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<P><STRONG><FONT size=6><SPAN class=twstorytextheadline>Energy bill passes </SPAN><BR></FONT></STRONG><FONT size=1><SPAN class=twstorysynop>By RUSSELL RAY World Staff Writer </SPAN><BR><SPAN class=twstorysynop>7/30/2005 </SPAN><BR><BR></FONT><A href="http://www.tulsaworld.com/TWPDFs/2005/Final/W_073005_E_1.PDF"><FONT color=#435059><SPAN class=twstorysynop><FONT size=1>View in Print (PDF) Format</FONT></SPAN> </FONT></A><BR><SPAN class=twstorytext><BR></P>
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<H3>Independent producers blast measure </H3>
<P>Congress approved a comprehensive energy bill Friday, but Oklahoma's oil and gas producers gave the measure a thumbs down, saying it won't curb soaring energy prices or bolster supplies. </P>
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<P>"I don't see anything in the bill for oil and gas companies," said Harold Hamm, chairman of the Oklahoma Independent Petroleum Association. </P>
<P>The bill was overwhelmingly approved by the Senate in a 74-26 vote Friday. The House approved the bill earlier this week by a vote of 275 to 156. </P>
<P>The measure provides $14.5 billion in tax breaks, including $2.6 billion for the oil and gas industry. It also provides tax breaks and incentives for the construction of nuclear plants, cleaner burning coal plants, wind power development and upgrades in electric transmission. </P>
<P>But Hamm said the bill does little to address the nation's most serious energy problem -- the declining supply of oil and natural gas. </P>
<P>"That was what we were fearful of, that they were going to come out with a so-called energy bill that doesn't address the problem," he said. "It looks to me that's what we have." </P>
<P>The bill does not promote the development of unconventional resources such as coalbed methane and oil and gas shales, Hamm said. It also offers no incentive for secondary and tertiary production. </P>
<P>"We lobbied hard for a lot of those things," he said. "Basically, they turned a deaf ear to us." </P>
<P>The bill fails to emphasize exploration, said Kent Harrell of Harrell Energy Co. in Tulsa. </P>
<P>"You have to have a much more pro-exploration bill to have an impact on supply," he said. "There's nothing in the bill that can change the supply picture domestically." </P>
<P>But the bill does contain a few provisions that will help limit the costs of domestic producers, Harrell said. For example, it exempts certain oil and gas operations from costly storm-water control regulation. </P>
<P>"That's something we've been trying to get the EPA to do for some time," Harrell said. </P>
<P>It also allows producers to write off geological and seismic costs. </P>
<P>"Anything you can do to lower costs helps the domestic industry," he said. </P>
<P>The bill also increases the use of biofuels and ethanol, a potential boon for Oklahoma and other agricultural states. </P>
<P>Republicans wanted to allow drilling and exploration in Alaska's Arctic National Wildlife Refuge, but that proposal never made it to the final draft. </P>
<P>"If we put it in we wouldn't be here" celebrating passage of the bill, said Sen. Pete Domenici, R-N.M., chairman of the Energy and Natural Resources Committee. </P>
<P>Opponents to drilling in ANWR had vowed to filibuster legislation that included the provision. </P>
<P>The bill also excludes what analysts have described as the best way to reduce oil imports and lower pump prices -- higher mileage standards for cars and light trucks. </P>
<P>"This bill is literally a series of missed opportunities," said Sen. Ron Wyden, D-Ore. </P>
<P>Still, the bill passed with broad bipartisan support, a major victory for President Bush even though it cost twice as much as he wanted. </P>
<P>"I look forward to signing it into law," Bush said in a statement. He said the legislation is "critically important to our long-term national and economic security." </P>
<P>Sens. Tom Coburn and Jim Inhofe, both R-Okla., voted for the bill. </P>
<P>The bill's approval comes four years after Bush called for an overhaul of the nation's energy needs. </P>
<P>Congress was stymied repeatedly by conflicts and environmental disputes. </P>
<P>The bill represents the first broad overhaul of energy policies in 13 years. </P>
<P>Domenici acknowledged that it will not lower gasoline prices or even affect oil imports in the short term. He maintained that the bill's myriad of measures -- from tax breaks and loan guarantees to new appliance efficiency requirements -- will benefit the nation "not tomorrow but for the next five or 10 years." </P>
<P>For the first time it would require utilities to comply with federal reliability standards for the electricity grid, instead of self-regulation. The goal was to reduce the likelihood of repeating of a blackout such as the one that struck the Midwest and Northeast in the summer of 2003. </P>
<P>For consumers, the bill would provide tax credits for buying gas-electric "hybrid" cars, make energy improvements in new and existing homes, and beginning in 2007 extend daylight-saving time by one month to save energy. </P>
<P>The bill's price tag is twice what the White House originally put forward and raised caution among some senators. </P>
<P>"This bill digs us deeper into a budget black hole. . . . The costs of this are staggering," said Sen. Russ Feingold, D-Wis., who tried to block the legislation on grounds that it violated the Senate's own budget rules. The effort failed 71-29. </P>
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<P>The Associated Press Contributed to this report. </P>
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<P><B>Russell Ray 581-8380 </B><BR><A href="mailto:russell.ray@tulsaworld.com"><FONT color=#435059>russell.ray@tulsaworld.com</FONT></A> </P>
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<P><FONT color=#4f626d size=2><IMG onerror="this.src='http://www.tulsaworld.com/images/Photonotavail.gif';" src="http://www.tulsaworld.com/images/2005/050730_E1_Energ74882_e1platform30.jpg"></FONT> </P>
<P><STRONG><FONT size=2><SPAN class=twnav-bold>The sun creates a silhouette of drilling operations at Apache Corp.'s Matagorda Island 700 block in the Gulf of Mexico. The chairman of the Oklahoma Independent Petroleum Association voiced his displeasure Friday with the $12.3 billion energy bill, which won congressional approval and is ready to be signed by President Bush.</SPAN><BR></FONT><SPAN class=twphotocaption><EM><FONT face="Times New Roman" color=#525252 size=1>Bloomberg News file</FONT></EM></SPAN></STRONG></P>
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<P><STRONG><FONT size=6><SPAN class=twstorytextheadline>Renewable sources get some help </SPAN><BR></FONT></STRONG><FONT size=1><SPAN class=twstorysynop>By BRAD FOSS Associated Press </SPAN><BR><SPAN class=twstorysynop>7/30/2005 </SPAN><BR><BR></FONT><A href="http://www.tulsaworld.com/TWPDFs/2005/Final/W_073005_E_1.PDF"><FONT color=#435059><SPAN class=twstorysynop><FONT size=1>View in Print (PDF) Format</FONT></SPAN> </FONT></A><BR><SPAN class=twstorytext><BR></P>
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<H3>Clean-energy advocates, while not totally satisfied, do like the bill's incentives. </H3>
<P>WASHINGTON -- America's fledgling renewable energy industry won't be significantly transformed by the energy bill Congress passed Friday. To the disappointment of environmentalists and those with a financial stake in alternatives to fossil fuels, most of the $14.5 billion in tax breaks will help producers and users of oil, natural gas and coal. </P>
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<P>Still, boosters of wind, solar and biofuels said their tiny segment of the market will also benefit from the legislation, as will consumers looking to conserve fuel at home or on the road. </P>
<P>"This bill is a major disappointment from an energy-policy perspective," said Dan Reicher, a former assistant secretary in the Energy Department during the Clinton administration and president of New Energy Capital Corp., a venture capital firm that specializes in renewables. </P>
<P>But while Reicher would have preferred legislation that mandates reductions in oil consumption and limits the output of carbon dioxide from power plants, he said the compromise bill "does provide some useful incentives for investors in clean energy." </P>
<P>Those who voted in favor of the bill and representatives of the fossil fuel industry would agree with Reicher's latter point, though they complain that the new energy policy does not go far enough to promote more domestic onshore and offshore drilling for oil and natural gas. </P>
<P>Rep. Richard W. Pombo, R-Calif., called the bill "a good first step" in addressing the country's rising dependence on foreign oil, the same description used by the American Petroleum Institute, a Washington-based trade group. </P>
<P>In sheer dollar terms, the biggest clean-energy perk in the bill was a two-year extension of a tax credit critical to companies that produce power from renewable sources -- an allocation worth $2.7 billion. The bulk of those funds will promote the construction of wind farms, a boon to utilities and wind turbine manufacturers, while the remainder will assist biomass, geothermal and hydroelectric companies. </P>
<P>"Given the relative size and political weight of our industry, I feel pretty good," said Randall Swisher, executive director of the American Wind Energy Association, which estimates that some $5 billion in new wind projects will go forward over the next two years. Without the tax credits, those projects would not go forward and hundreds of jobs would be lost, Swisher said. </P>
<P>Nevertheless, "with this bill, I don't see any fundamental changes in the direction of U.S. energy policy," Swisher said. </P>
<P>The bill does create a new category of tax credits known as clean renewable energy bonds, or CREBs, that have an estimated value of $400 million. These tax-exempt bonds can be issued by local governments or electricity cooperatives to help pay for wind, solar, biomass and other specified projects. </P>
<P>An additional $194 million will go toward the two-year extension of excise- and income-tax credits for manufacturers of biodiesel, a soybean derivative that is blended with regular diesel. </P>
<P>"Any time we can use one of our products as a fuel . . . that's a win for agriculture," said Darryl Brinkmann of Carlyle, Ill., a corn and soybean farmer and the chairman of the National Biodiesel Board. </P>
<P>Brinkmann and other farmers also stand to gain from a provision that mandates the annual use of 7.5 billion gallons of ethanol, a corn derivative, by 2012. </P>
<P>Yet advocates of renewables said the bill is equally notable -- and disappointing -- for what it does not include. There are no minimum requirements for clean power production in the United States and no disincentives to help curb fossil-fuel consumption, such as automobile fuel-economy standards or mandatory caps on greenhouse gas emissions. </P>
<P>"A strong energy policy needs both carrots and sticks," Reicher said. "But this is a bill that's mostly about carrots." </P>
<P>The Kyoto Protocol, an international treaty on climate change that went into effect in February, caps the amount of carbon dioxide that power plants and fuel-intensive manufacturers in more than two dozen countries are allowed to emit. The United States is not bound by the treaty. </P>
<P>While the bulk of the financial rewards in the energy bill are aimed at corporations, there are a handful of provisions that will make it more economical for homeowners and motorists to reduce their energy consumption and invest in cleaner fuels. </P>
<P>Solar enthusiasts may have gotten the most significant shot in the arm of anyone in the renewable sector, not in absolute dollar terms but with regard to the fact that homeowners who install photovoltaic systems will be eligible for federal financial assistance for the first time in 20 years. </P>
<P>The bill includes a federal tax credit worth 30 percent of the cost of residential solar panels after taking into account any assistance from the state. The credit is capped at $2,000. </P>
<P>Rhone Resch, president of the Washington-based Solar Energy Industry Association, said the tax credit would give "individuals support in making a purchase that will improve the United States' energy independence." </P>
<P>Similarly, close to $875 million in tax credits will be made available to those who buy "hybrid" gas-electric vehicles before 2010. A person buying a Toyota Prius, for instance, will receive a tax credit of at least $2,500, according to Toyota Motor Corp. spokeswoman Martha Voss. </P>
<P>The hybrid vehicle tax credit has its limits, however. Each manufacturer can apply the tax credit to just 60,000 vehicles, and Toyota sells roughly 150,000 hybrids per year. </P>
<P>"If we had our way, there would have been a cap of 200,000," Voss said. "But for hybrids just to be in the bill, we're thrilled." </P>
<P>About $555 million is available in the form of tax credits to homeowners who buy energy-efficient fans, furnaces and hot water boilers. </P>
<P>There are also tax credits available for manufacturers of home appliances, as well as commercial builders, if they meet certain energy-efficiency standards. </P>
<P>David Goldstein, director of the Natural Resources Defense Council's energy program, said the bill is well-intentioned with regard to spurring energy conservation among homeowners and businesses, but he fears the results will be minimal because the tax credits are only good for two years. </P>
<P>"It's just very frustrating," he said. </P>
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<P><B><A href="http://www.biodiesel.org/" target=_blank><FONT color=#435059>www.biodiesel.org</FONT></A></B> <BR><B><A href="http://www.awea.org/" target=_blank><FONT color=#435059>www.awea.org</FONT></A></B> <BR><B><A href="http://www.seia.org/" target=_blank><FONT color=#435059>www.seia.org</FONT></A></B> <BR><B><A href="http://www.newenergycapital.com/" target=_blank><FONT color=#435059>www.newenergycapital.com</FONT></A></B> <BR><B><A href="http://www.api.org/" target=_blank><FONT color=#435059>www.api.org</FONT></A></B> </P>
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<P><SPAN class=twtopstory><FONT color=#4f626d size=2>Related Photos & Graphics</FONT></SPAN></P>
<P><FONT color=#4f626d size=2><IMG onerror="this.src='http://www.tulsaworld.com/images/Photonotavail.gif';" src="http://www.tulsaworld.com/images/2005/050730_E1_Renew12433_e2wind30.jpg"></FONT> </P>
<P><STRONG><FONT size=2><SPAN class=twnav-bold>Wind turbine generators rotate in August breezes at the Ponnequin wind farm in northern Colorado. Proponents of alternative energy sources said that while they won't greatly benefit from the energy bill, consumers will received incentives to conserve energy.</SPAN><BR></FONT><SPAN class=twphotocaption><EM><FONT face="Times New Roman" color=#525252 size=1>Bloomberg News file</FONT></EM></SPAN></STRONG></P>
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