Confusion Reigns On Energy Bills

The House of Representatives cleared a sweeping energy bill (H.R. 6899) that would expand offshore oil drilling areas for the first time in more than 20 years, extend current tax incentives for renewable and other energy sources, and transform energy use in a host of areas.

H.R. 6899 is "a comprehensive energy bill that will honor our responsibility to make America energy independent," Speaker Nancy Pelosi (D-Calif.) said. Although the bill cleared the House quickly, its final fate is unclear and is tied into a tangle of election-year politics driven by voter anger over high gasoline prices.

The bill would end a ban on offshore oil and gas drilling along U.S. coasts with the exception of the eastern Gulf of Mexico. Drilling would be permitted 100 miles from shore, and states would have the option of allowing drilling 50 miles from their shorelines. The bill would repeal tax credits for oil companies and use the funds to pay for renewable energy tax subsidies, which without congressional action would end Jan. 1.

The bill is opposed by House Republicans who support drill-only legislation with greater offshore drilling expansion and incentives for states to encourage new drilling. The Bush Administration and the American Chemistry Council also oppose the bill.

Environmental groups are in confusion. They remain opposed to offshore drilling but find themselves in silent acquiescence on this bill—afraid of broader drilling alternatives—but hope H.R. 6899 will fail.

The House bill's fate in the Senate is unknown. Senate Majority Leader Harry M. Reid (D-Nev.) said he would allow votes on the House bill as well as several other energy bills before the Senate. He said he was particularly interested in legislation extending tax credits.

In the Senate at least three other bills have emerged, including one to simply extend the tax credits for renewable energy. This week, the Senate is slated to debate these options before members head out to campaign. Congress must also pass a continuing resolution to fund the government beyond Sept. 30, the end of the fiscal year, before they recess.