasible. We need to build vehicles that use less gasoline or no gasoline, and we need to make an aggressive transition to clean, renewable domestic fuels such as ethanol, biodiesel, and fuel cells.

The goal is a future of vehicles powered by fuel cells. The hydrogen is used to create the electricity to turn the motors that turn the wheels. The power from the fuel cell comes from hydrogen that will be made by renewable resources such as wind, photovoltaic, and other forms of renewable energy.

The biggest single step right now that we can take is to improve vehicle fuel economy. This bill takes a modest step in this direction, for example, by offering tax incentives for hybrid gas-electric vehicles, but we need improvements across the board, including raising the corporate average economy standard for vehicles.

Another commonsense way to reduce reliance on fossil fuels is to make greater use of clean and homegrown fuels. This bill has several provisions that take us in the right direction on this front, starting with the robust 8-billion-plus renewable fuel standard first proposed by Senator Lugar and I and overwhelmingly approved by this Senate last week.

It is very disturbing that even with the price of ethanol well below that of gasoline, fuel blenders are still turning their backs on this cleaner, cheaper, homegrown alternative and turning instead to imports of refined gasoline.

This chart illustrates that. Right now, going back to 5 years ago, there has been a steady increase in the imports of gasoline. This is weekly total gasoline imports--thousands of barrels per day. From April 28 of 2000 until March of this year, gasoline imports increased 66 percent. This is not oil, this is gasoline. This is oil that has been refined in some foreign country, put on a tanker, and shipped to this country. So right now, we are up to just about a million barrels a day. Think about that, that is just gasoline. Not too many people know that. Most people think we are just importing oil. We are importing about a million barrels a day of refined gasoline into this country. That is at the expense of American dollars and jobs. This is taking us in the wrong direction.

A recent report by the Consumer Federation of America found consumers would be saving up to 8 cents a gallon at the pump if refiners were instead adding it to the gasoline at just 10-percent blends.

My consumers in Iowa, right now, are saving as much as 10 cents per gallon on ethanol-blended fuels, for an average savings of at least $100 a year for a typical family.

I believe Americans all across the country deserve the cost and clean air benefits that ethanol-blended fuels provide. It is imperative we insist on our strong 8-billion-gallon renewable fuels standard when this Energy bill goes to conference with the House.

In addition to the renewable fuels standard, this bill in front of us includes tax incentives for alternative motor vehicles and fuels. This is very important. But we need to act more aggressively. For example, I believe we need to mandate that gasoline vehicles sold in this country be flexible-fuel vehicles that can run on E-85; that is, 85 percent ethanol or some other biofuel.

Now, flexible-fuel vehicles only cost maybe, right now, between $100 and $200 per vehicle. That is with just a small amount that are being made. If every vehicle was a flexible-fuel vehicle, the cost per vehicle would drop way below $100 per vehicle. The savings a consumer would get on that few dollars extra added to the sticker price of a car would be more than made up for, probably within the first year or so of buying flexible fuels.

So I am saying, right now we do not have that many flexible-fuel vehicles. We need to mandate that cars sold in America--not made here, sold in America--be a flexible-fuel vehicle. You might say: Is that possible? Well, Brazil is planning on having all of its new cars flexible-fuel ready by 2008. I want to ask the question: If the Brazilians can do it, why can't we? If the Brazilians can do it, of course we can do it.

Now, of course, consumers need access to the renewable fuels. So I am glad the bill in front of us includes incentives for the installation of flexible-fuel pumps at fueling stations. So now the bill has in it, as I said, incentives for installing flexible-fuel pumps at fuel stations. But we do not have a mandate to build flexible-fuel cars.

Right now, there is a fuel savings credit that auto manufacturers get for making E-85 vehicles. It is called the CAFE credits. But it is on the assumption that these vehicles will run on E-85 at least half the time. In other words, an auto manufacturer gets the credits for building a flexible-fuel vehicle on the assumption the vehicle will use E-85 half the time.

But the truth is, most people who own flexible-fuel vehicles do not even know it. So E-85 does not get used at all for that reason, and for the reason there are not many pumps out there. So we call this the dual-fuel loophole because carmakers get the credit for alternative fuels even if no alternative fuel is used. We should close that loophole now by tying CAFE credits to the amount of flexible fuel that is actually used, or by simply letting the credit expire.

So what I am saying is we need a three-pronged approach. We have the incentives in the bill to add flexible-fuel pumps at fueling stations. Secondly, we need to provide these credits will go only--only--on the amount of flexible fuel that is actually used. Third, what I am saying is we actually need a mandate that cars sold in America be flexible fueled.

Now, another important provision of the Energy bill extends the income tax credit for the production of biodiesel, another excellent renewable fuel. Biodiesel offers tremendous energy savings by providing 3.5 times more energy than is used to produce it, and by offering improved air quality over traditional diesel.

In addition to investment in today's biofuels, we also need a strong investment in the future of bio-based fuels and products of all kinds. New technology is making it possible to produce biofuels and a host of industrial and commercial products out of biomass; that is, agricultural material such as corn stalks and wheat straw and switchgrass and wood pulp and things like that--dedicated energy crops that together are expected to produce 10 times the current volume of ethanol at prices equal to or less than that of gasoline, and, again, with tremendous benefits to our environment and our rural economy.

A recent study found that farmers can expect to earn an additional $35 per acre just by selling the excess biomass--the stalks and the straw--from traditional corn and wheat operations.

Now, ethanol made from this residual biomass is expected to have near zero or even negative net carbon dioxide emissions. How can that be? If you are using it, you are burning it, burning the fuel in a car, you put carbon dioxide into the atmosphere. That is true. But as these plants grow, they take carbon dioxide out of the atmosphere more than what is burned in the automobile. So biomass is a vital part of combating climate change.

Now, the biorefineries that produce this ethanol will also give us bio-based products to supplement or replace everyday products now made from petroleum. I have a couple of posters that indicate that. Shipping materials, building construction materials, roofing materials, elastomeric-type roofing materials, paints, hand sanitizers, and even carpets are made from renewable resources, biodegradable resources. For home and automotive use, just think of all the plastic cups, all these containers made out of petroleum now. And there are lubricants, soy oil. Even rubber tires are made out of renewable resources which are biodegradable. All of these things can be made from the biorefineries that will be producing the ethanol and the biodiesel that we will use in transportation. Many of these products are on the market, not in the future but today.

Tripling the use of bio-based products could add $20 billion in economic benefits just by the year 2010--5 years from now. Replacing the Nation's petrochemicals with bio-based equivalents would save some 700 million barrels of petroleum a year. Just replacing plastics with bio-based counterparts would save another 100 million barrels or more. So there is great potential here. We need to get serious about supporting these bio-based products, and the Federal Government needs to take the lead.

Now, I know we are talking about the Energy bill, and that is what I have been talking about. But I am just going to digress for a minute and talk about a provision that was in the farm bill that was passed in 2002 because it has a lot to do with this Energy bill. Keep in mind what I have been saying is, by getting the biorefineries going and making more ethanol and biodiesel, we have byproducts that can also be made. As I mentioned, they are the plastic containers and the building materials and things like that. There is an important provision in the farm bill, section 9002, that we worked very hard to get in the farm bill, passed and signed by the President 3 years ago this month. Section 9002 requires all Government Departments and Agencies to give a purchasing preference to bio-based products. Now, here is the exact wording. This is section 9002. This is law. It has been the law for 3 years:

Each Federal agency . . . shall--

It does not say ``may''--

shall, in making procurement decisions, give preference to

such items composed of the highest percentage of bio-based

products practicable . . . unless such items (A) are not

reasonably available; (B) fail to meet performance standards;

or (C) are available only at an unreasonable price.

So price, performance, and availability--as long as it meets those three criteria, each Federal agency shall buy them. That is what it says, period.

Think of all the plastic cups and forks used every day in the Senate cafeteria alone.

Think of the Department of Defense, think about all of the plastic materials they use in serving the troops every day. Think of the millions of gallons of metal-working fluids, lubricants, and paint used by the Department of Defense. Yet 3 years after the passage of the farm bill, we still do not have a bio-based procurement program in place in the Federal Government. That has been there. It has been the law. And we are still not doing it. McDonald's can go buy plastic cups made out of renewable resources. Good for them. Why can't the Department of Defense? Why can't the Department of Interior that operates in our national parks? Why aren't they using more biodegradable materials? The law says they are supposed to, but they are not doing it because USDA has yet to issue the rules.

Again, I bring that up because this is part and parcel of the Energy bill. This saves us energy because right now all this material is made from imported oil, or most of it. It could be made by homegrown products here in America. We need to have the Federal Government setting an example and leading the way in reducing dependence on products made from foreign oil. I am sorry to say that 3 years later we still are not doing it.

We also need to invest in research and commercialization of bio-based fuels and products. That is why a few weeks ago, I, along with Senators Lugar, Obama, and Coleman, introduced the National Security and Bioenergy Investment Act of 2005. Our bill promotes targeted biomass research and development in order to expand the cost-effective use of bio-based fuels, products, and power. It provides incentives for the production of the first 1 billion gallons of biofuels from cellulosic biomass; that is, crop residues like corn stocks and wheat straw, or wood chips from lumber mills. It provides bioeconomy development grants to small bio-based businesses. It creates a new Assistant Secretary position at the Department of Agriculture to carry out energy and bio- based initiatives.

It requires the Capitol complex to lead by example by procuring bio- based products. This bill has the support of a broad coalition of agricultural producers, clean energy and environment groups, and national security experts. I have a number of letters from these organizations supporting the bill.

I ask unanimous consent that the letters be printed in the Record at the conclusion of my remarks.

Mr. President, I am excited about this new bill. I hope my colleagues will get behind it. In fact, we may be offering an amendment to the Energy bill that would take a small part of that and add it to the Energy bill. I hope we can get that done this week.

America's dangerous dependence on fossil fuels extends beyond oil. Natural gas prices have skyrocketed, hurting everyone who uses gas to heat their home or fuel their appliances or to make fertilizer for our farmers. Americans now pay two to three times what Europeans pay for natural gas due to our ever-growing demand and limited availability. Farmers are hit hard. Our farmers rely on natural gas not only to heat homes and run much of their equipment but also for fertilizer in the fields. These impacts on farmers are severe and getting worse. We need an energy bill that looks for sensible ways to lower natural gas costs for all Americans. We need to look for environmentally sensitive ways to increase our supply.

That is why I keep saying, the House put in a bill to drill for oil in the Arctic National Wildlife Refuge, but we all know that oil doesn't amount to anything. Most of that oil--I could be corrected--I believe all of that oil is going to go to Japan. It is a drop in the bucket compared to what we use. But what else they have in Alaska is a lot of natural gas, and we need to pipe that natural gas from Alaska down to the lower 48. That has been on the drawing boards in the past to get that natural gas down here. And for various and sundry reasons that I don't need to go into here, it has been held up.

I call upon the Governor of Alaska to move expeditiously to reach the agreements that are necessary to get the natural gas pipeline constructed and built to deliver the natural gas down to the lower 48. They have been talking a lot about how they would pipe it down--they would liquefy it and then send it down to the west coast, or maybe to the Gulf States. That costs a lot of money when you liquefy natural gas, when we could build a pipeline that could be environmentally safe and bring that gas right down to the Midwest where it is needed, not only for the Midwest but for the upper part, the northern part of the United States. So we need to move ahead aggressively on that, and we are not doing it.

We need to look for all environmentally sensitive ways to increase supply, and we need to look for solar and biomass and wind. I am glad so many colleagues from both sides of the aisle joined together in approving the amendment offered by Senator Bingaman requiring 10 percent of this country's electricity to come from renewable resources by 2020. Wind power in particular has tremendous potential to provide clean, abundant energy in many parts of the country. Wind power generation can provide thousands of dollars in additional revenue to our farmers and ranchers and people in rural areas, while continuing to allow for crop production and grazing. Valuable incentives for wind power production exist in the section 45 wind production tax credit. However, development of this vital industry has been tied up by Congress's refusal to provide a long-term extension of this incentive.

In 2004, when extension of the production tax credit was delayed, more than $2 billion in wind power investment was put on hold. I am pleased a 3-year extension of the production tax credit for wind has been included in this bill. We could do more, much more. It should be extended longer than that, but at least this minimal amount should provide developers the certainty they need to move ahead with wind power projects.

We also need to make sure farmers and farmer co-ops can be full participants in wind power projects. The farm bill's energy title, section 906, is providing grants and loans to farmers and rural small businesses to install wind and other renewable energy systems on their property. It also supports energy-efficient improvements to farm and small business operations. This program has been a real success over the past several years. We expect it to grow substantially in the years ahead.

I have also introduced a bill, S. 715, to help more farmers and other rural citizens become active investors in wind energy by removing restrictions that are in the production tax credit. This bill I am sponsoring includes a pass through of the wind production tax credit to cooperative members, just like the small ethanol producer credit pass through right now. This will provide another needed boost to rural America's wind power development. Right now, if a co-op builds an ethanol plant, they can get the production tax credits passed through to their members. If a co-op wants to build windmills, however, they can't pass it through to their members. Hopefully, we can lift this restriction, and we can do it on this Energy bill before us.

Finally, we need to look to the longer term future, and we need to do it now by laying the groundwork. To deliver truly sustainable energy that will not add to climate change and global warming, that will not pollute the environment, we must invest in clean technologies. What I am talking about is hydrogen. It offers real potential for a clean, domestic, sustainable energy future. But only if it is produced from renewable resources. That is why we need to support research and demonstration of technologies to produce hydrogen from ethanol and other renewable resources. My bill, S. 373, the Renewable Hydrogen Transportation Act, would do just that, by funding the installation of an ethanol-to-hydrogen reformer, as well as the operation of hybrid electric vehicles converted to run on renewable hydrogen instead of gasoline.

Making hydrogen from ethanol and other renewable fuels makes a lot of sense for transportation--one, because we can use the existing ethanol production and distribution network; two, because it could well be the least expensive renewable hydrogen option available. I appreciate the willingness of the chairman and the ranking member to work with me to put this modest, but meaningful, initiative in the bill.

Again, to get to that sustainable future, we have to think about making hydrogen from renewable resources. You use the wind power. When the wind blows at night and you don't need all that electricity and you cannot store it, what do you do with it? You waste it. It is gone. But if you can use that wind at night to turn a turbine that makes electricity, and you can use that electricity to hydrolyze water-- remember the old chemistry experiment where you put positive and negative in water, and off of one comes oxygen and off of the other comes hydrogen. There are two atoms for oxygen for every atom of hydrogen. As long as those turbines are turning, we can make hydrogen. You can store hydrogen. You can save it. You can compress it. You can pipe it. So, therefore, at times when you don't need a lot of electrical power and the wind is blowing, you can make hydrogen. You can store it and take the hydrogen and put it through a fuel cell to make the electricity when you need it. The beauty of doing that is you only get one product--H2O, water. Nothing else. It doesn't pollute, doesn't add to global warming or anything. So that is the cycle that we need. Use the Sun, use the wind, hydropower, whatever is renewable, take that and make hydrogen, store it, compress it, put it through a fuel cell, and make the electricity, and the cycle starts all over again. I know a lot of this is some years down the pike. We cannot do it tomorrow. But we can start now by building assistance that will enable us to move to a renewable hydrogen-based economy in this country.

Mr. President, let me close by thanking Senator Domenici and Senator Bingaman for the extraordinary job they have done during the past months and during floor consideration of the bill. The bipartisan cooperation we are seeing is due largely to their example and impressive leadership, and the entire Senate owes them a debt of gratitude for a job well done.

Of course, we are not done yet. Hurdles remain. We are headed, though, toward concluding a strong, bipartisan bill that leads America decisively into the new world of clean, renewable, home-grown energy. When the time comes, we need to stand firm for the Senate provisions when we go to conference.

Mr. President, I yield the floor.

Exhibit 1

June 9, 2005.

Re The National Security and Bioenergy Investment Act of

2005.

Hon. Tom Harkin,

U.S. Senate,

Washington, DC.

Hon. Richard Lugar,

U.S. Senate,

Washington, DC.

Dear Senators Harkin and Lugar: The National Corn Growers

Association (NCGA), the American Soybean Association (ASA),

and the Renewable Fuels Association are writing to express

our support for the National Security and Bioenergy

Investment Act of 2005. In particular, we strongly support

the increased procurement of biobased products by Federal

agencies and all Federal government contractors. Biobased

products represent a large potential growth market for corn

and soybean growers in areas such as plastics, solvents,

packaging and other consumer goods to provide markets for

U.S.-grown crops. The biobased product industry has already

started to grow, bringing new products to consumers, new

markets to growers and new investments to our communities.

The procurement of biobased products promotes energy and

environmental security. Products made from corn and soybeans

could replace a variety of items currently produced from

petroleum, and aid in reducing dependence on imported oil.

Already the production of ethanol and biodiesel reduces

imports by more than 140 million barrels of oil. The

production of biobased products generates less greenhouse gas

than traditional petroleum-based items. There are also

tremendous opportunities for grower-owned processing

facilities and rural America and agriculture as a whole. New

jobs and investments will be brought into rural communities,

as new processing and manufacturing facilities move into

those communities to be near renewable feedstocks.

NCGA, ASA and RFA applaud your continued efforts to promote

the use of biobased I products that will encourage the

development of new markets for corn and soybeans and

ultimately help to revitalize rural economies and the

agriculture industry as a whole. We have been avid supporters

of the biobased products industry, and we look forward to

working with you as you continue to provide vision and

direction for this emerging industry.

Sincerely,

Leon Corzine,

President, National Corn Growers Association.

Neal Bredehoeft,

President, American Soybean Association.

Bob Dinneen,

President, Renewable Fuels Association.

Mr. President, what is the parliamentary situation?

Amendment No. 799

Mr. President, is it in order to ask unanimous consent to lay aside the pending amendment for the purpose of speaking on an amendment that will be offered by Senator Martinez?

Mr. President, I will certainly be willing to have my colleague from Florida speak. I ask unanimous consent that I speak after the Senator from Florida, Mr. Martinez, who will offer the amendment.

Mr. President, I rise to join my colleague from Florida, as we have introduced this amendment to strike the portion of the Energy bill that would set up an inventory on the Outer Continental Shelf.

I want to show how extensive this inventory is going to be. The Outer Continental Shelf is all of the west coast of the United States, the Pacific coast, the area in yellow off the coast of Washington, Oregon, and California. All of that area would be subject to the inventory. All of this area in the Gulf of Mexico is presently covered by the moratorium about which Senator Martinez and I fought very hard last week to get an agreement from the two leaders and managers of the bill that they would not come in and support any amendments that would offer drilling in the Gulf of Mexico off Florida.

But look at the Outer Continental Shelf. It extends from Maine all the way down to Florida. We are talking about a huge area that would be inventoried. That sounds innocent enough, but let me tell you why I oppose it. I oppose it because it is unnecessary unless you are preparing to drill in areas off our coast that are currently subject to this moratorium; otherwise, why would we want to take an inventory if all of this Outer Continental Shelf is now under a moratorium so you cannot drill for oil and gas?

I oppose it also because it is harmful to marine life and commercial fish, and the Minerals Management Service already conducts inventories of the economically recoverable oil and gas reserves on the Outer Continental Shelf, including moratoria areas, every 5 years. In fact, the MMS will complete its next inventory this summer. Its last inventory came out in the year 2000. If that is the case, why do we need another inventory? How is the inventory in this bill different from the one that is already in effect? Two words: seismic exploration.

What is seismic exploration--in other words, what they call survey? It is an expensive, invasive, and harmful practice used by oil and gas companies to determine where to drill. Why doesn't MMS use seismic exploration currently to complete their inventory? Because it is too costly and it is considered a precursor to drilling.

If you are not going to drill, you should not be spending hundreds of millions of dollars to tell you where to put the drill. MMS estimates that these surveys would cost between $75 million and $125 million for each of the planning areas. Remember, in the Outer Continental Shelf, there are nine planning areas. At $75 million to $125 million apiece for seismic exploration, that means we would be having MMS spend $675 million to $1 billion to survey our moratorium areas, areas on our coastline that are under a moratorium until the year 2012, pursuant to a Presidential directive.

Let me tell you a little bit about what seismic exploration and surveying is. Oil and gas companies use seismic air guns. They are long, submersible cannons that are towed behind boats in arrays, firing shots of compressed air into the water every 10 seconds. Interestingly, these air guns have replaced dynamite as the industry's primary method of exploration. But they create sound rivaling that of dynamite. A large seismic array can produce peak pressures of sound that are higher than virtually any other manmade source, save for explosives like dynamite--over 250 decibels.

The oil and gas industry typically conducts several seismic surveys over the life of their offshore leases. They use these seismic surveys to determine the best placement of oil rigs and pipelines and to track fluid flows within the reservoirs. Seismic surveys are massive, covering vast areas of the ocean, with thousands of blasts going off every few seconds, in some cases over the course of days, weeks, months. The arrays towed by boats consist of 12 to 48 individual air guns, synchronized to create a simultaneous pulse of sound outputting a total of 3,000 to 8,000 cubic inches of air per shot. The sounds are so powerful because the array is attempting to generate echoes from each of several geologic boundary layers at the bottom of the ocean. Echoes produced by these seismic impulses are recorded, and they are analyzed by oil and gas companies to provide information on the subsurface geological features.

The noise pollution from these tests can literally be heard across oceans. If the sea floor is hard and rocky, the noise might be heard for thousands of miles. And the sound can mask the calls of whales and other animals that rely on the acoustic environment to breed and survive. Scientists are documenting more and more problems associated with the seismic surveys. Whales, dolphins, fish, sea turtles, and squid have all been impacted adversely by the seismic activity. I sure would not want to be a scuba diver in the water with one of these seismic blasts going off.

The 2004 International Whaling Commission's Scientific Committee, one of the most well-respected bodies of whale biologists in the world, concluded that increased sound from seismic surveys was a ``cause for concern'' because there is a growing body of evidence that seismic pulses kill, injure, and disturb marine life.

The impacts range from strandings to temporary or permanent hearing loss, to abandonment of habitat and disruption of vital behaviors such as mating and feeding.

Studies have also shown substantial impacts on commercial species of fish. Fishermen, beware. One series of studies demonstrated that air guns caused extensive and apparently irreversible damage to the inner ears of snapper, and the snapper were several kilometers from the seismic surveys.

The scientific community is not the one that is raising the alarm bells. Courts and governments are starting to realize the dangers posed by seismic exploration. In 2002, a California Federal court stopped a geologic research project in the Sea of Cortez, when two beaked whales were found dead with an undeniable link to the seismic activity.

The Canadian Government slowed a geologic project off its west coast and is looking closely at an oil and gas seismic survey off Cape Breton as a result of dangers posed by the surveys.

The Australian Government refused to issue permits for a survey near a marine park because the proponents of the survey could not prove it would not harm the marine park.

And the Bermuda Government refused to issue a permit for seismic geologic surveys off its coast, citing concerns for impacts on marine mammals.

Air gun activity associated with seismic surveys must be considered an invasive procedure, inappropriate for sensitive marine areas and economically important commercial fishing grounds.

We have to continue to remember that the United States has 3 percent of the world's oil reserves.

Yet the United States uses four times more oil than any other nation, according to the report from the National Commission on Energy Policy. According to Alan Greenspan in a speech he gave in April of this year, the 200 million personal vehicles currently on the U.S. highways consume 11 percent of the total world oil production. We cannot drill our way to energy independence.

Spending hundreds of millions of dollars on harmful exploration in areas whose economic livelihood depends on their fishing industry and their marine ecosystem could have devastating effects.

For these reasons, I must oppose this invasive, duplicative, and harmful exploration on the moratoria areas on the Outer Continental Shelf.

The bottom line is, if you have the Outer Continental Shelf under moratoria, why do we need to try to inventory all of that if you are not supposed to have any drilling under Presidential directive at least until the year 2012? Why go in with the risk to Mother Nature with this kind of seismic exploration?

I yield to my colleague from Florida.

That is an excellent question. If you are going to do the seismic exploration which this bill would allow in the nine areas under the moratoria, it is going to cost between $650 million and $1 billion. In a Congress that is so concerned about budget deficits to the tune of almost half a trillion a year, where are we going to get that kind of money?

The Senator's point is well taken. I thank my colleague from Florida for making that point.

The Senator is correct. Since a President of the United States established this moratorium on the Outer Continental Shelf and it is to run to 2012, why do we need to be spending money on seismic surveying on an area that is off limits to drilling, which the moratorium has in place until the year 2012?

I thank the Senator for joining to offer this amendment. I ask the Senate to consider helping continue to preserve the moratorium.

I yield the floor.

Mr. President, first, I thank my colleague from Iowa for his being always thoughtful. We even want to produce ethanol plants and wind in New York. We just don't want to transport it over to Iowa. I am not from Iowa. In any case, I am not here to talk about that.

Mr. President, I ask unanimous consent that the pending amendment be laid aside, and I send an amendment to the desk.

This is the sense of the Senate amendment on the Strategic Petroleum Reserve.

Mr. President, I believe the amendment is at the desk.

Mr. President, I ask unanimous consent that further reading of the amendment be dispensed with.

Mr. President, I thank my friend from New Mexico for his grace, as usual. I will be brief as I make a statement on the amendment.

I rise to offer this amendment, which will express the sense of the Senate that the Federal Government should take long, overdue action to curb the record-high gasoline prices that are plaguing American consumers at the pump. As my colleagues are well aware, for weeks, oil and gasoline prices have been placing an immense burden on working families and threatening our fragile economic recovery, and it is time that this body took action to protect our Nation's economic security from the sky-high oil prices and the whims of the OPEC cartel.

This amendment would urge the administration to provide the American consumer with relief by releasing oil from the Strategic Petroleum Reserve through a swap program in order to increase the supply, quell the markets, and bring down prices at the pump. Of course, the other side of the swap is that we would buy back the oil when the price was lower and put it back in the Strategic Petroleum Reserve, which is now just about full.

Mr. President, what we are faced with here is simple market economics of supply and demand. If demand goes up, price goes up. If supply goes up, price goes down. At a time facing record-breaking gasoline prices, it is hard to believe that the Federal Government would be taking oil off the market and exacerbate the high energy costs to working families.

The price of crude oil has remained at near record highs for over one-third of 2005, with oil having traded at over $50 a barrel since May 25. Just today, we saw the biggest jump yet, with oil closing at almost $60 a barrel. OPEC used to claim it was interested in helping to keep prices under $30 a barrel. That is when it went from a $22 to $28 rate. It may be fun to double down in Las Vegas but not in the oil market, and certainly not at the gas pump.

These prices have already burdened Americans in New York and in the rest of the Northeast. We get a double whammy because we have high home heating oil prices, as well as high gasoline prices because we depend on heating oil more than most parts of the country. Other parts are warmer or use more natural gas. I know these families were hoping for a quick spring so they could enjoy a brief respite from the high energy prices.

Unfortunately, that hasn't been the case, as the increased burden of oil costs has just moved from the home to the highway. As Americans are beginning to plan for their road trips and summer vacations, the national price of gasoline has seemingly reached a new record high every week. Last week, the Energy Information Administration reported that prices had increased for the second straight week, to $2.13 for regular self-service. That is an increase of almost 49 cents from last year. Unfortunately, it could give way to even higher prices in the future.

We know who is being hurt by these oil prices, and we know who is benefiting--OPEC. Last year, OPEC made $300 billion in oil revenue. They stand to gain much, much more if the price of oil stays as high as it is--stratospheric levels. In order to institutionalize the profits from these spikes, OPEC agreed to abandon their longstanding price target of $22 to $28 a barrel, as I mentioned before, and some of its members say they could be comfortable with oil remaining at $40 to $50 permanently. I know who will not be comfortable--American families who depend on affordable oil to commute to work, heat their homes, and provide for their energy needs.

Some of my colleagues may be asking: Didn't OPEC agree to increase production in March by 500,000 barrels a day?

The reality is that OPEC's pledge to increase production on paper has not reduced prices at the pump. OPEC, after having cut production by 1 million barrels in the face of rising oil prices--it is not that amazing--claimed that they would increase production by half the previous cut. While this would seem like a step in the right direction, the reality is they were already producing 700,000 barrels over their quota, so as a result this paper increase added no oil to U.S. markets.

These are exactly the type of shell games that the OPEC cartel uses to take money out of Americans' pockets to put toward OPEC profits.

We have to act to stop it. Once again, OPEC is talking about another 500,000-barrel increase. We will see if they actually follow through.

Instead of standing up to OPEC, what has this administration done? It has continued, incredibly enough, taking oil off the market and placing it in the SPR. This policy, which further tightens oil markets by taking much needed supplies out of commerce, is slated to take an average of almost 85,000 barrels per day off the market during the height of the driving season, between April and the end of August, despite the fact that the SPR is almost completely full.

I understand that some of my colleagues think the SPR should never be

touched, even to safeguard our economic security. I would argue that concerns to this degree do not properly balance America's physical security needs against its economic security needs. With the SPR almost full, we can easily reduce 30 million barrels through a swap and still have an effective safeguard against a physical supply disruption.

Initiating a swap of oil from the SPR to increase the supply of oil is a proven way to reduce the price of gasoline and heating oil. In the fall of 2000, the Clinton administration announced a swap of 30 million barrels over 30 days, causing crude oil prices to quickly fall by over $6 a barrel and wholesale prices to fall 14 cents a gallon. Under a swap, the Federal Government could decide on a set quantity of oil to release from the SPR and accept bids from private companies for the rights to that oil. The companies would then bid on how much oil they would be willing to return, in addition to the oil they would receive under the swap, to the SPR at a later date.

The administration has had these tools in its hands and could have acted more quickly, earlier, to stand up for the American consumer, but it has not. Instead, despite repeated urgings from Members of this body, among others, it has steadfastly refused to intervene and to allow oil prices to soar. It has been good for oil companies, it has been good for OPEC and bad for the American consumer.

This amendment says enough is enough and gives this body an opportunity to do what others have refused by hitting the breaks to stop runaway gasoline prices.

An oil swap would result in a win-win situation where gasoline prices are lowered and long-term contributions to the SPR are augmented at no additional cost to the taxpayers. The SPR is intended to provide relief at times when American families are struggling to make ends meet. The time is now. The summer driving months are just beginning.

I urge my colleagues to join me in protecting the pocketbooks of working families from OPEC profiteering by supporting this amendment.

Mr. President, I yield the floor.

Mr. President, today I am introducing a resolution pursuant to the Congressional Review Act to disapprove of the final rule promulgated by USDA that designates Canada as a Minimal-Risk Region for Bovine Spongiform Encephalopathy or BSE.

I am taking this action because opening our border to Canadian cattle imports at this time is premature. Allowing the BSE rule to go forward could have very serious consequences for the human and animal health in this country. Reopening the border poses serious economic risks for the U.S. cattle industry. And it complicates our efforts to reopen export markets.

BSE is an extremely dangerous disease. After BSE was first identified in England in 1986, Europe was forced to destroy millions of head of cattle. And, around the world, dozens of human deaths from Creutzfeld-- Jacob's Disease have since been linked to BSE. So we must be very careful before we consider opening our border to imports from a country known to have BSE.

Since the European outbreak, scientists from around the world have been engaged in efforts to learn more about the disease. They have developed methods to test, control, and eradicate BSE. Through the International Organization for Animal Health, known as the OIE, experts have designed science-based standards for the safe trade of beef products and live cattle from countries that have or may have BSE. In particular, because BSE is transmitted through livestock feed contaminated with animal proteins containing BSE, it is critical that countries adopt measures to ensure that animal proteins and other specified risk materials are not present in cattle feed.

Unfortunately, the USDA does not appear to have fully followed OIE guidelines in developing its rules. Moreover, with respect to Canada, USDA has not done a thorough evaluation to ensure that Canada's cattle feed is not contaminated with animal proteins.

The United States has appropriately blocked cattle imports from Canada since Canada confirmed its first indigenous case of BSE in May of 2003. Concerns were only heightened when BSE was confirmed in a dairy cow of Canadian origin in Washington State in December of 2003. This case resulted in many important U.S. trading partners banning the importation of U.S. cattle and beef products--a situation that continues today with regard to some of our most important customers.

So it is very important that USDA move slowly and deliberately and evaluate all possible risks before re-opening the border to Canadian cattle.

But the USDA rule does not do this. In particular, Canada has not effectively implemented measures to contain and control BSE for 8 years, as required by the OIE. Moreover, USDA has applied a very loose and flexible interpretation to the specific recommendations developed by the OIE.

Since USDA announced its proposed final rule designating Canada as a Minimum-Risk Region for BSE, Canada has confirmed two additional BSE cases. The most recent one is particularly disturbing because it involves a cow born several months after Canada implemented its ban on animal proteins in cattle feed. This raises serious questions about whether the Canadian feed ban is being effectively enforced.

These questions are only reinforced by other evidence of lax enforcement in Canada.

For example, numerous Canadian newspapers have reported that Canadian Food Inspection Agency tests indicate a disturbingly high level of non- compliance with Canada's overall livestock feed regulations.

An article in the Vancouver Sun indicates that secret tests found animal proteins that violated Canada's feed regulations in 41 of 70 Canadian feed samples. More than half of these ``vegetarian'' feed samples contained animal proteins. More than half. Clearly, feed regulation compliance in Canada is not up to par.

Since October, 2003, our own Food and Drug Administration has issued 19 import alerts concerning imported Canadian feed products that are contaminated with illegal animal proteins. Eight of those import alerts against Canadian livestock feed manufacturers are still in force.

Finally, Canada has recently issued new rules to further restrict the Use of animal proteins in livestock feed as well as in fertilizer. Canada's own justification for tightening its regulations is to reduce the potential for the cross contamination of livestock feed products and fertilizers with animal proteins that might contain the BSE prions. To me, this suggests that even

Canadian officials are concerned that the enforcement and compliance with existing regulations may be inadequate.

In addition, as noted in a letter I, along with Senators Harkin, Johnson and Salazar, recently sent to Secretary of Agriculture Johanns, there is concern, that not enough time has elapsed to be sure that Canada's education, surveillance and testing measures are truly indicative of their level of BSE risk.

The bottom line is this. Canada has not achieved the necessary level of compliance with OIE rules to justify designating it as a minimal risk region.

Canada's failure to enforce its BSE measures could have serious consequences if USDA proceeds to reopen the border.

First and most obviously, it would create potential dangers for consumers in this country.

Second, it would pose dangers for the health of our U.S. cattle herd.

Third, even if we do not end up with BSE-tainted imports, the perception of heightened risk for consumers could have adverse economic consequences for the U.S. cattle industry.

Finally, our major export markets have remained closed to U.S. beef exports, even though there has been no indigenous case of BSE in the U.S. I fear that reopening the border now, before we have reached agreement on reopening our export markets, will only give our trade partners an excuse to further delay reopening these critical markets for U.S. producers.

Yesterday's announcement by Secretary Johanns to restrict the importation of Canadian beef products to those from cattle under 30 months of age is a small step in the right direction. However, this announcement does not address the unresolved concerns about Canada's compliance with its feed regulations, which has been cited as the primary basis for extending a Minimal-Risk Region designation to Canada.

It was my hope that our new Secretary of Agriculture would withdraw the proposal to resume trade with Canada when he learned of these serious issues. But it now appears that the only way to stop this rule from going forward is for the Congress to block it. Therefore, I hope my colleagues will join me in supporting this resolution of disapproval.

Then perhaps we can have a meaningful dialogue on how to move forward in a way that will ensure the safety of the U.S. cattle herd and help open export markets. Our consumers and livestock producers deserve nothing less.

Mr. President, I rise today again with Senator Bennett to introduce the ``Artist-Museum Partnership Act.'' This bipartisan legislation will enable our country to keep cherished art works in the United States and to preserve them in our public institutions, while erasing an inequity in our tax code that currently serves as a disincentive for artists to donate their works to museums and libraries. This is the same bill we introduced the past three Congresses. It was also included in the Senate-passed version of the President's 2001 tax cut bill, and in the Senate-passed version of the 2003 Charity Aid, Recovery, and Empowerment, CARE, Act. I would like to thank Senators Bingaman, Cantwell, Cochran, Conrad, Dodd, Durbin, Jeffords, Kennedy, Kerry, Lieberman, Lugar, Stevens and Warner for cosponsoring this bipartisan bill.

Our bill is sensible and straightforward. It would allow artists, writers, and composers who donate works to museums and libraries to take a tax deduction equal to the fair market value of the work. This is something that collectors who make similar donations are already able to do. Under current law, artists who donate self-created works are only able to deduct the cost of supplies such as canvas, pen, paper and ink, which does not even come close to their true value. This is unfair to artists and it hurts museums and libraries--large and small-- that are dedicated to preserving works for posterity. If we as a nation want to ensure that art works created by living artists are available to the public in the future--for study or for pleasure--this is something that artists should be allowed to do.

In my State of Vermont, we are incredibly proud of the great works produced by hundreds of local artists who choose to live and work in the Green Mountain State. Displaying their creations in museums and libraries helps

develop a sense of pride among Vermonters and strengthens a bond with Vermont, its landscape, its beauty, and its cultural heritage. Anyone who has contemplated a painting in a museum or examined an original manuscript or composition, and has gained a greater understanding of both the artist and the subject as a result, knows the tremendous value of these works. I would like to see more of them, not fewer, preserved in Vermont and across the country.

Prior to 1969, artists and collectors alike were able to take a deduction equivalent to the fair market value of a work, but Congress changed the law with respect to artists in the Tax Reform Act of 1969. Since then, fewer and fewer artists have donated their works to museums and cultural institutions. The sharp decline in donations to the Library of Congress clearly illustrates this point. Until 1969, the Library of Congress received 15 to 20 large gifts of manuscripts from authors each year. In the four years following the elimination of the deduction, the Library received only one such gift. Instead, many of these works have been sold to private collectors and are no longer available to the general public.

For example, prior to the enactment of the 1969 law, Igor Stravinsky planned to donate his papers to the Music Division of the Library of Congress. But after the law passed, his papers were sold instead to a private foundation in Switzerland. We can no longer afford this massive loss to our cultural heritage. Losses like this are an unintended consequence of the 1969 tax bill that should now be corrected.

Congress changed the law for artists more than 30 years ago in response to the perception that some taxpayers were taking advantage of the law by inflating the market value of self-created works. Since that time, however, the government has cut down significantly on the abuse of fair market value determinations. Under this legislation, artists who donate their own paintings, manuscripts, compositions, or scholarly compositions would be subject to the same new rules that all taxpayer/ collectors who donate such works must now follow. This includes providing relevant information as to the value of the gift, providing appraisals by qualified appraisers, and, in some cases, subjecting them to review by the Internal Revenue Service's Art Advisory Panel.

In addition, donated works must be accepted by museums and libraries, which often have strict criteria in place for works they intend to display. The institution must certify that it intends to put the work to a use that is related to the institution's tax exempt status. For example, a painting contributed to an educational institution must be used by that organization for educational purposes and could not be sold by the institution for profit. Similarly, a work could not be donated to a hospital or other charitable institution that did not intend to use the work in a manner related to the function constituting the recipient's exemption under Section 501 of the tax code. Finally, the fair market value of the work could only be deducted from the portion of the artist's income that has come from the sale of similar works or related activities.

This bill would also correct another disparity in the tax treatment of self-created works--how the same work is treated before and after an artist's death. While living artists may only deduct the material costs of donations, donations of those same works after death are deductible from estate taxes at the fair market value of the work. In addition, when an artist dies, works that are part of his or her estate are taxed on the fair market value.

The Joint Committee on Taxation has previously estimated that our bill would cost $50 million over 10 years. This is a moderate price to pay for our education and the preservation of our cultural heritage.

I want to thank my colleagues again for cosponsoring this bipartisan legislation. The time has come for us to correct an unintended consequence of the 1969 law and encourage rather than discourage the donations of art works by their creators. This bill will make a critical difference in an artist's decision to donate his or her work, rather than sell it to a private party where it may become lost to the public forever. Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.