Energy Policy Act of 2005

On August 8th, 2005, President Bush signed the Energy Policy Act of 2005 into law.

After five years, the U.S. Congress crafted an energy bill that fails to reduce America’s dependence on oil, fails to address the threat of global warming, fails to make any new investments in clean energy, and by the President’s own admission, fails to help consumers at the gas pump. When it comes to solving America’s pressing energy problems, this bill can only be classified as a miserable failure. Instead of moving toward a new energy future, the energy bill provides tens of billions of dollars to the oil, gas, coal and nuclear industries, significantly weakens environmental protections such as the Clean Water Act and Safe Drinking Water Act, and undermines numerous consumer protections. This energy bill doesn’t meet America’s 21st century needs.

Background

Listed below are several of the many terrible provisions in the final energy bill.

1. Threatens drinking water by amending the Safe Drinking Water Act to allow the unregulated underground injection of chemicals during oil and gas development and during geothermal energy development. [Section 322]

2. Grants the oil and gas industries an exemption for their construction activities from compliance with Clean Water Act provisions that require all types of construction activities to reduce polluted runoff from these sites. [Sec. 323]

3. Provides billions of dollars in subsidies to the nuclear industry, including $2 billion risk insurance program for up to six new reactors that was not included in either the House or Senate passed energy bills. [Nuclear title; risk insurance was added as an amendment in conference]

4. Includes dangerous provisions to allow harmful underwater oil and gas exploration that could pave the way for offshore drilling along America’s coastlines. [Sec. 357]

5. Repeals the Public Utility Holding Company Act, the main law to protect consumers from market manipulation, fraud, and abuse in the electricity sector.[Sec. 1263]

6. Provides a first-ever $6 billion tax credit to the nuclear power industry [Tax Title]

7. Provides nearly $3 billion in tax credits to the coal industry, including the first-ever investment tax credit for building new coal plants. [Tax Title]

8. Provides $1.7 billion in tax breaks to the oil and gas industry, including a provision that would enable them to write-off certain exploration costs. [Tax Title]

9. Seeks to significantly increase the ability to categorically exclude a broad range of oil and gas exploration and drilling activities from public involvement and impact analysis under the National Environmental Policy Act [Sec. 389].

10. Pre-empts state authority in the siting and construction of liquefied natural gas (LNG) facilities, which are potentially dangerous facilities that will contain large amount of gas. [Sec. 311] 

11. Increases air pollution and global warming with more than $6 billion in new incentives to burn coal for electricity. [Coal and R&D titles]

12. Provides federal loan guarantees to build at least 16 new coal-fired power plants [Coal Title and Incentives Title]

13. Provides incentives to cut down trees, including those in sensitive areas such as roadless areas, to use in ethanol and motor fuels production [Sec. 1513]

14. Increases America's oil dependence by 130,000 barrels of oil per day in 2014 through extending the 'dual-fuel' loophole. [Title VII, Sec. 772]

15. Promotes nuclear proliferation by reversing long-standing U.S. nuclear policy against reprocessing waste from commercial nuclear reactors, and using plutonium to generate commercial energy. [Sec. 953]

16. Allows the producers and distributors of the likely carcinogenic gasoline additive MTBE to remove MTBE claims from state court to federal court, even when the claims are based on state tort law, nuisance law, or consumer law. This could unfairly deprive injured parties and their representatives (water utilities, states AGs, etc) of their right to have their claims heard in their state forum and could derail many legal claims, effectively shielding those companies responsible for MTBE contamination from their full financial liability for the damages they have caused. [Sec. 1503]

17. Tramples on states’ abilities to protect their coasts from harmful oil and gas exploration by weakening their voice about federal projects that affect their coasts. [Section 381]

18. Pre-empts states’ rights by providing federal siting authority for transmission lines. [Section 1221]

19. Extends the Price Anderson Act for 20 years which limits the nuclear industry’s liability in case of an accident [Nuclear Title]

20. Allows oil industry to forgo royalty payments to the federal Treasury for oil drilled areas off Alaska’s coastline [Section 346]

21. Provides $250,000 to develop technologies to use radioactivity to refine oil [Hall Amendment added in conference]

22. Weakens states rights under the Clean Water Act and the Clean Air Act in the permitting of liquefied natural gas (LNG) facilities and natural gas pipelines [Hall Amendment added in conference]

23. Authorizes up to $1.5 billion in new subsidies to the oil industry for ultra-deep oil drilling and exploration, [Hall amendment added in conference]

24. Threatens wildlife and subsistence values of the 23 million-acre National Petroleum Reserve-Alaska by literally giving away oil leases on Alaska's North Slope, while at the same time handing oil companies a free pass to sit on the leases for decades without contributing anything to America's energy needs. [Sec. 347]

25. Mandates the rapid development of a commercial oil shale/tar sands leasing program. Directs the Department of Interior to identify and prioritize for land exchange federal lands for transfer to corporations for oil shale development. [Sec. 369]

Recommendations for the Future

[Recommendations for the Future are courtesy of Sierra Club, and can be found online at www.sierraclub.org/ globalwarming/bush_plan/.]

If we make the right energy choices today, Americans can have cleaner air, less global warming pollution, vibrant public lands and reasonably priced power far into the future. Unfortunately, President Bush's energy plan will not accomplish these goals. His plan focuses on the wrong choices - to produce more coal, oil, gas and nuclear power - with insufficient emphasis on energy efficiency and cleaner alternatives.

We need an honest, balanced energy plan that gives us quicker, cleaner, cheaper and safer energy solutions. We can have clean energy and a healthy environment.

Quicker - Increasing energy efficiency technology and fuel efficiency will decrease our energy use and help relieve summer shortages immediately. In addition, wind turbines can be installed in six months and new, combined-cycle natural gas plants can begin saving energy and reducing pollution from old, dirty and inefficient plants by next year.

Cleaner - By choosing energy options such as solar, wind and energyefficient technologies, we can protect our clean air, clean water and climate.

Cheaper - Not only do we save energy by using more efficient appliances and technologies, such as compact fluorescent lightbulbs, but we save billions of dollars, too. Raising fuel economy standards for cars, SUVs and other light trucks will save consumers $45 billion a year at the gas pump.

Safer - An energy plan that provides a strong balance of efficiency, renewable energy and cleaner natural gas production is safer for our public health and environment.

The full text of the Energy Policy Act of 2005 is available online at:

http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=109_cong_bills &docid=f:h6enr.txt.pdf

Note: Material in this factsheet was excerpted from a national energy conservation coalition (including the League of Conservation Voters) letter sent to Capitol Hill on July 27, 2005.