Big Noise, Modest Result
There’s not much tiger left in the tank of energy legislation that President Bush sent to Congress last year. The House bill still contains much of Bush’s program, including exploration and drilling for oil in the Arctic National Wildlife Refuge. But after bitter debates, the Senate rejected Arctic drilling and turned down the Democrats’ major alternative--to save oil by boosting automobile, sport utility vehicle and light-truck mileage standards. Each side has basically lost its centerpiece energy measures.
What’s left of the bills would save only a little energy through conservation or develop only a few additional energy resources. But there’s enough between them to craft a final proposal worth passing.
The first thing the conference committee should do is put the Arctic refuge issue to rest. Senate sources say a majority will never vote for a final bill containing the Arctic provision. There’s no point wasting time discussing it.
Next, the committee should reject the Senate provision tripling the amount of ethanol that must be added to gasoline--a political giveaway to Midwestern farmers who grow corn and big processors such as Archer Daniels Midland that turn it into ethanol. California would have to use 2.7 million gallons of costly ethanol it did not need, according to Sen. Dianne Feinstein (D-Calif.). The ethanol presumably would replace MTBE, an oxygenating additive that is being banned in California because it leaks into aquifers. The fact is, modern reformulated gasolines do not need either MTBE or ethanol to meet clean-air standards. This is pure pork barrel--or corn bushel--politics.
The better alternative is House language that would provide a 25-cent-a-gallon federal tax credit for businesses using alternative fuels. Ethanol already is highly subsidized. If its producers can’t make it succeed as an additive with an additional 25 cents a gallon in assistance, it just doesn’t meet the test of American market economics. And if Congress loves ethanol so much, the U.S., not the state, should bear the burden of subsidizing it.
The conference committee also should support House language requiring the Department of Transportation to reduce U.S. gasoline use by 5 billion gallons from 2004 to 2010.
A Senate provision dividing $14 billion in energy subsidies between conservation and new sources of energy and boosting the amount of electricity that must be generated by renewable fuels deserves inclusion as well.
If the committee makes the right choices, the final measure could provide a modest improvement in the nation’s energy picture. Make the wrong choices and the nation might be better off with no bill at all.
