Policy News Update

July 28, 2008

In this issue: [Contract All : Expand All]


On July 25th, Senate Democrats came up short of the 60 votes necessary to move forward on a bill that would curb “excessive” oil market speculation by expanding Commodity Futures Trading Commission (CFTC) regulation.  The bill has become the center of the current energy debate, a debate that Republicans insist must be wide-ranging and include multiple amendments, in contrast to the limited amendment process offered to them by Senate Majority Leader Harry Reid (D-NV). All but two Senate Republicans voted against invoking cloture, a procedure that limits debate and would have moved the process forward.

At the heart of the disagreement are two issues:

  1. Offshore drilling restrictions: Democrats seek to maintain current restrictions, while Republicans are pushing to relax them.
  2. Oil market speculation: Whereas Democrats are focusing on curbing speculation as means of reducing energy costs, Republicans say speculation is at most a small part of the problem, and that the only way to reduce cost is to increase supply.

Two days earlier, Democrats unveiled a broad energy proposal to offer to the speculation bill. It included the following:

Alternately, the GOP leadership’s energy proposal would:

With the August recess approaching, however, impetus for an energy deal this year is limited despite high oil prices, because no new policies would offer immediate relief, and a new administration and Congress will soon be in place.

Ultimately, a resolution may hinge on the November election, and whether the parties see greater advantage in a deal, or believe they can successfully cast the other as standing in the way of policies to bring down gas prices.


On July 24, a Republican boycott prevented Senate Environment and Public Works Chairwoman Barbara Boxer’s (D-CA) attempt to subpoena a key U.S. EPA global warming document. In order to hold a subpoena vote, Boxer would need the support of at least two Republican senators. Meanwhile, the Bush administration has allowed House investigators to review the document so long as they do not discuss it in public.

The document in question is the draft EPA endangerment finding, which concludes that climate change threatens public health and welfare. The finding, which has yet to be publicly released, stems from the April 2007 Supreme Court decision in Massachusetts v. EPA, which ordered the federal government to consider greenhouse gas emissions as pollutants subject to regulation under the Clean Air Act. If EPA were to finalize the document, it would likely trigger a sweeping series of regulations to control greenhouse gases.

Former EPA Deputy Associate Administrator Jason Burnett recently testified that Bush officials at one time agreed to issue the endangerment finding, but later rescinded after hearing arguments from oil industry lobbyists and Vice President Cheney that the ruling could tarnish the President's anti-regulatory legacy.

Burnett said Bush officials convinced EPA to announce plans for a much broader regulatory announcement in response to the Supreme Court decision—these new plans were to include a public comment period on many different ideas related to greenhouse gas emissions.

Earlier this month, EPA opened a six-month public comment period on greenhouse gas rules, a move that effectively punts the issue to the next administration.

Senators Boxer and Patrick Leahy (D-VT) had also requested EPA Administrator Stephen Johnson to testify before the Senate Judiciary Committee, but Johnson declined. Leahy has since called for a U.S. EPA inspector general investigation into the Bush administration's global climate change decisions.


Last month in the House, Appropriations Chairman David Obey (D-WI) refused to bring the Interior bill before the full committee because of Republicans' desire to use the spending bill as a platform for their energy amendments. On July 22, the Senate Appropriations Committee cancelled markups of the Interior appropriations bill and an emergency supplemental spending bill.

Republicans were expected to propose amendments to the Interior spending bill aimed at increasing domestic energy production, including opening up more of the outer continental shelf (OCS) to drilling. Although an OCS amendment would have not likely made it through the subcommittee led by Senator Dianne Feinstein (D-CA), a fierce opponent of offshore drilling, the markup would have given Republicans another stage on which to assail Democrats for not addressing the energy crisis.

Chairman Robert Byrd (D-WV) said he took the markups off the calendar due to the short amount of time before the August recess, as well as the current Senate floor debate on oil price speculation, a debate that Democrats say would be a more appropriate place to address drilling amendments.

Senate Majority Leader Harry Reid (D-NV) told reporters earlier this month that most of the pending appropriations bills, including the Interior, Energy and Water, Transportation, and Commerce measures, would likely not be considered until next year. Meanwhile, those departments would be funded by a continuing resolution— that is, the current levels of funding—possibly until March 2009.

The cancellation also delays an emergency supplemental spending bill, which was to include funding for response to natural disasters including the recent Midwest floods and California wildfires. Senate Democrats will attempt to bring it up in September, Byrd said.


On July 17, the Senate Appropriations Committee cleared a spending blueprint that would reduce some of the funding boosts for conservation programs in the new farm bill. It is not uncommon for appropriators to turn to the farm bill to help offset spending increases elsewhere; in this case, both the Food and Drug Administration and food aid for the Women, Infants, and Children Program would see major increases.

The $20.4 billion fiscal year 2009 spending bill would place limits on some of the farm bill's mandatory funds for conservation and renewable energy programs, most notably shaving off:

$285 million from the Environmental Quality Incentives Program

$15 million from the Grasslands Reserve Program

$11 million from the Wildlife Habitat Incentives Program

In spite of these cuts, the Senate bill gives significant increases to several discretionary conservation accounts; overall, farm bill conservation programs would still receive more money than last year. For example: although the bill cuts $5 million from a program that helps farmers start renewable energy projects on their land, at $50 million, the renewable energy program still has twice as much money as last year.

The bill would also restore funding for some watershed programs the Agriculture Department had cut entirely in its budget:

$51 million for resource conservation and development

$30 million for watershed and flood prevention

$2 million for the Healthy Forests reserve program

Under the Senate bill, conservation programs would receive a total of $867 million, which is $19 million more than the House and $72 million more than the White House budget request.


Recent reports indicating that climate change and population increases could lead to significant water shortages are spurring members of Congress to consider legislation to coordinate and improve federal water research programs.

At a July 23rd House Energy and Environment Subcommittee hearing, a host of witnesses said the coordination of federal, state, and local efforts will be essential if the United States is to solve its water resources problem.

Draft legislation aimed at improving coordination could mitigate the effects of population growth on water supply. House Science and Technology Chairman Bart Gordon (D-TN) stated that better conservation methods could reduce expected increases in water demand over the next 30 years from 62 percent, the current estimate, to as little as 29 percent.

Gordon’s draft bill would:

The Ecological Society offers numerous scientific resources on this topic, including “Water in a Changing World” and a policy paper: “Meeting Ecological and Societal Needs for Freshwater”.


On July 16, the chairman of the Senate Foreign Relations Committee introduced a bill to create a fund that would deploy technology to developing countries in order to cut greenhouse gas emissions, as President Bush called for last year.

The legislation from Senator Joe Biden (D-DE) would create an International Clean Development Technology Deployment Board to administer $2 billion in appropriated funds from 2009 through 2011 to promote the use of clean technology in developing countries through direct assistance, indirect assistance from other institutions such as the World Bank, and technical assistance from the Energy Department.

The World Bank estimates it would cost $30 billion annually to deploy clean technologies to the power sectors of developing countries.

According to bill cosponsor Dick Lugar (R-IN) and Treasury Secretary Henry Paulson, the legislation would offer U.S. companies a new market for their technologies, and would prevent developing countries from investing in, and thus getting locked into, a “legacy of highly polluting, less efficient technologies.”

Some environmentalists have criticized the international clean technology fund, though, because it would cover clean coal power plants, which are more efficient but still emit a significant amount of carbon dioxide. House Speaker Nancy Pelosi also voiced concerns about this issue, which delayed the markup of a clean technology fund bill last month.


If even one of these bills is enacted into law in the coming year, it will be the first new environmental education bill passed in 18 years.

Sources: Environment and Energy Daily, Greenwire, Campaign for Environmental Literacy

Send questions or comments to Nadine Lymn, ESA Director of Public Affairs, Nadine@esa.org; Piper Corp, Policy Analyst, Piper@esa.org

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