An update on pending U.S. energy legislation

In late July 2010, the U.S. Senate released its version of the new energy legislation. This version, compared to its House of Representatives counterpart, is far less comprehensive and significantly smaller in scale (The details of the House bill be can accessed by clicking here). The Senate energy bill is lacking a majority of the foundational components found in the House version that passed, narrowly, nearly one year ago. Some of the missing components include:

•    Provisions for a “cap and trade” scheme to limit carbon emissions

•    Renewable energy purchasing targets for utility providers 

•    Enhanced energy efficiency standards for new commercial and residential development

Instead, a majority of the Senate bill is devoted to oil-related issues in response to the recent BP spill. This includes sections on “Oil Spill Response,” “Protecting the Environment” and “Reducing Oil Consumption” that focus on disaster response, general oversight and raising the liability cap for oil companies. The other major components of the bill focused on alternative fuel vehicles. The bill details rebate provisions for converting vehicles to natural gas systems and the establishment of a new electric vehicle program. 

It should not be a surprise that the Senate bill is not as far-reaching and comprehensive in scope as the House version. In order to pass the Senate, the bill needed be scaled-back to garner the required 60 votes for passage. 

From an optimistic standpoint, there are several positives that can be taken from this situation. First, this bill should be viewed as a foundational piece of legislation, which can be incrementally built upon to effectively address rising energy and environmental concerns. The Senate bill, while not as comprehensive, is still a step in the direction of environmental-issue management and provides the groundwork for additional legislation in the future related to limiting carbon emissions and establishing more stringent energy efficiency standards. Second, the bureaucratic process, in this instance, could play a pivotal role in shaping the final bill. If this bill passes the Senate, the House and Senate bills will need to be reconciled, which could lead to broader reform. 

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