FACT SHEET | June 26, 2007

Senate Passes Landmark Energy Legislation

On June 21, 2007, the Senate passed H.R. 6, the Renewable Fuels, Consumer Protection, and Energy Efficiency Act of 2007, which will enhance energy efficiency, increase production of clean domestic biofuels, raise fuel economy standards, punish price gougers, and achieve reductions in greenhouse gas emissions. This landmark legislation will reduce our dependence on oil, improve our energy security, and save consumers and taxpayers money on their energy bills. Unfortunately, Senate Republicans blocked two key provisions that would have made the bill even stronger: a national renewable electricity standard and tax incentives for clean, homegrown energy and energy efficiency.

 

Ramp up biofuels production and infrastructure.H.R. 6sets annual requirements for the amount of renewable fuels used in motor vehicles and for other purposes. The expanded renewable fuels standard (RFS) requires 8.5 billion gallons of renewable fuels in 2008 and progressively increases to a 36 billion gallon requirement by 2022. Biofuels will be required to emit 20 percent fewer lifecycle carbon emissions compared to gasoline, and the bill includes protections to ensure that increased use of biofuels will not harm our air or water quality. Beginning in 2016, an increasing portion of renewable fuels must be advanced biofuels, which include cellulosic ethanol, biobutanol, and other fuels derived from unconventional biomass feedstocks. The required amount of advanced biofuels begins at 3 billion gallons in 2016 and increases to 21 billion gallons in 2022. The legislation also promotes investment in renewable fuels infrastructure and supports research and development of new bioenergy sources.

 

Reduce dependence on oil and prevent supply disruptions. H.R. 6 sets aggressive targets to reduce our consumption of oil. The legislation requires a 35 percent, or 9.4 million barrel per day, reduction in oil consumption by 2030. The Office of Management and Budget (OMB) is required to identify any existing legal authority to achieve the oil savings. OMB and various federal agencies must provide periodic updates on their progress in achieving the goals. Also, refineries will be required to report planned outages for maintenance to prevent gasoline supply disruptions and skyrocketing gas prices as motorists saw this spring. Finally, the bill amends antitrust law to allow the United Statesto sue the Organization of Petroleum Exporting Countries (OPEC) as an illegal oil-exporting and producing cartel.

 

Promote advanced vehicles and vehicle technologies. H.R. 6authorizes research and development programs at the Department of Energy (DOE) in the use of light-weight materials such as advanced carbon composites and light-weight steel alloys in the construction of vehicles and on energy storage and advanced battery development for vehicles and electricity transmission. The bill also authorizes loan guarantees for facilities to manufacture parts for fuel-efficient vehicles and authorizes awards to manufacturers and suppliers for 30 percent of qualified investment for incremental costs incurred to re-equip, expand, or establish a manufacturing facility to produce advanced technology vehicles. The Secretary of Transportation is required to implement an action plan to ensure that the sale of alternative fuel vehicles reaches at least 50 percent in 2015. Finally, the bill expands research and development of electric drive transportation technology, requires the DOE and Environmental Protection Agency (EPA) to examine the management of the electricity grid as a source of power for the transportation sector, and clarifies that fleet operators can choose electric drive transportation technologies including hybrid electric vehicles to comply with fleet acquisition requirements currently in federal law.

 

Increase energy efficiency. H.R. 6 enacts consensus efficiency standards for residential boilers, dishwashers, clothes washers, dehumidifiers, and electric motorsThe bill also requires rulemaking for efficiency standards for refrigerators by 2010 and for furnace and boiler fans by the end of 2014. The legislation enacts efficiency standards for certain lighting products. It provides the Department of Energy with expedited rulemaking authority and increased flexibility to issue energy efficiency standards that maximize energy savings and direct the Federal Trade Commission (FTC) to develop, through a rulemaking, Energy Guide labels for televisions, computer monitors, and other consumer electronics product categories. The bill also authorizes loans for renewable energy systems and energy efficiency projects for small businesses and establishes a small business energy efficiency program.

 

Invest in carbon capture and storage technology. Carbon capture and sequestration, which is a key technology in helping to reduce U.S.greenhouse gas emissions, may hold particular promise in reducing pollutants from power plants, since they produce an estimated one-third of U.S. carbon dioxide emissions from fossil fuels.

H.R. 6 expands and improves the DOE’s existing research in this area and requires a national assessment of capacity to sequester carbon.

 

Make the government a leader in cutting energy consumption and reducing greenhouse gas emissions.H.R. 6requires the General Services Administration (GSA) to reduce operating costs in its buildings by 20 percent in no less than five years by implementing measures to increase energy efficiency and to replace inefficient lighting. The Alliance to Save Energy has said this bill would “establish the federal government as a successful model for others to emulate and complement rather than compete with existing funding and activities.” H.R. 6codifies the Administration’s stated goal of reducing petroleum usage by the federal government by 30 percent by 2015. This will save taxpayers’money; in Fiscal Year 2005, the federal government spent almost $9 billion on vehicles, fuels and equipment—more than 60 percent of the total federal energy bill. The bill also requires the federal government to increase its purchases of renewable electricity to 10 percent by 2010 and 15 percent by 2015. In addition, the legislation creates a new competitive grant demonstration program to reduce the emissions of carbon dioxide and other pollutants from the Capitol power plant.

 

Increase fuel economy. H.R. 6increases fuel economy to 35 miles per gallon by 2020 and includes passenger cars and light trucks in the fleet average. After 2020, fuel economy must improve at the maximum feasible rate each year. H.R. 6also requires fuel economy standards for medium duty and heavy duty trucks, which do not currently have standards, to increase at the maximum feasible rate. Finally, the bill offers grants for service station owners to install pumps for E85 and other biofuels.

 

Make price gouging a punishable federal crime. H.R. 6makes gasoline price-gouging a federal crime, enhances federal authority to prevent and prosecute manipulation of fuel supplies and anti-competitive behavior, and increases the transparency of petroleum markets. These actions will protect consumers from manipulative practices like those used by Enron to gouge electricity consumers in the western United Statesduring 2000 and 2001.

 

Position the United States as a world leader on global energy security. H.R. 6 puts the United Statesback on the world stage as a leader in preventing and preparing for energy crises. The legislation expresses the Sense of Congress that the President should work with foreign governments, particularly governments with high or rapidly growing energy consumption, to establish strategic energy partnerships and crisis response mechanisms. The President should also establish a regional-based ministerial Hemisphere Energy Response Forum to develop and implement energy crisis, sustainability, and development initiatives. The bill also provides for the development and coordination of a comprehensive and integrated research program that assists the people of the United Statesand the world to understand, assess, and predict human-induced and natural processes of abrupt climate change.

 

Republicans blocked a national Renewable Electricity Standard (RES).Republicans blocked a vote on an amendment introduced by Senator Bingaman and others to require utilities to purchase 15 percent of their electricity from renewable energy sources including wind, solar, biomass, and geothermal by 2020. A national RES would promote domestically produced, clean energy; reduce U.S.greenhouse gas emissions; reduce energy costs for American consumers and businesses; and create American jobs. An analysis by the Union of Concerned Scientists found that a 15 percent RES would: save residential consumers $3.3 billion in electricity and natural gas costs through 2030; save all sectors $16.3 billion in electricity and natural gas costs through 2030; and reduce carbon dioxide emissions by nearly 200 million tons per year by 2020. The amendment had the support of a majority of the Senate; 50 Senators sent a letter to the Chairman and Ranking Member of the Energy Committee on April 30, 2007 expressing their support for a strong national RES. (Union of Concerned Scientists, May 2007)

 

Republicans blocked tax credits to boost renewable electricity and renewable fuels.A majority of Republicans voted to block a final vote on bipartisan legislation reported from the Finance Committee extending tax credits to spur the production of renewable electricity, renewable fuels, alternative fuel infrastructure, and advanced technology vehicles. The reported legislation would have also extended incentives for clean renewable energy bonds, residential energy efficiency and renewable energy investments, and clean coal. By a vote of 57-36, most Republicans voted to continue tax breaks for Big Oil companies, who made $120 billion in profits last year, rather than direct that funding toward consumers and producers of clean, homegrown energy, energy efficient homes and products, and advanced alternative fuel vehicles.

DPC

DPC