Archive for Sunday, August 5, 2007

House OKs taxes on oil firms

August 5, 2007

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— Declaring a new direction in energy policy, the House on Saturday approved $16 billion in taxes on oil companies, while providing billions of dollars in tax breaks and incentives for renewable energy and conservation efforts.

Republican opponents said the legislation ignored the need to produce more domestic oil, natural gas and coal.

The House passed the tax provisions by a vote of 221-189. Earlier it had approved, 241-172, a companion energy package aimed at boosting energy efficiency and expanding use of biofuels, wind power and other renewable energy sources.

"We are turning to the future," said House Speaker Nancy Pelosi.

The two bills, passed at a Saturday session as lawmakers prepared to leave town for their monthlong summer recess, will be merged with legislation passed by the Senate in June.

On one of the most contentious and heavily lobbied issues, the House voted to require investor-owned electric utilities nationwide to generate at least 15 percent of their electricity from renewable energy sources such as wind or biofuels.

The utilities and business interests had argued aggressively against the federal renewables mandate, saying it would raise electricity prices in regions of the country that do not have abundant wind energy. But environmentalists said the requirement will spur investments in renewable fuels and help address global warming as utilities use less coal.

"This will save consumers money," said Rep. Tom Udall, D-N.M., the provision's co-sponsor, maintaining that utilities will have to use less high-priced natural gas. He noted that nearly half the states already have a renewable energy mandate for utilities, and if utilities can't find enough renewable sources they can meet part of the requirement through power conservation measures.

The bill also calls for more stringent energy efficiency standards for appliances and lighting and incentives for building more energy-efficient "green" buildings. It would authorize special bonds for cities and counties to reduce energy demand.

Pelosi, D-Calif., said it was essential to commit to renewable energy while reducing reliance on fossil fuels. Doing so, she said, will help address global warming and make the country more energy-independent.

"It's about our children, about our future, the world in which they live," Pelosi said.

Democrats avoided a nasty fight by ignoring - at least for the time being - calls for automakers to make vehicles more fuel-efficient. Cars, sport utility vehicles and small trucks use most of the country's oil and produce almost one-third of the carbon dioxide emissions linked to global warming.

That issue and whether to require increases in the use of corn-based ethanol as a substitute for gasoline, were left to be thrashed out when the House bill is merged with energy legislation the Senate passed in June, which called for a 40 percent increase auto mileage to 35 mpg by 2020.

The White House indicated President Bush might veto the bill, saying it makes "no serious attempts to increase our energy security or address high energy costs" and would harm domestic oil and gas production.

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