House Votes to Repeal Big Oil Giveaways

House Votes to Repeal Big Oil Giveaways

House Democrats completed their agenda for the first 100 legislative hours of the new Congress by passing the CLEAN Energy Act (H.R. 6). Approved by a margin of 264 to 163 with the help of 36 Republicans, the measure would provide $14 billion for the development of renewable energy, alternative fuels and energy efficiency technologies. The money will be provided by repealing $7.6 billion dollars in tax breaks for oil drillers and collecting $6.3 billion in royalties from companies extracting oil and gas from publicly owned waters in the Gulf of Mexico and off the coast of Alaska.

The CLEAN Energy Act corrects errors in drilling leases signed in 1998 and 1999, which the Government Accountability Office estimates have cost the Treasury $1 billion already, and could cost as much as $10 billion if the Senate fails to approve the bill and the leases remain unchanged. H.R. 6 also requires companies to pay a “conservation fee” of $9 per barrel for oil and $1.25 per million Btu for natural gas when prices exceed a certain threshold. Companies that fail to renegotiate existing leases that do not include this price threshold will be ineligible for any future federal leases.

Section 301 of the CLEAN Energy Act directs the revenue and budgetary savings from the legislation into an account known as the Strategic Energy Efficiency and Renewables Reserve. The money put into this reserve will be used to: 1) accelerate the use of clean domestic renewable energy resources and alternative fuels; 2) promote the use of energy-efficiency produces and practices and conservation; and 3) increase research, development and deployment of clean renewable energy and energy efficiency technologies.

While the bill passed easily in the House, the Senate must also pass the measure for the president’s final signature. A number of Senate Democratic leaders have signaled their approval of the bill, with Senate Energy and Natural Resources Chairman Bingaman asking for the House bill to be placed directly on the Senate calendar. Leaders in the House have made good on their campaign promise to move America toward a clean energy future, now it’s time for leaders in the Senate to do the same. PSR will be calling on all Senators to support the CLEAN Energy Act when it is introduced in the Senate and we encourage PSR members to let the Senate and the White House know of your support.