Omnibus Energy Legislation, 109th Congress: Assessment of H.R. 6 as passed by the House
Congressional research reportJun 3, 2005
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Omnibus Energy Legislation, 109th Congress:
Assessment of H.R. 6 as passed by the House
June 3, 2005
Mark Holt and Carol Glover, Coordinators
Resources, Science, and Industry Division
Congressional Research Service ˜ The Library of Congress
Omnibus Energy Legislation, 109th Congress:
Assessment of H.R. 6 as passed by the House
Summary
The House approved an omnibus energy bill (H.R. 6) on April 21, 2005, that
would open the Arctic National Wildlife Refuge (ANWR) to oil and gas leasing,
substantially change oversight of electric utilities, increase the use of alternative
motor fuels, provide $8.1 billion in energy tax incentives, extend the nuclear accident
liability system, and authorize numerous energy R&D programs. The House-passed
bill contains many provisions from the conference version of an omnibus energy bill
(also H.R. 6) in the 108th Congress that was blocked by a Senate filibuster.
Electricity. In part, the electricity section would repeal the Public Utility
Holding Company Act (PUHCA) and establish mandatory standards for interstate
transmission. Standard market design (SMD) would be remanded to the Federal
Energy Regulatory Commission (FERC).
Renewable Fuels and Ethanol. An increase in renewable fuel and ethanol
consumption to 5 billion gallons annually by 2012 would be mandated. However,
states could petition for a waiver if the mandate would have severe economic or
environmental repercussions, other than loss of revenue to the highway trust fund.
MTBE. Methyl tertiary butyl ether (MTBE), a gasoline additive widely used to
meet Clean Air Act requirements, has caused water contamination. The bill would
ban the use of MTBE by 2015 with some possible exceptions, provide funds for
MTBE cleanup, and provide protection for fuel producers and blenders of renewable
fuels and MTBE from defective product lawsuits.
Energy Taxes. The bill would reduce energy taxes about $8.1 billion over 10
years, as compared with $23.5 billion in the H.R. 6 conference report in the 108th
Congress and $6.7 billion in President Bush’s FY2006 budget request.
Nuclear Energy. H.R. 6 would provide a 20-year extension of the PriceAnderson nuclear liability system to the end of 2025 and authorize new reactors.
Energy Efficiency Standards. New statutory efficiency standards would be
established for several consumer and commercial products and appliances. For
certain other appliances, the Department of Energy could set new standards.
ANWR. The House-passed bill would authorize oil and gas exploration,
development, and production in ANWR, with a 2,000-acre limit on production and
support facilities. Supporters of the provision maintain that ANWR oil could be
developed with minimal environmental harm, but opponents contend that intrusion
on this ecosystem cannot be justified.
Energy Production on Federal Lands. Royalty reductions would be provided
for marginal oil and gas wells on federal lands and the outer continental shelf.
This report will not be updated.
Contents
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Major Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Electricity Regulation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Renewable Fuel Standard and MTBE . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Energy Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Nuclear Energy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Renewable Energy and Efficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Arctic National Wildlife Refuge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Domestic Energy Production . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Hydrogen and Fuel Cells . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Organization of Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Title I — Energy Efficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Subtitle A — Federal Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 101: Energy and Water Saving Measures in
Congressional Buildings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 102: Energy Management Requirements . . . . . . . . . . . . . . . . . 8
Section 103: Energy Use Measurement and Accountability . . . . . . . . . 8
Section 104: Procurement of Energy-Efficient Products . . . . . . . . . . . . 8
Section 105: Energy Savings Performance Contracts . . . . . . . . . . . . . . 8
Section 107: Voluntary Commitments to Reduce Industrial
Energy Intensity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 108: Advanced Building Efficiency Testbed . . . . . . . . . . . . . . 9
Section 109: Federal Building Performance Standards . . . . . . . . . . . . . 9
Section 111: Daylight Savings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 112: Enhancing Energy Efficiency in Management of
Federal Lands . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Subtitle B — Energy Assistance and State Programs . . . . . . . . . . . . . . . . . . 9
Section 121: Low Income Home Energy Assistance Program
(LIHEAP) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 122: Weatherization Assistance . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 123: State Energy Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 124: Energy-Efficient Appliance Rebate Programs . . . . . . . . . 9
Section 125: Energy-Efficient Public Buildings . . . . . . . . . . . . . . . . . . 9
Section 126: Low Income Community Energy Efficiency Pilot
Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Subtitle C — Energy-Efficient Products . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 131: Energy Star Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 132: HVAC Maintenance Consumer Education Program . . . 10
Section 133: Energy Conservation Standards for Additional
Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 134: Energy Labeling . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 135: Preemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 136: State Consumer Product Energy Efficiency Standards . . 10
Section 137: Intermittent Escalators . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Subtitle D — Public Housing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 141: Capacity Building for Energy-Efficient, Affordable
Housing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 142: Increase of CDBG Public Services Cap for
Energy Conservation and Efficiency Activities . . . . . . . . . . . . . . 11
Section 143: FHA Mortgage Insurance Incentives for
Energy-Efficient Housing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 144: Public Housing Capital Fund . . . . . . . . . . . . . . . . . . . . . 11
Section 145: Grants for Energy-Conserving Improvements for
Assisted Housing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 147: Energy-Efficient Appliances . . . . . . . . . . . . . . . . . . . . . . 11
Section 148: Energy-Efficient Standards . . . . . . . . . . . . . . . . . . . . . . . 11
Section 149: Energy Strategy for HUD . . . . . . . . . . . . . . . . . . . . . . . . 11
Title II — Renewable Energy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Subtitle A — General Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 201: Assessment of Renewable Energy Resources . . . . . . . . . 12
Section 202: Renewable Energy Production Incentive . . . . . . . . . . . . 12
Section 203: Federal Purchase Requirement . . . . . . . . . . . . . . . . . . . . 12
Section 204: Insular Areas Energy Security . . . . . . . . . . . . . . . . . . . . . 12
Section 205: Use of Photovoltaic Energy in Public Buildings . . . . . . 13
Section 206: Federal Procurement of Biobased Products . . . . . . . . . . 13
Section 207: Renewable Energy Security . . . . . . . . . . . . . . . . . . . . . . 13
Section 208: Installation of Photovoltaic System . . . . . . . . . . . . . . . . 13
Section 209: Sugar Cane Ethanol Pilot Program . . . . . . . . . . . . . . . . . 13
Subtitle C — Hydroelectric . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 231: Alternative Conditions and Fishways . . . . . . . . . . . . . . . 13
Section 241: Hydroelectric Production Incentives . . . . . . . . . . . . . . . . 14
Section 242: Hydroelectric Efficiency Improvement . . . . . . . . . . . . . . 14
Section 243: Small Hydroelectric Power Projects . . . . . . . . . . . . . . . . 14
Title III — Oil and Gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Subtitle A — Petroleum Reserve and Home Heating Oil . . . . . . . . . . . . . . 15
Section 301: Permanent Authority to Operate the Strategic
Petroleum Reserve . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 302: National Oilheat Research Alliance . . . . . . . . . . . . . . . . 15
Section 303: Site Selection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 304: Suspension of Strategic Petroleum Reserve Deliveries . 15
Subtitle B — Production Incentives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Section 320: Liquefied Natural Gas . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Section 327: Hydraulic Fracturing . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Section 328: Oil and Gas Exploration and Production Defined . . . . . 18
Section 329: Outer Continental Shelf Provisions . . . . . . . . . . . . . . . . 19
Section 330: Appeals Relating to Pipeline Construction or
Offshore Mineral Development Projects . . . . . . . . . . . . . . . . . . . 19
Sections 332 — 333: Natural Gas Market Reform . . . . . . . . . . . . . . . 19
Section 334: Oil, Gas, and Mineral Industry Workers . . . . . . . . . . . . . 20
Subtitle C — Access to Federal Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Sections 344 and 346: Leasing and Permitting Processes . . . . . . . . . . 20
Section 355: Encouraging Prohibition of Drilling in the
Great Lakes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 358: Federal Coalbed Methane Regulation . . . . . . . . . . . . . . . 21
Subtitle D — Refining Revitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Sections 371- 379: Refining Revitalization . . . . . . . . . . . . . . . . . . . . . 21
Title IV — Coal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Subtitle A — Clean Coal Power Initiative . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Sections 401- 404: Clean Coal Power Initiative . . . . . . . . . . . . . . . . . 22
Subtitle B — Clean Power Projects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Sections 411- 416: Clean Power Projects . . . . . . . . . . . . . . . . . . . . . . 23
Subtitle D — Coal and Related Programs . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Section 441: Clean Air Coal Program . . . . . . . . . . . . . . . . . . . . . . . . . 23
Title V — Indian Energy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 501: Short Title . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 502: Office of Indian Energy Policy and Programs . . . . . . . . 24
Section 503: Indian Energy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 504: Consultation with Indian Tribes . . . . . . . . . . . . . . . . . . . 24
Section 505. Four Corners Transmission Line Project . . . . . . . . . . . . 25
Title VI — Nuclear Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Subtitle A — Price-Anderson Act Amendments . . . . . . . . . . . . . . . . . . . . . 25
Sections 601- 612: Price-Anderson Nuclear Liability Coverage . . . . . 25
Subtitle B — General Nuclear Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 621: Commercial Reactor License Period . . . . . . . . . . . . . . . 27
Section 622: NRC Training and Fellowship Program . . . . . . . . . . . . . 27
Section 623: Cost Recovery From Government Agencies . . . . . . . . . 27
Section 624: Elimination of Pension Offset for Key NRC Personnel . 27
Section 625: Antitrust Review Suspension . . . . . . . . . . . . . . . . . . . . . 28
Section 626: Decommissioning Fund Protection . . . . . . . . . . . . . . . . . 28
Section 627: Limitation on DOE Legal Fee Reimbursement . . . . . . . 28
Section 629: Feasibility Study for Commercial Reactors at
DOE Sites . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 630: Government Uranium Sales . . . . . . . . . . . . . . . . . . . . . . 28
Section 631: Uranium Mining Research and Development . . . . . . . . . 28
Section 632: Whistleblower Protection . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 633: Uranium Exports for Medical Isotope Production . . . . . 28
Section 634: Fernald Byproduct Material . . . . . . . . . . . . . . . . . . . . . . 29
Section 635: Safe Disposal of Greater-than-Class-C Radioactive
Waste . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 636: Prohibition on Nuclear Exports to Terrorism
Sponsors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 638: National Uranium Stockpile . . . . . . . . . . . . . . . . . . . . . . 29
Section 639: Nuclear Regulatory Commission Meetings . . . . . . . . . . 29
Section 640: Employee Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Subtitle C — Advanced Reactor Hydrogen Production . . . . . . . . . . . . . . . 30
Sections 651-652: Hydrogen Cogeneration Production Programs . . . 30
Subtitle D — Nuclear Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 661: Nuclear Facility Threats . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 662: Fingerprinting for Criminal Background Checks . . . . . . 30
Section 663: Use of Firearms by Nuclear Licensees . . . . . . . . . . . . . . 30
Section 664: Unauthorized Introduction of Dangerous Weapons . . . . 30
Section 665: Sabotage of Nuclear Facilities or Fuel . . . . . . . . . . . . . . 30
Section 666: Secure Transfer of Nuclear Materials . . . . . . . . . . . . . . . 31
Section 667: Department of Homeland Security Consultation . . . . . . 31
Section 668: Authorization of Appropriations . . . . . . . . . . . . . . . . . . . 31
Title VII — Vehicles and Fuels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Subtitle A — Existing Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 701: Use of Alternative Fuels by Dual-Fueled Vehicles . . . . 31
Section 704: Incremental Cost Allocation . . . . . . . . . . . . . . . . . . . . . . 31
Section 705: Lease Condensates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 706: Review of Energy Policy Act of 1992 Programs . . . . . . 32
Section 707: Report Concerning Compliance with
Alternative Fuel Vehicle Purchasing Requirements . . . . . . . . . . 32
Subtitle B — Hybrid Vehicles, Advanced Vehicles, and Fuel Cell Buses . 32
Section 711: Hybrid Vehicles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 712: Hybrid Retrofit and Electric Conversion Program . . . . . 32
Section 713: Efficient Hybrid and Advanced Diesel Vehicles . . . . . . 32
Sections 721-724: Advanced Vehicles . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 731: Fuel Cell Transit Bus Demonstration . . . . . . . . . . . . . . . 32
Subtitle C — Clean School Buses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Sections 741-744: Clean School Buses . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 743A: Diesel Truck Retrofit and Fleet Modernization
Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Subtitle D — Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 751: Railroad Efficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 752: Mobile Emission Reductions Trading . . . . . . . . . . . . . . 33
Section 753: Aviation Fuel Conservation and Emissions . . . . . . . . . . 33
Section 754: Diesel Fueled Vehicles . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 755: Conserve by Bicycling Program . . . . . . . . . . . . . . . . . . . 34
Section 756: Reduction of Engine Idling of Heavy-Duty Vehicles . . . 34
Section 757: Biodiesel Engine Testing Program . . . . . . . . . . . . . . . . . 34
Section 758: High Occupancy Vehicle Exception . . . . . . . . . . . . . . . . 34
Section 759: Ultra-Efficient Engine Technology for Aircraft . . . . . . . 34
Subtitle E — Automobile Efficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Sections 771-775: Fuel Economy Standards . . . . . . . . . . . . . . . . . . . . 34
Title VIII — Hydrogen . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Sections 801-809: Hydrogen Research and Development . . . . . . . . . . 35
Section 810: Solar and Wind Technologies . . . . . . . . . . . . . . . . . . . . . 35
Section 811: Hydrogen Fuel Cell Buses . . . . . . . . . . . . . . . . . . . . . . . 35
Title IX — Research and Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 900: Short Title; Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Subtitle A — Science Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 901: Office of Science Programs . . . . . . . . . . . . . . . . . . . . . . 36
Section 902: Systems Biology Program . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 903: Catalysis Research and Development Program . . . . . . . 36
Section 904: Hydrogen . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 905: Advanced Scientific Computing Research . . . . . . . . . . . 36
Section 906: Fusion Energy Sciences Program . . . . . . . . . . . . . . . . . . 36
Section 907: Science and Technology Scholarship Program . . . . . . . . 37
Section 908: Office of Scientific and Technical Information . . . . . . . 37
Section 909: Science and Engineering Pilot Program . . . . . . . . . . . . . 37
Section 910: Authorization of Appropriations . . . . . . . . . . . . . . . . . . . 37
Subtitle B — Research Administration and Operations . . . . . . . . . . . . . . . 37
Section 911: Cost Sharing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Section 912: Reprogramming . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Section 913: Merit-Based Competition . . . . . . . . . . . . . . . . . . . . . . . . 37
Section 914: External Technical Review of Departmental Programs . 38
Section 915: Competitive Award of Management Contracts . . . . . . . 38
Section 916: National Laboratory Designation . . . . . . . . . . . . . . . . . . 38
Section 917: Report on Equal Employment Opportunity Practices . . 38
Section 918: User Facility Best Practices Plan . . . . . . . . . . . . . . . . . . 38
Section 919: Support for Science and Energy Infrastructure and
Facilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 920: Coordination Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 921: Availability of Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Subtitle C — Energy Efficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Chapter 1 — Vehicles, Buildings, and Industries . . . . . . . . . . . . . . . . . . . . 39
Section 922: Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Section 923: Vehicles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Section 924: Buildings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Section 925: Industries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Section 926: Demonstration and Commercial Application . . . . . . . . . 39
Section 927: Secondary Electric Vehicle Battery Use Program . . . . . 40
Section 928: Next Generation Lighting Initiative . . . . . . . . . . . . . . . . 40
Section 929: Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 930: Authorization of Appropriations . . . . . . . . . . . . . . . . . . . 40
Section 931: Limitation on Use of Funds . . . . . . . . . . . . . . . . . . . . . . 40
Chapter 2 — Distributed Energy and Electric Energy Systems . . . . . . . . . . 40
Section 932: Distributed Energy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 933: Electricity Transmission and Distribution and
Energy Assurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 933A: Advanced Portable Power Devices . . . . . . . . . . . . . . . 40
Section 934: Authorization of Appropriations . . . . . . . . . . . . . . . . . . . 41
Subtitle D — Renewable Energy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Section 935: Findings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Section 936: Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Section 937: Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Section 938: Solar . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Section 939: Bioenergy Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Section 940: Wind . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Section 939: Geothermal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Section 942: Photovoltaic Demonstration Program . . . . . . . . . . . . . . . 42
Section 943: Additional Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 944: Analysis and Evaluation . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 945: Authorization of Appropriations . . . . . . . . . . . . . . . . . . . 42
Subtitle E — Nuclear Energy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 946: Definition of Junior Faculty . . . . . . . . . . . . . . . . . . . . . . 42
Section 947: Nuclear Energy Programs . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 948: Advanced Fuel Recycling Program . . . . . . . . . . . . . . . . 42
Section 949: University Nuclear Science and Engineering Support . . 43
Section 950: University-National Laboratory Interactions . . . . . . . . . 43
Section 951: Nuclear Power 2010 Program . . . . . . . . . . . . . . . . . . . . . 43
Section 952: Generation IV Nuclear Energy Systems Initiative . . . . . 43
Section 953-955: Infrastructure and Facilities . . . . . . . . . . . . . . . . . . . 43
Section 956: Authorization of Appropriations . . . . . . . . . . . . . . . . . . . 43
Sections 957-961: Next Generation Nuclear Plant . . . . . . . . . . . . . . . 43
Subtitle F — Fossil Energy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Chapter 1 — Research Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Section 962: Enhanced Fossil Energy Research and
Development Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Section 963: Fossil Research and Development . . . . . . . . . . . . . . . . . 44
Section 964: Oil and Gas Research and Development . . . . . . . . . . . . 44
Section 965: Transportation Fuels . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Section 966: Fuel Cells . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Section 967: Carbon Dioxide Capture Research and Development . . 44
Section 968: Authorization of Appropriations . . . . . . . . . . . . . . . . . . . 44
Section 968A: Western Michigan Demonstration Project . . . . . . . . . . 44
Section 968B: Western Hemisphere Energy Cooperation . . . . . . . . . . 44
Section 968C: Arctic Engineering Research Center . . . . . . . . . . . . . . 44
Section 968D: Barrow Geophysical Research Facility . . . . . . . . . . . . 45
Chapter 2 — Ultra-Deepwater and Unconventional Natural Gas and
Other Petroleum Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Sections 969 - 976: Ultra-Deepwater and Unconventional Natural
Gas and Other Petroleum Resources . . . . . . . . . . . . . . . . . . . . . . 45
Title X — Department of Energy Management . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Section 1002: Other Transactions Authority . . . . . . . . . . . . . . . . . . . . 46
Section 1003: University Collaboration . . . . . . . . . . . . . . . . . . . . . . . . 46
Section 1004: Sense of Congress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Title XII — Electricity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Section 1201: Short Title . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Subtitle A — Reliability Standards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Section 1211: Electric Reliability Standards . . . . . . . . . . . . . . . . . . . 46
Section 1221: Siting of Interstate Electric Transmission Facilities . . 48
Section 1222: Third-Party Finance . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 1223: Transmission System Monitoring . . . . . . . . . . . . . . . . 49
Section 1224: Advanced Transmission Technologies . . . . . . . . . . . . 50
Section 1225: Electric Transmission and Distribution Programs . . . . 50
Section 1226: Advanced Power System Technology Incentive
Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Section 1227: Office of Electric Transmission and Distribution . . . . 50
Subtitle C — Transmission Operation Improvements . . . . . . . . . . . . . . . . . 50
Section 1231: Open Nondiscriminatory Access . . . . . . . . . . . . . . . . . 50
Section 1232: Sense of Congress on Regional Transmission
Organizations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Section 1233: Regional Transmission Organization Applications
Progress Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Section 1234: Federal Utility Participation in Regional
Transmission Organizations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Section 1235: Standard Market Design . . . . . . . . . . . . . . . . . . . . . . . 51
Section 1236: Native Load Service Obligation . . . . . . . . . . . . . . . . . . 54
Section 1237: Study on the Benefits of Economic Dispatch . . . . . . . 54
Subtitle D — Transmission Rate Reform . . . . . . . . . . . . . . . . . . . . . . . . . . 54
Section 1241: Transmission Infrastructure Investment . . . . . . . . . . . . 54
Subtitle E — Amendments to PURPA . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Section 1251: Net Metering and Additional Standards . . . . . . . . . . . 55
Section 1252: Smart Metering . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Section 1253: Cogeneration and Small Power Production Purchase
and Sale Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Section 1253: Interconnection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
Subtitle F — Repeal of PUHCA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
Section 1261: Short Title . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
Section 1262: Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
Section 1263: Repeal of the Public Utility Holding Company Act
of 1935 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
Section 1264: Federal Access to Books and Records . . . . . . . . . . . . 60
Section 1265: State Access to Books and Records . . . . . . . . . . . . . . . 60
Section 1266: Exemption Authority . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Section 1267: Affiliate Transactions . . . . . . . . . . . . . . . . . . . . . . . . . 61
Section 1268: Applicability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Section 1269: Effect on Other Regulations . . . . . . . . . . . . . . . . . . . . . 61
Section 1270: Enforcement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Section 1271: Savings Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Section 1272: Implementation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Section 1273: Transfer of Resources . . . . . . . . . . . . . . . . . . . . . . . . . 61
Section 1274: Effective Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
Section 1275: Service Allocation . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
Section 1276: Authorization of Appropriations . . . . . . . . . . . . . . . . . . 62
Section 1277: Conforming Amendments to the Federal Power Act . . 62
Subtitle G — Market Transparency, Enforcement, and Consumer
Protection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
Section 1281: Market Transparency Rules . . . . . . . . . . . . . . . . . . . . . 62
Section 1282: Market Manipulation . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Section 1283: Enforcement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Section 1284: Refund Effective Date . . . . . . . . . . . . . . . . . . . . . . . . . 63
Section 1285: Refund Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
Section 1286: Sanctity of Contract . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
Section 1287: Consumer Privacy and Unfair Trade Practices . . . . . . . 64
Subtitle H — Merger Reform . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
Section 1291: Merger Review Reform and Accountability . . . . . . . . . 64
Section 1292: Electric Utility Mergers . . . . . . . . . . . . . . . . . . . . . . . . 65
Subtitle I — Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Section 1295: Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Section 1297: Conforming Amendments . . . . . . . . . . . . . . . . . . . . . . 65
Subtitle K — Economic Dispatch . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Section 1298. Economic Dispatch . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Title XIII — Energy Tax Incentives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Section 1300: Short Title . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Subtitle A — Energy Infrastructure Tax Incentives . . . . . . . . . . . . . . . . . . . 65
Section 1301: Natural Gas Gathering Lines Treated As 7-Year
Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Section 1302: Natural Gas Distribution Lines Treated As 15-Year
Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
Section 1303: Electric Transmission Property Treated As 15-Year
Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
Section 1304: Expansion of Amortization of Certain
Atmospheric Pollution Control Facilities in Connection
With Plants First Placed-in-Service After 1975 . . . . . . . . . . . . . . 66
Section 1305: Modification of Credit for Producing Fuel
From a Nonconventional Source . . . . . . . . . . . . . . . . . . . . . . . . . 67
Section 1306: Modifications to Special Rules for
Nuclear Decommissioning Costs . . . . . . . . . . . . . . . . . . . . . . . . . 68
Section 1307: Arbitrage Rules Not to Apply to Prepayment of
Natural Gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Section 1308: Determination of Small Refiner Exception to Oil
Depletion Allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Subtitle B — Miscellaneous Energy Tax Provisions . . . . . . . . . . . . . . . . . . 69
Section 1311: Credit for Residential Energy Efficiency Property . . . . 69
Section 1312: Credit for Business Installation of Qualified Fuel
Cells . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
Section 1313: Reduced Motor Fuels Excise Tax on Certain
Mixtures of Diesel Fuel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
Section 1314: Amortization of Delay Rentals . . . . . . . . . . . . . . . . . . . 69
Section 1315: Amortization of Geological and Geophysical
Expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
Section 1316: Advanced Lean-Burn Technology Motor Credit . . . . . 70
Section 1317: Credit for Energy Efficiency Improvements to
Existing Homes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
Subtitle C — Alternative Minimum Tax Relief . . . . . . . . . . . . . . . . . . . . . 70
Section 1321: New Non-refundable Personal Credit Allowed
Against Regular and Alternative Minimum Tax . . . . . . . . . . . . . 70
Section 1322: Certain Business Energy Credits Allowed Against
Regular and Minimum Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
Title XIV — Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
Subtitle C — Other Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
Section 1441. Continuation of Transmission Security Order . . . . . . . 71
Section 1442: Review of Agency Determinations on Gas Projects . . . 72
Section 1443: Attainment Dates for Downwind Ozone
Nonattainment Areas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
Section 1444: Energy Production Incentives . . . . . . . . . . . . . . . . . . . . 73
Section 1446: Regulation of Certain Oil Used in Transformers . . . . . 73
Section 1447: Risk Assessments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
Section 1448: Oxygen-fuel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
Section 1449: Petrochemical and Oil Refinery Facility Health
Assessment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
Sec. 1450: United States — Israel Cooperation . . . . . . . . . . . . . . . . . . 73
Section 1451: Carbon-Based Fuel Cell Development . . . . . . . . . . . . . 74
Section 1452: National Priority Project Designation . . . . . . . . . . . . . . 74
Title XV — Ethanol and Motor Fuels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Subtitle A — General Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Section 1501: Renewable Content of Motor Vehicle Fuel . . . . . . . . . 74
Section 1502: Fuels Safe Harbor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Section 1503: MTBE Transition Assistance . . . . . . . . . . . . . . . . . . . . 75
Sections 1504-1505: Ban on the Use of MTBE . . . . . . . . . . . . . . . . . . 75
Section 1506: Elimination of Oxygen Requirement and
Maintenance of Toxic Emission Reductions . . . . . . . . . . . . . . . . 75
Sections 1507-1508: Analyses and Data Collection . . . . . . . . . . . . . . 76
Section 1509: Reducing the Proliferation of State Fuel Controls . . . . 76
Section 1510: Fuel System Requirements Harmonization Study . . . . 76
Section 1511: Commercial Byproducts From Municipal Solid
Waste and Cellulosic Biomass Loan Guarantee Program . . . . . . 76
Section 1512: Conversion Assistance for Cellulosic Biomass,
Waste-Derived Ethanol, Approved Renewable Fuels . . . . . . . . . 76
Section 1513: Blending of Compliant Reformulated Gasolines . . . . . 76
Subtitle B — Underground Storage Tank Compliance . . . . . . . . . . . . . . . . 76
Sections 1521- 1533: Underground Storage Tank Provisions . . . . . . . 76
Subtitle C — Boutique Fuels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
Section 1541: Reducing the Proliferation of Boutique Fuels . . . . . . . 78
Title XVI — Studies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
Section 1601: Study on Inventory of Petroleum and Natural Gas
Storage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
Section 1605: Study of Energy Efficiency Standards . . . . . . . . . . . . . 79
Section 1606: Telecommuting Study . . . . . . . . . . . . . . . . . . . . . . . . . . 79
Section 1607: LIHEAP Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
Section 1608: Oil Bypass Filtration Technology . . . . . . . . . . . . . . . . . 79
Section 1609: Total Integrated Thermal Systems . . . . . . . . . . . . . . . . 79
Section 1610: University Collaboration . . . . . . . . . . . . . . . . . . . . . . . . 79
Section 1611: Reliability and Consumer Protection Assessment . . . . 79
Section 1612: Report on Energy Integration with Latin America . . . . 80
Section 1613: Low-Volume Gas Reservoir Study . . . . . . . . . . . . . . . . 80
Section 1614: Consolidation of Gasoline Industry . . . . . . . . . . . . . . . 80
Section 1615: Study of Fuel Savings From Information
Technology for Transportation . . . . . . . . . . . . . . . . . . . . . . . . . . 80
Section 1616: Feasibility Study for Mustard Seed Biodiesel . . . . . . . . 80
Title XVII — Renewable Energy — Resources . . . . . . . . . . . . . . . . . . . . . . . . . 80
Section 1701: Grants to Improve the Commercial Value of Forest
Biomass for Electric Energy, Useful Heat, Transportation
Fuels, Petroleum-Based Product Substitutes, and Other
Commercial Purposes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
Section 1702: Environmental Review for Renewable Energy
Projects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
Section 1703: Sense of Congress Regarding Generation
Capacity of Electricity From Renewable Energy Resources
on Public Lands . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
Title XVIII — Geothermal Energy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
Sections 1801-1820: Geothermal Energy Leasing Amendments . . . . 81
Title XIX — Hydropower — Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
Section 1901: Increased Hydroelectric Generation at Existing
Federal Facilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
Section 1902: Shift of Project Loads to Off-Peak Periods . . . . . . . . . . 83
Section 1903: Report Identifying and Describing the Status of
Potential Hydropower Facilities . . . . . . . . . . . . . . . . . . . . . . . . . . 83
Title XX — Oil and Gas — Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
Subtitle A — Production Incentives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
Section 2001: Definition of Secretary . . . . . . . . . . . . . . . . . . . . . . . . . 83
Section 2002: Program on Oil and Gas Royalties-In-Kind . . . . . . . . . 83
Section 2003: Marginal Property Production Incentives . . . . . . . . . . . 83
Section 2004: Incentives for Natural Gas Production From Deep
Wells in the Shallow Waters of the Gulf of Mexico . . . . . . . . . . 83
Section 2005: Royalty Reductions for Deep Water Production . . . . . . 84
Section 2006: Alaska Offshore Royalty Suspension . . . . . . . . . . . . . . 84
Section 2007: Oil and Gas Leasing in the National Petroleum
Reserve in Alaska . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
Section 2008: Orphaned, Abandoned, or Idled Wells on
Federal Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
Section 2009: Combined Hydrocarbon Leasing . . . . . . . . . . . . . . . . . 84
Section 2010: Alternate Related Uses on the Outer Continental
Shelf . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
Section 2011: Preservation of Geological and Geophysical Data . . . . 84
Section 2012: Oil and Gas Lease Acreage Limitations . . . . . . . . . . . . 85
Section 2013: Deadline for Decision on Appeals under the
Coastal Zone Management Act . . . . . . . . . . . . . . . . . . . . . . . . . . 85
Section 2014: Reimbursement for Costs of NEPA
Analysis, Documentation, and Studies . . . . . . . . . . . . . . . . . . . . 86
Section 2015: Gas Hydrate Production Incentive . . . . . . . . . . . . . . . . 86
Section 2016: Onshore Deep Gas Production Incentive . . . . . . . . . . . 86
Section 2017: Enhanced Oil and Natural Gas Production . . . . . . . . . . 87
Section 2018: Oil Shale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
Section 2019: Use of Information about Oil and Gas Public
Challenges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
Subtitle B — Access to Federal Lands . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
Sections 2021- 2027: Leasing and Permitting Processes . . . . . . . . . . . 87
Section 2028: Fair Market Rental Value Determinations for
Public Land and Forest Service Rights-of-Way . . . . . . . . . . . . . . 87
Section 2029: Energy Facility Rights-of-Way and Corridors on
Federal Lands . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
Section 2030: Consultation Regarding Energy Rights-of-Way
on Public Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
Section 2031: Electricity Transmission Line Right-of-Way in
Cleveland National Forest and Adjacent Public Land . . . . . . . . 88
Section 2032: Sense of Congress Regarding Development of
Minerals Under Padre Island National Seashore . . . . . . . . . . . . . 88
Section 2033: Livingston Parish Mineral Rights Transfer . . . . . . . . . . 88
Subtitle C — Naval Petroleum Reserves . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
Sections 2041-2044: Naval Petroleum Reserves . . . . . . . . . . . . . . . . . 88
Subtitle D — Miscellaneous Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
Section 2051: Split-Estate Federal Oil and Gas Leasing and
Development Practices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
Section 2052: Royalty Payments Under Certain Leases . . . . . . . . . . . 89
Section 2053: Domestic Offshore Energy Reinvestment . . . . . . . . . . . 89
Section 2054: Repurchase of Leases That Are Not Allowed
To Be Explored or Developed . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
Section 2055: Limitation on Required Review Under NEPA . . . . . . . 91
Title XXI — Coal — Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
Sections 2101-2109: Federal Coal Leases . . . . . . . . . . . . . . . . . . . . . . 91
Title XXII — Energy Development in Arctic Refuge . . . . . . . . . . . . . . . . . . . . . 92
Current Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
Section 2201: Short Title . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
Section 2202: Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
Section 2203: Leasing Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
Section 2204: Leasing Procedures, Bidding System, Minimum
Acreage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
Section 2205: Grant of Leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
Section 2206: Terms and Conditions of Leases; Project Labor
Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
Section 2207: Environmental Protection . . . . . . . . . . . . . . . . . . . . . . 94
Section 2208: Expedited Judicial Review . . . . . . . . . . . . . . . . . . . . . 95
Section 2209: Federal and State Distribution of Revenues; Low
Income Home Energy Assistance . . . . . . . . . . . . . . . . . . . . . . . . 95
Section 2210: Rights of Way Across the Coastal Plain . . . . . . . . . . . 96
Section 2211: Surface and Subsurface Estate Conveyance to
Native Corporations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
Section 2212: Local Government Impact and Community
Service Assistance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
Title XXIII — Set America Free (SAFE) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
Sections 2301- 2305: The Set America Free Act of 2005 . . . . . . . . . . 96
Title XXIV — Grand Canyon Hydrogen-Powered Transportation
Demonstration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
Sections 2401-2406 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
Title XXV — Additional Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
Section 2501: Wind Energy Royalty Relief . . . . . . . . . . . . . . . . . . . . . 97
List of Tables
Table 1. Authorizations in H.R. 6 as passed by the House . . . . . . . . . . . . . . . . . 98
Omnibus Energy Legislation, 109th
Congress: Assessment of H.R. 6 as passed
by the House
Introduction
Since the Arab oil embargo in 1973-1974, Congress has periodically taken up
energy policy legislation with a comprehensive scope — often spurred by the price
of oil and U.S. dependence upon imported oil. The price of crude oil began to rise
in 2003 and briefly approached $60/barrel (bbl) in the spring of 2005, setting the
scene for renewed debate over omnibus energy legislation in the 109th Congress.
National and world demand for oil continues to grow. However, domestic oil
production in the United States continues to decline. As a consequence, the gap
between U.S. production and consumption has had to be covered by increased oil
imports. These imports, roughly 6 million barrels per day (mbd) after the Arab oil
embargo, now exceed 10 mbd to satisfy U.S. oil consumption of nearly 21 mbd.1
Addressing dependence on imported oil raises a number of issues touching on
both demand and consumption of fossil fuels. Chief among these are the production
of additional fossil fuels, development of alternative energy sources, and
conservation and energy efficiency. Energy infrastructure has also been a growing
issue, including the oil refining and distribution sector, and electricity transmission,
reliability, and regulation. Increased use of domestic coal and reassessment of many
issues associated with nuclear energy have drawn attention as well.
Developing a comprehensive approach to energy policy that balances economic,
security, and environmental issues — as well as competing regional priorities in the
United States — is an enormous challenge for policymakers. Keeping a clear eye on
distinguishing between short- and long-term policies is also difficult, but important
in keeping expectations realistic for what comprehensive legislation can achieve.
In the 109th Congress, the House approved an omnibus energy bill (H.R. 6) on
April 21, 2005, that would open the Arctic National Wildlife Refuge (ANWR) to oil
and gas leasing, substantially change oversight of electric utilities, increase the use
of alternative motor fuels, provide $8.1 billion in energy tax incentives, extend the
nuclear accident liability system, and authorize numerous energy R&D programs.
The House-passed bill contains many provisions from the conference version of an
1
U.S. Department of Energy, Energy Information Administration, at
[http://www.eia.doe.gov/pub/oil_gas/petroleum/data_publications/weekly_petroleum_
status_report/current/pdf/tableh1.pdf].
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omnibus energy bill (also H.R. 6) in the 108th Congress that was blocked by a Senate
filibuster.
The bill would mandate increasing levels of ethanol production through 2012
but allow regions to opt out under certain conditions. Use of methyl tertiary butyl
ether (MTBE) as a domestic gasoline additive would be banned by the end of 2014,
but the President could void the ban and a state could authorize continued use.
Producers of MTBE and renewable fuels would be granted protection (a “safe
harbor”) from product liability lawsuits, a provision that proved highly contentious
in the 108th Congress.
Royalty reductions would be provided for marginal oil and gas wells on federal
lands and the outer continental shelf. Provisions are also included to increase access
by energy projects to federal lands. Several new statutory efficiency standards would
be established for consumer and commercial products and appliances, and other
standards could be set by the Department of Energy (DOE).
Funding authorizations in the bill total about $82 billion over 10 years. (The
likely cost of the funding authorizations has not yet been estimated by the
Congressional Budget Office.)
Major Provisions
Electricity Regulation. Title XII would create an electric reliability
organization (ERO) that would enforce mandatory reliability standards for the bulkpower system. All ERO standards would be approved by the Federal Energy
Regulatory Commission (FERC). Under this Title, the ERO could impose penalties
on a user, owner, or operator of the bulk-power system that violates any FERCapproved reliability standard. This Title also addresses transmission infrastructure
issues. The Secretary of Energy would be able to certify congestion on the
transmission lines and issue permits to transmission owners. Permit holders would
be able to petition in U.S. District Court to acquire rights-of-way for the construction
of transmission lines through the exercise of the right of eminent domain. A
provision that would have required FERC to approve participant funding for new
transmission lines was removed in markup by the House Committee on Energy and
Commerce.
FERC’s Standard Market Design notice of proposed rulemaking would be
remanded. Native load service obligations would be clarified, and federal utilities
would be allowed to participate in regional transmission organizations.
The electricity title would repeal the mandatory purchase requirements under the
Public Utility Regulatory Policy Act. The Public Utility Holding Company Act of
1935 (PUHCA) would be repealed. The Federal Energy Regulatory Commission and
state regulatory bodies would be given access to utility books and records.
FERC would be required to issue rules to establish an electronic system that
provides information about the availability and price of wholesale electric energy and
transmission services. For electric rates that the Federal Energy Regulatory
Commission finds to be unjust, unreasonable, or unduly discriminatory, the effective
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date for refunds would begin at the time of the filing of a complaint with FERC but
not later than five months after filing of a complaint. Criminal and civil penalties
would be increased. The Federal Power Act would be amended to give FERC review
authority for transfer of assets valued in excess of $10 million.
(For additional discussion on these issues, see CRS Report RL32728, Electric
Utility Regulatory Reform: Issues for the 109th Congress; and CRS Report RL32133,
Federal Merger Review Authority.)
Renewable Fuel Standard and MTBE. As passed by the House, H.R. 6
would amend the Clean Air Act to eliminate the requirement that reformulated
gasoline (RFG) contain 2% oxygen to reduce automotive emissions, a requirement
which prompted the widespread use of MTBE and, to a lesser degree, ethanol.
Instead, the bill would establish a new requirement that an increasing amount of
gasoline contain renewable fuels such as ethanol. The bill would require that 3.1
billion gallons of renewable fuel be used in 2005, increasing to 5.0 billion gallons by
2012 (as compared to 3.4 billion gallons used in 2004). However, concerns have
been raised that this requirement could significantly raise the pump price for gasoline
in some areas.
Because of concerns over drinking water contamination by MTBE (a major
competitor with ethanol), the bill would ban the use of MTBE in motor vehicle fuel,
except in states that specifically authorize its use, not later than December 31, 2014.
The ban has two possible exceptions. First, EPA may allow MTBE in motor fuel up
to 0.5 percent by volume, in cases that the Administrator determines to be
appropriate; and second, the President may make a determination, not later than June
30, 2014, that the restrictions on the use of MTBE shall not take place. The bill
would also authorize $2.0 billion to assist the conversion of merchant MTBE
production facilities to the production of other fuel additives. Further, the bill would
preserve the reductions in emissions of toxic substances achieved by the RFG
program.
One of the most controversial provisions in H.R. 6 is the establishment of a
“safe harbor” from product liability lawsuits for producers of MTBE and renewable
fuels. The safe harbor provision would protect anyone in the product chain, from
manufacturers down to retailers, from liability for cleanup of MTBE and renewable
fuels or for personal injury or property damage based on the product being deemed
defective. (That legal approach has been used in California to require refiners to
shoulder liability for MTBE cleanup.) The safe harbor would be retroactive to
September 5, 2003. Prior to that date, five lawsuits had been filed. After that date, at
least 150 suits were filed, on behalf of 210 communities in 15 different states.
(For additional information, see CRS Report RL32865, Renewable Fuels and
MTBE: A Comparison of Selected Legislative Initiatives; CRS Report RL30369, Fuel
Ethanol: Background and Public Policy Issues; and CRS Report RL32787, MTBE
in Gasoline: Clean Air and Drinking Water Issues.)
Energy Taxes. After the failure of the conference report on H.R. 6 in the
108th Congress, several of the measure’s energy tax provisions — estimated at $1.3
billion over 10 years — were included in the Working Families Tax Relief Act of
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2004 (P.L. 108-311), enacted on October 4, 2004. About $5 billion in additional
energy tax incentives over 10 years were part of the American Jobs Creation Act of
2004 (P.L. 108-357) enacted on October 22, 2004.
Many of the energy tax incentives in H.R. 6 from the 108th Congress that were
not enacted in 2004 have been repackaged into the House-passed H.R. 6 in the 109th
Congress. The bill would reduce energy taxes about $8.1 billion over 10 years as
compared with $23.5 billion in H.R. 6 in the 108th Congress. President Bush’s
FY2006 budget request was for $6.7 billion in energy tax incentives. Counting the
tax provisions enacted in the 108th Congress, the House-passed version of H.R. 6
excludes roughly $9 billion in tax breaks from the H.R. 6 conference report in the
108th Congress.
H.R. 6’s tax cuts are weighted primarily toward energy (oil, gas, and electricity)
production and supply, particularly energy infrastructure. The most notable
provisions would accelerate depreciation deductions for natural gas gathering lines
and distribution lines, and significantly reduce the depreciation period for
transmission assets and for oil and gas production.
(For more background, see CRS Issue Brief IB10054, Energy Tax Policy.)
Nuclear Energy. Reauthorization of the Price-Anderson Act nuclear liability
system is one of the top nuclear items on the energy agenda. Under Price-Anderson,
commercial reactor accident damages are paid through a combination of
private-sector insurance and a nuclear industry self-insurance system. Liability is
capped at the maximum coverage available under the system, currently about $10.7
billion. Price-Anderson also authorizes the Department of Energy to indemnify its
nuclear contractors. The limit on DOE contractor liability is the same as for
commercial reactors, except when the limit for commercial reactors drops because
of a decline in the number of covered reactors.
H.R. 6 would provide a 20-year extension of Price-Anderson to the end of 2025.
The nuclear industry contends that the system has worked well and should be
continued, but opponents charge that Price-Anderson’s liability limits provide an
unwarranted subsidy to nuclear power. The bill would also require the Nuclear
Regulatory Commission (NRC) to assess nuclear power plant security and require
additional security measures.
The bill would authorize $1.3 billion for a nuclear-hydrogen cogeneration
project at the Idaho National Laboratory, along with five projects to demonstrate
hydrogen production at existing nuclear power plants. In addition to the hydrogen
cogeneration projects, about $1.3 billion would be authorized for DOE to design,
build, and operate an advanced technology nuclear reactor by 2015.
Not included in the House-passed bill is a 1.8 cents per kilowatt-hour nuclear
energy tax credit that would have been provided by the conference report on H.R 6
in the 108th Congress.
(For more information, see CRS Issue Brief IB88090, Nuclear Energy Policy.)
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Renewable Energy and Efficiency. H.R. 6 would legislate new energy
efficiency standards for several consumer and commercial products and appliances.
For certain other products and appliances, DOE would be empowered to set new
standards. Also, the bill would provide increased funding authorizations for the DOE
weatherization program and establish a voluntary program to promote energy
efficiency in industry.
However, the bill does not include one of the top priorities of environmental
groups: a renewable portfolio standard (RPS), which would require retail electricity
suppliers to obtain a minimum percentage of their power from a portfolio of new
renewable energy resources.
(For additional information, see CRS Issue Brief IB10020, Energy Efficiency:
Budget, Oil Conservation and Electricity Conservation Issues, and CRS Issue Brief
IB10041, Renewable Energy: Tax Credit, Budget, and Electricity Production Issues.)
Arctic National Wildlife Refuge. The congressional debate over whether
to open ANWR to energy development has continued for more than 40 years. H.R.
6 as passed by the House would authorize oil and gas exploration, development, and
production in ANWR, with a 2,000-acre limit on production and support facilities.
Development advocates argue that ANWR oil would reduce U.S. energy markets’
exposure to crises in the Middle East; boost North Slope oil production; lower oil
prices; extend the economic life of the Trans Alaska Pipeline System; and create
many jobs in Alaska and elsewhere in the United States. They maintain that ANWR
oil could be developed with minimal environmental harm, and that the footprint of
development could be limited to a total of 2,000 acres.
Opponents of development in ANWR argue that intrusion on this ecosystem
cannot be justified on any terms; that economically recoverable oil found (if any)
would provide little energy security and could be replaced by cost-effective
alternatives, including conservation; and that job claims are overstated. They also
maintain that the footprint of oil development, despite a provision in the measure to
limit certain facilities to 2,000 acres, would still be scattered in many parcels across
the landscape, and would have a greater impact than is implied by any limit on total
acreage. They also argue that past proposals to limit any footprint have not been
worded so as to apply clearly to the extensive Native lands in the Refuge, which
could be developed if the Arctic Refuge were opened.
On April 20, 2005, the House rejected the Markey/Johnson amendment (H.
Amdt 73) to strike the ANWR title (yeas 200, nays 231, Roll Call #122). (For
additional information, see CRS Issue Brief IB10136, The Arctic National Wildlife
Refuge: Controversies for the 109th Congress; and CRS Reports RL31115, Legal
Issues Related to Proposed Drilling for Oil and Gas in the Arctic National Wildlife
Refuge and CRS Report RS22143, Oil and Gas Leasing in the Arctic National
Wildlife Refuge (ANWR): the 2,000-Acre Limit).
Domestic Energy Production. The Department of the Interior (DOI) has
estimated that roughly a quarter of oil resources and less than one-fifth of gas
resources on Indian lands have been developed. H.R. 6 would allow Indian tribes to
enter into business agreements with energy developers without obtaining prior
CRS-6
approval from the Department of the Interior, but only if DOI has already approved
the tribe’s regulations governing such energy agreements.
To encourage production on federal lands, royalty reductions would be provided
for marginal oil and gas wells on public lands and the outer continental shelf.
Provisions are also included to increase access to federal lands by energy projects —
such as drilling activities, electric transmission lines, and gas pipelines.
Hydrogen and Fuel Cells. H.R. 6 would authorize $4 billion for
FY2006-2010 for hydrogen and fuel cell R&D. The bill would also establish a goal
of producing commercial fuel cell vehicles and developing hydrogen infrastructure
by 2020. Critics of the Administration suggest that the hydrogen program is intended
to forestall any attempts to significantly raise vehicle Corporate Average Fuel
Economy (CAFE) standards, and that it relieves the automotive industry of assuming
more initiative in pursuing technological innovations. On the other hand, some
contend that it is appropriate for government to become involved in the development
of technologies that could address national environmental and energy goals but are
too risky to draw private-sector investment.
(For additional information, see CRS Report RS21442, Hydrogen and Fuel Cell
R&D: FreedomCAR and the President’s Hydrogen Fuel Initiative; and CRS Report
RL32196, A Hydrogen Economy and Fuel Cells: An Overview.)
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Organization of Report
The remainder of this report provides a section-by-section summary of the
House-passed version of H.R. 6. Some of the most controversial sections are
discussed in greater detail, while multiple sections that deal with a single program
have been combined. Funding authorizations are shown in Table 1 at the end of the
report.
The following analysts in the CRS Resources, Science, and Industry Division
contributed to this report:
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Amy Abel, electric utilities;
Anthony Andrews, nuclear security, DOE management;
Robert Bamberger, energy security;
Carl Behrens, nuclear nonproliferation;
Claudia Copeland, Federal Water Pollution Control Act;
Lynne Corn, ANWR;
Bernard Gelb, gasoline industry;
Carol Glover, Native American energy, general authorizations;
Mark Holt, nuclear energy;
Marc Humphries, federal energy leasing, coal;
Larry Kumins, oil and gas;
Salvatore Lazzari, taxes;
Jim McCarthy, Clean Air Act, MTBE;
Dan Morgan, science programs;
Kyna Powers, hydropower;
Fred Sissine, conservation and renewable energy;
Mary Tiemann, underground storage tanks, drinking water;
Brent Yacobucci, motor fuels;
Jeff Zinn, Coastal Zone Management Act.
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Title I — Energy Efficiency
Subtitle A — Federal Programs
Section 101: Energy and Water Saving Measures in Congressional
Buildings. The Architect of the Capitol would be required to plan and implement
an energy and water conservation strategy for congressional buildings that would be
consistent with that required of other federal buildings. An annual report would be
required. Up to $2 million would be authorized. Section 310 of the Legislative
Branch Appropriations Act of 1999 called for the Architect of the Capitol (AOC) to
develop an energy efficiency plan for congressional buildings.
Section 102: Energy Management Requirements. The baseline for
federal energy savings would be updated from FY1985 to FY2003 and a new goal
of 20% reduction would be set for FY2015. At that time, DOE would be directed to
assess progress and set a new goal for FY2025. Section 202 of Executive Order
13123 uses FY1985 as the baseline for measuring federal building energy efficiency
improvements and calls for a 35% reduction in energy use per gross square foot by
FY2010. Most of the other provisions for federal agencies in this Subtitle are
administrative measures that would help agencies achieve the above-described goal.
Section 103: Energy Use Measurement and Accountability. Federal
buildings would be required to be metered or sub-metered by late 2010, to help
reduce energy costs and promote energy savings.
Section 104: Procurement of Energy-Efficient Products. Statutory
authority would be created to require federal agencies to purchase products certified
as energy-efficient under the Energy Star program or energy-efficient products
designated by the Federal Energy Management Program (FEMP) — provided the
products are found to be “cost-effective” and “reasonably-available.” Currently,
Section 403 of Executive Order 13123 directs federal agencies to purchase life-cycle
cost-effective Energy Star products.
Section 105: Energy Savings Performance Contracts. This would
amend the National Energy Conservation Policy Act (42 U.S.C. 8287) by limiting all
federal agencies combined to a total of 100 energy savings performance contracts and
payments of no more than a total of $500,000,000. Under such contracts, energy
saving measures are installed at government facilities by private-sector firms in
return for a share of the resulting energy cost reductions. The Sunset and Reporting
Provisions of section 801(c) of the Act would be effectively repealed October 1,
2006, and any new contract after that date would be included in the contract limits.
Section 107: Voluntary Commitments to Reduce Industrial Energy
Intensity. DOE would be authorized to form voluntary agreements with industry
sectors or companies to reduce energy use per unit of production by an unspecified
amount. While there is no current statutory authority, industry energy efficiency
programs have been in place, such as the former Climate Wise program at the
Environmental Protection Agency (EPA).
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Section 108: Advanced Building Efficiency Testbed. DOE would be
required to create a program to develop, test, and demonstrate advanced federal and
private building efficiency technologies.
Section 109: Federal Building Performance Standards. DOE would
be directed to set revised energy efficiency standards for new federal buildings at a
level 30% stricter than industry or international standards — provided the standards
would be “life-cycle cost-effective.” Mandatory energy efficiency performance
standards for federal buildings are currently set in Section 305(a) of P.L. 94-385 and
implemented through 10 CFR Part 435.
Section 111: Daylight Savings. Daylight saving time would begin one
month earlier (in March) and end one month later (in November). This is expected
to reduce energy used for night-time electric lighting. Under current law (Uniform
Time Act, P.L. 89-387, §3a), states can choose whether to participate. However, if
a state chooses to participate, the duration of daylight savings is set by federal law.
Section 112: Enhancing Energy Efficiency in Management of
Federal Lands. National parks, forests, and wildlife refuges would be required to
employ energy efficiency measures in buildings and energy-efficient vehicles
(including biodiesel and hybrid engines) “to the extent practicable.”
Subtitle B — Energy Assistance and State Programs
Section 121: Low Income Home Energy Assistance Program
(LIHEAP). Increased funding would be authorized for the LIHEAP grant program
for FY2005 through FY2007. Department of Health and Human Services funding
for LIHEAP was authorized through FY2003 in the Human Services Authorization
Act of 1998. Also, states and their designees would be allowed to use renewable
fuels (including biomass) to carry out the purposes of this section.
Section 122: Weatherization Assistance. Increased funding would be
authorized for the DOE weatherization grant program for FY2006 through FY2008.
Funding for the program was authorized through FY2003 under 42 U.S.C. 6872.
Section 123: State Energy Programs. New requirements would be set for
state energy conservation goals and plans. Also, increased funding would be
authorized for FY2006 through FY2008 for DOE state energy grant programs.
Section 124: Energy-Efficient Appliance Rebate Programs. DOE
would be authorized to fund rebate programs in eligible states to support residential
end-user purchases of Energy Star products.
Section 125: Energy-Efficient Public Buildings. A grant program would
be created for energy-efficient renovation and construction of local government
buildings.
Section 126: Low Income Community Energy Efficiency Pilot
Program. A pilot energy-efficiency and renewable energy grant program would be
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created for local governments, private companies, community development
corporations, and Native American economic development entities.
Subtitle C — Energy-Efficient Products
Section 131: Energy Star Program. DOE and EPA would be given
statutory authority to carry out the Energy Star program, which identifies and
promotes energy-efficient products and buildings.
Section 132: HVAC Maintenance Consumer Education Program.
DOE would be required to implement a public education program for homeowners
and small businesses that explained the energy-saving benefits of improved
maintenance of heating, ventilating, and air conditioning equipment. Also, the Small
Business Administration would be directed to assist small businesses in becoming
more energy-efficient.
Section 133: Energy Conservation Standards for Additional
Products. DOE would be directed to issue a rule that determined whether
efficiency standards should be set for standby mode in battery chargers and external
power supplies. Also, energy efficiency standards would be set by statute for exit
signs, traffic signals, torchieres (floor lamps), distribution transformers (electric
utility equipment), unit heaters (fan-type heaters, usually portable), and medium base
compact fluorescent lamps (CFLs). Further, DOE would be directed to issue a rule
that prescribed efficiency standards for ceiling fans, vending machines, commercial
refrigerators and freezers and refrigerator-freezers, and residential fans.
Section 134: Energy Labeling. The Federal Trade Commission (FTC)
would be required to consider improvements in the effectiveness of energy labels for
consumer products. Also, DOE or FTC would be directed to consider prescribing
labeling requirements for many of the products listed in Section 133 of the bill. The
FTC is currently required by Section 324(a) of the Energy Policy and Conservation
Act (P.L. 94-163) to issue rules for energy efficiency labels on consumer products
(42 U.S.C. 6294).
Section 135: Preemption. As of January 1, 2006, the energy efficiency
standard for ceiling fans set out in Section 133 shall supersede all state and local
standards for ceiling fans.
Section 136: State Consumer Product Energy Efficiency Standards.
If the product efficiency standards set forth in Section 133 are not implemented
within three years of this law’s enactment, the federal preemption of state standards
will expire.
Section 137: Intermittent Escalators. With certain exceptions, all new
escalators acquired for federal buildings will operate on an intermittent (on-demand)
basis.
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Subtitle D — Public Housing
Section 141: Capacity Building for Energy-Efficient, Affordable
Housing. Activities would be required that would provide energy-efficient,
affordable housing and other residential measures under the HUD Demonstration
Act.
Section 142: Increase of CDBG Public Services Cap for Energy
Conservation and Efficiency Activities. The amount of community
development block grant (CDBG) public services funding that could be used for
energy efficiency would be increased to 25%. The current limit is 15% under Section
105(a)(8) of the Housing and Community Development Act of 1974.
Section 143: FHA Mortgage Insurance Incentives for EnergyEfficient Housing. Solar energy equipment can be eligible for up to 30% of the
total amount of property value that can be covered by Federal Housing
Administration mortgage insurance. The current limit is 20% under Section
203(b)(2) of the National Housing Act.
Section 144: Public Housing Capital Fund. The Public Housing Capital
Fund would be modified to include certain energy- and water-use efficiency
improvements. Under Section 9 of the United States Housing Act, the Capital Fund
is available to public housing agencies to develop, finance, and modernize public
housing developments and to make management improvements to these housing
facilities. There is currently no provision for energy conservation projects that
involve water-conserving plumbing fixtures and fittings.
Section 145: Grants for Energy-Conserving Improvements for
Assisted Housing. The Department of Housing and Urban Development (HUD)
would be directed to provide grants for certain energy and water efficiency
improvements to multifamily housing projects. Section 2(a)(2) of the National
Housing Act, as amended by Section 251(b)(1) of the National Energy Conservation
Policy Act, empowers HUD to make grants for energy conservation projects in public
housing, but it has no provision for energy- and water-conserving plumbing fixtures
and fittings.
Section 147: Energy-Efficient Appliances. Public housing agencies
would be required to purchase cost-effective Energy Star and FEMP-designated
appliances and products.
Section 148: Energy-Efficient Standards. The energy efficiency standards
and codes that the federal government encourages states to use would be changed
from the codes set by the Council of American Building Officials to the 2003
International Energy Conservation Code.
Section 149: Energy Strategy for HUD. The Secretary of Housing and
Urban Development would be required to implement an energy conservation strategy
to reduce utility expenses through cost-effective energy-efficient design and
construction of public and assisted housing.
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Title II — Renewable Energy
Subtitle A — General Provisions
Section 201: Assessment of Renewable Energy Resources. DOE
would be required to report annually on resource potential, including solar, wind,
biomass, ocean (tidal, wave, current, and thermal), geothermal, and hydroelectric
energy resources. DOE would be required to review available assessments and
undertake new assessments as necessary, accounting for changes in market
conditions, available technologies, and other relevant factors. The resource potential
for renewables has not been assessed as thoroughly as that for conventional energy
resources, and the potential may be altered somewhat by climate change.
Section 202: Renewable Energy Production Incentive. Eligibility for
the existing incentive would be extended through 2025 and expanded to include
electric cooperatives and tribal governments. Qualifying resources would be
expanded to include landfill gas, livestock methane, and ocean (tidal, wave, current,
and thermal) energy. Federal law currently provides a 1.5 cent/kwh incentive for
power produced from wind and biomass by state and local governments and nonprofit electrical cooperatives.2 The incentive is funded by appropriations to DOE and
was created to encourage public agencies, which are not eligible for tax incentives,
in a fashion parallel to the renewable energy production tax credit for private sector
businesses. This incentive has played a major role in wind energy development and
is viewed by the wind industry as the single-most important provision in the bill.
Section 203: Federal Purchase Requirement. Federal agencies would
be required, to the extent “economically feasible and technically practicable,” to
purchase power produced from renewable sources. The collective total percentage
of renewables use, as a share of total federal electric energy use, would start at 3%
in FY2007, rise to 5% in FY2010, and then reach 7.5% in 2013 and all subsequent
years. Renewable energy produced at a federal site, on federal lands, or on Indian
lands would be eligible for double credit toward the purchase requirement. This
provision aims to help develop the market for renewables. A report to Congress
would be required every two years.
Section 204: Insular Areas Energy Security. This section includes
congressional findings that electric power transmission and distribution lines in
insular areas are not adequate to withstand hurricane and typhoon damage, and that
an assessment is needed of energy production, consumption, infrastructure, reliance
on imported energy, and indigenous sources of energy in insular areas. Federal law
currently requires comprehensive energy plans for insular areas that describe the
potential for renewable energy resources.3 This section would require the Secretary
of the Interior, in consultation with the Secretary of Energy and the head of
government of each insular area, to update insular area plans by 2007 to reflect these
findings, and to seek to reduce energy imports by increasing energy conservation and
2
Energy Policy Act, Sec. 1212 (42 U.S.C. 13317)
3
42 U.S.C. 1492 .
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energy efficiency and by attempting to maximize the use of indigenous resources.
Annual appropriations would be authorized that would, in part, be used for matching
grants (federal share maximum is 75%) for projects designed to protect electric
power transmission distribution lines in one or more of the territories of the United
States from damage caused by hurricanes and typhoons.
Section 205: Use of Photovoltaic Energy in Public Buildings. The
General Services Administration (GSA) would be authorized to encourage use of
solar photovoltaic energy systems in new and existing buildings. This provision aims
to help reduce federal fossil fuel use. Further, it seeks to reduce costs and, thereby,
stimulate the market for photovoltaic equipment.
Section 206: Federal Procurement of Biobased Products. This
provision amends the existing requirement4 that federal agencies give procurement
preference to items composed of the highest percentage of biobased products
practicable by adding a specific reference to degradable six-pack rings.5
Section 207: Renewable Energy Security. For the DOE Weatherization
grant program, Section 207(a) increases the limit on support for renewable energy
equipment from $2,500 to $3,000 per dwelling unit. Also, Section 207(d) creates a
consumer rebate for renewable energy equipment installed in a dwelling or small
business. The maximum rebate is the lesser of 25% of equipment cost or $3,000.
Section 208: Installation of Photovoltaic System. This provision
authorizes $20 million for the Administrator of GSA to proceed with the Sun Wall
Design Project, the winning entry in a national design competition sponsored jointly
by DOE and the National Renewable Energy Laboratory, to install a photovoltaic
solar electric system on the headquarters building of DOE.
Section 209: Sugar Cane Ethanol Pilot Program. This provision
authorizes a three-year demonstration program for the production of ethanol in
Hawaii to parallel the existing program for corn to show that the process can be
applicable to cane sugar and can be replicated on a larger scale once the sugar cane
industry has located a site and constructed ethanol production facilities.
Subtitle C — Hydroelectric
Section 231: Alternative Conditions and Fishways. Under the Federal
Power Act (FPA, 16 U.S.C. 797 et. seq.) the Federal Energy Regulatory Commission
has primary responsibility for balancing multiple water uses and evaluating
hydropower relicensing applications. However, the FPA also creates a role in the
licensing process for federal agencies that are responsible for managing fisheries or
federal reservations (e.g. national forests, etc.). Specifically, sections 4(e) and 18 of
4
7 U.S.C. 8201(c)(1) gives preference to procurement of items made with the highest
percentage of biobased products.
5
42 U.S.C. 6914b-1 provides for use of naturally degradable material in plastic ring carriers
to help reduce litter and to protect fish and wildlife.
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the FPA give certain federal agencies the authority to attach conditions to FERC
licenses. For example, federal agencies may require applicants to build passageways
through which fish can travel around the dam, schedule periodic water releases for
recreation, ensure minimum flows of water for fish migration, control water release
rates to reduce erosion, or limit reservoir fluctuations to protect the reservoir’s
shoreline habitat. Once an agency issues such conditions, FERC must include them
in its license. While these conditions often generate environmental or recreational
benefits, they may also require construction expenditures and may increase costs by
reducing operational flexibility.
This provision in H.R. 6 would allow license applicants to propose alternative
license conditions, and would require federal agencies to consider alternatives
proposed by license applicants. It would also require an agency to accept an
applicant’s proposed alternative if it found that the alternative (1) provides for the
adequate protection and utilization of the federal reservation, or is no less protective
of the fish resource than the fishway initially prescribed, and (2) costs less to
implement, and/or will improve operation of the project for electricity production.
H.R. 6 also requires agencies that are issuing conditions to provide FERC with a
written statement demonstrating that the relevant Secretary gave “equal
consideration” to the effects of the conditions on factors such as energy supply, flood
control, navigation, water supply, and air quality. This equal consideration clause
may be a topic of debate during further consideration of H.R. 6. Opponents of the
provision are concerned that it would hamper agencies’ ability to protect the
resources under their jurisdiction; proponents argue that conditioning agencies, like
FERC, should be required to balance competing water uses.
Section 241: Hydroelectric Production Incentives. The Secretary of
Energy would make incentive payments to non-federal owners or operators of
hydroelectric facilities for power that is first produced within 10 years of the date of
enactment by generating equipment added to existing facilities. Payments of 1.8
cents per kilowatt-hour (kWh), up to a total of $750,000/year, may be made for up
to 10 years from the first year after the facility begins operating.
Section 242: Hydroelectric Efficiency Improvement. The Secretary of
Energy would make incentive payments to the owners or operators of hydroelectric
facilities who make capital improvements on existing facilities that improve
efficiency by at least 3%. Payments would not exceed 10% of the improvement cost
and would not exceed $750,000 at any single facility.
Section 243: Small Hydroelectric Power Projects. This provision
would amend the Public Utility Regulatory Policies Act of 1978 (16 U.S.C. 2078),
to change the date on or before which a dam must be constructed to qualify as an
existing dam, from April 20, 1977, to March 4, 2003.
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Title III — Oil and Gas
Subtitle A — Petroleum Reserve and Home Heating Oil
Section 301: Permanent Authority to Operate the Strategic
Petroleum Reserve. Congress authorized the Strategic Petroleum Reserve (SPR)
in the Energy Policy and Conservation Act (EPCA, P.L. 94-163) to help prevent a
repetition of the economic dislocation caused by the 1973-74 Arab oil embargo.
Physically, the SPR comprises five underground storage facilities, hollowed out from
naturally occurring salt domes, located in Texas and Louisiana. In 2000, Congress
also authorized establishment of a Northeast Heating Oil Reserve (NHOR) where
two million barrels of home heating oil is kept in leased, above-ground storage, to be
released if the price of heating oil exceeds a calculated historic average. The
authorities governing the SPR and NHOR are included in the Energy Policy and
Conservation Act (EPCA, P.L. 94-163) and are currently authorized through FY2008
by P.L. 108-7. These authorities also provide for U.S. participation in emergency
activities of the International Energy Agency (IEA) without risking violation of
antitrust law and regulation.
The House bill would permanently reauthorize both programs, avoiding
awkward periods such as occurred in 2000 when differences between the House and
Senate over certain issues resulted in a period of several months when the authorities
were not in force.
Section 302: National Oilheat Research Alliance. The National Oilheat
Research Alliance (NORA) was established by the Energy Policy Act of 2000 (P.L.
106-469), and assesses a fee of $.002 per gallon on home heating oil sold by retail
distributors. The proceeds, among other purposes, are dedicated to research on
improving the efficiency of furnaces and boilers, and providing education and
training resources to professionals in the industry. The House bill would extend the
authorization for NORA until nine years (2010) after the date on which the Alliance
was established.
Section 303: Site Selection. Pursuant to Section 310(d), the Secretary of
Energy would be required, within one year of the enactment of the legislation, to
select sites — from among those that have been previously studied — for expansion
of the SPR to its fully authorized volume of one billion barrels.
Section 304: Suspension of Strategic Petroleum Reserve
Deliveries. Producers of offshore leases in the Gulf of Mexico pay a royalty to the
U.S. Treasury based upon production at their sites. Since 1999, most new fill of the
SPR has been accomplished by the acceptance of royalty-in-kind (RIK) oil from these
producers in lieu of cash paid to the Treasury. Some policymakers have objected to
RIK deliveries, arguing that diverting any oil from the markets was contributing to
rising crude prices. The Administration argued that the volumes involved, never
more than 200,000 b/d and often less, was not large enough to have the effect on
prices that some alleged. The SPR holds roughly 700 million barrels. Current
capacity is estimated at 727 million barrels. It is not apparent whether the
Administration plans to continue RIK fill after current contracts end during the
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summer of 2005. Should the Administration do so, this provision of H.R. 6 would
permit accepting deliveries of RIK oil only when crude prices were below $40/barrel.
Subtitle B — Production Incentives
Section 320: Liquefied Natural Gas. This section would expand the scope
of the Natural Gas Act (15 U.S.C. 717b) to include importing and exporting natural
gas as well as the construction of liquefaction and re-gasification facilities. Building
and operating such facilities would require authorization by the Federal Energy
Regulatory Commission. FERC would be designated as lead agency for the purpose
of coordinating all applicable federal authorizations, and for coordinating compliance
with the National Environmental Policy Act of 1969 (42 U.S.C.4312). FERC would
set a schedule ensuring expeditious administrative proceedings, and compile the
consolidated record of all state and federal proceedings.
The section would limit the criteria upon which FERC could reject a proposed
liquefied natural gas (LNG) project or a facility expansion. FERC could deny an
application only by finding the project not in the public interest, or that the project
sponsor was not capable of constructing and operating an LNG facility. FERC would
be barred from imposing certain conditions on an applicant — such as the provision
of additional services. Additionally, FERC could not deny a “certificate of
convenience and necessity”prior to January 1, 2011, solely because a facility would
be at least partly dedicated to importing the project sponsor’s own natural gas.
FERC would be tasked to issue a construction certificate within one year of
application. Judicial review would be exclusively delegated to the U.S. Court of
Appeals for the District of Colombia Circuit, which must provide expedited
consideration.
Current Law. Under the Natural Gas Act, FERC reviews jurisdictional project
proposals (including those for natural gas importation) to determine if a public need
would be met. A wide variety of criteria are applied in making such a determination.
The Commission can reject a project for a range of reasons, including impact on the
competitive nature of U.S. natural gas markets.
Section 327: Hydraulic Fracturing. This section would amend the Safe
Drinking Water Act (SDWA), Section 1421(d), to specify that the definition of
“underground injection” excludes the injection of fluids or propping agents used in
hydraulic fracturing operations related to oil or gas production activities. Responding
to a 1997 court ruling that directed EPA to regulate hydraulic fracturing as
underground injection, this section would expressly preclude EPA from regulating
the underground injection of fluids used in hydraulic fracturing for oil and gas
production. This provision is unchanged from the conference report for H.R. 6 in the
108th Congress.
Current Law. The SDWA required EPA to promulgate regulations for state
underground injection control (UIC) programs that included minimum requirements
for programs to prevent underground injection that endangers sources of drinking
water. The Act specifies that UIC program regulations may not prescribe
requirements that interfere with “any underground injection for the secondary or
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tertiary recovery of oil or natural gas, unless such requirements are essential to assure
that underground sources of drinking water will not be endangered by such injection”
(§1421(b)(2)).
Policy Context. Before 1997, EPA had not considered regulating hydraulic
fracturing for oil and gas development, because it did not view this well-production
process as an activity subject to regulation under SDWA’s UIC program. In 1997,
the 11th Circuit Court of Appeals ruled that the injection of fluids for the purpose of
hydraulic fracturing constituted underground injection, that all underground injection
must be regulated, and that hydraulic fracturing of coalbed methane (CBM) wells in
Alabama must be regulated under the state’s UIC program (LEAF v. EPA, 118 F. 3d
1467).
Hydraulic fracturing involves the high-pressure injection of fluids into coal beds
to enhance the recovery of oil and natural gas from underground formations. Waterbased fluids are typically used as fracturing fluids; however, diesel fuel often is used
instead of water, and various chemicals are added to fracturing fluids.6 While
hydraulic fracturing has been used in the recovery of conventional oil and gas since
the 1950s, this practice has been used for CBM recovery mainly since the 1990s.
A growing concern is that, in many CBM-producing regions, the target coalbeds
occur within underground sources of drinking water, and the fracturing process
injects fluids directly into the drinking water sources; EPA has determined that the
use of diesel fuel as a fracturing fluid introduces benzene and other toxic substances
directly into underground sources of drinking water.7 Also, because the process
fractures rock, fracturing can create new pathways for natural gas (primarily
methane) to enter drinking water aquifers. As the number of coalbed methane (CBM)
wells and the use of hydraulic fracturing have increased rapidly in recent years, so has
concern over the potential impact on water resources, particularly in the water-scarce
West, and very few studies have been done to evaluate these impacts.
In 2003, EPA’s National Drinking Water Advisory Council recommended that
EPA (1) work to eliminate the use of diesel fuel and related additives in fracturing
fluids that are injected into formations containing drinking water sources; (2)
continue to study the problems that could occur from hydraulic fracturing for CBM
production; and (3) defend its discretion to implement the UIC program in a way that
advances protection of groundwater resources from contamination.
6
Environmental Protection Agency, Evaluation of Impacts to Underground Sources of
Drinking Water by Hydraulic Fracturing of Coalbed Methane Reservoirs, Washington,
D.C., June 2004, pp. 4-3 - 4-4.
7
Environmental Protection Agency, Evaluation of Impacts to Underground Sources of
Drinking Water by Hydraulic Fracturing of Coalbed Methane Reservoirs, pp. 1-6.
According to EPA, hydraulic fracturing of oil and gas found in conventional geologic traps
is well established; however, hydraulic fracturing of coal beds is relatively new.
Conventional sites are usually very deep and involve saline ground water that is unsuitable
for drinking water. In contrast, formations that contain coal bed methane can be near the
surface where ground water may be used as a source of drinking water supplies. pp. 4-9 4-10.
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In late 2003, EPA entered into an agreement with three companies that provide
most hydraulic fracturing services.8 Under this voluntary agreement, the firms agree
to remove diesel fuel from CBM fluids injected directly into drinking water sources,
if cost-effective alternatives are available.
In 2004, EPA issued a final report that concluded that the injection of hydraulic
fracturing fluids into CBM wells poses little or no threat to underground sources of
drinking water and requires no further study; however, EPA noted that very little
documented research has been done on the environmental impacts of injecting
fracturing fluids.9 The report has been criticized by some, and the EPA Inspector
General has been asked to review a whistle-blower’s assertions that EPA’s findings
are scientifically unfounded.10 (For more information, see CRS Report RL32262,
Selected Legal and Policy Issues Related to Coalbed Methane Development, by
Aaron M. Flynn.)
Section 328: Oil and Gas Exploration and Production Defined. This
section would give a permanent exemption from Clean Water Act (CWA)
stormwater runoff rules for the construction of exploration and production facilities
by oil and gas companies and the roads that service those sites. Currently under the
CWA, the operation of facilities involved in oil and gas exploration, production,
processing, transmission, or treatment generally is exempt from stormwater runoff
regulations, but the construction of these facilities is not. The amendment would
modify the act to specifically include construction activities in the types of oil and
gas facilities that are covered by the law’s statutory exemption from stormwater
rules.
The issue arises from stormwater permitting rules for small construction sites
and municipal separate storm sewer systems that were issued by EPA in 1999 and
became effective March 10, 2003. Those rules, known as Phase II of the CWA
stormwater program, require most small construction sites disturbing one to five
acres and municipal separate storm sewer systems serving populations of up to
100,000 people to have a CWA discharge permit. The permits require
pollution-prevention plans describing practices for curbing sediment and other
pollutants from being washed by stormwater runoff into local water bodies. Phase
I of the stormwater program required construction sites larger than five acres
(including oil and gas facilities) and larger municipal separate storm sewer systems
to obtain discharge permits beginning in 1991.
As the March 2003 compliance deadline approached, EPA authorized a
two-year extension of the Phase II rules for small oil and gas construction sites to
allow the agency to assess the economic impact of the rule on that industry. In March
8
Memorandum of Agreement Between the United States Environmental Protection Agency
and BJ Services Company, Halliburton Energy Services, Inc., and Schlumberger Technology
Corporation, December 12, 2003.
9
EPA, Evaluation of Impacts to Underground Sources of Drinking Water by Hydraulic
Fracturing of Coalbed Methane Reservoirs, 2004. p. 4-1.
10
Letter to Senators Wayne Allard and Ben Nighthorse Campbell and Representative Diana
DeGette from Weston Wilson, U.S. Environmental Protection Agency, October 8, 2004.
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2005 EPA extended the exemption until June 2006 and said it would propose a
specific rule for small oil and gas construction sites by September 11, 2005. EPA
had initially assumed that most oil and gas facilities would be smaller than one acre
in size and thus excluded from the Phase II rules, but recent Department of Energy
data indicate that several thousand new sites per year would be of sizes subject to the
rule.
The provision in H.R. 6 is identical to one in H.R. 6/S. 2095 in the 108th
Congress, making EPA’s delay permanent and making it applicable to construction
activities at all oil and gas development and production sites, regardless of size,
including those covered by Phase I rules. Industry has argued that the stormwater
rule creates costly permitting requirements, even though the short construction period
for drilling sites carries little potential for stormwater runoff pollution. Supporters
say the amendment is intended to clarify existing CWA language. Opponents argue
that the provision does not belong in the energy legislation, and that there is no
evidence that construction at oil and gas sites causes less pollution than other
construction activities, which are regulated under EPA’s stormwater program.
Section 329: Outer Continental Shelf Provisions. For applications to
build deepwater ports, the Secretary of Transportation could use environmental
impact statements or other studies prepared by other federal agencies instead of
conducting separate studies. Information from state and local governments and
private-sector sources could also be used.
Section 330: Appeals Relating to Pipeline Construction or Offshore
Mineral Development Projects. Appeals of decisions under the Coastal Zone
Management Act on natural gas pipelines and offshore energy projects would be
based exclusively on the record compiled by FERC or the relevant permitting agency.
It would be the sense of Congress that appeals relating to natural gas pipeline
construction would be coordinated within FERC’s established timeframes under
sections 3 and 7 of the Natural Gas Act (15 U.S.C. 717 b 717 (f).
Sections 332 — 333: Natural Gas Market Reform. These sections
would address natural gas price reporting issues in the wake of the Enron scandal.
During extremely volatile market episodes in 2000-2001 — when gas prices briefly
soared to unprecedented levels — it was alleged that market participants reported
false trading information to price-reporting services. Beyond creating higher prices
for the market participants involved, these price-reporting schemes arguably resulted
in higher transactions prices for unrelated gas deals whose prices were derived from
published price indices artificially escalated by the allegedly false reports.
Section 332, entitled “Natural Gas Market Reform,” would modify the
Commodity Exchange Act (CEA, 7 U.S.C. 13), banning “knowingly false or
knowingly misleading or knowingly inaccurate reports.” It also would increase the
penalties for false reporting.
Section 333, entitled “Natural Gas Market Transparency,” would direct FERC
to issue rules calling for the timely reporting of natural gas prices and availability and
to evaluate the data for accuracy. The language specifies that FERC not impinge on
the role of commercial publishers of natural gas prices.
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Current Law. The Commodity Futures Trading Commission regulates public
trading in gas under a variety of securities laws, including the CEA. FERC also has
existing authority to prevent market manipulation and issued Order 644 on
November 13, 2003, to prevent market abuse, set “rules of the road,” and provide a
more stable marketplace for both electricity and natural gas. It establishes rules
relating to market manipulation, data reporting, and record retention. It also makes
sellers subject to disgorgement of unjust profits and revocation of FERC authorities
to operate under market-based rules (i.e. without direct regulatory supervision) and
to do business.
Section 334: Oil, Gas, and Mineral Industry Workers. Within a year
after enactment, the secretaries of Energy, Labor, and the Interior must submit a
report to Congress with recommendations on meeting future labor requirements for
the domestic oil, gas, and mining industries. This section was not in the H.R. 6
conference report in the 108th Congress.
Subtitle C — Access to Federal Land
Sections 344 and 346: Leasing and Permitting Processes. These
sections would address concerns over delays in the permitting process for oil and gas
development after leases are granted. Some lease stipulations are considered by the
Administration to be impediments to domestic oil and gas development. However,
concerns have also been raised that faster permitting could bypass important
environmental protections.
Current Law. The federal oil and gas leasing program is governed under the
Mineral Leasing Act of 1920, as amended (30 U.S.C. 181 et. seq.). Bureau of Land
Management (BLM) procedures for an application for a permit to drill (APD) are
contained in 43 CFR 3162.3-1. The APD is posted for 30 days. Within 5 working
days after the 30-day period, the BLM consults with surface-managing agencies
whose consent is also required, then notifies the applicant of the results. The BLM
is also required to process the application within the 35-day period. The Bush
Administration has taken some action on this issue, including processing and
conducting environmental analyses on multiple permit applications with similar
characteristics, implementing geographic area development planning for oil and gas
fields or areas within a field, and allowing for block surveys of cultural resources.
H.R. 6. The Secretaries of the Interior and Agriculture would be required to
sign a memorandum of understanding (MOU) on the “timely processing” of oil and
gas lease applications, surface use plans and drilling applications, the elimination of
duplication, and ensuring consistency in applying lease stipulations (Sec. 344).
Compliance with Executive Order No. 13211 (42 U.S.C. 12301 note), requiring
energy impact studies, would be required before taking action on regulations having
an effect on domestic energy supply (Sec. 346).
Section 355: Encouraging Prohibition of Drilling in the Great Lakes.
Congress would urge that no federal or state permits be issued for oil and gas drilling
in or under the Great Lakes.
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Section 358: Federal Coalbed Methane Regulation. States on the list
of “affected states” under section 1339(b) of the Energy Policy Act of 1992 (42
U.S.C. 13368(b)) would be removed if they took specified actions within three years
after enactment of H.R. 6 or had previously taken action under section 1339(b). The
list of “affected states” established under the Energy Policy Act of 1992 (42 U.S.C.
13368 (b)) includes: West Virginia, Pennsylvania, Kentucky, Ohio, Tennessee,
Indiana, and Illinois. These states are on the list as a result of coalbed methane
(CBM) ownership disputes, impediments to development, lack of a regulatory
framework to encourage CBM development in the state, and no current extensive
development of CBM. A state may be removed from the list through a petitioning
process initiated by the governor of that state.
Subtitle D — Refining Revitalization
Sections 371- 379: Refining Revitalization. This subtitle is designated
as the “United States Refinery Revitalization Act of 2005.” Based on the finding that
fuel demand exceeds the production capacity of domestic refineries, it is in the
national interest to increase capacity to refine fuels within the United States. The
findings in Sec. 372 note that no new refinery has been built in the country since
1976, and there has been a reduction in the number of operating facilities. It also
notes that gasoline demand is expected to increase 45% between 2005 and 2025.
Closure of refineries since 1981 has resulted in the shuttering of nearly 500,000
barrels per day of capacity. While the number of operating facilities has fallen from
324 to 149, the total amount of capacity has risen, the result of expansion of existing
plants. But the investment climate for expansion of old plants and construction of
new remains clouded, in part due to regulatory uncertainty at the federal, state, and
local levels. The findings make note of the planned Yuma, AZ, refinery, which just
received its federal air quality permit after five years under the current regulatory
process.
The Act’s purpose, as stated in Sec. 373, is to provide an accelerated review and
approval process for idled refineries, and to lend legal and technical support to states
needing help to meet such permit demands.
Refinery Revitalization Zones are designated in Sec. 374, and the Secretary of
Energy is directed to identify areas (within 90 days after enactment) that have
experienced mass layoffs in manufacturing, contain an idle refinery, and have an
unemployment rate that exceeds the national average by 10%.
Sec. 375 calls for a memorandum of understanding between the Secretary of
Energy and the EPA Administrator that designates appropriate agency officials and
staff to implement the purposes of the Act and administer any regulations issued
thereunder. State Governors and Indian Tribe representatives may enter into this
MOU. Once a qualifying state enters into the MOU, Sec. 376 calls on the Secretary
of Energy to delegate agency staff to provide assistance to the state. The EPA
Administrator is similarly charged, and specifically directed to provide expertise
regarding the laws the agency administers as they relate to refineries.
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DOE is designated lead agency in Sec. 377. Upon written request of an
applicant, the Department will coordinate all applicable authorizations and
environmental reviews, including those at the state and local level. It would be
required to set a prompt and binding schedule for federal reviews and authorizations,
such that the whole federal process would be completed within six months. The
Department would maintain a complete consolidated record of the proceedings, and
act as the arbiter in the case of appeals. Decisions on appeals would be required
within 60 days.
The Secretary would establish a 60-day pre-application process to help establish
likelihood of approval and identify potential issues. In its lead agency role, the
Department would coordinate all federal actions for NEPA compliance, as well as
consolidation of the impact statement into one document covering all environmental
impacts.
Sec. 378 calls for the compliance with all applicable laws and regulations.
Sec. 379 contains definitions for a number of significant items, including:
!
Federal authorizations means those required under the Clean Air
Act, the Federal Water Pollution Control Act, the Safe Drinking
Water Act, the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, the Solid Waste Disposal
Act, the National Historic Preservation Act, and the National
Environmental Policy Act of 1969.
!
An idle refinery is real property used as a refinery since December
31, 1979, and not operational before April 1, 2005.
!
A refinery means any facility designed and operated to store or ship
oil, as well as to operate as a refinery or a refinery component. This
includes places where fuel blending took place.
!
A qualifying state is a state or Indian tribe which has entered into a
MOU with the Secretary of Energy, and has a refining infrastructure
coordination office.
Title IV — Coal
Subtitle A — Clean Coal Power Initiative
Sections 401- 404: Clean Coal Power Initiative. The Clean Coal Power
Initiative (CCPI) is in its third year of funding under a 10-year, $2 billion program
outlined by the Bush Administration. According to DOE, the program supports costshared projects with the private sector to demonstrate new technologies that could
boost the efficiency and reduce emissions from coal-fired power plants.
CRS-23
Current Law. CCPI does not currently have a specific authorization, although
it has been funded through FY2005 in the annual Interior and Related Agencies
Appropriations bill. The program supersedes the Clean Coal Technology Program,
which has completed most of its projects and has been subject to rescissions and
deferrals since the mid-1990s.
H.R. 6. Funding for CCPI would be authorized for $200 million for each year
from FY2006-FY2014 (Sec. 401). The technical criteria would be established for
coal-based gasification and other projects. The federal share of financing for each
clean coal project would not exceed 50% (Sec. 402). A report on the projects’ status
and technical milestones would be submitted after the first year and every two years
by the Secretary of Energy to various congressional committees (Sec. 403). The
program would include grants to universities to establish Centers of Excellence for
energy systems of the future (Sec. 404).
Policy Context. A key ingredient of President Bush’s May 2001 National
Energy Policy is to bolster U.S. energy supply. One of its goals is to use coal more
efficiently, as coal is an abundant national resource. The Administration contends
that new technologies could cost-effectively reduce emissions from coal-fired power
plants and overcome barriers to expanded coal use.
Subtitle B — Clean Power Projects
Sections 411- 416: Clean Power Projects. The Secretary of Energy
would be authorized to provide a $125 million loan to an experimental clean coal
power plant in Healy, Alaska (Sec. 411). Loan guarantees would be authorized for
a power plant of at least 400MW capacity using integrated combined-cycle (IGCC)
technology in a deregulated market and receiving no ratepayer subsidy (Sec. 412).
Loan guarantees would be available for at least five petro-coke gasification
polygeneration projects, involving co-production of electricity and fuels (Sec. 414).
The Secretary of Energy would be directed to use $5 million of appropriated funds
to begin a project managed by the DOE Chicago Operations Office to demonstrate
high-energy electron scrubbing technology for high-sulfur coal emissions (Sec. 416).
Subtitle D — Coal and Related Programs
Section 441: Clean Air Coal Program. This section would amend the
Energy Policy Act of 1992 with the addition of a clean air coal program to promote
increased use of coal, acceptance of new clean coal technologies, and advance
deployment of pollution control equipment to meet the Clean Air Act (42 U.S.C.
7402 et seq.).
A total of $500 million over FY2006-FY2010 would be authorized for pollution
control projects to control mercury, nitrogen dioxide, sulfur dioxide emissions,
particulate matter, or more than one pollutant; and allow use of the waste byproducts.
Additional authorizations totaling $2.5 billion over FY2007-FY2013 would be
provided for projects using coal-based electrical generation equipment and processes,
and associated environmental control equipment.
CRS-24
Project selection criteria would be based on significantly improving air quality,
replacing less efficient units, and improving thermal efficiency. Up to 25% of
projects would be cogeneration or other gasification projects. At least 25% of the
projects would be solely for electrical generation, with priority for those generating
less than 600 MW. Federal loans or loan guarantees would not exceed 30% of the
total funds obligated during any fiscal year. The federal share of projects funded
would not exceed 50%.
No technology funded by the program, or level of emissions reduction achieved
by funded projects, would be considered adequately demonstrated for purposes of
Sections 111, 169, or 171 of the Clean Air Act.
Title V — Indian Energy
Section 501: Short Title. This title would be cited as the “Indian Tribal
Energy Development and Self-Determination Act of 2005.”
Section 502: Office of Indian Energy Policy and Programs. Title II
of the Department of Energy Organization Act (42 U.S.C. 7131 et. seq.) would be
amended to create the Office of Indian Energy Policy and Programs at the
Department of Energy.
Section 503: Indian Energy. Title 26 the Energy Policy Act of 1992 (25
U.S.C. 3501) would be replaced by this section, which outlines procedures whereby
Indian tribes would be able to develop and manage the energy resources located on,
and rights-of-way through, tribal land. Within a year of enactment of the bill, the
Department of the Interior (DOI) would issue regulations on the requirements for
approval of tribal energy resource agreements. Under their own tribal energy
resource agreements as approved by DOI, Indian tribes would be able to enter into
leases or business agreements for energy development and grant rights-of-way over
tribal land for pipelines or electric lines.
Assistance for tribal energy development would be provided through DOI by
grants and low-interest loans and through DOE by grants and loan guarantees.
Federal agencies could give preference to Indian energy when purchasing energy
products and byproducts.
DOI would be required to undertake a review and make recommendations
regarding tribal opportunities under the Indian Mineral Development Act of 1982 (25
U.S.C. 2101 et. seq.). The Bonneville Power Administration and Western Area
Power Administration would be authorized to assist in developing distribution
systems that provide power to Indian tribes using the federal transmission system.
Section 504: Consultation with Indian Tribes. The Secretaries of Energy
and of the Interior would be required to consult with Indian tribes in carrying out this
title.
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Section 505. Four Corners Transmission Line Project. The Dine
Power Authority, an enterprise of the Navajo nation, would be eligible to receive
grants and other assistance to develop a transmission line from the Four Corners Area
to southern Nevada, including related generation facilities.
Title VI — Nuclear Matters
Subtitle A — Price-Anderson Act Amendments
Sections 601- 612: Price-Anderson Nuclear Liability Coverage. The
Price-Anderson Act,11 which addresses liability for damages to the general public
from nuclear incidents, would be extended through 2025. The Price-Anderson
liability system was up for reauthorization on August 1, 2002, and was extended for
commercial nuclear reactors through December 31, 2003, by the FY2003
consolidated appropriations resolution (P.L. 108-7). Even without further extension,
existing reactors will continue to operate under the current Price-Anderson liability
system, but any new reactors would not be covered. Price-Anderson coverage for
DOE nuclear contractors was extended through December 31, 2004, by the National
Defense Authorization Act for FY2003 (P.L. 107-314). A further two-year extension
for DOE contractors was approved by Congress on October 9, 2004, as part of the
Ronald W. Reagan National Defense Authorization Act for Fiscal Year 2005 (P.L.
108-375).
Current Law. Under Price-Anderson, the owners of commercial reactors must
assume all liability for nuclear damages awarded to the public by the court system,
and they must waive most of their legal defenses following a severe radioactive
release (“extraordinary nuclear occurrence”). To pay any such damages, each
licensed reactor must carry financial protection in the amount of the maximum
liability insurance available, which was increased by the insurance industry from
$200 million to $300 million on January 1, 2003. Any damages exceeding that
amount are to be assessed equally against all covered commercial reactors, up to
$95.8 million per reactor (most recently adjusted for inflation on August 20, 2003).
Those assessments — called “retrospective premiums” — would be paid at an annual
rate of no more than $10 million per reactor, to limit the potential financial burden
on reactor owners following a major accident. According to the Nuclear Regulatory
Commission (NRC), 103 commercial reactors are currently covered by the PriceAnderson retrospective premium requirement.
Funding for public compensation following a major nuclear incident, therefore,
would include the $300 million in insurance coverage carried by the reactor that
suffered the incident, plus the $95.8 million in retrospective premiums from each of
the 103 currently covered reactors, totaling $10.2 billion. On top of those payments,
a 5% surcharge may also be imposed, raising the total per-reactor retrospective
premium to $100.6 million and the total potential compensation for each incident to
about $10.7 billion. Under Price-Anderson, the nuclear industry’s liability for an
11
Primarily Sec. 170 of the Atomic Energy Act of 1954, 42 U.S.C. 2210.
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incident is capped at that amount, which varies depending on the number of covered
reactors, the amount of available insurance, and an inflation adjustment that is made
every five years. Payment of any damages above that liability limit would require
congressional approval under special procedures in the act.
The Price-Anderson Act also covers contractors who operate hazardous DOE
nuclear facilities. The liability limit for DOE contractors is the same as for
commercial reactors, excluding the 5% surcharge, except when the limit for
commercial reactors drops because of a decline in the number of covered reactors.
Because two closed reactors had been covered until recently (for a total of 105), the
liability limit for commercial reactors, minus the surcharge, had been $10.4 billion,
which remains the liability limit for DOE contractors. Price-Anderson authorizes
DOE to indemnify its contractors for the entire amount, so any damage payments for
nuclear incidents at DOE facilities would ultimately come from the U.S. Treasury.
However, the law also allows DOE to fine its contractors for safety violations, and
contractor employees and directors can face criminal penalties for “knowingly and
willfully” violating nuclear safety rules. However, Section 234A of the Atomic
Energy Act specifically exempts seven non-profit DOE contractors and their
subcontractors. Under the same section, DOE automatically remits any civil
penalties imposed on non-profit educational institutions serving as DOE contractors.
House Bill. Price-Anderson liability coverage for commercial reactors and for
DOE contractors would be extended through December 31, 2025 (Sec. 602). The
total retrospective premium for each reactor would be set at the current level of $95.8
million and the limit on per-reactor annual payments raised to $15 million (Sec. 603),
with both to be adjusted for inflation every five years (Sec. 607). For the purposes
of those payment limits, a nuclear plant consisting of multiple small reactors (100300 megawatts, up to a total of 1,300 megawatts) would be considered a single
reactor (Sec. 608). Therefore, a power plant with six 120-megawatt modular reactors
would be liable for retrospective premiums of up to $95.8 million, rather than $574.8
million. The liability limit on DOE contractors would be set at $10 billion per
accident, also to be adjusted for inflation (Sec. 604).
The liability limit and maximum indemnification for DOE contractors for
nuclear incidents outside the United States would be raised from $100 million to
$500 million (Sec. 605). However, Price-Anderson indemnification would be
prohibited for contracts related to nuclear facilities in countries found to sponsor
terrorism (Sec. 610). None of the increased liability limits would apply to nuclear
incidents taking place before the amendments are enacted (Sec. 609). NRC and DOE
would have to report to Congress by the end of 2021 on the need for further PriceAnderson extensions and modifications (Sec. 606).
For future contracts, the House-passed bill would eliminate the civil penalty
exemption for nuclear safety violations by the seven non-profit contractors listed in
current law. DOE’s authority to automatically remit penalties imposed on all nonprofit educational institutions serving as contractors would also be repealed.
However, the bill would limit the civil penalties against a non-profit contractor to the
amount of management fees received under that contract (Sec. 611).
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The House-passed version of H.R. 6 would also authorize the federal
government to sue DOE contractors to recover at least some of the compensation that
the government had paid for any accident caused by intentional DOE contractor
management misconduct. Such cost recovery would be limited to the amount of the
contractor’s profit under the contract involved, and no recovery would be allowed
from nonprofit contractors (Sec. 612). This section was also in H.R. 6 as passed by
the House in the 108th Congress but not in the conference report.
Policy Context. The Price-Anderson Act’s limits on liability were crucial in
establishing the commercial nuclear power industry in the 1950s. Supporters of the
Price-Anderson system contend that it has worked well since that time in ensuring
that nuclear accident victims would have a secure source of compensation, at little
cost to the taxpayer. However, opponents contend that Price-Anderson subsidizes
the nuclear power industry by protecting it from some or most of the financial
consequences of the worst conceivable accidents.
Because no new U.S. reactors are currently planned, missing the deadline for
extension has had little immediate effect on the nuclear power industry, as existing
reactors continue to be covered. For the first time in more than 20 years, however,
several U.S. utilities have announced that they are considering whether to build new
reactors. It is unlikely that any such projects would move forward without PriceAnderson coverage. A lapse in Price-Anderson would also affect all subsequently
signed DOE nuclear facility contracts, which would have to use alternate
indemnification authority.
Subtitle B — General Nuclear Matters
Section 621: Commercial Reactor License Period. The initial 40-year
period for a commercial nuclear reactor license would begin when NRC authorized
the reactor to commence operation after construction had been completed. Currently,
under Atomic Energy Act Section 185 b. (added by the Energy Policy Act of 1992,
P.L. 102-486), the 40-year initial license period may begin when a “combined
construction and operating license” is issued several years before the reactor is to
start operating. Before Section 185 was added in 1992, reactor operating licenses had
been issued only after construction was complete, but any future licenses are
expected to use the combined license option.
Section 622: NRC Training and Fellowship Program. Funding of $1
million per year would be authorized from FY2005-FY2009 for NRC to conduct a
training and fellowship program to develop critical nuclear safety regulatory skills.
Section 623: Cost Recovery From Government Agencies. NRC would
be authorized to charge cost-based fees for all services rendered to other federal
agencies. Such authority is limited under current law (Atomic Energy Act, Section
161 w.).
Section 624: Elimination of Pension Offset for Key NRC Personnel.
When NRC has a critical need for the skills of a retired employee, NRC could hire
the retiree as a contractor and exempt him or her from the annuity reductions that
would otherwise apply.
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Section 625: Antitrust Review Suspension. NRC would no longer have
to submit nuclear reactor license applications to the Attorney General for antitrust
reviews, as currently required by Atomic Energy Act Section 105 c.
Section 626: Decommissioning Fund Protection. NRC would be
explicitly authorized to issue regulations ensuring that funds collected to
decommission nuclear power plants would not be used for other purposes. This
provision is particularly aimed at cases in which an original nuclear power plant
owner has sold the plant but retained control over decommissioning funds collected
before the ownership transfer.
Section 627: Limitation on DOE Legal Fee Reimbursement. Except
as required by existing contracts, DOE would be prohibited from reimbursing its
contractors for legal expenses incurred in defending against “whistleblower”
complaints that are ultimately upheld.
Section 629: Feasibility Study for Commercial Reactors at DOE
Sites. The Secretary of Energy would be required to submit a study to Congress on
the feasibility of developing commercial nuclear power plants at existing DOE sites.
Section 630: Government Uranium Sales. With certain exceptions,
DOE uranium sales would be restricted to 3 million pounds per year from FY2005FY2009, 5 million pounds per year in FY2010-FY2011, 7 million pounds per year
in FY2012, and 10 million pounds per year thereafter. DOE must report to Congress
within three years on the impact of such sales on the domestic uranium industry.
Section 631: Uranium Mining Research and Development. Funding
of $10 million per year would be authorized during FY2006-FY2008 for a costshared research and development program by DOE and domestic uranium producers
on in-situ leaching mining technologies and related environmental restoration
technologies, except that “no activities funded under this section may be carried out
in the State of New Mexico.”
Section 632: Whistleblower Protection. Existing whistleblower
protections for employees of nuclear power plants and other NRC licensees and
employees of DOE contractors would be extended to employees of NRC contractors.
An employee whose whistleblower retaliation complaint did not receive a final
decision by the Secretary of Labor within 540 days could take the case to federal
court.
Section 633: Uranium Exports for Medical Isotope Production.
Highly enriched uranium (HEU) could be exported to Canada, Belgium, France,
Germany, and the Netherlands for production of medical isotopes in nuclear reactors.
Those countries would be exempt from existing requirements (under Section 134 of
the Atomic Energy Act) that they agree to switch to low-enriched uranium (LEU) as
soon as possible and that LEU fuel for their reactors be under active development.
Instead, those countries would have to agree to convert to suitable LEU fuel when it
became available. NRC would have to review current security requirements for HEU
used for medical isotope production and impose additional requirements if necessary.
The National Academy of Sciences would study the potential availability and cost of
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medical isotopes produced in LEU reactors; that study would be used by DOE to help
determine whether U.S. medical isotope demand could be reliably and economically
met with production facilities that do not use HEU. If the Secretary of Energy
certifies that such demand can be met, the export exemption in the House bill would
terminate. The current HEU export restrictions are intended to spur foreign
cooperation with U.S. efforts to convert all HEU reactors to LEU, but supporters of
the exemption contend that the restrictions could disrupt the supply of medical
isotopes produced in foreign HEU reactors.
Section 634: Fernald Byproduct Material. DOE-managed material in the
concrete silos at the Fernald uranium processing facility would be considered
byproduct material (as defined by section 11 e.(2) of the Atomic Energy Act of 1954
(42 U.S.C. 2014(e)(2)). DOE would dispose of the material in an NRC- or stateregulated facility.
Section 635: Safe Disposal of Greater-than-Class-C Radioactive
Waste. DOE would designate an office with the responsibility for developing a
comprehensive plan for permanent disposal of all low-level radioactive waste with
concentrations of radionuclides that exceed the limits established by the NRC for
Class C radioactive waste. The plan would include developing a new facility or use
of an existing facility for disposal.
Section 636: Prohibition on Nuclear Exports to Terrorism
Sponsors. Exports of nuclear materials, equipment, and sensitive technology
would be prohibited to any country identified by the Secretary of State as a sponsor
of terrorism. The President could waive the export restriction under certain
conditions. It is intended to block implementation of a 1994 agreement under which
North Korea was to receive a U.S.-designed nuclear power plant in return for
abandoning its nuclear weapons program. The agreement has been suspended in
light of North Korea’s continuing weapons activities.
Section 638: National Uranium Stockpile. The Secretary of Energy
would be authorized to create a national low-enriched uranium stockpile.
Section 639: Nuclear Regulatory Commission Meetings. Whenever
a quorum of the Nuclear Regulatory Commission gathers to discuss official business,
other than at formal Commission meetings, the discussions would have to be
recorded and the public notified within 15 days. A transcript of the recording would
be available to the public upon request except for information that is exempted or
prohibited from disclosure by law.
Section 640: Employee Benefits. Subject to the availability of funds,
workers at DOE’s uranium enrichment plants at Portsmouth, Ohio, and Paducah,
Kentucky, who were eligible for certain pension and health care benefits on April 1,
2005, shall continue such eligibility.
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Subtitle C — Advanced Reactor Hydrogen Production
Sections 651-652: Hydrogen Cogeneration Production Programs.
DOE would be authorized to develop, design, construct, and operate an advanced
nuclear reactor to produce hydrogen and electricity. The project would be managed
by the DOE Office of Nuclear Energy, Science, and Technology, and the reactor
would be located at the Idaho National Laboratory. Among other requirements, the
project should begin producing hydrogen or electricity by 2011 unless the Secretary
of Energy finds that goal infeasible. The reactor would be licensed and regulated by
NRC. Five projects to demonstrate hydrogen production at existing nuclear power
plants would also be authorized. Funding for the program would be authorized at
$1.3 billion through FY2015.
Subtitle D — Nuclear Security
Section 661: Nuclear Facility Threats. In consultation with NRC and
other appropriate agencies, the President would be required to identify types of
security threats at nuclear facilities. The President would have to issue reports on the
identified threats and on actions taken or to be taken to address the threats. NRC
would be authorized to revise its regulations based on the President’s threatidentification report. NRC would be required to conduct periodic force-on-force
exercises to test nuclear facility security. NRC would be authorized to issue
regulations to protect information about nuclear facility security, and would be
required to assign a security coordinator to each NRC region.
Section 662: Fingerprinting for Criminal Background Checks. The
existing requirement that individuals be fingerprinted for criminal background checks
before receiving unescorted access to nuclear power plants (Atomic Energy Act,
Section 149) would be extended to individuals with unescorted access to any
radioactive material or property that could pose a health or security threat. Other
biometric methods could be used instead of fingerprinting.
Section 663: Use of Firearms by Nuclear Licensees. NRC would be
authorized to allow the use of firearms by security personnel at nuclear power plants
and other facilities licensed or regulated by NRC. Federal law currently authorizes
NRC employees and contractors to use firearms, but not employees or contractors of
nuclear licensees (Atomic Energy Act, Section 161 k.). This provision would counter
some state laws that preclude private guard forces from utilizing some weapons.
Section 664: Unauthorized Introduction of Dangerous Weapons.
Existing NRC controls on the entry of dangerous weapons or materials into
Commission facilities (Atomic Energy Act, Section 229a) would be extended to
commercial nuclear power plants and other NRC-regulated facilities.
Section 665: Sabotage of Nuclear Facilities or Fuel. Maximum
penalties for sabotage of licensed nuclear facilities or materials (Atomic Energy Act,
Section 236 a.) would be increased from $10,000 and 10 years in prison to $1 million
and life imprisonment without parole. The language would clarify that the penalties
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could apply to facilities “certified” as well as “licensed” by NRC, and also to
sabotage of facilities under construction.
Section 666: Secure Transfer of Nuclear Materials. Nuclear materials
transferred or received in the United States pursuant to an import or export license
would have to be accompanied by a detailed manifest. Every worker involved in
such shipments would have to undergo a federal security background check.
Section 667: Department of Homeland Security Consultation. Before
issuing a license for a nuclear power plant, NRC would have to consult with the
Department of Homeland Security about the vulnerability of the proposed plant
location to terrorist attack.
Section 668: Authorization of Appropriations. Appropriation of such
sums as necessary to carry out this subtitle would be authorized. A statutory
requirement that the Nuclear Regulatory Commission recover 90% of its costs (minus
certain exceptions) through licensee fees would be made permanent. The current fee
requirement, imposed by the Omnibus Budget Reconciliation Act of 1990 (42 U.S.C.
2214), is set to expire September 20, 2005. NRC’s costs in regulating residual
defense radioactive waste under Section 3116 of the Ronald W. Reagan National
Defense Authorization Act for Fiscal Year 2005 (50 U.S.C. 2601 note) would be
excluded from costs subject to the 90% cost recovery requirement.
Title VII — Vehicles and Fuels
Subtitle A — Existing Programs
The sections of this subtitle refer to alternative fuel and vehicle purchase
requirements under the Energy Policy and Conservation Act (EPCA) (P.L. 94-163)
and the Energy Policy Act of 1992 (EPAct, P.L. 102-486). Various requirements
apply to federal vehicle fleets, as well as state fleets and fleets operated by alternative
fuel providers.
Section 701: Use of Alternative Fuels by Dual-Fueled Vehicles.
Section 400AA of EPCA would be amended to require that all federal agencies
operate dual-fueled vehicles on alternative fuels or petition the Secretary of Energy
for a waiver from the requirement. Under current law, agencies are not required to
file a petition to be exempted from the requirement. A dual-fuel vehicle is one that
can be operated on either an alternative fuel (e.g., ethanol or natural gas) or a
conventional fuel (e.g., gasoline). Currently, most federally owned dual-fuel vehicles
are operated on gasoline as opposed to alternative fuel.
Section 704: Incremental Cost Allocation. Section 303(c) of EPAct
allows federal agencies to allocate the incremental cost of required alternative-fuel
vehicles across the whole vehicle fleet. H.R. 6 would require agencies to do so.
Section 705: Lease Condensates. Section 705 would amend the definition
of alternative fuel to include lease condensate (liquids recovered from natural gas
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separation) and fuels derived from lease condensate. Fleets could generate one
vehicle purchase credit for the use of a certain volume (to be determined by the
Secretary of Energy) of lease condensate fuel in medium- and heavy-duty vehicles.
This provision is similar to the existing credit structure for the use of biodiesel.
Section 706: Review of Energy Policy Act of 1992 Programs. The
Secretary of Energy would be required to conduct a study on the effectiveness of the
alternative fuel vehicle programs under EPAct. Specifically, the Secretary would be
required to assess the effects on vehicle technology, availability, and cost.
Section 707: Report Concerning Compliance with Alternative Fuel
Vehicle Purchasing Requirements. Each federal agency is required to report
annually (through 2012) to Congress on its compliance with EPAct vehicle purchase
requirements. The conference report would extend the requirement through 2020.
Subtitle B — Hybrid Vehicles, Advanced Vehicles, and Fuel
Cell Buses
Section 711: Hybrid Vehicles. Section 711 would require the Secretary of
Energy to accelerate research on technologies for hybrid vehicles. No new funds
would be authorized.
Section 712: Hybrid Retrofit and Electric Conversion Program. The
Administrator of the Environmental Protection Agency (EPA) would be required to
establish a grant program for the installation of technologies to retrofit existing
combustion engines with electric or hybrid systems. Retrofitted vehicles must
achieve federal Low Emission Vehicle standards. Section 712 authorizes a total of
$100 million between FY2005 and FY2007 for the program.
Section 713: Efficient Hybrid and Advanced Diesel Vehicles. The
EPA Administrator would be required to establish a program to encourage the
domestic production and sales of efficient hybrid and advanced diesel vehicles. The
program must include grants to domestic vehicle manufacturers to encourage
production and provide consumer purchase incentives. A total of $3 billion is
authorized between FY2006 and FY2015.
Sections 721-724: Advanced Vehicles. The Secretary of Energy would
be authorized to provide grants to state governments, local governments, and
metropolitan transit authorities for the purchase of alternative fuel, hybrid, fuel cell,
and ultra-low sulfur diesel vehicles (defined in Sec. 721), and the infrastructure to
support them. The program would be administered through the Clean Cities
Program. Grants would be capped at $20 million per applicant. Between 20% and
25% of all grant funds would be used for ultra-low sulfur diesel vehicles (Sec. 722).
The Secretary would be required to submit reports to Congress identifying grant
recipients and evaluating the program’s effectiveness (Sec. 723). $200 million total
would be authorized for the grant program (Sec. 724).
Section 731: Fuel Cell Transit Bus Demonstration. The Secretary of
Energy would be required to establish a program to demonstrate up to 25 fuel cell
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transit buses in various localities. $10 million annually would be authorized for
FY2006 through FY2010.
Subtitle C — Clean School Buses
Sections 741-744: Clean School Buses. A pilot program administered
by the Environmental Protection Agency would be established to provide grants to
local governments and contractors that provide school bus service for public school
systems. Grants would be provided to aid in the purchase of alternative fuel and
advanced diesel buses (as defined in Sec. 741), and the infrastructure necessary to
support them. A total of $200 million would be authorized for FY2005 through
FY2007, and a maximum of 30% of the grant funds could be used to purchase
advanced diesel buses (Sec. 742). A pilot program would also be established to
provide grants for the development and application of retrofit technologies for diesel
school buses. A total of $100 million would be authorized for FY2005 through
FY2007 (Sec. 743). In addition, a pilot program would be established for the
development and demonstration of fuel cell school buses. A total of $25 million
would be authorized for FY2005 through FY2007 (Sec. 744).
Section 743A: Diesel Truck Retrofit and Fleet Modernization
Program. The EPA Administrator would be required to establish a program to
provide grants (administered by state or local governments) to modernize cargo truck
operations. Grants would be used to retrofit pre-1999 vehicles with advanced
emissions control devices. A total of $100 million would be authorized between
FY2005 and FY2007.
Subtitle D — Miscellaneous
Section 751: Railroad Efficiency. A public-private research partnership
would be established for the development and demonstration of locomotive engines
that increase fuel economy, reduce emissions, and lower costs. A total of $110
million would be authorized for FY2006 through FY2008.
Section 752: Mobile Emission Reductions Trading. Within 180 days
of enactment, the EPA Administrator would be required to submit a report to
Congress on EPA’s experience with the trading of mobile source emission reduction
credits to stationary sources to meet emission offset requirements within Clean Air
Act nonattainment areas.
Section 753: Aviation Fuel Conservation and Emissions. This section
would require the Federal Aviation Administration and EPA to initiate a joint study
of the impact of aircraft emissions on air quality in Clean Air Act nonattainment
areas, ways to promote fuel conservation measures and reduce emissions, and
opportunities to reduce air traffic inefficiencies that increase fuel burn and emissions
within 60 days of the date of enactment, and to report the results to Congress within
one year of initiating the study.
Section 754: Diesel Fueled Vehicles. The Secretary of Energy would be
required to accelerate research on emissions control technologies for diesel motor
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vehicles. The objective of the research would be to enable diesel technology to meet
Tier 2 emission standards not later than 2010. (These standards would apply to cars
and light trucks after the 2003 model year.) No new funding would be authorized.
Section 755: Conserve by Bicycling Program. This provision was
added as a floor amendment (H.Amdt. 88). The Department of Transportation
(DOT) would be directed to conduct up to 10 pilot bicycling projects to conserve
energy. A minimum of 20% of each project’s costs would have to be provided by
state or local sources. Also, DOT would be directed to engage the National Academy
of Sciences to conduct a research study on the feasibility of converting motor vehicle
trips to bicycle trips. Some local governments have experimented with police bicycle
patrols and other bicycling programs. This provision may help expand such uses of
bicycling.
Section 756: Reduction of Engine Idling of Heavy-Duty Vehicles.
EPA would be required to study whether existing air emission models accurately
reflect emissions from idling vehicles. Further, EPA would be required to establish
a program to support the deployment of idle-reduction technologies. A total of $95
million would be authorized for FY2006 through FY2008 for the deployment
program.
Section 757: Biodiesel Engine Testing Program. The Secretary of
Energy would be required to study the effects of biodiesel and biodiesel blends on
current and future emissions control technologies. $5 million would be authorized
annually for FY2006 through FY2010.
Section 758: High Occupancy Vehicle Exception. The Transportation
Equity Act for the 21st Century (TEA-21, P.L. 105-178) would be amended to allow
states to exempt hybrid and dedicated alternative fuel vehicles from high occupancy
vehicle (HOV) restrictions. Through September 30, 2003, states had the authority
to exempt certain types of alternative fuel vehicles from the restrictions. However,
hybrid vehicles and some alternative fuel vehicles did not qualify. As the existing
authorization has expired, states do not currently have the authority to exempt any
type of alternative fuel vehicle from HOV restrictions.
Section 759: Ultra-Efficient Engine Technology for Aircraft. The
Secretary of Energy, in cooperation with the National Aeronautics and Space
Administration, would be required to develop new engine technology for aircraft with
a goal of a 10% increase in fuel efficiency and a 70% decrease in nitrogen oxide
emissions during takeoff and landing. A total of $225 million would be authorized
between FY2006 and FY2010.
Subtitle E — Automobile Efficiency
Sections 771-775: Fuel Economy Standards. The bill would authorize
$2 million annually during FY2006-FY2010 for the National Highway Traffic Safety
Administration (NHTSA) to carry out fuel economy rulemakings (Sec. 771). It
would expand the criteria that the agency would be required to take into account in
setting maximum feasible fuel economy for cars and light trucks, including the
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effects of prospective standards on vehicle safety and automotive industry
employment In many instances, these additional factors may add specificity to
broader considerations that are already taken into account by NHTSA in developing
its rules (Sec. 772).
The legislation would also extend corporate average fuel economy (CAFE)
credits that accrue to manufacturers of dual-fueled vehicles. The cap to the credit of
1.2 miles per gallon (mpg) earned by any individual manufacturer would be extended
to model year (MY) 2010. It was otherwise scheduled to drop to a cap of 0.9 mpg
beginning in MY2005. The bill would postpone institution of the 0.9 cap until
MY2011 and authorize it through MY2014 (Sec. 773). It also would require a study
to explore the feasibility and effects of reducing automobile fuel consumption “a
significant percentage” by MY2012 (Sec. 774). A new provision to the Energy Policy
Act of 2005, not a part of H.R. 6 in the 108th Congress, would require a revision to
the adjustment made to tested fuel economy levels so that the in-use fuel economy
estimates posted on new vehicles would be more in conformance with the fuel
economy that purchasers of new vehicles experience in actual use. The adjustment
would have to take into account current use of air conditioning, currently higher
speed limits, and faster acceleration rates (Sec. 775).
Title VIII — Hydrogen
Sections 801-809: Hydrogen Research and Development. Sections
801 through 809 would reauthorize hydrogen fuel research and development at the
Department of Energy (Sec. 803). The title would establish an Interagency Task
Force to coordinate federal research (Sec. 804). Further, the title would require the
Secretary of Energy to develop a plan for the development of hydrogen fuel and fuel
cells (Sec. 802), and would establish a Hydrogen Technical and Fuel Cell Advisory
Committee to advise the Secretary and review the development plan (Sec. 805).
DOE’s plans for the hydrogen program would be reviewed by the National Academy
of Sciences (Sec. 806), and the Secretary of Energy would represent U.S. interests
related to hydrogen programs in consultation with relevant agencies (Sec. 807).
Specified authorities of the Secretary of Transportation would not be affected (Sec.
808). A total of $4 billion would be authorized for FY2006 through FY2010 (Sec.
809). Definitions are provided in Sec. 801.
Section 810: Solar and Wind Technologies. A program of five pilot
projects is created to demonstrate the use of solar energy to produce hydrogen.
Further, a program of five pilot projects is created to demonstrate the use of wind
energy to produce hydrogen. Also, DOE is directed to support research programs at
universities that study the use of solar and wind energy technologies to produce
hydrogen.
Section 811: Hydrogen Fuel Cell Buses. The Secretary of Energy,
through the Advanced Vehicle Technologies Program, would be required to establish
four fuel cell bus demonstration sites.
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Title IX — Research and Development
Section 900: Short Title; Definitions. This title would be referred to as
the “Energy Research, Development, Demonstration, and Commercial Application
Act of 2005.” Defines, for the purposes of this title, the terms applied programs,
biomass, Department, departmental mission, institution of higher education,
National Laboratory, renewable energy, Secretary, State, university, and user
facility.
Subtitle A — Science Programs
Section 901: Office of Science Programs. The programs of the Office
of Science would be authorized in general, and DOE would be directed to commence
construction of the Rare Isotope Accelerator no later than September 30, 2008.
Expenditures on the Rare Isotope Accelerator prior to operation would be limited to
$1.1 billion.
Section 902: Systems Biology Program. DOE would be directed to
establish a research, development, and demonstration program in genetics, protein
science, and computational biology, with specified goals. DOE would have to submit
a research plan for this program to Congress within one year and contract with the
National Academy of Sciences to review the plan within an additional 18 months.
Biomedical research and research related to humans would not be permitted as part
of the program.
Section 903: Catalysis Research and Development Program. DOE
would be directed to conduct a program of R&D in catalysis science.
Section 904: Hydrogen. DOE would be directed to conduct a program of
fundamental R&D in support of the hydrogen programs authorized in Title VIII.
Section 905: Advanced Scientific Computing Research. DOE would
be directed to conduct a program of R&D in advanced scientific computing,
including applied mathematics and the activities authorized by the Department of
Energy High-End Computing Revitalization Act of 2004 (P.L. 108-423).
Section 906: Fusion Energy Sciences Program.
Research,
development, demonstration, and commercial application directed at competitiveness
in fusion energy, including a demonstration of the utilization of fusion energy to
produce electric power or hydrogen, would be declared to be U.S. policy. DOE would
be directed to submit a plan to carry out that policy. Authority would be given for the
United States to participate in the international fusion energy experiment known as
ITER (International Thermonuclear Experimental Reactor). DOE would be directed
to develop a plan for ITER participation and have it reviewed by the National
Academy of Sciences. Funds could not be expended for ITER construction until the
plan and other reports were provided to Congress. If construction of ITER appeared
unlikely, DOE would be directed to submit a plan for a domestic burning plasma
experiment.
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The United States withdrew from the design phase of ITER in 1998 at
congressional direction, largely because of concerns about cost and scope. The
project has since been restructured, and in January 2003, the Administration
announced its intention to reenter the project. Other international partners include the
European Union, Japan, Russia, China, and South Korea. A decision on whether to
build ITER in France or in Japan was supposed to be made in November 2003, but
negotiations were still under way when the House passed H.R. 6 in April 2005.
Section 907: Science and Technology Scholarship Program. DOE
would be authorized to establish a scholarship program to help recruit and prepare
students for careers in DOE. Scholarship recipients would be required to work for
DOE for 24 months per academic year of scholarship received.
Section 908: Office of Scientific and Technical Information. DOE
would be directed to maintain the Office of Scientific and Technical Information.
Section 909: Science and Engineering Pilot Program. DOE would be
directed to award a grant to Oak Ridge Associated Universities to establish a regional
pilot program to enhance scientific, technological, engineering, and mathematical
literacy, creativity, and decisionmaking. The program would involve research
universities, universities that train elementary and secondary school teachers, and
DOE national laboratories. A report would be required on lessons learned from the
pilot program, including a plan for expanding the program nationwide.
Section 910: Authorization of Appropriations. Appropriations would
be authorized for the Office of Science for FY2006 through FY2010, with increases
of 10%-15% per year. Within these totals, appropriations would be authorized for the
individual programs described in Sections 902, 905, 906 (except ITER), 907, 908,
and 909. Appropriations for construction of ITER would be authorized separately,
as would appropriations for integrated bioenergy R&D for FY2005 through FY2009.
Subtitle B — Research Administration and Operations
Section 911: Cost Sharing. Cost sharing would be required for programs
carried out under this title. The minimum non-federal share would be 20% for R&D
programs and 50% for demonstration and commercial application programs, but
DOE could lower or waive these requirements in certain circumstances.
Section 912: Reprogramming. Within 60 days after any appropriation
authorized under this title, DOE would be required to report to Congress on how the
appropriated amounts would be distributed. Subsequent reprogramming would be
limited to the lesser of 2% or $2 million unless reported to Congress with at least 30
days’ notice.
Section 913: Merit-Based Competition. Awards of funds authorized
under this title would be permitted only through open competitions following an
impartial review of scientific and technical merit.
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Section 914: External Technical Review of Departmental Programs.
Advisory committees would be established for DOE programs in energy efficiency,
renewable energy, nuclear energy, and fossil energy. The requirement could be met
by existing DOE committees. Existing advisory committees would continue for the
programs of the Office of Science, and the chairs of the Office of Science committees
would constitute a Science Advisory Committee for the Director of the Office. DOE
would be directed to arrange with the National Academy of Sciences to review and
assess the programs authorized by this title, and reports on the results of these
reviews and assessments would be due to Congress within two years of enactment.
Section 915: Competitive Award of Management Contracts.
Management and operating contracts for DOE national laboratories (except
Livermore, Los Alamos, Sandia, and Savannah River) would have to be awarded
competitively unless the Secretary of Energy granted a waiver on a case-by-case
basis. The Secretary would not be permitted to delegate his waiver authority and
would have to notify Congress at least 60 days before awarding a non-competitive
contract.
In the past, management contracts at most DOE laboratories have been extended
without competition. In some cases, laboratories have been managed by the same
contractor for 60 years or more. In November 2003, DOE released the report of a
blue-ribbon commission that it established to examine this issue. The commission’s
report is available online at [http://www.seab.doe.gov/publications/brcDraftRpt.pdf].
It states that “the issue of whether competition should be routinely used for research
and development laboratories is subject to wide and varied opinions.”
Section 916: National Laboratory Designation. DOE would be
prohibited from designating additional facilities as national laboratories, beyond
those defined in Sec. 900.
Section 917: Report on Equal Employment Opportunity Practices.
DOE would be required to report to Congress with one year and every two years
thereafter on equal employment opportunity practices at the national laboratories.
Section 918: User Facility Best Practices Plan. No DOE facility would
be permitted to begin operating as a user facility unless DOE had developed and
transmitted to Congress a plan for staffing the facility, allocating time fairly to its
users, and operating it in a safe and fiscally prudent manner.
Section 919: Support for Science and Energy Infrastructure and
Facilities. DOE would be directed to develop and implement a strategy for
maintaining existing facilities and infrastructure, closing unnecessary facilities,
modifying facilities, and building new facilities. A report to Congress would be
required by June 1, 2007, summarizing the strategy.
Section 920: Coordination Plan. DOE would be directed to develop a plan
to improve coordination and collaboration in research, development, demonstration,
and commercial application activities across DOE organizational boundaries. A
conference of program managers from the Office of Science and the applied
programs would be convened as part of the process of developing this plan. DOE
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would be required to transmit the plan to Congress within nine months and transmit
a revised version every two years thereafter.
Section 921: Availability of Funds. Funds authorized under this title
would remain available for three years.
Subtitle C — Energy Efficiency
Chapter 1 — Vehicles, Buildings, and Industries
Section 922: Programs. General objectives would be set for DOE energy
efficiency programs in terms of energy security, reduced costs, and environmental
impacts. A report would be required to provide cost and performance baselines and
set quantitative targets for energy and cost savings over five fiscal years.
Section 923: Vehicles. DOE would be directed to conduct a research,
development, demonstration, and commercial application (RDD&C) program for
hybrid and electric vehicles, advanced engines, advanced materials, and advanced
drivetrains. Also, a hydrogen propulsion and infrastructure RDD&C program would
be established.
Section 924: Buildings. This provision would direct DOE to conduct an
RDD&C program to improve the energy efficiency and environmental performance
of commercial, industrial, institutional, and residential buildings. This program is to
include advanced controls, building envelope, building components (e.g. lighting,
appliances), and onsite renewable energy use. Also, a pilot grant program would be
created to help businesses and organizations demonstrate energy efficiency
technologies for buildings. It would provide up to 50% of design and energy
modeling costs, with a maximum of $50,000. Further, DOE would be directed to
work with the National Institute of Building Sciences to assess voluntary building
energy performance standards.
Section 925: Industries. This provision would direct DOE to conduct an
RDD&C program to improve the energy efficiency, environmental performance, and
process efficiency of energy-intensive and waste-intensive industries. This program
would include RDD&C on advanced control devices to improve the efficiency of
electric motors, including those used in industrial settings.
Section 926: Demonstration and Commercial Application. DOE
would be directed to consider applying more efficient technologies to improve the
energy efficiency of equipment and test procedures used to measure appliance energy
efficiency. Further, DOE would be required to coordinate with public and private
organizations to study means of updating building energy codes. Also, a DOE grant
program (50% federal match) would be established to support state and local
governments, universities, and nonprofit organizations to create a network of
Advanced Energy Technology Transfer Centers. Additionally, this section would
require that a periodic report to Con
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