DEMS ENERGY BILL IS ESSENTIAL FIRST STEP TOWARD ENERGY INDEPENDENCE

Washington, DC - Representative Edward J. Markey (D-MA), a senior Democratic member of both the House Resources and Energy and Commerce Committees, today issued the following statement regarding introduction of the “Creating Long-Term Energy Alternatives for the Nation” (CLEAN Act).  Rep. Markey is the primary author of a number of these provisions to roll back royalty relief for oil and gas companies, collect unpaid royalties on faulty 98-99 leases, and create and alternative energy fund.

“The bill that we are introducing is the first step in charting a new direction for the nation’s energy policy.  It repeals wasteful tax breaks and royalty-free drilling rights for the oil and gas companies, and designates those revenues for investment in clean renewable energy sources, clean alternative fuels, and energy efficiency and conservation,” Markey stated.

This bill contains a section based on Markey’s “Royalty Relief for American Consumers Act” (H.R. 4749) from the last Congress, as well as last year’s successful floor amendment to the Interior Appropriations cosponsored by Representative Hinchey (D-NY), which would fix the problem of the 1998-1999 oil and gas leases that failed to contain provisions suspending royalty relief in times of high market prices.  Under the bill, oil companies would either have to renegotiate those leases; be ineligible to bid on new leases; or pay a conservation of resources fee.

The Clean Act also contains provisions derived from two amendments Markey offered during the 2005 energy conference to suspend all of the new royalty relief proposed for the oil and gas companies. 

These provisions would repeal:
    - Royalty relief for the oil companies to drill from deep wells in shallow water
    - An expansion of deep water royalty relief
    - Royalty relief for Alaska offshore areas
    - Royalty relief for the National Petroleum Reserve in Alaska. 
 
Markey continued, “At today’s high energy prices, there is no justification for expansion of expanding royalty relief giveaways because the market provides sufficient incentives for the oil and gas companies to drill in each of these areas.  The CLEAN Act also repeals a ban -- which I fought during the 2005 energy conference -- that prevents implementation of a Bush Administration proposal to require cost recovery fees to be applied to oil company drilling permit applications.  The bill also repeals two special tax breaks for the oil and gas companies, one which expanded the tax break for expensing of geological and geophysical expenses, and another which allowed the oil companies to exploit a tax break intended for domestic manufacturing activities.”

"The roughly $13 billion derived from these reforms will be used to create a Strategic Energy Efficiency and Renewables Reserve that will to be used accelerate the use of clean domestic renewable energy and clean alternative fuels resources; to promote the utilization of energy-efficient products and practices; and to increase research, development, and deployment of renewable energy and energy efficiency technologies.  This will help ensure that America deploys clean solar and wind energy sources, makes the investments needed to enable use of celluosic ethanol fuels, and makes the energy efficiency improvements needed to reduce our nation’s consumption of electricity and fossil fuels.  America’s genius is as an innovator, and if we invest in new energy generation technologies, clean alternative fuels, and energy efficiency, we can dramatically reduce our reliance on imported oil from the Middle East, curb the carbon emissions that contribute to global warming, and grow our economy at the same time.”

“Next Thursday, the House will debate this legislation, and, I predict, will pass it.  I appreciate the leadership shown by Speaker Pelosi, Chairman Rahall, Chairman Rangel, and Chairman Dingell putting together this bill, and I look forward to next week’s floor debate,” Markey concluded.

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