Price-Anderson Amendments Act of 2005

Mr. President, I thank my colleagues for their hard work on this important legislation. We are here to talk about passing an Energy bill that is not a complete answer to all our energy needs. This is not the end of discussion about energy independence and getting off our overdependence on foreign oil, but it is an important first step. My colleagues need to understand that the provisions in this bill are nuts-and-bolts important for our energy economy, moving forward. As a Senator who supports this legislation, there are certain technologies, certain investments in this legislation that I hope will win the day and will help us build a different kind of energy economy, based on newer technologies and energy supplies than the ones we have today. But this bill represents a compromise that was forged in the Senate and was fought hard for by my colleagues, both Democrats and Republicans, when they went to conference.

I am proud that it has an extension of renewable production tax credits so that our utilities can continue to invest in even more renewable energy; that for the first time it has a renewable clean energy bond section, so that local governments and public power can make greater investments in renewable energy; that it has an extension of the renewable energy production incentive program for public power; that there are efficiency provisions in the bill for appliances and other types of standards that will save 3.5 quads of energy.

That is the same as building 85 powerplants. It has a hybrid vehicle incentive provision. It has a biodiesel incentive program. It reinstates the oil spill liability trust fund, which was going broke and which helps us clean up oil pollution, and taxes those who are the polluters. It has research on the smart grid technology that is going to get us more efficiency in our transmission system, and it has incremental steps to push the States toward better standards on net metering. For the Northwest, the electricity title in this legislation is clearly a victory, and I would say the efficiency title in this bill is also a victory.

We are moving closer to the key tools we need to upgrade our transmission system. We will have many more debates about what this body can do, though, to continue to diversify off of foreign oil. But we should take the step today to secure that transmission system and get reliability standards in place, something this body has debated now for more than 5 years. After a Western blackout, after a New York blackout, after people in Ohio and Michigan have been affected, the least we can do is push this legislation to improve the security and reliability of our electricity grid.

I ask my colleagues to support this legislation as a first step, a short stroke of success, and get about going back to the broader decisions we need to make truly start moving in the direction toward energy independence.

Mr. President, I rise today to discuss the conference report on H.R. 6, the Comprehensive Energy Policy Act of 2005. I stand before my colleagues today with very mixed feelings about this legislation. This conference report has many meaningful achievements and measures that can help provide this Nation, our researchers, and innovators, with the basic tools to start moving America forward toward a new energy strategy for the 21st century. Yet it is far from perfect. It sidesteps many of the most fundamental energy security challenges we face--challenges like our dependence on foreign oil and global climate change, which grow more intractable the longer we wait to address them. It contains provisions that I simply do not support. It is certainly not the Energy bill that this Senator would write if I alone held the drafting pen--the kind of legislation that would put this Nation on a far more ambitious path toward greater energy security in the global economy. I know many of my colleagues feel exactly the same way.

And yet I believe all Senators must clearly acknowledge that this legislation is in many ways superior to the Energy bill conference report we considered during the 108th Congress. And that is true in some very meaningful ways for my region, the Pacific Northwest.

When the Senate, last month, approved its version of this legislation, I noted that I appreciated the skill and thoughtfulness with which the chairman and ranking member of the Energy Committee, Senators Domenici and Bingaman, had navigated a path forward for this bill. I suggested at the time that they would need every bit of that skill in coming to resolution with the House of Representatives, on a piece of legislation worthy of this Senate's support. Frankly, I doubted very much that it could be done.

But I stand here today ready to vote for this conference report--with reservations, of course--but in recognition of the fact that this legislation is probably better than many of us had reason to expect; and as good as the current political will of Congress would allow. For that, I give enormous credit to the chairman and ranking member. As a member of the Senate Energy Committee, I want to say that I have appreciated the bipartisan nature in which they have handled this bill from the outset. At every turn, they have treated this Senator--and her constituents' interests--with complete fairness. The process by which this legislation was assembled should serve as a model for this body.

I want to talk briefly about what I view as some of the most important achievements of this legislation--particularly for my region and the great State of Washington. These are some of the basic tools that can help serve as building blocks to a more ambitious energy strategy for America.

First and foremost, it is important to understand that the Pacific Northwest is a region completely unique when it comes to our energy system. More than 70 percent of the electricity production in Washington State is derived from hydroelectric sources--designed around our great river, the mighty Columbia. This was a system built as part of President Franklin Delano Roosevelt's efforts to electrify the West. As a result, we are a region with a rich and diverse energy history, an uncommon collection of public and private institutions, a large Federal presence that starts with the Bonneville Power Administration, BPA, and a diverse array of stakeholders rightly concerned about the river's multiple uses. I know all of my colleagues from the Northwest who sit on the Energy Committee--there are five of us, in fact--appreciate this tremendous heritage, our region's history of cost-based power, and the valuable asset that we inherited from our predecessors, great leaders like Senators Jackson, Hatfield, and Magnuson.

That is why we worked hard, in a bipartisan manner at every turn, to safeguard the Northwest's system of cost-based power--the engine of our regional economy. That is why the electricity title of this legislation is so important to my region, and to the ratepayers of Washington State.

I am proud this legislation specifically protects the Northwest's transmission system, by prohibiting the Federal Energy Regulatory Commission, FERC, from converting the Bonneville Power Administration's existing system of cost-based, firm transmission contracts to a market- based auction of financial transmission rights.

Now, this auction of financial transmission rights was a central tenet of FERC's controversial and ill-fated standard market design, SMD, proposal. All of us from the Northwest were united in our opposition to SMD because we recognized right away that it was a scheme with the potential to result in tremendous amounts of cost-

shifting onto our ratepayers, and to substantially undermine our cost- based system. The provision that protects the Northwest's existing system is thus an important achievement because it slams the door on any sort of future FERC-imposed proposal like standard market design. I would also note that the Senate-passed Energy bill would have slammed the door on SMD once and for all. This became unnecessary, however, when FERC's new chairman officially terminated the commission's SMD proceeding earlier this month. I think that was a very wise choice and think it speaks quite well of the commission's new leadership.

Also important to my region are provisions that this bill does not contain. Specifically, this conference report omits the administration's legislative proposals--unveiled earlier this year--to hamstring BPA's ability to invest in regional infrastructure and upend Bonneville's system of cost-based power sales. The Northwest Power and Conservation Council has estimated the administration's proposal would raise regional power rates by $1.7 billion. That would translate to a $480-a-year rate hike for families in some of Washington's most rural communities. Again thanks to the bipartisan efforts of Northwest Senators, those legislative proposals were dead on arrival.

When it comes to protecting Washington State consumers, I must also mention a number of other provisions. At long last, the bill establishes mandatory, enforceable reliability rules for operation of the Nation's transmission grid. This effort also began in the Pacific Northwest--after an August 1996 blackout resulting from two overloaded transmission lines near Portland, OR which caused a sweeping outage that knocked out power for up to 16 hours in 10 States, including Washington. As a result, both a DOE task force and the industry itself in 1997 recommended mandatory reliability rules for operating the transmission grid. The Senate first passed this legislation just over 5 years ago, in an effort begun by my predecessor, Senator Slade Gorton. It is legislation that I have championed since I have arrived in the Senate, an effort that gained more urgency with the Northeast blackouts of two summers ago; and I will be very pleased to see this measure through to the end.

This bill also takes steps to respond to the disastrous western energy crisis, which extracted billions of dollars and hundreds of thousands of jobs from our regional economy. As I have recounted many times on this floor, the illegal and unethical practices of Enron and others sent Washington power rates through the roof. This Energy bill puts in place the first ever broad prohibition on manipulation of electricity and natural gas markets. These provisions are modeled on a measure that I have authored that has now passed the Senate twice, and I am pleased that they are included in this conference report-- particularly given the far inferior provisions contained in the House legislation, which would have in many ways gone in the entirely opposite direction.

In light of the now-infamous audiotapes of Enron traders and others conspiring to gouge consumers, the legislation also gives Federal regulators new authority to ban unscrupulous energy traders and executives from employment in the utility industry. In addition, it substantially increases fines for energy companies that break the rules. And importantly for my constituents, this legislation prohibits a Federal bankruptcy court from enforcing fraudulent Enron power contracts, including $122 million the now-bankrupt energy giant is attempting to collect from Snohomish PUD. That would translate to more than $400 from the pockets of every family in Snohomish County, WA, who have already seen their utility bills rise precipitously as a result of the western energy debacle.

For all these provisions, I am tremendously grateful to the chairman and ranking member. I know they faced a steep uphill battle with the House in retaining these measures, and I applaud and thank them for their efforts in ensuring that the Senate positions prevailed.

I should also mention the renewable fuels provisions of this bill, which I believe will help put Washington State farmers and entrepreneurs in the biofuels business. Today, production of biofuels is dominated by the midwestern region of the country, as traditional policies have supported corn- and soy-based fuel production and helped that technology gain maturity. However, the key to lowering costs and establishing a truly national strategy is to make an investment in new technologies that will diversify biofuels production in the United States.

Researchers at Washington State University estimate that our State has the capacity to produce 200 million gallons of ethanol from wheat straw, and up to 1.2 billion gallons with technology improvements. Meanwhile, biodiesel is another emerging opportunity for Washington State farmers, using canola or yellow mustard. These crops are particularly well-suited to Washington State, providing high yields without irrigation.

Around Spokane, it is estimated that 500,000 acres a year could be put into oil seed production, enough oil to produce 25 million gallons of biodiesel. Statewide, at least 2 million acres could be put into oilseed production for biodiesel.

There are a number of very important provisions in this bill that will help my State capitalize on the promise of biofuels, including an Advanced Biofuel Technology Program I authored, to help demonstrate these new technologies; important market-based incentives for refiners to diversify the types of biofuels they use; and financial support in many forms for cellulosic ethanol and biodiesel production.

These are very important achievements that will help transform biofuels from a boutique regional industry to something that can become part of a truly national strategy to help supplant our Nation's petroleum imports--lowering costs and helping provide greater economic security to our farmers at the same time.

But in addition to renewable fuels, we should acknowledge the provisions of this legislation promoting renewable electricity generation. Obviously, this legislation does not go as far as I would like. I vigorously support a renewable portfolio standard--even a more aggressive standard than what passed the Senate. It is unfortunate, indeed, that the House would not accept this provision, and those of us who strongly advocate it will continue to attempt to move the RPS forward.

But this legislation does extend through the end of 2007 the existing production tax credit for renewable energy, such as wind resources. It is estimated that this credit can help save Washington State ratepayers $260 million over the next 10 years. As Northwest utilities add wind resources to help bolster regional power supplies, these investments are also helping fill the coffers of local communities. For example, a new wind project near Ellensburg, WA, has generated an additional $2 million in revenue for Kittitas County. Similarly, wind energy is helping provide another source of income for Northwest farmers. Growers in Columbia County, WA, home to the new 150 Megawatt Hopkins Ridge wind project, receive about $5,000 per turbine located on their land. One farmer estimates the revenue generated by the project will equal the income generated by 250 acres of harvest.

For the first time, the Energy bill creates clean renewable energy bonds, to support investment in renewable energy resources by governmental entities, including tribes, agencies such as BPA and other public power entities. I am also pleased that for 20 years the Renewable Energy Production Incentive, REPI, Program, which provides a direct payment to public power entities, which do not qualify for tax credits, for renewable electricity production. Eligible resources are expanded to include ocean energy. The REPI Program has already been used by multiple Washington State public utilities to make renewable energy investments.

Washington State is also home to the Pacific Northwest National Lab, and for that reason, the research and development title of this legislation bears mentioning. The Energy bill conference report authorizes hundreds of millions of dollars of investment in research ongoing at the Pacific Northwest National Lab and Washington State universities, including systems biology research, distributed and smart energy technology research and development; bio- and nanotechnology related to the production of bioproducts; and advanced scientific computing.

The Energy bill's ``personnel and training'' title is also worth noting, since it will help provide a skilled energy workforce for the 21st century, as the energy industry braces for a critical shortage. Washington State is poised to help train the next generation of engineers and innovators in this area. The legislation requires the Secretaries of Energy and Labor to monitor workforce trends in the area of electric power and transmission engineers and identify critical national shortages of personnel. It also authorizes the Secretaries to establish a grants program of up to $20 million a year to enhance training--including distance-learning, such as the program now being pioneered at Gonzaga University--in electric power and transmission engineering fields. While fewer than 15 universities nationwide offer world-class, Ph.D.-level programs in power engineering, both Washington State University and the University of Washington offer strong programs in this area. In addition, Gonzaga University this year established a specialized masters of science degree and certification program in transmission and distribution engineering.

This conference report also streamlines technology transfer rules for national labs such as PNNL, and extends the 20 percent R&D tax credit to energy research done by nonprofit consortiums involving small businesses, National Labs, and universities to promote interaction and collaboration between public and private researchers. The research and development and workforce provisions of this bill hold some of the most promise in putting in place the building blocks for a real, innovative energy strategy for the 21st century.

Years in the making, the Energy bill also includes bipartisan reform of the hydroelectric relicensing process. The hydro provisions included in this legislation are designed to improve the accountability and quality of Federal agencies' decisions. At the same time, the compromise restores the rights of the public to participate in the process on equal footing with license applicants--provisions that have been missing in previous versions of the bill. Over the next 15 years, 70 percent of Washington State's non-Federal hydro must go through the hydro relicensing process.

Another provision of importance to my State is this legislation's reinstatement of the oil spill liability trust fund, OSLTF. Earlier this year, a Coast Guard report found that the OSLTF--which has been used to clean up spills in the Puget Sound--would run out of money by 2009. The OSLTF was established in the 1990 Oil Pollution Control Act, and has been funded through a per-barrel fee on oil companies until it reached its statutory cap of $1 billion. The fund was designed to be maintained from interest on that original $1 billion, but increasing cleanup costs and low liability caps have eroded the principal amount. The Energy bill would reinstate the fee in April 2006 or thereafter, once the Secretary finds that the balance in the account falls below $2 billion. The bill authorizes application of the fee through 2014.

Lastly, I want to mention this legislation's provisions to provide energy assistance to some of our Nation's neediest families. The Energy bill would boost authorization for the Low-Income Home Energy Assistance Program, LIHEAP, from its traditional level of $2 billion to $5.1 billion, for 2005-2007. LIHEAP funding is critical for some of Washington State's most vulnerable citizens. As a result of the western energy crisis, electricity rates have gone up more than 20 percent statewide while 72 percent of low-income families in Washington use electricity to heat their homes. And already, the 105,000 Washingtonians with incomes below 50 percent of the Federal poverty level spend 34 percent of their entire annual pay on home energy bills. In recent years, less than 30 percent of Washington's eligible families have been able to receive energy assistance--as demand has for LIHEAP dollars has far outpaced their availability. More than doubling available LIHEAP funding would provide a much-needed boost to local organizations in Washington struggling to meet the needs of their communities.

As my colleagues can see, this legislation is tremendously complex. I have listed many of the provisions important to my constituents. Of course, there are a number of other measures with which I simply disagree. Perhaps that is to be expected of a 1,700-page piece of legislation that touches every sector of the American economy. For example, the inventory of Outer Continental Shelf oil and gas resources is wrong-headed, and I oppose it. I would note, however, that in order for the inventory to move forward, it must be funded. I know this Senator believes any such inventory would constitute a tremendous waste of taxpayer funds, and the fight is far from over on this issue.

Similarly, I oppose the liquefied natural gas provisions of this bill because I believe States and local communities need a bigger role in these decisions. Some of the nuclear provisions of this bill are particularly offensive, in that they create an inherent conflict of interest at the Nuclear Regulatory Commission, which should not be subject to the cross pressures of protecting public safety and the public interest, at the same time the commission is under fiscal pressure to unwisely accelerate its proceedings under the guise of some new form of ``risk insurance.''

I oppose the Clean Water Act and Safe Drinking Water Act rollbacks in this bill. The National Energy Policy Act provisions are similarly unnecessary. But I recognize that they are far less sweeping than those originally proposed by the House. If this Senator had her way, we would not be repealing the Public Utility Holding Company Act. Yet I am at least comforted by the fact this legislation hews closely to the compromise on utility mergers reached by the Senate.

Moreover, the tax package does not resemble the tax package I would have written. On this point, I agree with the President: The oil and gas industry does not need these incentives, given where prices are at today.

I am not the first Senator to say it, and I won't be the last. This bill is not as I would have written it. It has the flaws that I have listed. It is also incomplete. It is a status quo bill when it comes to one of the most difficult challenges to our economic and national security faced by this generation: America's dangerous dependence on foreign oil. This bill does not address this festering problem. It will not provide relief to consumers at the gas pump. Any suggestion to the contrary would be simply false.

It is clear to this Senator that if this body is truly serious about putting in place a framework that will allow the United States to compete in the global marketplace; a framework that will allow America to control its own destiny in the coming decades as it relates to our energy security, our work is not done. Tomorrow isn't soon enough to go back to the drawing board and get serious about our dependence on foreign oil. And this Senator will keep fighting to do just that. Our work on energy security has hardly begun--it is far from finished if we want to live up to our responsibilities to future generations of Americans. We must not leave to them a Nation crippled by its addiction to foreign sources of oil--an over-dependence that jeopardizes our economic future and national security.

On the contrary, it is our responsibility to face up to a simple fact: The accidents of geology make it impossible for this Nation to drill its way to energy independence, since we are situated on just 3 percent of the world's proven oil reserves. We must recognize that fact and read the economic indicators. We must consider emerging competitors such as China and India, and recognize the seismic shifts that are likely to occur in the dynamics of world energy markets.

I firmly believe that future generations of Americans will measure us on how we choose to address the challenges of energy security and climate change. They are that vital to this Nation's security and our economic future.

But this Senator also recognizes that the leadership of this Congress is not yet prepared to take that step; that my colleagues and I who believe so fundamentally in the importance of enhancing our oil security have more work to do to change the hearts and minds of our colleagues. The American people must also demand better leadership from their elected officials when it comes to energy security. And this Senator stands ready to work across

the aisle to do what is necessary to make meaningful progress on these issues.

This bill is not perfect. We have much more work to do to bolster our energy security, and this Senator is ready to roll up her sleeves and do it. But on the whole, this bill provides some basic building blocks toward a better energy future. For that reason, I will support the Energy bill conference report and urge my colleagues to do the same.

Mr. President, as the Senate is poised to pass the Energy Policy Act of 2005 and send it to the President, Utahns should sit up and take notice, because our State is at the heart of this legislation. So many of the problems in our energy structure have solutions that can be found in Utah, whether it is the need for more clean coal, more clean geothermal energy, more natural gas, better hydroelectric, more refining capacity, or more major sources of domestic oil, Utah will play a major part in the solution.

I want to talk more about some of these solutions, but first, let me take a moment to thank Chairman Domenici and Senator Bingaman of the Senate Committee on Energy and Natural Resources for leading us to this point. The Senate Finance Committee, on which I sit, has made a major contribution to the bill with its tax incentives title. Chairman Grassley and Senator Baucus deserve just as much praise for their outstanding coordination and hard work on that important part of this bill.

As the ranking member of the Finance Committee and as a Conferee on this legislation, I was able to watch all 4 of these men work together under pressure, and I could not be more impressed with their leadership and the work their excellent staffs have provided to our nation at this critical time. Working together, they have given us what I consider to be one of the most important bills to be enacted in a long time.

I have, at times, been criticized for reaching across the aisle to accomplish important policy goals. Some believe that compromise signals weakness. Well I just plain disagree, and after 4 years of failing to pass a major Energy bill with a simple majority, I think the Senate has proven that we stand the strongest when we stand together. And our energy situation calls for this type of leadership and strength.

Over the last decade, American consumers have increased their demand for oil by 12 percent, but domestic oil production has grown by less than \1/2\ of 1 percent. Is it any wonder that we rely on foreign countries for more than half our oil needs? We import 56 percent of our oil today, and it is projected to be 68 percent within 20 years.

On the larger scale, global demand for oil is growing at an unprecedented pace--about 2\1/2\ million barrels per day in 2004 alone. While global oil production is increasing, the discovery of new oil reserves is dropping off at an alarming rate. Moreover, trends indicate that the global thirst for petroleum will continue to grow, especially in Asia.

If our Nation must rely on oil imports to meet our future energy needs, we are headed for trouble, because, unless something changes, a sufficient oil supply will not be there. We should keep in mind that the transportation sector in the U.S. accounts for nearly \2/3\ of all of our oil consumption, and that sector is 97 percent dependent on oil. It could not be more clear: if we want to improve our energy security, we must focus on our transportation sector, and we must focus on diversifying our transportation fuels.

Recently, we heard President Bush call on our Nation to ``develop new ways to power our automobiles,'' and he spoke of his proposal to provide $2.5 billion over 10 years in tax incentives for the purchase of hybrid technologies. The President also called for a better alternative fuel infrastructure and the need to develop hydrogen fuel cell vehicles.

As for these policies the President addressed, my legislation, S. 971, the Clean Efficient Automobiles Resulting from Advanced Car Technologies Act, or CLEAR ACT, is exactly where the rubber meets the road. The CLEAR ACT, now a part of this Energy bill, is the most comprehensive and effective plan put forward by Congress to accelerate the transformation of the automotive marketplace toward the widespread use of fuel cell vehicles. And it does so without any new Federal mandates. Rather, it offers powerful market incentives to promote the advances in technology, in our infrastructure, and in the alternative fuels that are necessary if fuel cells are to ever reach the mass market. With the CLEAR ACT we accomplish this goal, but in the meantime, we also get cleaner air, we reduce our dependency on foreign oil, and we help lead our Nation into the future.

Historically, consumers have faced three basic obstacles to accepting the use of alternative fuels and advanced technologies. These are the higher cost of the vehicles, the lack of an infrastructure of alternative fueling stations, and the higher cost of alternative fuels. The CLEAR ACT will lower all three of these market barriers through the use of tax incentives.

First, we provide a tax credit for the purchase of alternative fuels. Next we promote a new infrastructure of alternative fuel filling stations by extending an existing tax deduction for the purchase of the necessary equipment and providing a new tax credit for the cost of installing it.

Finally we provide a Clear Act Credit to consumers who purchase alternative fuel and advanced technology vehicles. This includes fuel cell, hybrid electric, alternative fuel, and battery electric vehicles.

All of the technologies promoted in the CLEAR ACT--whether they be battery or electric motor technologies or advances in fuel storage and alternative fuel infrastructure--lead us closer to the hydrogen fuel cell vehicle. I believe fuel cells are in our future. However, even if the widespread use of fuel cell vehicles never becomes a reality, advances in these other technologies provide a dramatic social benefit on their own.

I have heard from some who question the need for incentives for hybrid vehicles when they are popular in some areas. It may be true that demand for these vehicles is high in a few regions. However, these high-demand areas tend to have local or state incentives in place for the purchase of these vehicles. Where incentives are not in place, hybrid sales are minimal. This demonstrates that incentives can indeed provide a market breakthrough to consumer acceptance of alternative vehicles.

With the CLEAR ACT, we are trying to provide that breakthrough on a national scale. And the numbers show that a breakthrough is desperately needed. It may be true that hybrid sales have doubled in the last couple of years, but they still represent a minuscule 0.48 percent of cars that were sold in 2004. So I am very pleased, Mr. President, that the energy bill will lead us into the future in this regard.

We should also be using more clean alternatives when we generate another form of energy--electricity. I am very pleased that the Energy bill includes S. 1156, my legislation that extends and expands the production tax credit for electricity from renewable sources, including geothermal. This is particularly important to my home State of Utah, which has vast potential for the creation of electricity from geothermal sources, along with other renewable energy sources, such as wind and biomass.

While this production tax credit has been in the tax code for some time, it had an unfair feature that provided the tax credit for 10 years for electricity produced from wind, but only for 5 years for electricity produced from most of the other renewable resources. This inequity has skewed investment in these resources unfairly and in a way that has not led to the best use of these national assets.

I am happy to see that this provision has survived in conference. This should result in a better-balanced and higher output of electricity from all our renewable resources.

And, I have highlighted just two among many important provisions in this bill that will promote the greater use of alternative and renewable sources of energy.

We cannot escape the fact that our nation remains reliant on oil and gas, and we absolutely must increase our supply of these resources in a big way.

It is a little known fact that the largest hydrocarbon resource in the world rests within the borders of Utah, Colorado, and Wyoming. I know it may be hard to believe, but energy experts agree that there is more recoverable oil in these 3 states than there is in all the Middle East. In fact, the U.S. Department of Energy estimates that recoverable oil shale in the western United States exceeds 1 trillion barrels, but it is not counted among world reserves, because it is not yet commercially developed. If anyone is wondering what the significance is of that number, he or she should know that the world's oil reserves stand at just about 1.6 trillion barrels. That means we have almost as much unconventional oil in Utah, Colorado, and Wyoming as the rest of the world's conventional oil combined.

Companies have been waiting for the Federal government to recognize the potential of this resource and allow access to it. My legislation, S. 1111, the Oil Shale and Tar Sands Development Act, will do just that, and more.

Some have been understandably hesitant to develop this resource. During the 1970s, there was a very large and expensive effort in western Colorado to develop oil shale there. When the price of oil dropped dramatically, though, the market for oil shale went bust and the region suffered an economic disaster.

We need to remember that our past failure in this area was not necessarily a failure of technology, but was due to a dramatic slump in gas prices. We now have a different scenario. Today, the world is reaching peak oil production of conventional oil, and cheap oil prices are nowhere in sight.

We have already seen that a shift in focus to unconventional fuels such as tar sands produce mind-boggling results. Only a few years ago, Alberta, Canada recognized the potential of its own tar sands deposits and set forth a policy to promote their development. As a result, Canada has increased its oil reserves by more than a factor of 10, going from a reserve of about 14 billion barrels to its current reserve of more than 176 billion barrels in a very short period. And just think--we are sitting on a similar resource of oil shale and tar sands in the United States.

It is frustrating to learn that Utah imports about one-fourth of its oil from Canadian tar sands, even though we have our own very large resource of tar sands in our own state sitting undeveloped. I look forward to the day in the not-too-distant future, when Utah's oil shale and tar sands are developed to their potential. If it happens, and I believe that it will, Utah will become a world leader in oil production.

But even if we do solve the oil importation issue, we still have another problem. Our Nation is so lacking in refining capacity for crude, that we are forced to import 10 percent of our refined fuel. We could produce all the domestic oil in the world, but until we can refine it, we cannot use it.

It is clear that one of the reasons we currently have sharply higher gasoline prices is that we simply do not have enough refining capacity in this country. This is both a short-term and a longer-term concern for our economy and national security.

Regrettably, gasoline, diesel, jet fuel and home heating oil supplies are simply too tight in America today. There is not a lot that can be done in the very near term to address the higher cost of fuel that is attributable to refining bottlenecks. However, ensuring the long-term viability of the U.S. refining industry should be at the very heart of a smart national energy policy.

One of the major problems with our refining capacity is that industry profitability has been poor over the past several decades. This has contributed to the steady decline in the number of operating refineries in America from more than 300 in 1980 to less than 150 today. I am told the last major refinery to be built in America came on line in the 1970s.

Earlier this year, the National Petroleum Council reported that U.S. refining capacity growth was not keeping pace with demand growth, that poor historic returns in the refining sector was impeding further investment, and that major expenditures in new regulations were limiting the funds available for capacity expansions. This was bad news crying out for a solution.

Another problem mentioned in the report is that the 10-year depreciation schedule prescribed by the current tax law for refining assets is much longer than the write-off periods for similar process equipment in other manufacturing industries. Also, the tax code does not contain any incentives to encourage new investment in refining capacity, which is an endeavor that carries high costs and risks.

With these facts in mind, I introduced S. 1039, the Gas Price Reduction Through Increased Refinery Capacity Act of 2005. S. 1039 would adjust the depreciation period for assets used in refining from 10 years to 5 and would allow an immediate write-off of these assets if companies made an early and firm commitment to invest in new capacity within a relatively short time.

I thank Senator Grassley for including the temporary refinery expensing provisions of S. 1039 in the Chairman's mark of the tax title to the Energy bill. This provision passed the Senate as part of the energy tax package. I am pleased the Conference Committee accepted this provision even though cost constraints forced us to limit the incentive to 50 percent expensing.

This is the first provision passed by Congress in the past half century that gives the U.S. refining industry a specific tax incentive designed to spur investment in increased refining capacity. The National Petrochemical & Refiners Association, which represents virtually all U.S. refineries, has indicated this measure will help stimulate facility expansions and output. It is the only provision in the entire Energy bill that encourages refining capacity growth and increased gasoline, diesel and jet fuel supply for consumers. This provision alone should make a significant difference in fuel supplies.

Utah is a major gas producer. But most of Utah's natural gas lies under our vast public lands. Utah has a large supply, but as you might guess, Federal red tape is the number one obstacle to supplying the country with the natural gas it demands.

One example is the natural gas found within Utah's tar sands. Historically, extracting natural gas from tar sands has required a dual application requiring both a permit for gas extraction and mineral extraction. I introduced a bill that amends the Mineral Leasing Act to allow a company only going after the gas to forgo the permitting for mineral extraction, while fully leaving in place every relevant environmental law and regulation. This legislation, S. 53, was included in the energy bill.

In another effort to create a lose-lose situation, the Department of the Interior recently published a rule that would tack on a new and expensive fee on new Applications for Permit to Drill (APDs) for natural gas development. As members of the Conference Committee, Senator Craig Thomas and I joined forces to put an end to this fee for at least 10 years.

We do not need another hurdle to obtaining gas from our public lands. The Federal government receives about $1.6 billion every year in royalties from gas production on public lands. With every new well in Utah, gas companies pay a generous royalty to Federal and State governments. It is simple math--in the long run, Utah and the Nation loses money when wells are stopped because of fees. We also suffer from the resulting slow down in the supply of natural gas.

Finally, I was a proponent of an item in the Energy bill that reduces the depreciable lives of natural gas gathering and distribution lines. By being able to depreciate their equipment more quickly, companies are better able to invest in future production activity. This provision should help spur investment in more exploration and production of this clean and important fuel.

As I mentioned at the beginning of my remarks, the Energy Policy Act will have a very large impact on Utah,

not only in positive economic growth and jobs, but also in the benefits of cheaper and cleaner energy costs for families and businesses. Again, I thank the leaders in the Senate who have brought us to this point, along with their counterparts in the House of Representatives. I think we have proven today, that Congress can respond to the needs of the nation and our citizens when we work together with that goal in mind.

Mr. President, I am afraid that the heralded passage of this energy bill against years of failure by the Congress to legislate a comprehensive energy policy has created a false sense of accomplishment in Washington today. As my colleagues are well aware, oil prices are hovering near the infamous $60 per barrel mark; the greenhouse effect is beginning to have a substantial measurable impact on the global climate; and American families are being gouged at the pump while their tax dollars are carelessly spent on Federal subsides for big oil and gas companies. As leaders, we cannot claim that we have successfully addressed these real-life challenges by enacting this latest incarnation of special interest influence in policymaking.

I do want to acknowledge the work of the Senate conferees for keeping out a few of the most objectionable provisions that prevented passage of the bill during the last Congress, particularly the MTBE liability waiver and the proposed drilling in ANWR. They took the right action in preventing the inclusion of those provisions. Unfortunately, after all the time and effort spent on this issue during the past several years, when it comes to solving America's pressing energy problems, this bill simply does not go far enough. It will not reduce our dependence on foreign oil, it won't assure the growing threat of global warming is addressed in a meaningful way, and it wont effectively reduce the price of gasoline at the pump.

The estimated cost of this energy bill has ballooned far beyond the original $6.7 billion in the President's proposal. The conference agreement provides an estimated $14.5 billion in corporate subsidies and tax credits. And the tax package provides more than twice as many incentives to the oil, gas, coal and nuclear industries as it does to energy efficiency and renewable energy--a significant change from the Senate-passed bill.

Indeed, big oil, coal and gas companies seem to be disproportionally favored under this bill as most of the tax breaks going to traditional industries. Only about 36 percent of the estimated tax package would go to renewable energy and cleaner burning vehicles. Even then, some of the programs to promote renewable energy and alternative fuels are questionable. A loan guarantee program that would cover up to 80 percent of the cost of developing new energy technologies was scored at $3.75 billion for the first 5 years. These

loans carry a 20- to 60-percent risk of default according to the CBO, and after the 5 years there are no limits on the amount of loans that can be guaranteed, thus leaving the taxpayer to cover the losses when such endeavors fail. Perhaps more alarming, the estimated costs of the bill are estimates at best, and don't take into account some of the hidden costs associated with program authorizations and future tax credit extensions.

And then there is the ambiguous realm of alternative fuels for vehicles. Rather than addressing the gas mileage interests of consumers, this energy conference report would boost ethanol production by requiring 7.5 billion gallons of the corn-derived fuel be added to the domestic gasoline supply by 2012. This is double the current ethanol mandate and while it will be a boon for the ethanol producers, it will have a negligible effect on oil imports. While I fully recognize and support efforts to promote clean energy sources, the costs also need to be weighed against any presumed benefits. And at this juncture, the beneficiaries are still the producers, not the consumers and not the environment.

Let me mention some of the more ``interesting'' provisions in the conference report:

Section 134. Energy Efficiency Public Information Initiative. Authorizes a total of $400 million, $90 million for Fiscal Years 2006 through 2010, for the Secretary of Energy to carry out a national consumer information program to encourage energy efficiency through disseminating information to the American public addressing, among other things, the importance of proper tire maintenance. I am fully aware that it is important to rotate your tires, and to take other actions to preserve energy, but do we really need to spend almost half a billion on such a campaign?

Section 138. Intermittent Escalator Study. Requires the GSA to study the advantages and disadvantages of employing intermittent escalators in the United States. I can't imagine many of my colleagues would support removing ``Senators Only'' features in the Capitol Complex and be content to wait for an elevator to intermittently show up, but maybe the rest of the American public is more patient.

Section 207. Installation of Photovoltaic System. Authorizes $20 million for the GSA to install a photovoltaic system, as set forth in the Sun Wall Design Project, for the Department of Energy headquarters building. Of all the sunny places in this country where solar power is viable, the Energy Department Building in DC would not be the first place that comes to mind.

Section 208. Sugar Cane Ethanol Program. Establishes a new $36 million program under EPA that is limited to sugar producers in the States of Florida, Louisiana, Texans and Hawaii for 3 years.

Section 224. Royalties and Near-Term Production Incentives. Under this section, all monies received by the U.S. on all lands except for the State of Alaska, from sales, bonuses, rentals and royalties on leased Federal lands or geothermal resources shall be paid into the Treasury of the U.S. and a percentage of such funding is then partially redistributed to the State within the boundaries of which the revenues were generated. But in the case of Alaska, seems that they will get to keep all of the monies generated.

Section 237. Intermountain West Geothermal Consortium. Establishes an Intermountain West Geothermal Consortium that focuses on building collaborative efforts among universities in the State of Idaho, other regional universities, State agencies and the Idaho National Laboratory, must be hosted and managed by Boise State University, and have a directed appointed by the Boise State University. Why do we need a federal law to promote collaboration at Boise State?

Section 244. Alaska State Jurisdiction Over Small Hydroelectric Projects. Amends the Federal Power Act with respect to certain authorities for the State of Alaska, allowing the State to completely ignore any recommendations received from the National Marine Fisheries Service, the U.S. Fish and Wildlife Service, and State fish and wildlife agencies concerning conditions for the protection, mitigation, and enhancement of fish and wildlife in constructing small hydroelectric projects.

Section 245. Flint Creek Hydroelectric Project, located in Granite and Deer Lodge Counties, Montana. The bill basically extends the project's permit for an additional 3 years. And, notwithstanding other laws and regulations regarding payment to the U.S. for the use of Federal lands, such payments surrounding this project would be specified in the bill. I can only assume this payment is less than what would otherwise be required.

Section 354. Enhanced Oil and Natural Gas Production Through Carbon Dioxide Injection. Establishes a $3 million demonstration program solely for 10 projects in the Willistin Basin in North Dakota and Montana and 1 project in the Cook Inlet Basin in Alaska.

Section 356. Denali Commission. Authorizes $55 million annually for fiscal years 2006-2015 for a seven-member commission created in 1998 comprised entirely of Alaska interests to support Alaska interests. This funding would be used to carry out energy programs.

Section 365. Pilot Project to Improve Federal Permit Coordination. Establishes a pilot that only the States of Wyoming, Montana, Colorado, Utah, and New Mexico can participate in.

Section 412. Loan to Place Alaska Clean Coal Technology Facility in Service. This section authorizes a direct Federal loan for up to $80 million for a plant near Healy, Alaska. One of the few protections under this section for the American taxpayer is extremely lax. It states that prior to providing the loan, the Secretary determine that ``there is a reasonable prospect that the borrower will repay the principal and interest on the loan.'' That sure doesn't sound like the type of stringent criteria and risk assessment that would be weighed by many lending institutions that I am aware of. And why does this particular facility merit a Federal loan over other clean energy technologies?

Section 416. Electron Scrubbing Demonstration. Directs the Secretary to use $5 million to initiate, through the Chicago operations office, a project to demonstrate the viability of high-energy electron scrubbing technology on commercial-scale electrical generation using high-sulfur coal.

Section 628. Decommissioning Pilot Program. This section authorizes $16 million for a pilot program to commission and decontaminate the sodium cooled fast breeder experimental test site reactor located in northwest Arkansas.

Section 755. Conserve by Bicycling Program. Provides $6.2 million to establish a pilot program to be known as the ``Conserve by Bicycling Program'' and study the feasibility of converting motor vehicle trips to bicycle trips, including whether such factors make bicycle riding feasible: weather, land use and traffic patterns, the carrying capacity of bicycles and bicycle infrastructure. I find it difficult to support spending $6.2 million to encourage Americans to ride bicycles when we are running a deficit of $368 billion this year and a 10-year projected deficit of $1.35 trillion, according to the Congressional Budget Office.

Section 756. Reduction of Engine Idling. Authorizes $139.5 million to study the environmental impact of engine idling from heavy-duty vehicles and locomotives at truck stops, ports of entry, rest areas and private terminals. Is there any doubt that engine idling may be contributing to air quality problems? Do we need to expend almost $140 million on such a study? It might be cheaper to pay the truckers and engineers to shut off their engines.

Section 955. Department of Energy Civilian Nuclear Infrastructure and Facilities. Requires the Secretary to develop a comprehensive plan for facilities at the Idaho National Laboratory to avoid duplicative efforts at other national laboratories and establish or consider plans to establish or convert various areas into user facilities.

Section 980. Spallation Neutron Source. Requires the Secretary develop an operational plan for the Oak Ridge National Laboratory in Oak Ridge, TN, to ensure the facility is employed to its full capability. It further authorizes the Spallation Neutron Source Project at Oak Ridge at $1,411,700,000 for total project costs.

Section 997. Arctic Engineering Research Center. It directs the Secretary of Transportation to provide annual grants, worth $18 million total, to ``a

university research center to be headquartered in Fairbanks''--that must be the University of Alaska-Fairbanks according to its Web site-- to establish and operate a university research center to research improved performance of roads, bridges, residential, commercial, and industrial structures in the Arctic region.

Section 1511. Renewable Fuel. The section authorizes a total of $12 milliom--$4 million for 3 years--for a resource center to further develop bioconversion technology at the Center for Biomass-Based Energy at the Mississippi State University and the Oklahoma State University.

Section 1811. Coal Bed Methane Study. Directs the DOE and EPA to collaborate with the NAS on a study on the effect of coalbed natural gas production on surface and ground water aquifers in Montana, Wyoming, Colorado, New Mexico, North Dakota, and Utah.

Now that we know a little about some of the provisions contained in the conference agreement, let's talk about one very important issue that is not addressed--an issue of worldwide significance: global warming.

Earlier this month, the leaders of the G8 nations met and issued an agreement with respect to climate change. The agreement among the G8 nation states that: ``We will act with resolve and urgency now to meet our shared and multiple objectives of reducing greenhouse gas emissions [.]''

This agreement followed the joint statement that was issued in June in which the U.S. National Academy of Sciences and national academies from other G8 countries, along with those of Brazil, China, and India, which concluded that: ``The scientific understanding of climate change is now sufficiently clear to justify nations taking prompt action. It is vital that all nations identify cost-effective steps that they can take now, to contribute to substantial and long-term reduction in net global greenhouse gas emissions.''

It is very disappointing that the climate change provisions in the conference report fail to address the necessary commitment for taking urgent actions and making substantial reductions in greenhouse gas emissions.

The conference report requires the Department of Energy to develop greenhouse gas intensity technologies and strategies. Such requirements are a waste of time and effort as we already know that using the greenhouse gas intensity does not work. How do we know it doesn't work? We know because the Department of Energy has shown us and because climate change science tells us that the climate system does not respond to greenhouse gas intensity, but rather to greenhouse gas concentration levels in the atmosphere.

Recently, the Energy Information Administration at the Department of Energy released a statement indicating that preliminary data for the year 2004 revealed that energy-related carbon emission intensity fell by 2.6 percent, while energy-related carbon dioxide emissions grew by 1.7 percent. This is an early reality check for those who argue that we can control greenhouse gas emissions by only controlling carbon emission intensity.

Again this clearly shows how our efforts to address climate change are misfocused and without substance. If we continue down this path, the $5 billion per year that we are currently investing in the climate change science and technology programs will not provide the return on investments that the American people deserve.

Furthermore, if you look at any credible scientific report on climate change, it speaks of the impact of greenhouse gases on the climate system, not the impact of greenhouse gas intensity. In all the hearings that we have held in the Commerce, Science, and Transportation Committee over the past few years, I don't recall a single scientist indicating that if we control our greenhouse gas intensity, then we can mitigate the impacts of climate change.

If we are to address climate change consistent with the sense-of-the- Senate resolution passed by this body just over a month ago, then we must pursue solutions that will truly have an impact on the climate system, not those that are no more than ``smoke and mirrors.'' Of course, the conferees failed to agree to even include the modest resolution in the final conference agreement.

If it weren't for the pressing need to show the American public that we are acting in at least some way to address our Nation's energy problems--action that every person is reminded of every time they pay yet a higher price at the pump--I doubt many of my colleagues would be so rushed to pass this bill. Quite frankly, it seems as though the Congress is grasping at straws to address our energy quandary, unwilling or unable to use the foresight necessary to plan for a future America that is less reliant on foreign oil, cleaner under renewable energy generation, or leading in cutting-edge energy efficiency technology. And in our failure, the American people will be disappointed.

Mr. President, I am supporting the conference report on the Energy bill. The conference report includes provisions that will increase the diversity of our Nation's fuel supply, encourage investment in infrastructure and alternative energy technologies, increase domestic energy production, take steps to improve the reliability of our electricity supply, and improve energy efficiency and conservation. This conference report is far from perfect but on balance it moves toward a sounder energy policy that will lead the way to greater energy security and efficiency for the United States.

Our policies have long ignored the problem of U.S. dependence on foreign oil, and we remain as vulnerable to oil supply disruptions today as we have been for decades. Taking the steps necessary to reduce our dependence on foreign oil is an important objective for this country. We need a long-term, comprehensive energy plan, and I have long supported initiatives that will increase our domestic energy supplies in a responsible manner and provide consumers with affordable and reliable energy.

There are some positive provisions included in the conference report in this regard, particularly those provisions that address energy efficiency and will lead us toward greater use of advanced vehicle technologies and alternative fuels such as ethanol and biodiesel. I have also long advocated Federal efforts that will lead to revolutionary breakthroughs in automotive technology that will in turn help us reduce our oil consumption. We need a level of leadership similar to the effort of a previous generation to put a man on the moon.

The conference report includes a wide-range of energy efficiency provisions that will make conservation and efficiency a central component of our Nation's energy strategy. These provisions address Federal, State, and local energy efficiency programs, provide funding for important programs such as home weatherization, and establish efficiency standards for a wide variety of consumer and commercial products. I am particularly pleased that the conference report authorizes both the weatherization program and the Low Income Home Energy Assistance Program, LIHEAP, at higher levels of funding than the Congress has provided in recent years.

The conference report takes critical steps to improve the reliability of our electrical grid and promote electricity transmission infrastructure development. Our economy depends upon electric power, and, in some cases, electric power literally saves lives. Failures in the electric system interrupt many crucial activities, and the need for improvement was underscored painfully by the August 2003 blackout. There were 2 key lessons from the blackout--the need for strong regional transmission organizations to ensure that reliability standards are carried out and enforced, and the need for additional transmission upgrades to maintain reliability. I regret that it has taken 2 years to legislate on these issues, but I am pleased that the conference report includes the steps necessary to ensure there will be mandatory and enforceable reliability standards.

The conference report also puts increased emphasis on diversity of supply and includes a range of provisions intended to encourage the use of new and cleaner technologies, particularly for power generation. Nearly 60 percent of electricity generation in Michigan is generated from coal, which will remain a vital resource well into the future. Programs authorizing research in clean coal-based gasification and combustion technologies will ensure that the most advanced technologies are developed for power generation. Other provisions of the conference report also encourage the use of innovative technologies for both power generation and other end-uses.

Increased emphasis on diversity of fuel supply will help to take the pressure off our tight natural gas supply, which is important for States such as Michigan with a large manufacturing base. Over the past 6 years, the tight natural gas supply and volatile domestic prices have had significant impacts on the U.S. manufacturing sector, which depends on natural gas as both a fuel source and a feedstock and raw material for everything from fertilizer to automobile components. As domestic production of natural gas has declined, demand for natural gas has increased dramatically, particularly in the area of power generation. Today, U.S. natural gas prices are the highest in the industrialized world, and many companies have been forced to move their manufacturing operations offshore. More than 2 million manufacturing jobs have been lost to overseas operations in the 5 years, in part no doubt because natural gas prices jumped from $2 per million Btu to more than $7 per million Btu.

I am pleased that the conference report includes significant provisions from the Senate bill for research, development, demonstration and commercialization effort in the area of hydrogen and fuel cells. I believe that this program will help us make critical strides toward realizing the goal of putting hydrogen fuel cell vehicles on the road over the next 10 to 15 years. The conference report also includes an amendment I offered in the Senate to have the National Academy of Sciences conduct a study and submit a budget roadmap to Congress on what level of effort and what types of actions will be required to transition to fuel cell vehicles and a hydrogen economy by 2020. If hydrogen is the right answer, we will need the equivalent of a moon shot to get there. We will need a significant Federal investment--well beyond anything we are doing today--in conjunction with private industry and academia to reach that goal. This study and roadmap will be an important step toward determining if that is the right path to follow.

We also need to put greater Federal resources into work on other breakthrough technologies such as advanced hybrid technologies, advanced batteries, advanced clean diesel, and hybrid diesel technology. Federal Government investment is essential not only in research and development but also as a mechanism to push the market toward greater use and acceptance of advanced technologies. Expanding the requirements for the Federal Government to purchase advanced technology vehicles will help provide a market for advanced technologies. Encouraging and supporting State and local efforts is also important in the effort to push these advanced technologies forward. Therefore, I am pleased the conference report includes the amendment offered by Senator Voinovich in the Senate to authorize $200 million annually for 5 years to fund Federal and State grant and loan programs that will help us to replace older diesel technology with newer, cleaner diesel technology. These initiatives will help the U.S. to develop advanced clean diesel technology, which can make a major contribution toward our meeting stricter emissions standards in a cost- effective manner.

Finally, the conference report also includes important tax incentives for advanced technology vehicles--including advanced clean diesel, as well as hybrid and fuel cell vehicles--that are critical to encourage consumers to make the investment in these technologies. I would have liked for the tax package to have included more generous tax credits for consumers and to have included an investment tax credit to manufacturers to help defray the cost of re-equipping or expanding existing facilities to produce advanced technology vehicles. The tax incentives included in the conference report are a modest first step. I will continue to

press for an investment tax credit for manufacturing of advanced technology vehicles because I believe it is necessary to offset the high capital costs of such an investment and to ensure that these vehicles will be made in the U.S.

I am pleased that the conference report includes an amendment that I offered in the Senate with Senator Collins to direct the U.S. Department of Energy to develop and use cost-effective procedures for filling the U.S. Strategic Petroleum Reserve. This provision requires DOE to consider the price of oil and other market factors when buying oil for the SPR and to take steps to minimize the program's cost to the taxpayer while maximizing our energy security. Since early 2002, DOE has been acquiring oil for the SPR without regard to the price or supply of oil. During this period the price of oil has been very high-- often over $30 per barrel--and the oil markets have been tight. Many experts have stated that filling the SPR during the tight oil markets over the past several years increased oil prices. With this provision, the conference report directs DOE to use some common sense when buying oil for the SPR.

I am also pleased that the conference report provides at least a short-term approach to some air quality issues in West Michigan. Interstate pollution from upwind areas such as Chicago and Gary, has resulted in several Michigan counties being designated by the EPA as in nonattainment with the National Ambient Air Quality Standards. This interstate pollution not only has environmental and health ramifications, but also has economic development implications because nonattainment regions are required to comply with more stringent regulatory standards. The 2 year respite from these additional regulatory provisions for West Michigan counties whose air quality problems were caused by upwind sources will provide temporary regulatory relief. However, these counties are still burdened with air pollution they did not cause. I am hopeful that EPA's 2 year demonstration study of the long-range transport of ozone and ozone precursors required in the Energy bill will provide helpful information for addressing the source of the pollution and result in improved air quality for downwind areas. Until the source pollution is addressed, West Michigan will continue to be plagued by pollutants from upwind areas. I am hopeful that this study and 2 year delay in regulatory requirements will provide the motivation for addressing the broader problems of interstate air pollution.

I am pleased that the conference report contains a ban on future drilling in the Great Lakes. Millions of people rely on the Great Lakes for drinking water, and it is simply irresponsible to risk contamination of this source of drinking water, tourism and recreation. Preventing future drilling does not jeopardize more than a minute amount of our energy supply, and the bill does that for a very good cause, which is the protection of one of the world's truly great natural assets, the source of about 20 percent of the world's fresh water.

The conference report puts some increased emphasis on renewable energy technologies, such as wind, biomass, and solar power. These technologies are becoming more economical every year. In fact, in some areas of the country these technologies are competitive with traditional fuels such as coal and natural gas. However, I regret that the conference report deleted the Renewable Portfolio Standard, which I supported in the Senate bill that would have pushed the sellers of electricity to obtain 10 percent of their electric supply from renewable energy sources by the year 2020. I believe that these goals could have been met and that an increased use of renewable technologies will both reduce our dependence on foreign oil and lead to the creation of tens of thousands of new jobs.

I regret that the conference report does not include a comprehensive effort to adequately address the impact of global climate change. For years, almost all scientists have agreed that human actions are causing temperatures around the world to increase. Experts also agree that this global climate change will lead to environmental problems and economic hardship, but there has been no consensus in the United States about what we should do to stop climate change.

The threat is real and growing, and the longer we wait to reach a reasonable consensus, the more painful the solutions will be. I believe two major policy changes are needed at the Federal level: support for a new, binding international treaty that includes all countries, and a massive new Federal investment in research, development and commercialization of new technologies. Both of these steps would provide real environmental and economic benefits while being fair to American workers. The Senate considered several well-intentioned proposals on this issue, though I did not believe they would have taken us in a comprehensive direction. I supported a Sense of the Senate resolution that acknowledges the problem and calls on the administration to work with the Congress to enact a comprehensive national program to address this issue. I regret that the conference report did not include such a modest provision.

Finally, I am disappointed the provision allowing continued export of highly enriched uranium was included in the conference report. The amendment that Senator Kyl and Senator Schumer offered to strike this provision from the Senate passed bill was adopted by the Senate by rollcall vote. It is unfortunate that this provision, which is a special interest provision, granting relief to one Canadian company was reinserted in the final agreement. This provision undermines longstanding U.S. efforts to eliminate highly enriched uranium in commerce, and increases the possibility that highly enriched uranium could be stolen by terrorists and used in a nuclear weapon or radiological device.

The energy bills considered by the Congress over the last couple of years have been doomed by a heavy-handed, partisan approach. We lost valuable time in putting us on the course toward a sounder energy policy. The conference committee pursued a different approach this year, and as a result, was able to produce a bill with bipartisan support, which, while far from perfect, on balance, is an improvement over current policy.

Mr. President, first, I would like to thank both the chairman and the ranking member of the Energy and Natural Resources Committee, Senators Domenici and Bingaman, for working together in a more open and bipartisan way in developing the bill we are considering today.

While there are many provisions that should be in this bill but aren't and many other provisions in here that I don't agree with, this bill could have been worse. There are numerous extraneous and environmentally harmful provisions that were in previous energy bills but are not included here. I appreciate both of my colleagues' efforts to avoid those pitfalls and produce the Energy bill we are now considering.

However, there remains one very large and glaring omission in this bill. While framed as a ``comprehensive national energy policy,'' this bill completely ignores the most important energy issues facing America, our growing dependence on foreign oil and the impact this dependence has on our economic security and national security.

I have no doubt that our Republican colleagues will go home and hold press conferences claiming victory. They will say that they finally broke through the obstructionism and passed an energy bill that will reduce America's dependence on foreign oil; a bill that will make America more secure.

I wish that were true--but it is not. This is not an energy policy for America in the 21st century. And that is very unfortunate.

The price of a barrel of oil is above $60 and rising, gas prices are again reaching record highs, yet this bill offers no solution. In all of the pages of text, there is no meaningful program or plan to reduce our dependence on foreign oil. There is no provision that increases fuel efficiency or promotes oil conservation. There is no provision to create a comprehensive, long-term program for the development of renewable, sustainable fuels.

This bill could have been a roadmap to a new energy future in America, but instead it leaves us stuck in our current energy mess.

Supporters of this bill will claim that it can reduce America's dependence on foreign oil by increasing domestic oil production. But I would point out a

well-known fact--the U.S. contains only 3 percent of the known global oil reserves in the entire world. No matter how much we drill here, we will never drill enough to meet our growing thirst for oil.

As long as we continue to consume as much oil as we do today, without addressing the hard issues such as fuel economy standards, we will become more, not less, reliant on foreign oil. With global demand for oil steadily increasing, this continued dependence on imported oil could have devastating economic consequences.

Today we import 58 percent of our oil. The Department of Energy's Energy Information Administration projects that the U.S. will import 68 percent of our oil by 2025--more than \2/3\ of our oil consumption.

Former CIA Director James Woolsey, Robert McFarlane, former President Reagan's National Security Adviser, and other national security experts have created a group they call the Set America Free Coalition. According to them, ``It is imperative that the nation's energy policy address the national security and economic impacts of growing oil dependence.''

Imagine what would happen to the U.S. economy if there were a major disruption in oil supplies in a foreign producing country--perhaps in the Middle East. Can you imagine what could happen to our economy?

I can. Thirty years ago, war in the Middle East caused oil prices in the U.S. to increase by 70 percent. Overnight, the price of oil rose from $3 per barrel to $5.11 per barrel. Just a few months later, oil prices more than doubled again to $11.65 per barrel.

At the time of the 1970s oil embargo the U.S. imported less than a third of our oil. This embargo hit Americans hard, as many remember well. Back then, Congress recognized the economic impact of oil dependence and took steps to address oil consumption in America. Among other actions, Congress passed national fuel economy standards, raising passenger cars from an average 12.9 miles per gallon in 1973 to 27.5 miles per gallon by 1985.

Increasing fuel economy standards for cars is one of the most effective steps we can take to reduce oil dependence. Unfortunately, this Congress has rejected that goal.

Listen to this, from an article published in BusinessWeek about a month ago:

As Congress puts the final touches on a massive new energy

bill, lawmakers are about to blow it. That's because the bill

almost certainly won't include one policy initiative that

could seriously reduce America's dependence on foreign oil: A

government-mandated increase in the average fuel economy of

new cars, SUVs, light trucks and vans.

BusinessWeek was right, Congress did blow it.

Congress has blown it at a time when the National Academy of Sciences and many other energy and engineering experts tell us the technology is available today to reduce our need for oil by 3 million barrels per day by 2015.

Not only is there no new fuel economy standard, the energy conferees even rejected a modest provision that would have reduced oil consumption by 1 million barrels per day by 2015--just 4 percent of the petroleum it is projected we will use by 2015.

Incredibly, it is President Bush's stated policy to oppose any fuel savings measures.

Does this make any sense?

There is only one provision in this entire bill that may--may--reduce America's dangerous dependence on foreign oil: a renewable fuels provision that requires a doubling in ethanol production by 2012. This provision will reduce oil consumption by about 1 percent over the next 7 years.

But does this limited 1-percent reduction in imported oil over 7 years represent the best we can do for America's energy security? Economic security? National security?

Senate Democrats believe that Americans can do better than we are today.

We offered a plan to reduce America's dependence on imported oil by 40 percent by 2025. This goal was a realistic goal--with realistic changes in the way we use energy, advance the production and application of energy technology, and promote energy efficiency and conservation.

Nearly half of the Members of this body voted for our plan.

But big oil companies, car companies, and their allies in the White House and Congress rejected even setting a goal.

How is it that the same administration that talks about sending a man to Mars does not have enough faith in American genius and American know-how to believe that our scientists and engineers can determine how to increase the fuel efficiency of our automobile fleet safely?

Almost 3 months ago, I spoke to an auditorium of scientists at the Argonne National Energy lab--America's first national energy lab just outside of Chicago. The scientists there do not think that decreasing America's over-reliance on foreign oil is impossible. They think it is imperative.

Instead of shoveling billions of dollars at oil and energy companies, we ought to be investing in the work of those and other scientists. Yet, the Republican leadership, from the White House on down, is cutting public investments in scientific research and providing billions of dollars in tax incentives to big oil companies that have been recording record profits.

This bill takes much of the $11.5 billion in tax incentives that could have been used to develop renewable and alternative energy sources and instead gives it to big oil and energy companies.

For instance, there are generous royalty payment relief provisions for energy companies that drill on Federal lands. A better bill would have maintained royalty payments and used these funds to extend the production tax credit for wind generation beyond the 2 years written in this bill. Unfortunately the 2-year extension will continue the boom and bust cycle we've witnessed in the investment of wind generation.

The President himself says that oil and energy companies do not need tax cuts--but he will sign this bill anyway, even if they are included.

Think about that: the upcoming reconciliation bill will contain $10 billion in cuts in health care for the poor while this bill provides over $10 billion in tax breaks, mostly for big oil and energy companies.

Talk about a Congress out of touch with America.

And we will have to borrow the money to pay for those tax breaks and pay interest on that money too, so the true cost is even higher.

This is a failure in leadership.

From the day they took office, the Bush administration made passing a new national energy bill a top priority. The President put the Vice President in charge of getting the job done. We still don't know how much of this bill can be traced back to the Vice President's secret energy task force because the administration has gone to extraordinary lengths--all the way to the U.S. Supreme Court--to keep all of its records about the task force secret.

There are at least two things the big oil and energy companies wanted that are not in this bill.

For 5 years, MTBE manufacturers prevented the passage of an energy bill by demanding that they be shielded from liability for groundwater contamination caused by their product. Thankfully, the liability waiver is not in this bill--so Americans won't have all the cleanup costs shifted onto the taxpayers.

Oil companies also fought hard against increasing ethanol production--knowing that this renewable fuel would replace some of their products. The oil companies wanted only a token nod toward ethanol.

Thankfully, this bill contains a renewable fuel standard that increases the use of domestically produced renewable fuels to 7.5 billion gallons by 2012. This change will be good for America's economy, good for our energy security and good for Illinois farmers.

Illinois farmers grow corn that provides 40 percent of the total ethanol consumed in the U.S. annually. They stand ready and eager to meet the new challenges in this bill.

I believe the renewable fuels standard can lead to greater energy security for our Nation.

I will vote for this bill for one reason. After 4 years of fighting this battle, it is clear we are not going to get an energy plan for the 21st century as long as Texas oil men are in charge of the Federal Government. This is as good as we are going to get.

It has been 13 years since the last time America passed a national energy plan. I can guarantee you, it will not be another 13 years before this plan is abandoned and replaced with a more visionary and responsible plan.

We should have increased America's national and economic security by reducing our reliance on oil imported from Saudi Arabia and other politically volatile nations. We have the scientific ability to meet that challenge. Unfortunately, we lack the political leadership to do so.

The price we will pay for this failure of leadership in rising gas prices and increased risk to our national economy and national security will far exceed the cost of the wasteful tax breaks this bill gives to big oil.

This bill does not reduce gas prices at the pump, it does not reduce dependence on foreign oil, it does not address fuel efficiency and conservation, and it does not increase America's economic and national security. It is not an energy plan for the 21st century.

And it is definitely not the end of the energy debate--only the beginning.