Senate Aims to Beat Holiday Hangover on Energy Policy

Energy holiday cheer resulting from the omnibus spending bill decked the halls for fossil fuel-backers and renewable supporters alike as Congress headed to its year-end break last month, but don’t expect a holiday hangover.

The Senate is primed in the new year to play catch up with the House as it tries to enact an energy policy update (S 2012) for the first time in more than a decade, although both chambers will have to adjust their vision if they want the White House on board.

“If you look at our energy bill, it really is an energy policy modernization act,” said Senate Energy and Natural Resources Chairwoman Lisa Murkowski, R-Alaska, before the break. “We basically refresh a lot of the energy policies that have not been looked at for a decade plus.”

Murkowski introduced the bipartisan legislation with the energy panel’s top Democrat, Maria Cantwell of Washington, in mid-2015.

The bill would streamline permitting for gas exports while also boosting energy-efficiency standards for commercial and federal buildings, permanently reauthorizing the Land and Water Conservation Fund and requiring infrastructure upgrades to ensure grid reliability and security.

While the bill has bipartisan backing, the recent energy bonanza in the omnibus, including the lifting of a 1970s crude oil export ban and the five year extension for wind and solar tax credits, could either decrease motivation for more floor time on energy or it could bolster momentum even further.

“I am hopeful that we will have time on the calendar, and I am going to be pushing for that,” Murkowski said.

Murkowski added that oil exports in the omnibus would not derail her bill, saying “oil exports are just one aspect of one energy source, but what we have in our bigger, broader energy bill is a focus on all forms of energy, whether it be fossil, renewable, nuclear or hydro. It is far more than just one energy source.”

But energy policy observers predict that with the small amount of floor time in 2016, getting any measure passed would take a lot of momentum.

“It’s going to be difficult to get any floor time in 2016,” said Elizabeth Gore, the energy policy director at Brownstein Hyatt Farber Schreck. “The fact that the energy [provisions] got into the omnibus should build momentum to get some of the second tier energy issues done, but it’s going to be a hill.”

Gore also pointed the presidential election and its effect on driving policy in Congress.

“So much of the Hill will be seen through the prism of presidential elections,” Gore said. “Since neither side right now is really pushing energy policy that may hamper the chance of a broad energy package from getting done.”

But election year timidity may not interfere with the bill’s progress, according to Murkowski’s spokesman.

“There’s no reason why it shouldn’t be taken up in the new year,” said spokesman Robert Dillon. “It has bipartisan support, and Murkowski is committed to it. It’s up to leadership as to when it will hit the floor.”

Senate Majority Leader Mitch McConnell has remained mum about his legislative floor schedule in 2016, outside of his commitment to return to regular order in the appropriations process.

According to McConnell spokesperson Antonia Ferrier, there have been no announcements about the legislative calendar, but “obviously energy is an important focus for us, and Chairman Murkowski and her committee have been working very hard.”

Because of the bipartisan nature of the bill, there is less urgency to be done with it before Congress becomes distracted by election-year demands, so it could slide toward the end of the year, Dillon said.

One previously controversial measure that won’t stop the energy package is lifting the ban on crude oil exports, which was included in the fiscal 2016 appropriation omnibus bill.

Democrats had long-opposed lifting the ban, but Republicans were able to negotiate an exchange of five-year tax credit extensions for wind and solar, the removal of policy riders that sought to derail President Barack Obama’s environmental agenda, and the three year reauthorization of the Land and Water Conservation Fund for oil exports.

In light of lifting the oil export ban, the American Petroleum Institute suggested Tuesday that Congress reconsider some of the infrastructure portions of the bill, to support the expansion of pipelines to ports and expedite permitting of LNG terminals, to better reflect the global oil opportunities.

“We think you always have to reassess where the infrastructure opportunities are in the United States, not only for the domestic market, but now for the global market,” said Jack Gerard, API president and CEO.

The House’s broad energy bill (HR 8), introduced by House Energy and Commerce Chairman Fred Upton, R-Mich., passed in early December, mainly along party lines, setting the stage for the Senate to pass a companion package.

The House version went heavy on preserving a role for fossil fuels, including measures that would streamline the export of liquefied natural gas, expedite gas pipeline permits and direct federal agencies to better coordinate on grid reliability issues and to incorporate smart grid and efficiency technologies into the overall electricity infrastructure.

“A decade ago no one could have imagined where we would be in 2015 and how much the energy script would be flipped in our favor,” Upton said when the bill was on the House floor. “But now that we are here it is time to bring our energy policy in line with the new realities. It’s time we put the scarcity mindset in the rear view mirror and say yes to energy and yes to jobs.”

The House’s bill had originally moved with bipartisan support, but Republican-backed language added to the bill in committee resulted in the collapse of Democratic support in the Dec. 3, 2015, vote, when only nine members of the minority backed it.

The Senate, however, still maintains the bipartisan support for its bill.

Murkowski made sure the committee markup last July avoided controversial amendments, but such measures could still turn it into something that the president would oppose.

The White House has already issued a veto threat against the House version of the bill, arguing it would undermine the Obama administration’s commitment to low-carbon energy.

“The Administration is committed to taking responsible steps to modernize the Nation’s energy infrastructure in a way that addresses climate change, promotes clean energy and energy efficiency, drives innovation, and ensures a cleaner, more stable environment for future generations,” according to the statement of administration policy in HR 8. “The Administration strongly opposes H.R. 8 because it would undermine already successful initiatives designed to modernize the Nation’s energy infrastructure and increase our energy efficiency.”