It appears that congress is finally showing some signs of life (as usual, they are the late to the party). Here's the skinny on the new bi-partisan energy proposal you are about to hear a lot of buzz about. Initial read is quite positive. Particular interest is a $7500 tax credit for vehicles using alternative propulsion as well as $2500 to help retrofit existing automobiles (this is significant)
- $7.5 billion for R&D focused on the major technological barriers to alternative fuel vehicles, such as advanced batteries
- $7.5 billion to help U.S. automakers and parts makers re-tool and re-equip to become the world leader in making alternative fuel vehicles
- Consumer tax credits of up to $7,500 per vehicle to incentivize Americans to purchase advanced alternative fuel vehicles (those that run primarily on non-petroleum fuels) and up to $2,500 to retrofit existing vehicles with advanced alternative fuel engines.
- Extending renewable energy, carbon mitigation and energy conservation and efficiency tax incentives, including the production tax credit, through 2012 to create greater certainty and spur greater investment
- New consumer tax credits of up to $2,500 to purchase highly fuel efficient vehicles, to help Americans reduce their annual gas costs and reduce oil imports
- Extending and expanding the $2,500 tax credit for hybrid electric vehicles
- $500 million for R&D into new materials and other innovations to improve vehicle fuel efficiency
- $2.5 billion in R&D on next generation biofuels and infrastructure
- Tax incentives for the installation of alternative fueling stations, pipelines and other infrastructure
- Expanding transmission capacity for power from renewable sources
- New dedicated funding for the weatherization assistance program.
- Provides grants and loan guarantees for the development of coal-to-liquid fuel plants with carbon capture capability. Plants must have lifecycle greenhouse gas emissions below those of the petroleum fuels they are replacing
- Supports nuclear energy by increasing staff at the NRC, providing workforce training, accelerating depreciation for nuclear plants, and supporting R&D on spent fuel recycling to reduce nuclear waste
WASHINGTON - U.S. Senator Lindsey Graham (R-South Carolina) helped draft and signed on to a bipartisan energy proposal that enables our nation become more energy independent.
The proposal, New Energy Reform Act of 2008 from the group dubbed the 'Gang of 10', contains provisions on offshore drilling, spent nuclear fuel recycling, promotes new technologies and conservation, and requires the oil companies to pay fair market prices for oil leases and drilling rights.
"There is no greater problem facing average American's and small business today than high fuel costs and our nation's dependency on foreign oil, "said Graham. "Our proposal is not perfect, but it is a bipartisan start on the road to a comprehensive energy strategy leading our nation to independence from foreign oil. It will create new jobs from new technologies good for American wallets and our environment. I am proud to be part of this bipartisan effort to address this serious problem."
Among the major provisions of the legislation:
· Increased Off-Shore Drilling
The ban on offshore drilling in large parts of the Gulf of Mexico and Atlantic will be lifted. States would have to consent to drilling at least 50 miles off their shores.
· Recycling of Spent Nuclear Fuel
The recycling of spent nuclear fuel would reduce by 90 percent the waste to be placed in long-term storage at the proposed repository at Yucca Mountain, Nevada. Spent fuel rods would be recycled and reused as fuel in commercial nuclear power plants and would help reenergize our nuclear power industry.
· Strong Conservation and Energy Independence Measures
The proposal takes strong steps in promoting new technologies that will reduce the amount of foreign oil we consume. It expands existing incentives to purchase hybrid vehicles, facilitates the development of next-generation batteries, and includes hydrogen infrastructure tax credit to help bring this promising technology to market.
· Requires Oil Companies to Pay Fair Market Value
The proposal repeals tax breaks and incentives for oil companies. Oil companies will also be required to pay royalty payments due on existing leases where royalties were not previously charged. The inability to collect royalty payments was a result of poor drafting of leases during the Clinton Administration. The revenue would be invested in alternative fuels.
"Offshore drilling, with the consent of the states, is an integral part of any energy independence plan," said Graham. "There is no doubt we need more domestic exploration. Every barrel of oil we can find in America will be one less we have to compete with China and India for or be subject to OPEC price setting. The more domestic energy we can locate and utilize the better.
"Since the 1970s, our country has had an irrational view of nuclear power," said Graham. "This view is best demonstrated by our nation's refusal to allow recycling of spent fuel rods. For decades the French, Japanese and British have all been recycling spent fuel. Surely this is an instance were we can be as bold as the French.
"Our proposal also commits billions for research, development, and purchases of alternative fuel vehicles," said Graham. "We call for an 'Apollo Project' like effort to support the goal of transitioning 85 percent of American new motor vehicles to non-petroleum-based fuels within the next 20 years."
"Quite frankly, this particular tax incentive was never asked for by the oil companies," said Graham. "It is irrational to be allocating around $1 billion per year in tax dollars to assist in production at a time when oil is $124 per barrel and companies are recording record profits. The proposal also seeks royalty payments due on existing leases where royalties were not previously charged. The inability to collect royalties was a result of poor drafting of the leases during the Clinton Administration and could result in billions in payments being collected over the next 10 years. These revenues will be invested in alternative fuel technology.
"It is clear to the American people their Congress is broken. I appreciate the efforts of my colleagues to try to jumpstart serious discussions on how to solve America's energy crisis," said Graham. "It is my hope that this group will provide some reassurance to the American people that we still can work together and find common ground on the important problems facing every American family and business. I hope that over the congressional recess support will build for this common-sense, balanced approach to making our nation more energy independent."
The members of the 'Gang of 10' include Senators Kent Conrad (D-North Dakota), Saxby Chambliss (R-Georgia), John Thune (R-South Dakota), Johnny Isakson (R-Georgia), Bob Corker (R-Tennessee), Blanche Lincoln (D-Arkansas), Mary Landrieu (D-Louisiana), Mark Pryor (D-Arkansas), and Ben Nelson (D-Nebraska).
[source: Associated Press]