Friday, August 01, 2008

Off-Shore Drilling Debate Spiraling Toward A Government Shutdown

Jul 31: Senator Bill Nelson (D-FL) moved to stop President Bush’s interior secretary from launching a plan for a new wave of oil drilling off the coast of Florida and other protected states. In a letter to Interior Secretary Dirk Kempthorne, Nelson vowed “to take whatever action is necessary” to prevent such a questionable step by an administration he views as hell-bent on risky offshore drilling. On July 30, Kempthorne announced his proposal to "jumpstart the development of a new oil and natural gas leasing program for the U.S. Outer Continental Shelf" [See WIMS 7/30/08]. The DOI initiative uses the process mandated by the Outer Continental Shelf Lands Act Amendments of 1978, which gives the Secretary of the Interior authority to develop “out-of-cycle” leasing programs and requires various procedural steps, including several rounds of public comment and multiple environmental reviews. The "Call for Information" will be published in the Federal Register on August 1, 2008. All comments must be received by September 15, 2008.

In a letter to Kempthorne, Senator Nelson said, “It is becoming increasingly clear that President Bush is set on putting oil rigs off the state of Florida before he leaves office in January, regardless of the fact it will have no effect on energy prices. You and he both know exploiting our coastlines won't bring down gasoline prices. The answer lies in the rapid development of alternative fuels and vehicles, like cars that run on hydrogen, not petroleum. And the oil companies need to drill in the 68 million acres already under lease where there still is no drilling.”

In a release Senator Nelson indicated that, "Kempthorne’s announcement comes hard on the heels of GOP presidential candidate Sen. John McCain having reversed his position to support new drilling, thus pushing the issue center-stage in the presidential contest. It also comes in the wake of President Bush saying he was lifting an executive ban on coastal drilling that was put in place by his own father when he was president.

"And, the announcement comes as Republicans in Congress are beginning to threaten not to approve a temporary spending measure for operating the government that’s could be up for a vote in September, unless Congress removes from that measure its annual moratorium language against drilling in protected areas. Failure to approve the spending plan could result in a shut-down of the government, like one that occurred in the mid-1990s during a bitter, partisan fight between President Clinton and the Newt Gingrich-led Congress.

In addition to Senator Nelson's opposition, the West Coast Governors of California, Oregon and Washington launched their historic West Coast Governors' Ocean Action Plan, on July 29, which states explicitly, "The three states have determined that new offshore oil and gas development in ocean waters along the West Coast is unacceptable because of the harmful impacts to the marine and coastal environment. Therefore, the states are committed to exploring options for developing renewable energy sources in an environmentally sustainable manner. Recent advances in wind, wave, current, and tidal energy conversion technologies have improved the economic viability of these alternatives."

On the Senate Floor, the debate over Republican drilling proposals, as opposed to various alternatives proposed by Democrats has escalated out of control [
See WIMS 7/30/08]. On July 31, Senate Majority Leader Harry Reid (D-NV) and other Senate Democratic Leaders asked unanimous consent to pass six bills designed to address the nation’s energy crisis; however, Reid said, "Just as they have throughout the year, Bush-McCain Republicans said no, preferring to slow, stop and stall progress rather than help American families paying record-high energy prices. Below are Reid’s remarks as prepared for delivery. . . Their one idea -- more coastline drilling -- won’t have any significant impact on prices ever. . ."

The Senators now leave for a 5-week break in the middle of this bitter debate which may serve as a cooling off period. The hope for a breakthrough seems to rest in the proposal put forth today by the so-called "Gang of 10."

In a July 30, letter to Senator Mitch McConnell (R-KY), the Senate Minority Leader, Senator Reid responded to a proposal from 10 Republican and Democratic Senators ('Gang Of 10' Energy Plan) and indicated, "Given we have been unable to make progress on these measures, I think it is important that we both look at other ways to break the current legislative impasse on energy.

"Therefore, I am proposing that we jointly embrace the proposal made by the bipartisan group of Senators to convene a summit to address all facets of the energy challenges confronting this nation today including economic security, national security, global warming and ending our addiction to oil. As you may know, I have already taken the initiative to plan a National Clean Energy Summit next month in Las Vegas to bring together Republicans, Democrats, business leaders, labor and academics to address these challenges. . .

"Please let me know as soon as possible if you agree with this proposal for a summit here. If so, we can get to work immediately with the bipartisan group and other interested Senators in our respective caucuses to work out the details of this summit. If not, I want to inform you that I think the energy issues facing this country are so important a bipartisan summit still makes sense and I intend to proceed accordingly."

Although Senator McConnell agreed to the bipartisan summit, he delivered a lengthy and highly critical speech on the Floor today saying, "This was an opportunity for the Democrats who control Congress to demonstrate courage and resolve. They squandered it. In their hunt for more seats in Congress and control of the White House, they took the path of least resistance. They decided that they could increase their hold on Congress by avoiding tough votes, and then blaming the mess that followed on a party that wasn’t even in charge. . . When Americans demanded action, the Democrats played games."

Majority Leader Reid said regarding the "Gang of 10" proposals, “This proposal includes some very good ideas to address our country’s many energy-related challenges, and while I do not agree with every part of it, I very much appreciate the bipartisan spirit in which it was constructed. Along with the National Clean Energy Summit I will host this month in Nevada and September’s bipartisan energy summit, this group’s ideas should be helpful as we craft comprehensive energy legislation. I am hopeful this plan can begin to break the current legislative stalemate on the Senate floor. The American people deserve a real debate with productive Senate action on bipartisan proposals to help make energy more abundant, secure and affordable for America’s families and businesses.”

The "Gang of 10" Senate lawmakers include: Senators Kent Conrad (D-ND); Saxby Chambliss (R-GA); and other members include: Senators Ben Nelson (D-NE), John Thune (R-SD), Lindsey Graham (R-SC); Blanche Lincoln (D-AR); Mark Pryor (D-AR); Mary Landrieu (D-LA), Johnny Isakson (R-GA), Bob Corker (R-TN).

The bipartisan coalition of senators led Senators Conrad and Chambliss unveiled their sweeping energy proposal at about noon August 1, to reduce gas prices, lessen our nation’s dependence on foreign oil, and strengthen America’s economy. They said the comprehensive New Energy Reform Act of 2008, -- known as “New ERA” -- lays the groundwork to transition the nation’s motor vehicle fleets to fuels other than gasoline and diesel. To ease gas prices in the interim, the proposal includes significant conservation provisions, consumer tax credits, and responsible measures to increase domestic production. The New Era bill contains three main components: An intensive effort to transition vehicles to non-petroleum based fuels; A robust federal commitment to conservation and energy efficiency; and Targeted, responsible domestic production of energy resources. They said they hoped the discussion draft bill could be a starting point for discussions when the Senate returns in September.

In brief summary, the plan calls for transitioning 85% of America’s new motor vehicles to non-petroleum-based fuels within 20 years; significant $84 billion federal commitment to promoting conservation and efficiency including; extending renewable energy, carbon mitigation and energy conservation and efficiency tax incentives and the production tax credit, through 2012; increased domestic energy production in environmentally responsible ways, including new Gulf of Mexico areas and allowing Virginia, North and South Carolina and Georgia to opt in to leasing off their shores. The plan is silent for now on the subject of speculation and the groups said the would await the mid-September report of the CFTC to consider this subject [A general summary of the bill is available from the contact below].

Access a release from Senator Nelson and link to the letter to Kempthorne (
click here). Access a release from DOI (click here). Access a prepublication copy of the Call for Information (click here). Access a FAQ document on the Call (click here). Access the MMS website for additional information (click here). Access the West Coast Governors Ocean Agreement website for complete background and extensive information (click here). Access a release from Majority Leader Reid (click here). Access a letter from Reid to McConnell and his statement on the "Gang of 10" (click here). Access the Floor statement from Senator McConnell (click here). Access the Gang of 10 release on their plan (click here). Access a Senatus Blog posts on the possible September shutdown (click here). Access the "Gang of 10" press conference video (click here). [*Energy, *Water]