President Bush Signs the No Fear Act

Maybe the NO FEAR Coalition should look into this coalition:

CASEnergy Coalition

Clean and Safe Energy Coalition

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ENVIRONMENTAL JUSTICE

AGENCY STATEMENT ON THE INSPECTOR GENERAL'S REPORT ON EPA'S
ENVIRONMENTAL JUSTICE IMPLEMENTATION

The Environmental Protection Agency welcomes the Office of the Inspector General's attention to the vitally important issue of environmental justice.
The Agency takes special note of the Inspector General's finding that Office of Environmental Justice has changed from an office with "an emphasis on community outreach to an emphasis on integration of environmental justice concepts in the Agency's activities."   The Agency agrees that the integration of environmental justice into the EPA's programs, policies, and activities has been and must continue to be a priority.

The Agency agrees with the Inspector General on the intent of Executive Order 12898 which is to address environmental justice concerns in minority and/or low-income populations   However, since the Executive Order has no force of law, these concerns must be addressed in the context of the existing environmental laws that EPA is required to enforce equally across
the nation.

Moreover, the Agency does not accept the Inspector General's central and baseline assumption that environmental justice only applies to minority and/or low-income individuals.  The EPA firmly believes that environmental justice belongs to all people, including those living in minority and/or low-income populations.  All Americans, including minority and/or low-income residents, have a right to clean air, clean land, and clean water, and to have a meaningful say in the environmental decisions that affect them.  These are basic rights that belong to all people,
regardless of race or income.

The Agency believes the Inspector General’s report reflects a mistaken interpretation of Executive Order 12898 by placing an emphasis on identifying communities based on race and/or income.  Rather, the Executive Order instructs the Agency to identify and address the
“disproportionately high and adverse human health and environmental effects of its programs, policies, and activities... [on minority and/or low income populations].”  Therefore, EPA emphasizes the need to assess these human health and environmental impacts that may occur in any given geographic area of concern, and the use of the Agency’s statutory authority to take actions to address environmental justice issues.  In fact, the use of the law is emphasized in Section 1-101 of Executive Order 12898, which states, “To the greatest extent practicable and permitted by law, ..., each Federal agency shall make achieving environmental justice part of their mission...”  Also, the Presidential Memorandum accompanying the Executive Order further underscored “certain provision(s) of existing law that can help ensure that all communities and persons across this Nation live in a safe and healthful environment.”

As a federal regulatory agency, the EPA takes its authority from existing environmental statutes and enforces these.  Existing environmental laws direct the EPA to protect all people from significant environmental hazards and risks.  Environmental justice, therefore, is an inherent
part of the Agency's mission, and EPA continues to focus on identifying and addressing environmental and public health impacts using its statutory authority. Under existing environmental laws, the Agency protects the environment and the health of all communities on the basis of their environmental conditions and needs, not on the demographic information
(race or income) of a community. The Agency is keenly aware that minority and/or low-income populations are frequently confronted with disproportionate exposure to environmental harms and risks.  As reflected in the environmental justice action plans of each EPA regional and
program office, the Agency is addressing the environmental and/or public health issues in communities across the country, including low-income and minority communities.

While the Agency takes strong exception to certain findings and recommendations of the Inspector General's report, other conclusions will enhance this already strong  program.  Specifically, the Agency has committed to:

• Increase the accountability of each office and region for the
integration of environmental justice into its core programs, under the
statutes and regulations that the Agency implements;

• Develop and apply environmental justice performance measures to each
core activity, which will enhance the ability of offices to be
accountable; and

• Conduct a comprehensive management study of program and regional
offices' funding and staffing for environmental justice to ensure that
adequate resources are available to fully implement the Agency's
environmental justice action plans.

The EPA's environmental justice program will benefit from many of the Inspector General's suggestions regarding accountability, adequate resources, and results-based monitoring.  These suggestions will aid the Agency in measuring progress and becoming more efficient as it continues to use its legal authority to integrate environmental justice into its day-to-day work.

For more information on EPA's Office of Environmental Justice, please
visit: http://www.epa.gov/compliance/environmentaljustice

Environmental Justice

The EPA Office of Environmental Justice, Environmental Justice Quarterly publication, Summer/Fall 2003 edition, is now available at:
http://www.epa.gov/compliance/resources/newsletters/ej/ej-newsletter-fall-2003.pdf
In this issue:
- Report Reveals Industry Perspectives
- Urban Planning and Environmental Justice
- Alternative Dispute Resolution Case Studies
- EJ Coordinators' National Meeting
- Environmental Justice Action Plans
- Headquarters Update: OPPTS
- Region 4 Update
- New EJ Geographic Assessment Tool

EPA Where You Live Map

Locations of sensitive populations (e.g., schools and hospitals) and demographic data, in an easy to use map form. http://epa.gov/compliance/whereyoulive.html

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Environmental Justice

Environmental Justice 'The Second Generation' & The EJ Elite

 

A Second Generation of environmental justice activists recently met to discuss the environmental justice movement.  Some of these activists are affiliated with 'old school' environmental justice individuals and organizations and others are simply looking to the future.  Will they reinvent the wheel or willl they aggressively address injustice issues through the application of practical environmental solutions?  Will there be a split between the Second Generation of environmental justice activists and the traditional environmental justice elite?  Or is this the initiation of an inspired second coming of the environmental justice movement?   Let's hope it is the latter.  Maybe they will just work with EJ journeymen who are only interested in promoting EJ improvements.

 

Unfortunately, 2nd Geners must have noticed that certain individuals have appointed themselves as the 'gatekeepers' of environmental justice.  Although such EJ narcissism is delusional at best, it appears to have generated a reaction from those who do not choose to kneel at the alter of illusions.  Hopefully, 2nd Geners will not end up kneeling in front of their own mirrors.

 

Where is the environmental justice movement heading?  Will it take the same path of the now defunct Washington Office On Environmental Justice, which imploded from the weight of the egos involved?   Will it organize to provide a relevant presence before the U.S. Congress and the Executive Branch?  Will it challenge and compete in the private sector?  Will it litigate to protect vulnerable communities of color when needed?  Will it work to pass a national environmental justice act?  Or will it mimic a cycle of individuals jockeying to be EJ messiahs and EJ elite disciples?  It was such a shame when Washington's powerful realized that the EJ movement was impotent due to self-destructive competition, back-biting and glory seeking.  It dismissed the movement with some 'success stories' and a Presidential Executive Order that has no teeth in protecting vulnerable communities. And having another EJ conference in Washington, DC, although helpful,  is not a history-making event.  The No Fear Act is history!  Check the home page of virtually every Federal agency and you will see NO FEAR.

 

Traditional environmental organizations have gone through this process and not for the better.  Their elitism has corrupted and  blinded them. In their arrogance they ignore dissent, rational solutions, African Americans, dogmaticallly push a capitalist-fueled anti-capitalist, no-growth, socialist-communist, segregationist, dictatorial agenda and generally oppose the American way of life (not all but many).  The EJ movement could also be perverted by elistist tendencies.  I remember when traditional environmental groups were small, righteous, efficient and effective advocates for the environment.  I also watched them become powerful K Street players where you cannot tell the difference between their offices and the offices of the powerful they once opposed.  Now that the traditional environmental movement is a $6 billion per year industry, they have lost their soul (not all but many).

 

Let's hope the EJ Elite will let go of their elitism, that the 2nd Gen will work efficiently and effectively with the old school and that the fusion will result in the protection of vulnerable communities.

 

In support of AAEA organization goal #4: Increase African American participation in the environmental movement. 

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FORESTS

Dec 2004 -- The Bush Administration issued new forest planning regulations that simplifiy and streamline implementation of the 1976 National Forest Management Act (NFMA), the law that directs management plans to be developed and implemented for all national forests every fifteen years.  The regulations affect recreation, endangered-species protections and livestock grazing, among other things, on all 192 million acres of the country's 155 national forests.

The action rescinds the previous rule as well as creates a new Categorical Exclusion under NEPA, for adopting, revising and amending forest plans.   The government will no longer require that its managers prepare an environmental impact analysis with each forest's management plan, or use numerical counts to ensure there are "viable populations" of fish and wildlife. Traditional environmentalists consider this a retreat from environmental protection of our national forests.

The changes will:

1. Reduce the number of required scientific reports and ask federal officials to focus on a forest's overall health, rather than the fate of individual species, when evaluating how best to protect local plants and animals.
2. Require more active participation by scientists and better utilization of current scientific data.
3. Replace a bureaucratic planning process with a more corporate management approach that will allow officials to respond to changing ecological and social conditions.

The changes represent a modernization of the planning process the Forest Service has been using since 1982 to manage our national forests. Under the old policy:

• It took the agency an average of 7 years and $7.5 million to produce just one forest plan.
• The process was so burdensome and time consuming that the plans were obsolete before they were finished.
• The outdated plans and red-tape have prevented the Forest Service from responding to changing conditions in forests, such as insect and disease outbreaks, hurricane and storm damage, and catastrophic wildfires.

Proponents of the Administration's new regulations believe the changes will streamline the process while continuing to allow for full public participation.  Opponents of the changes believe the regulations will promote logging and other commercial exploitation of the national forests and relegate the public to the sidelines. Opponents believe that only strict federal rules can guarantee a haven for animals that seek refuge in the forests. Although the administration sought to update the rules to address new challenges, such as invasive species and forest fires, and to give the public input on how to manage the forests rather than commenting on individual projects, the disagreement over these changes will probably lead to more litigation, which will increase uncertainty in this sector.

The new rules:

1. Give economic activity equal priority with preserving the ecological health of the forests in making management decisions
2. Potentially liberalizes caps on how much timber can be taken from a forest.
3. Will cut Forest Service planning costs by 30 percent and
4. Will allow managers to finish what amount to zoning requirements for forest users in two to three years, instead of the nine or 10 years they sometimes take now.

Activists and timber industry representatives have complained that the 15-year management plans, which describe how federal officials auction off timber, locate campsites, allocate grazing rights and protect vulnerable species in each forest, can take five to nine years to complete and are out of date when they become final.

Just before leaving office, Clinton finalized a set of regulations that emphasized ecosystem health and wildlife protection over commercial exploitation; President Bush reversed those rules just before Thanksgiving 2002.

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FORESTS

USDA Forest Service Acts To Conserve Roadless Areas In National Forests

May 2005 - - The USDA has issued a final rule that invites input from state governors in the conservation and management direction for inventoried roadless areas within national forests. This rule will provide environmental benefits and help to ensure that the needs of local communities are considered in roadless area conservation. The new rule was developed after the previous regulation, issued January 12, 2001, was struck down by a U.S. District Court in July 2003 and deemed in violation of both the National Environmental Policy Act and the Wilderness Act.

The rule sets a straightforward, collaborative path toward conserving inventoried roadless areas by working with the states on regulations specific to the needs and requirements of each state. It incorporates the department's five conservation principles for inventoried roadless areas. They are:

• Make informed decisions to ensure that inventoried roadless area management is implemented with reliable information and accurate mapping, including local expertise and experience.
• Work with states, tribes, local communities and the public through a process that is fair, open and responsive to local input and information.
• Protect forests to ensure that the potential negative effects of severe wildfire, insect and disease activity are addressed.
• Protect communities, homes and property from the risk of severe wildfire and other risks on adjacent federal lands.
• Ensure that states, tribes and private citizens who own property within inventoried roadless areas have access to their property as required by existing law.

The rule allows governors to petition the secretary of agriculture to develop regulations to manage roadless areas that meet the specific needs within each state. USDA will accept state petitions from governors for 18 months after the effective date of the final rule. During the state-petitioning process, the Forest Service will continue to maintain interim measures to conserve inventoried roadless areas.

Petitions must identify areas for inclusion and may also include ways to protect public health and safety, reduce wildfire risks to communities and critical wildlife habitat, maintain critical infrastructure (such as dams and utilities), and ensure that citizens have access to private property.

Once a state has submitted its petition and the secretary accepts it, the Forest Service will work with the state to develop and publish a subsequent state-specific rule that addresses the management requirements set forth in the petition. The state-specific rulemaking process will include any required National Environmental Policy Act analysis and invite public input during a notice and comment period. If a state chooses not to file a petition, inventoried roadless areas within that state will continue to be managed in accordance with the direction set forth in each national forest's land and resource management plan.

While 38 states and Puerto Rico have inventoried roadless areas on National Forest System lands within their boundaries, 56.6 million acres, or 97 percent, of all inventoried roadless areas in the country are contained within 12 states. Those states are Alaska, Arizona, California, Colorado, Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington and Wyoming.

The department is also announcing the establishment of a national advisory committee to provide advice and recommendations to the secretary on implementing this rule. Members of the committee will represent diverse national organizations interested in the conservation and management of National Forest System inventoried roadless areas.

The final rule and the notice announcing the establishment of the advisory committee will be published in the Federal Register this week and are available at www.roadless.fs.fed.us.

(Source: USDA)

Alaska Tongass Forest Debate

The Tongass National Forest is a coastal rain forest that covers about 17 million acres of southeastern Alaska. The federal government is attempting to support the U.S. timber industry in Alaska by providing subsidies and excluding the Tongass from the Roadless Rule.  Even with the subsidy, local logging companies are struggling to make a profit.

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Just before leaving office, Clinton issued a rule barring road building and commercial logging on 58.5 million acres, or nearly one-third, of the country's national forest land.

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Logging company owners and Forest Service officials believe the timber industry in southeast Alaska is at risk of disappearing.  They believe that lumber can be produced at a profit, but decades of environmental lawsuits and contradictory federal rules have made it impossible to run a business that can compete in a global market.  Traditional environmental groups believe that large-scale logging in the Tongass is ecologically destructive and not cost-effective.

The U.S. Forest Service logging program is costing the federal government about $35 million more than it collects in annual timber sales. Logging company owners and Forest Service officials believe those sales are uneconomic because they are on inaccessible terrain and are too far from sawmills.

World competition in the forest products industry has hurt the Alaska timber industry. Cheap timber from Russia and South America has conspired to make logging in the Tongass even less competitive. Global competition forced the closure of pulp mills, the loss of thousands of jobs and the loss of millions of board feet in logging volume in 2003. Only three large lumber mills are still operating in southeast Alaska.

The timber industry has also been hurt by the rise of a profitable cruise ship business in southeastern Alaska. Tourism and recreation have long since overtaken logging as the region's primary employers and engine of growth. Cruise ships have made the forest an eco-destination for tens of thousands of summertime tourists.

The Bush administration exempted the Tongass from Clinton's Roadless Rule in December 2004 and on July 12, 2004 proposed overturning the rule in all federal forests. According to Agriculture Secretary Ann M. Veneman, the abolition of the Roadless Rule will end litigation and encourage cooperation between state and federal officials.

Companies that bid on timber from national forests can now cancel the purchase because Senator Ted Stevens (R-Alaska), chairman of the Appropriations Committee, attached a rider to a 2003 appropriations bill making these contractual escapes possible.  In 2004, the federal government allowed local companies to walk away from 10 timber sales.

Traditional environmental groups believe that there is more than enough timber available from existing roads to fully supply the timber industry at levels they have been cutting in recent years without building new roads. They believe that the Forest Service, in part to justify its own large payroll in southeast Alaska (about 500 employees), chronically overstates market demand and wastes money preparing timber sales that are not needed.

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FORESTS

BUSH SIGNS 'HEALTHY FORESTS' LEGISLATION INTO LAW

Healthy Forest Initiative

The Healthy Forest Restoration Act of 2003 (H.R. 1904), cosponsored in the Senate by Sen. Dianne Feinstein, was approved by a vote of 80-14 on October 30, 2003.  The legislation, a modified version of President Bush's Healthy Forest Initiative, calls for expedited procedures for tree thinning on 20 million acres of federal forest threatened by fire.

AAEA supports the Healthy Forests Initiative but we are concerned about the precedent set by weakening the environmental assessment provision included in the bill.  However, we have to do something about forest management because millions of acres of forests are being devastated annually by wildfires.  The specific environmental section of the bill we are concerned about:

SEC. 104. ENVIRONMENTAL ANALYSIS.

(b) DISCRETIONARY AUTHORITY TO ELIMINATE ALTERNATIVES- In the case of an authorized hazardous fuels reduction project, the Secretary concerned is not required to study, develop, or describe any alternative to the proposed agency action in the environmental assessment or environmental impact statement prepared for the proposed agency action pursuant to section 102(2) of the National Environmental Policy Act of 1969 (42 U.S.C. 4332(2)).

We understand the motivation behind eliminating the environmental assessment provision: traditional environmentalist use it to slow down or stop forest management practices they disagree with via litigation, thus slowing or stopping measures that could save millions of acres of forest from wildfire destruction. 

Also, unlike traditional environmental organizations, we do not believe the legislation is intended to get the courts out of the way to directly benefit the timber industry while doing almost nothing to help the communities threatened by fire.

The "Forestry and Community Assistance Act of 2003," S. 1453 will protect communities and property from fire and leave intact long-established environmental, procedural and legal safeguards. This bill is sponsored
by Sens. Patrick Leahy (D-VT) and Barbara Boxer (D-CA),

CBC Opposes President Bush's Healthy Forest Initiative

 

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Utilities

Web-Based Distributed Generation Will Revolutionize The Grid

Currently, electricity grids are dumb--that is, electrons go out blindly one way to service equipment without regard to communicating sophisticated feedback.  If electricity outputs and inputs could be monitored and controlled via computer, it would revolutionize the grid.  Of course it will take super computers to control the awesome inputs and outputs required to monitor and control small, distributed systems all over a grid.  Today, mechanical switches protect loads but do not compute.  That is about to change. Computers will do for the grid what they have done for homes and offices.  Command and control in the case of a computerized grid is a very good thing.

Distributed generation is a system where small, modular electricity generators are sited close to the customer load.  This enables utilities to defer or eliminate costly investments in transmission and distribution system upgrades.  It also provides customers with better quality, more reliable supplies and a cleaner environment.  Technologies for distributed electricity generation include wind, solar, bioenergy, fuel cells, gas microturbines, hydrogen, cogeneration and hybrid power systems.  Of course, distributed generators will never totally replace large, centralized systems. 

Web-Based Distributed Generation (WBDG) equipment collects data on distributed generators and transfers operating instructions to them across the Internet. The system can scrutinize distributed generation sources for problems and alert operators, start and stop equipment, and conduct various load management procedures. WBDG is designed to provide a comprehensive end-to-end solution that utilizes technology to simultaneously consider real time energy prices, forecasted electric and thermal loads, frequency adjustments, maintenance costs, unit availability, efficiency curves, reliability needs and other key parameters to determine the most economically effective way to provide electric and thermal energy to customers.

Of course, connecting a distributed power system to the electricity grid has potential impacts on the safety and reliability of the grid. Several states are developing their own interconnection standards while awaiting completion of a national standard.  Of course, many companies will have to adhere to standardized equipment and practices to make distributed generation work.  One company currently testing this technology is DTE Energy Technologies. They are conducting tests in a cost-sharing program with the Department of Energy.

Home Efficiency Increases

(1) Nearly One in 10 2004 Homes Qualified for Energy Star
(2) Some Superfund Sites to Become Model Airplane Zones
(3) Minnesota Warehouse/Supply Company Sentenced for Illegal Hazardous
Waste Storage and  Disposal
(4) El Paso Waste Disposal Company Officers Sentenced in Waste Fraud
Scheme

(1) Nearly One in 10 2004 Homes Qualified for Energy Star

Contact:  John Millett, 202-564-7842 / millett.john@epa.gov

Nearly 10 percent of all homes built in 2004 qualified for Energy Star, according to an EPA report.  Since 1995 more than 350,000 of the nation's new homes have met Energy Star ratings, saving homeowners an estimated $200 million and eliminating approximately 4 million pounds of
greenhouse gas emissions, equivalent to the emissions of about 150,000 vehicles.

Home energy use accounts for nearly 17 percent of the total U.S. greenhouse gas emissions and 15 percent of energy consumption nationwide.  For the past 10 years, EPA has been working with the
housing industry, utilities, states, and independent energy efficiency home ratings professionals to bring increased energy efficiency to the homebuilding industry.  Today more than 2,500 builders are committed to building Energy Star qualified homes, and in some markets 20 to 40 percent of new housing starts earn the Energy Star.

New homes that qualify for the Energy Star designation use about 30 percent less energy than a home built to the model energy code without compromising comfort or quality.  Energy Star qualified homes can be found in every state and the District of Columbia.  States with the most Energy Star qualified homes include Texas, with more than 91,000 qualifying homes, California with more than 52,000 qualifying homes, and Arizona, with more than 41,000 qualifying homes.  States with at least 10 percent of new homes earning the Energy Star in 2004 include Alaska,  Arizona, California, Hawaii, Iowa, Louisiana, Massachusetts, New Jersey, Nevada, Ohio, Oregon, Rhode Island, Texas and Vermont.

For more information, or a copy of the report, "A Decade of Change in Homebuilding with Energy Star, visit:  http://www.energystar.gov or

Hydrogen

DC Opens First Hydrogen Fueling Station

November 2004 -- According to officials from Shell Hydrogen and General Motors Corporation, the hydrogen-dispensing pump at the Shell station on Benning Road NE in the Washington, DC is the first installed at a public gas station in the country.  Shell spent more than $2 million on the special Benning Road NE pump, which it will use to demonstrate hydrogen technology to lawmakers and staffers on Capitol Hill through a partnership with GM.

Shell and GM are major proponents of moving toward a "hydrogen economy," in which a significant part of the world's vehicle fleet would run on hydrogen-powered fuel cells. Such cells are essentially batteries that generate electricity by converting hydrogen and oxygen into water, producing no pollution.

The station and GM's fleet of fuel cell minivans are part of their plan to establish small networks of five or six such commercial pumping stations throughout the country by 2007; connecting a number of such small networks into regional networks beginning around 2010; and having mass-market penetration between 2015 and 2025.

The facility was opposed by River Terrace communty activist George Gurley and other members of the community.  It was supported by others, such as the principal of River Terrace elementary school, which is right behind the fueling station.

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ETHANOL

E85

E85 is a mixture of 15 percent gas and 85 percent ethanol and is derived from corn, grain or other plants.  According to the National Ethanol Vehicle Coalition, based in Missouri, and the National Highway Traffic Safety Administration, approximately 150 of the roughly 176,000 gas stations nationwide offer the ethanol-based fuel.  End users of ethanol are large gasoline blenders, such as Shell Oil Co., ExxonMobil Corp. and BP. They usually use a 10 percent ratio for ethanol in gasoline to comply with government regulations.

The coalition lists three gas stations in Maryland and one in Virginia that sell E85.  A Chevron station outside Fort Meade in Maryland sells about 3,000 gallons of E85 a month at $1.79 a gallon.  The other stations are in Arlington, Rockville and Annapolis.  Converting standard gasoline tanks and pumps to handle ethanol costs $25,000 to $60,000.  Equipping a vehicle to run on ethanol involves strengthening some hoses.  Such adjustments cost less than $160 per vehicle.

Ethanol As A Fuel Additive

Fuel additives from lead to MTBE (methyl tertiary butyl ether) are problematic.  Both have been banned as additives.  The dangers of lead are well known.  MTBE, a gasoline additive made from methanol, contaminates ground water supplies.  California banned MTBE in 2003. New York and Connecticut banned MTBE in 2004.

Ethanol is the latest candidate being touted as a great gasoline additive. It has less energy content than gasoline, but has a cleaner and more complete burn than gasoline. As a result, fewer emissions are leaving the car's tailpipe—meaning that fewer greenhouse gases are entering the atmosphere. Ethanol is a liquid alcohol fuel produced from biomass, which consists of trees, grasses and wastes. It also comes from grain or agricultural waste. While ethanol creates fewer ozone-forming compounds and toxic air pollutants, it reduces mileage per gallon because of its lower energy content than pure gasoline.

Some researchers note that it takes more energy to produce a gallon of ethanol from corn than ethanol can create. This is attributed to the amount of natural gas and coal that are required to make the fertilizer that grows the corn and is then used to process ethanol. Other critics note that ethanol's lower energy content means that more gasoline must be burned to make cars run. Ethanol's strongest attribute is that it significantly reduces carbon monoxide.  Unfortunately, it also produces more nitrogen oxides, a component of smog. Thus, although ethanol is probably not as polluting as lead or MTBE, it will not help in reducing a major component of smog.

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COAL

Top 20 Electric Utilities Ranked by Receipts of Coal, 2000

Major U.S. Coal Producers - 2001

Company, Production (Million Short Tons), Percent of Total U.S. Tonnage

1. Peabody Energy Corporation1      194.4      17.3%

2. Arch Coal, Inc. 2                          118.4      10.6%

3. Kennecott Energy Company 3       117.5      10.5%

4. CONSOL Energy Inc.                     73.7      6.6%

5. RAG American Coal Holding, Inc.   65.5      5.8%

6. AEI Resources, Inc. (Addington Enterprises, Inc.)  45.6   4.1%

7. Massey Energy Company                45.0      4.0%

8. Triton Coal Company, LLC            43.0       3.8%

9. The North American Coal Corporation  31.3   2.8%

10. Westmoreland Coal Company      27.8       2.5%

11. TXU Mining (Texas Utilities)        22.8       2.0%

12. The Pittsburg & Midway Coal Mining Company      16.0      1.4%

13. BHP Billiton                                15.8        1.4%

14. Alliance Resource Partners          15.7        1.4%

15. Kiewit Mining Group, Inc. 4        15.1        1.3%

16. James River Coal Company        13.1         1.2%

17. Interwest Mining Company (Sub. Of PacifiCorp)      11.3      1.0%

18. Lodestar Energy, Inc. 10.4 0.9%

19. TECO Coal Corporation 10.1 0.9%

20. Pittston Coal Company 9.4 0.8%

21. Coastal Coal Company, LLC 9.3 0.8%

22. Andalex Resources, Inc. 7.1 0.6%

23. American Coal Company (Murray Energy Corp.) 6.8 0.6%

24. American Electric Power Service Corp. (AEP)5   6.8 0.6%

25. Jim Walter Resources, Inc. 5.8 0.5%

26. Aluminum Company of America (ALCOA Inc.) 5.7 0.5%

27. U.S. Steel Mining Company LLC 4.8 0.4%

28. AMVEST Minerals Company LLC 4.6 0.4%

29. The Ohio Valley Coal Company (Murray Energy Corp.) 4.6 0.4%

30. Drummond Company, Inc. 4.1 0.4%

31. Anker Coal Group, Inc. 4.0 0.4%

32. Oxford Mining Co. 3.6 0.3%

33. Western Fuels Association, Inc. 3.6 0.3%

34. Black Hills Corp. 3.5 0.3%

35. ExxonMobil Coal and Minerals Company 3.2 0.3%

36. Dolet Hills Lignite Co. (Sub. of AEP) 2.8 0.2%

37. KenAmerican Resources, Inc. (Murray Energy Corp.) 2.3 0.2%

38. Maple Creek Mining, Inc. (Murray Energy Corp.) 2.3 0.2%

39. Trapper Mining Inc. 1.9 0.2%

40. Usibelli Coal Mine, Inc. 1.5 0.1%

41. PennAmerican Coal LP (Murray Energy Corp.) 1.2 0.1%

42. Sun Coke Company 1.0 0.1%

43. Energy Resources, Inc. (Murray Energy Corp.) 0.8 0.1%

44. Cravat Coal Company 0.7 0.1%

45. Pacific Coast Coal Company 6   0.0 0.0%

Other Producers 127.4 11.4%

Total U.S. Production 1,121.3 100.0%

Notes: Data from 2002 NMA survey of major producers. Production is EIA estimate.

1 Peabody Energy Corp. production figure includes production plus sales tonnage.

2 Arch Coal production figure includes 100% interest in Canyon Fuels (65% ownership).

3 Kennecott Energy production figure includes 50% ownership (tonnage) of Decker Mine.

4 Kiewit production figure includes 100% ownership (tonnage) of Decker, Black Butte, and Walnut Creek mine tonnage.

5 AEP production figure includes tonnage from Quaker Coal Company, excludes Dolet Hills Lignite Co.

6 Production tonnage under a half million (.003 million  tons

National Mining Association

101 Constitution Avenue, NW, Suite 500 East 

Washington, DC 20001 - Phone (202) 463-2600

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COAL

Coal Facts: 1  2  3

Clean Coal: Coal Gasification

Rather than burning coal directly, gasification breaks down coal into its basic chemical constituents. In a modern gasifier coal is exposed to hot steam and carefully controlled amounts of air or oxygen under high temperatures and pressures, which causes carbon molecules in coal to break apart, setting into motion chemical reactions that produce a mixture of carbon monoxide, hydrogen and other gaseous compounds.

Gasification may be one of the best ways to produce clean-burning hydrogen for tomorrow's automobiles and power-generating fuel cells. Hydrogen and other coal gases can also be used to fuel power-generating turbines.

Coal gasification can cleanse as much as 99 percent of the pollutant-forming impurities from coal-derived gases.  Coal gasification can remove 97 percent of the sulfur and 82 percent of the nitrogen oxide from smoke stacks. Coal gasification plants release 50 percent less mercury and 20 percent less carbon dioxide than a conventional coal-fired plant without scrubbers because of the inherent efficiency of the gasification process.  Sulfur in coal, for example, emerges as hydrogen sulfide and can be captured by processes used today in the chemical industry. In some methods, the sulfur can be extracted in either a liquid or solid form that can be sold commercially.  In an integrated gasification combined-cycle plant, significant efficiencies can be achieved.  And using Selective Catalytic Reduction (SCR) reduce emissions to levels comparable to firing with natural gas. 

If oxygen is used in a coal gasifier instead of air, carbon dioxide is emitted as a concentrated gas stream. In this form, it can be captured more easily and at lower costs for ultimate disposition in various sequestration approaches. (By contrast, when coal burns or is reacted in air, 80 percent of which is nitrogen, the resulting carbon dioxide is much more diluted and more costly to separate from the much larger mass of gases flowing from the combustor or gasifier).

Coal currently supplies 52 percent of America's electricity needs. Coal is about a third of the cost of natural gas and it is estimated that there is about 200 years worth in the ground. Coal produces significant amounts of sulfur dioxide (SO2) that creates acid rain as well as the nitrogen oxide (NOx) that causes smog and soot. Coal plants also generate the majority of the industry's carbon dioxide (CO2) and mercury emissions. At least 90 percent of toxins regulated under the Clean Air Act that include NOx and SO2 can be removed with new technologies.

Today's coal-fired plants have a fuel to efficiency rate of 33-35 percent. With the new technologies, such as gasification, however, that efficiency rate is said to increase to 45-50 percent, and potentially as much as 60 percent. The cost: about $1,200 per kilowatt compared to $900 with conventional coal plants.

President Bush's clean coal technology program has budgeted $2 billion over 10 years to help fund eight projects to install the latest equipment for reducing emissions. The administration will award about $316 million in 2003. The private sector, meanwhile, will contribute about $1 billion. Currently, more than 30 such projects are vying for the next round of money.

Coal plants run between 90 to 95 percent of the time compared to gas-fired combined-cycle plants that run 50 to 60 percent of the time.    Coal plants are difficult to get sited, are far more capital intensiveand and take about twice as long to site as those fired by natural gas. That is why 90 percent of all power plants now being proposed would run on natural gas, which generates a return for investors sooner.

Eastern coal may be more expensive than Western coal but the transportation costs associated with it are lower. If the supply of eastern coal production is curtailed because mountaintop mining is banned, it would mean that certain utilities would import coal that has an inferior heat rate and at potentially higher costs.

The Energy Information Administration estimates that coal reserves in Appalachia are 55.2 billion tons while coal production tied to mountaintop mining in West Virginia alone is 52 million tons annually. 

The coal industry is the single largest source of revenue for West Virginia. According to the National Mining Association, the industry contributes indirectly $13.5 billion there to the economy and supports nearly 113,000 jobs. Coal mining jobs pay as much as $50,000 annually and more than half of all such workers are older than 50 years old. 

Indeed, American coal spot market sales are now worth about $50 a ton, although the price has been as high as $63 a ton. That's compared to roughly $40 a ton a year ago.

New Coal Company Goes Public

Foundation Coal Holdings Inc., a coal producer headquartered in an office park near Baltimore-Washington International Airport, has filed to go public. If the offering proceeds as envisioned by its owners, they could make roughly $600 million on a company they have only held since July.

The Linthicum Heights company is the fourth-largest coal producer in the country. Interest in coal producers has surged as energy companies, faced with rising natural gas prices and stepped-up demand for electricity, plan a number of new coal-fired power plants. For more click on the links below: http://www.washingtonpost.com/wp-dyn/articles/A3111-2004Nov21.html

 http://www.washingtonpost.com/wp-dyn/articles/A53893-2004Dec9.html?referrer%3Demailarticle&sub=AR

Oil 

America imported more than 10 percent of its oil from two African countries in 2001: Nigeria and Angola.  By 2015, Africa could be providing 25 percent of America’s oil needs, according to National Intelligence Council estimates cited in “African Oil: A Priority for U.S. National Security and African Development,” a white paper recently released by the African Oil Policy Initiative Group (AOPIG), a consortium of policy makers and energy producers.  Africa and America have much to offer one another, in particular, energy security for this country and economic development for Africa.  Congress should begin taking serious steps toward securing such a future.

In the first half of 2002, the U. S. imported 110 million barrels of crude oil from Iraq.  African sources could eventually help soften price shocks during times of upheaval in the Middle East.

African oil has other advantages. Much of it lies beneath the Atlantic or near the West African coast, which makes it simpler to transport to the United States than oil from the Persian Gulf or the Caspian Sea. Nigeria is the only sub-Saharan country that belongs to the Organization of the Petroleum Exporting Countries, which means that much of Africa's new production will not be constrained by any cartel quotas. Gabon was an OPEC member but quit in 1995, and Nigeria is considering quitting.  Nigeria is the largest oil producer in sub-Saharan Africa and the fifth-largest exporter of oil to the United States.

Nigeria is expected to raise production over 3 million barrels a day by 2007, from 2.2 million now, according to the Petroleum Finance Company. Angola's daily production is projected to double, to nearly 2 million barrels. Chad is expected to produce 225,000 barrels a day once a $3.5 billion pipeline through Cameroon is completed in 2004. Production in tiny Equatorial Guinea is expected nearly to double, to 350,000 barrels a day, within three years.

Chad's pipeline is being threatened by some environmental groups. Environmental groups are critical of lending by U.S.-subsidized banks, which include the World Bank, Inter-American Development Bank, Asian Development Bank and African Development Bank. The groups contend these public agencies, including the U.S. Agency for International Development (U.S. AID), back projects -- oil and gas wells, dams, pipelines and logging -- that accelerate the destruction of fragile, diverse and dwindling ecosystems.  AAEA believes the pipeline is important for Chad and for America's energy security.  Adequate environmental assessments should be conducted expiditiously to assure speedy and environmentally friendly construction of such projects.

Eight environmental groups -- including the Bank Information Center, Sierra Club, Natural Resources Defense Council and Friends of the Earth -- complained to Congress in June that environmental oversight of public-bank lending had weakened significantly. The group also singled out the handling of a U.S. AID critique of a $3.7 billion oil pipeline to be built by an Exxon-Mobil-led consortium from Chad to Cameroon's Atlantic coast. World Bank agencies lent the project $140 million.

Before the World Bank vote, U.S. AID officials had said Chad and Cameroon failed to perform an adequate assessment of the pipeline's impact on the ecosystem. But a Treasury representative at the World Bank backed the project anyway. In a draft of the same report to Congress, a U.S. AID reviewer faulted the Chad-Cameroon process because it used an environmental assessment produced by the oil consortium rather than one supervised by the governments, as required by World Bank policies.

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LNG

 U.S. Department of Commerce Approves Maryland LNG Project

The U.S. Department of Commerce approved the Sparrows Point LNG proposal by AES Corporation stating that the need for natural gas outweighs any environmental damage that could be caused by the LNG terminal and the dredging that would be needed in the PatapscoRiver to accommodate the tankers importing the fuel.

"The impact of dredging to fish and aquatic vegetation will not be significant," according to the Commerce report, which notes that the project would "help meet regional energy demand by providing enough natural gas capacity to heat approximately 3.5 million homes per day or to generate electricity for 7.5 million homes per day."

The ruling from the federal agency does not guarantee approval for the project, but the decision is another disappointment to elected officials and community leaders fighting the plan by AES Corporation to build the terminal at the old Bethlehem Steel shipyard site on Sparrows Point. Once the liquid is processed, it would be distributed for use through an 88-mile pipeline, under the company's plan.

Senator Barbara A. Mikulski, Senator Benjamin, Governor Martin O'Malley and Baltimore County Executive James T. Smith Jr.oppose the project.

In July 2007, the Maryland Department of the Environment reviewed the AES proposal and found that there was not enough information to determine whether it violated the Coastal Zone Management Act, and that - in essence - if forced to make a decision at that point, officials would conclude the project did not meet the state's environmental standards. But the Commerce Department concluded AES had provided enough information to show its project meets an overriding goal of the CZMA, meeting the nation's energy needs.

Yesterday's finding does not resolve a separate legal dispute over whether Baltimore County can ban LNG facilities in environmentally sensitive waterfront areas, as part of its federally sanctioned Coastal Zone Management plan. Because of a federal appeals court ruling last month finding fault with the county's ban, officials have asked for federal approval of its amended coastal zone management plan.

Union leaders have long supported the project because of the jobs it would create, including 50 permanent jobs and 375 temporary construction positions.

This year, Federal Energy Regulatory Commission staff members recommended conditional approval for the LNG project. A final report from FERC is expected in August, with the five-member commission tentatively set to make a decision about the project in November. The Army Corps of Engineers is reviewing the company's request to dredge an 118-acre area in the Patapsco River.

 

Baltimore Sun, By Laura Barnhardt, June 27, 2008

On Nov 27, 2007 the Supreme Court will hear from lawyers for Delaware and New Jersey in a legal dispute over plans for a BP-proposed liquefied natural gas terminal on the Jersey side of the Delaware River.  A court-appointed special master concluded that Delaware, which opposes the project on safety grounds, controls the river all the way to the Jersey shore. If adopted by the court, that determination could mean the end of the terminal.

The case was brought to the court after Delaware rejected a permit for a 2,000-foot-long pier, which would be used by tankers to make deliveries to the planned terminal.  As the sovereign owner of the Delaware River bottom, Delaware can regulate and police developments extending from New Jersey's shoreline.

New Jersey officials filed a legal brief stating that it should have exclusive jurisdiction over its shoreline as well as construction of the pier.  A century-old agreement between New Jersey and Delaware gives each state authority over piers and other structures on its side of the river.

BP wants to build the terminal directly across the river from Claymont, Delaware.  BP has said that its understanding is that New Jersey can decide what gets built and Delaware would have authority over the pier once it has been constructed.

Texas LNG Facility Approved

June 18, 2004 -- The Federal Energy Regulatory Commission (FERC) approved a $500 million liquefied natural gas (LNG) complex owned by a three-company consortium that will be located in Quintana Island, Texas.  Freeport LNG Investments, Cheniere LNG and Contango Oil and Gas will build the facility 70 miles south of Houston, Texas, which will have the capability to unload 200 ships a year of LNG. 

The Freeport LNG venture will be partially financed by ConocoPhillip oil company in exchange for a portion of the gas.  Dow Chemical will also receive a large portion of the gas. 

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Liquefied Natural Gas (LNG)

Dominion To Double Cove Point Capacity

Dominion Resources Inc.plans to nearly double output capacity at the Cove Point liquefied natural gas terminal by 2008, to increasing the daily output of its terminal from 1 billion cubic feet per day - enough to serve the energy needs of 3.4 million homes - to 1.8 billion cubic feet per day, enough for 6.2 million homes.  Dominion is proposing to double its storage tank capacity, expand its Maryland pipeline and build a new pipeline in central Pennsylvania.

Norway's biggest oil and gas company, Statoil ASA, has signed a letter of intent with Dominion to provide gas for the additional storage at the terminal, one of only four operating in the United States. The letter of intent gives Statoil the exclusive right to negotiate a deal to use all the increased capacity at Cove Point for a 20-year period. Statoil plans to sell the gas in the Northeast.

Natural gas production has not kept pace with rising demand, experts say, driving up the market price. The average household pays 11 percent more to heat with natural gas this winter, according to the Energy Information Administration.

Two percent of the natural gas used by homes and businesses comes from liquefied natural gas. The gas is chilled to 260 below zero to be stored and transported in insulated tankers, then reheated into gaseous form at terminals such as Cove Point before being piped to customers.

Imports of liquefied natural gas are expected to increase.  The nation's other three liquefied natural gas facilities - at Elba Island, Ga., Lake Charles, La. and Everett, Mass. - also have proposed expanding and new terminals are being proposed on both coasts.

If capacity isn't increased by importing more gas, building larger pipelines and exploring for additional sources of natural gas, America will continue to demand gas, put pressure on the supply side and drive prices up.

Dominion needs approval from the Federal Energy Regulatory Commission to expand and build the additional pipelines.

In Maryland, the new pipeline - which would be attached to the existing line - would run 47 miles from the terminal to the Potomac River, crossing Calvert, Charles and Prince George's counties.

Cove Point, built in 1978, had processed natural gas imports for three years before being mothballed. Under Dominion's ownership, the plant reopened in August 2003. Since then, it has taken in about five shiploads of liquefied natural gas a month. Statoil, Shell North America and BP bring in shipments through Cove Point, most of the gas coming from Trinidad and Tobago. The expansion would probably double the number of ships to about 10.

Australian Company Wants LNG Port Off Cali Coast

Feb 2004  BHP Billiton, an Australia-based company, has submitted an license application to construct a $500-million floating deep-water liquefied natural gas port terminal off the Ventura County coast. The environmental review process will take into account economic, environmental, marine habitat and public safety issues.  Public hearings will be scheduled as part of the review, which is expected to take a year and will be overseen by the Coast Guard and the California State Lands Commission.

The Cabrillo Deepwater Port, which would act as a receiving point for shipments of California-bound natural gas, would be the first such floating terminal on the West Coast. Stored liquefied natural gas would be converted to vapor through a heat exchange system and transported by an undersea pipeline to existing onshore natural gas facilities. The project would be built about 20 miles off the coast of Oxnard. BHP has stated that the terminal would also be placed outside shipping lanes and marine mammal migratory routes, as well as away from the Point Mugu Navy base and the Channel Islands National Marine Sanctuary.

Once the environmental review process is completed, the Coast Guard will issue a recommendation on the review to the state Department of Transportation, which will ultimately decide whether to issue an operating license to BHP

Explosion Kills 27 and Closes Algerian Refinery

Jan 2004  A powerful explosion at the Skikda refinery in Algeria, the second largest exporter of liquefied natural gas, killed 27 workers and closed the facility.  Company officials estimate that it will cost $800 million to rebuild three damaged units that process liquefied natural gas.  Hydrocarbon products brought in $24 bilion in 2003, or 96 percent of Algeria's export revenues.  The Skikda refinery employs 12,000 workers and produces 335,000 barrels a day of refined products, including 10 to 13 shipments of naphtha a month of more than 27,000 tons each.  Algeria is the world's largest gas producer and a quarter of its gas shipments leave from Skikda, all to southern Europe.

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Natural Gas

Alaska Natural Gas Pipeline Legislation Approved

Congress passed legislation for the Alaska natural gas pipeline on Monday, October 11, 2004 that includes expedited approval of permits and loan guarantees worth up to $18 billion. The line is expected to cost about $20 billion.

The bill was part of a 2005 military construction funding bill.  The U.S. Senate passed a corporate tax bill with two gas line-related tax credits on a 69-17 vote. A separate military construction bill, which offers a federal construction loan guarantee and streamlines several regulatory processes, also passed by unanimous consent. The House passed the corporate tax bill Thursday, October 7, 2004 by a vote of 280-141 and the construction bill unanimously Saturday, October 9, 2004.  Alaska's three members of Congress advocated or voted for passage of all the measures.

Proponents have been working for two decades to get subsidies for an Alaskan natural gas pipeline.  Companies interested in building the pipeline include British Petroleum, ExxonMobil and ConocoPhillips. 

Gas pipeline owners can now amortize the cost of all Alaska portions of a pipeline over seven instead of 15 years.  There is also a tax credit for a gas conditioning plant on the North Slope of Alaska.   It should take about 10 years to complete the pipeline.  In summary, the measures:

• Provide a federal loan guarantee provision of $18 billion, or up to 80 percent of capital costs, to make the project more attractive to the eventual pipeline builder.
• Direct the Federal Energy Regulatory Commission to quickly permit the project once certain requirements are met, and provide for expedited judicial review.
• Designate FERC as the lead agency for the National Environmental Policy Act process and requires a single environmental impact study.
• Allow pipeline owners "accelerated depreciation" to claim construction costs on their taxes over seven years instead of 15 years. They also makes a proposed North Slope gas conditioning plant eligible for a tax credit worth $295 million over the same period.
• Create a federal coordinator within the executive branch to provide a single point of contact between federal agencies and pipeline officials.

The three major North Slope gas owners already are negotiating as a group with Gov. Frank Murkowski's administration. The Alaska Legislature passed a law a few years ago allowing the executive branch to tinker with existing state tax rules to make a project more attractive for developers. Two Canada-based pipeline companies, TransCanada Corp. and Enbridge Inc., are also negotiating under that law. The gas owner companies and the pipeline companies all can negotiate with the state over sales, corporate income and property tax rates,  The three major North Slope operators, because they own the gas, can negotiate the share that the state collects as a royalty. The Alaska Legislature must approve any agreement before it takes effect.

Exxon is not necessarily seeking lower tax rates from the state of Alaska and it refrained from advocating for any federal tax breaks. Exxon believes the pipeline project should be able to stand on its own. They are concerned about certainty and the risk of going into the project and then three or four years later the administration or the Congressional mood changes.

Another question mark is the traditional regulatory process of the Canada National Energy Board for approving pipeline projects, in which the 1970s Alaska Natural Gas Transportation System failed. While the Alaska delegation stressed that the package they have put in place does not mandate a line through Canada, the major gas owners have said that is the most feasible option. However, two governmental organizations, the Alaska Natural Gas Development Authority and the Alaska Gas Line Port Authority, want to build a line to Valdez rather than through Canada.

Natural Gas: A Primer

Natural gas is a great fuel, cleaner than coal or oil.  That is why proponents recommend it as a fuel for use in electric power plants to replace coal and uranium.  Unfortunately, natural gas is very hard to store, doesn't have pipelines to large sources, has limited availability due to restrictions on exploration and production on pubic lands and cannot be imported easily. Moreover, baseload powerplants use massive amounts of fuel (except uranium) to produce electricity and usage in power plants would significantly reduce availabilility of this precious fuel for residential (heating & cooking) and commercial uses. Although environmentalists and policy makers promote it as a clean fuel for use in electric power plants, they restrict its production by fighting exploration and drilling on public lands.

A cubic foot of natural gas is the volume of methane and related gases (propane, butane and others) occupying one cubic foot when the temperature is 60 degrees Fahrenheit and atmospheric pressure is 14.7 pounds per square inch (pressure at sea level).

Before natural gas enters an interstate pipeline, contaminating components, such as the sulfur, water vapor and solids are processed out to meet standards mandated by the Federal Energy Regulatory Commission (FERC). One of the most important standards is the identification of heating content per cubic foot, usually measured in British thermal units(or African thermal units by AAEA). One Btu or Atu is the energy required to raise the temperature of one pound of water one degree Fahrenheit, at sea level.  If natural gas were pure methane, the Btu or Atu content of a cubic foot would be 1,012 Btu (Atu). A therm is roughly 100 cubic feet of gas or 100,000 Atu.

There is a critical shortage of natural gas in the U.S. The Department of Energy (DOE) reports that natural gas storage levels are at their lowest levels in 30 years and prices have increased by up to 700 percent since 2000.  According to DOE's Energy Information Administration's Annual Energy Outlook 2003:

• Total demand for natural gas is expected to increase at an annual average rate of 1.8%.
• This increase is due to the rapid growth in demand for electricity generation.
• Forty percent of U.S. natural gas resources are inaccessible due to stringent environmental regulations on the federal lands.
• Environmental regulations favor the use of natural gas over other fuel sources, such as coal and gasoline.                                                                          

Federal Reserve Chairman Alan Greenspan testified about the natural gas shortage before the Joint Economic Committee and noted that:

• Importation facilities are limited and domestic sources are the best solution.
• Policy-makers have encouraged the use of natural gas, but have constrained access to it.
• Contradictory federal policies are creating shortages and leading to price increases.

Natural gas is the other reason energy companies want to drill in Alaska. It is estimated that Alaska's reserves could remedy the shortage. According to the U.S. Geological Survey Alaska has at least 35 trillion cubic feet of proven reserves of natural gas, and its federal lands could contain another 59.7 trillion cubic feet in undiscovered reserves. However, there is no natural gas pipeline to transport the fuel to the lower 48.  The Energy Security Act of 2003 proposes an Alaskan natural gas pipeline. However, greens are opposing it.  It is contradictory to promote the use of natural gas for electricity production while limiting its production from public lands and the outer continental shelf (moratoria on offshore drilling on the East and West coasts.

The Department of Energy Energy Information Administration forecasts a 34 percent increase in natural gas consumption over the next 10 years, from about 22 trillion cubic feet a year to 30 trillion cubic feet annually. But the gas can't get to its delivery points unless more pipelines are developed. 

2002

8 of 36 Congressional Black Caucus + JC Watts

By a vote of 240 to 189 approving $33.5 billion in tax breaks over 10 years for renewable energy, conservation and energy production.  The 511-page bill would open up 2,000 acres (down from the 1.5 million acres in the president's energy proposal) of the Arctic National Wildlife Refuge in Alaska to oil and gas exploration.  [Passed Thurs, Aug 2, 2001]

 The bill includes $300 million in tax credits for energy-efficient appliances, which will pay manufacturers $50 or $100 per clothes washer or refrigerator for meeting efficiency standards. The bulk of the credits and breaks — $27 billion, go to traditional energy producers, both to drill for more oil and gas, develop nuclear energy and produce cleaner coal ($3.3 billion for clean-coal technology).

One measure helps several electric companies avoid an estimated $2 billion in taxes by allowing utilities to transfer control of their power lines to independents tax-free, if they are required to do by federal regulators. Click HERE for full text of legislation [SAFE Act of 2001, H.R.4]

Click HERE & See Legislation & Legislative Calendar

House Passes Energy Bill Conference Report

11-18-2003, 4:47 p.m.The House vote was 246 Yeas to 180 Nays.

Senator Wyden Anti-Nuclear Amendment Fails

June 10, 2003: The U.S. Senate today voted 50-48 to reject an amendment (S.Amdt.875) offered by Sen. Ron Wyden, Oregon Democrat to strike the nuclear loan guarantees from S. 14, the Energy Policy Act of 2003.

  The U.S. House of Representatives voted 247-175 to pass H.R. 6, the Energy Policy Act of 2003, on Friday, April 11, 2003.  The energy plan increases domestic energy supplies; renews and enhances the energy delivery infrastructure; increases energy efficiency and conservation efforts; and provides energy assistance to America's most poor families (a provision making available to the Low Income Home Energy Assistance Program (LIHEAP) the expected $2.1 billion in revenue from ANWR). An amendment that would have required higher fuel economy standards for cars and light trucks was defeated.

Senate Energy Committee Passes Energy Bill

The Senate Energy & Natural Resources Committee approved S.14, comprehensive energy legislation (The Energy Policy Act of 2003) by a vote of 13-10 on April 30, 2003.  Consideration now moves to the Senate Floor. Upon passage, a House/Senate conference committe will reconcile the legislation.

S. 14 also repeals the Public Utility Holding Company Act (PUHCA), enacted in the early part of the 20th Century to control utility investments.  It is antiquated in a deregulated utility universe. AAEA supports utility deregulation and supports repeal of PUHCA.

Proponents have been working for two decades to get subsidies for an Alaskan natural gas pipeline.  Companies interested in building the pipeline include British Petroleum, ExxonMobil and ConocoPhillips. 

Gas pipeline owners can now amortize the cost of all Alaska portions of a pipeline over seven instead of 15 years.  There is also a tax credit for a gas conditioning plant on the North Slope of Alaska.   It should take about 10 years to complete the pipeline.  In summary, the measures:

• Provide a federal loan guarantee provision of $18 billion, or up to 80 percent of capital costs, to make the project more attractive to the eventual pipeline builder.
• Direct the Federal Energy Regulatory Commission to quickly permit the project once certain requirements are met, and provide for expedited judicial review.
• Designate FERC as the lead agency for the National Environmental Policy Act process and requires a single environmental impact study.
• Allow pipeline owners "accelerated depreciation" to claim construction costs on their taxes over seven years instead of 15 years. They also makes a proposed North Slope gas conditioning plant eligible for a tax credit worth $295 million over the same period.
• Create a federal coordinator within the executive branch to provide a single point of contact between federal agencies and pipeline officials.

The three major North Slope gas owners already are negotiating as a group with Gov. Frank Murkowski's administration. The Alaska Legislature passed a law a few years ago allowing the executive branch to tinker with existing state tax rules to make a project more attractive for developers. Two Canada-based pipeline companies, TransCanada Corp. and Enbridge Inc., are also negotiating under that law. The gas owner companies and the pipeline companies all can negotiate with the state over sales, corporate income and property tax rates,  The three major North Slope operators, because they own the gas, can negotiate the share that the state collects as a royalty. The Alaska Legislature must approve any agreement before it takes effect.

Exxon is not necessarily seeking lower tax rates from the state of Alaska and it refrained from advocating for any federal tax breaks. Exxon believes the pipeline project should be able to stand on its own. They are concerned about certainty and the risk of going into the project and then three or four years later the administration or the Congressional mood changes.

Another question mark is the traditional regulatory process of the Canada National Energy Board for approving pipeline projects, in which the 1970s Alaska Natural Gas Transportation System failed. While the Alaska delegation stressed that the package they have put in place does not mandate a line through Canada, the major gas owners have said that is the most feasible option. However, two governmental organizations, the Alaska Natural Gas Development Authority and the Alaska Gas Line Port Authority, want to build a line to Valdez rather than through Canada.

Clock Ran Out On Energy Bill (2003-2004)

A main sticking point that caused the energy bill to fail was the MTBE liability exemption.  The exemption provides protection from lawsuits for makers of the fuel additive methyl tertiary-butyl ether (MTBE), which has been found to contaminate groundwater.

One of the main proponents of the MTBE exemption is House Majority Leader Tom Delay (R-TX).  The largest domestic producer of MTBE, Lyondell Chemical Company (formerly Arco Chemical) is headquartered in Houston, Texas, part of which is represented by Delay.  Valero Energy Company of San Antonio, Texas also makes MTBE.  Critics charge the MTBE exemption will affect approximately 130 lawsuits filed by communities seeking damages for contamination.  A key defense of MTBE's manufacturers is that the 1990 Clean Air Act Amendments passed by Congress mandated the use of oxygenates such as MTBE as additives in gasoline to reduce smog.  Finally, opponents of ethanol as a replacement for MTBE agreed to support ethanol in exchange for the exemption.  So eliminating the exemption to try to pass the energy bill neutralizes the ethanol deal.  This equation will not change in 2004. 

The Energy Bill has been in limbo for weeks because of a disagreement between Senate Finance Chairman Grassley and House Ways and Means Chairman Thomas over tax breaks for ethanol.  Thomas has consistently rejected Grassley's plan to reform the ethanol tax incentive program, known as the "Volumetric Ethanol Excise Tax Credit (VEETC) Act of 2003, S.1548, " which proposes to eliminate the ethanol tax credit exemption and fully fund the Highway Trust Fund. 

April 11, 2004 -- The Senate voted 85-13 vote to approve a $14 billion package of tax breaks to stimulate U.S. energy production and hold down prices. The tax incentives are aimed at long-term production and would have little impact on high prices for gasoline, natural gas and crude oil this year. The energy provision was attached to a corporate tax bill, the Foreign Sales Corporation/Extraterritorial Income Act,  FSC/ETI bill (HR 4520 and S 1637) or JOBS Bill, (S.1637).  Senators supporting the measure believe actions are needed to persuade industry to get back into the business of producing more energy.

The bill includes $9 billion in tax incentives for the oil and gas industry and   billions more to encourage development of clean coal technology and renewable fuels. The bill would encourage construction of a $20 billion pipeline to carry natural gas from Alaska's North Slope by guaranteeing a price support if the price of gas falls below a certain level.

It also contains tax breaks aimed at energy conservation and development of renewable energy sources, including building more energy efficient homes, buying more energy efficient appliances and a tax credit of up to $2,000 for the purchase of increasingly popular gas-electric hybrid automobiles.  These incentives would encourage consumers to save energy and would develop markets for innovative energy-efficient products. The result would be a meaningful reduction in energy use, with associated environmental and energy security benefits. While these important tax incentives are included in the Senate tax bill known as "FSC/ETI", the House version of the legislation does not include such provisions. The Senate and House have begun a conference on the to work through the differences.

In summary, the critical incentives for new energy-efficient technologies include:

• Buildings: incentives for new homes, improvements to existing homes, and commercial buildings that far exceed building codes;

   ENERGY 2005

Bill Signing

MTBE Deal Proposed

Joe Barton (R-TX), Chairman of the House Energy & Commerce Committee and Representative Charles Bass (R-NH) have proposed to resolve the  methyl tertiary butyl ether (MTBE) problem by creating an $11.4 billion fund to clean up drinking water contaminated by the gasoline additive.  The proposal is a compromise between the House bill, which exempts MTBE manufacturers from defective product lawsuits, and the Senate version, which does not.  This provision was excluded from the final energy bill (See below).

The plan would require the oil industry to pay about a third of the amount in the fund, with the rest coming from the federal government and state governments.  Barton's plan calls for $11.4 billion in funding over 12 years for cleanup and other compensation. The industry cost would be about $4 billion; the federal government would pay more than $4 billion and the cost to states would be nearly $3 billion.

Opponents of legal protection believe the plan is a giveaway to the oil industry and puts most of the burden of clean on taxpayers.  The oil industry believes the fund is too large and opposes it too.  Analysts can only guess at cleanup estimates.

MTBE has been widely used in gasoline to help reduce air pollution. But the additive has leaked from underground tanks, causing water pollution.  Proponents believe there should be legal protection for manufacturers because the government required that additives be used.

Bush Energy Plan 2005

President Bush called for the use of new technology to help secure domestic and global energy supplies. President Bush listed five initiatives to accelerate American energy security::

1. Call on federal agencies to work with states and communities to encourage construction of oil refineries on closed military bases. No specific sites have been identified.
2. Expand an existing White House proposal to provide a $2.5-billion tax credit for purchases of hybrid and fuel-cell vehicles by including cars and trucks that burn "clean diesel" fuel, which is more efficient than gasoline.
3. Encourage construction of nuclear power plants by reducing uncertainty in the licensing process and providing federal risk insurance to mitigate the cost of unforeseen delays. No new nuclear plants have been commissioned since 1973.
4. Increase federal authority over the location of onshore liquefied natural gas terminals. Four LNG terminals are now operating. Energy companies have proposed building 32 more if government approval can be obtained. The LNG proposal would "clarify" the authority of the Federal Energy Regulatory Commission to approve the placement of onshore terminals that accept tanker shipments of highly compressed gas and convert it to conventional natural gas for distribution to domestic markets.
5. Press other countries to participate in international efforts to promote more efficient and less polluting energy use, including clean coal and nuclear power generation.

President Bush's promotion of a mix of energy sources should be approved by Congress. It would be good if the nation could switch the percentages on coal and nuclear to 20 and 50 percent respectively. We need secure supplies of nuclear power, wind power, oil refineries, liquified natural gas, hydrogen, ethanol, and clean coal.

Congress Approves Budget Resolution With ANWR Drilling

The U.S. Congress approved a $2.57 trillion budget resolution, H. Con. Res. 95, on April 28, 2005 that allows oil drilling on the coastal plain of the Arctic National Wildlife Refuge (ANWR). The budget resolution only requires a majority vote and the ANWR provision was included to avoid a Senate filibuster.

The resolution is a nonbinding plan that establishes federal spending for fiscal 2006, revises the budget for fiscal year 2005, and sets forth appropriate budgetary levels for fiscal years 2007 through 2010.

The measure passed the House of Representatives in a 214-211 vote at the Senate in a 52-47 vote.