**[HIGHLIGHTS OF THE BIPARTISAN ENERGY BILL]{.underline}**

The bipartisan Senate energy bill contains the following key provisions
to increase production, increase conservation, diversify fuel supply and
employ new technologies:

> **Ethanol**
>
> **Creates an ethanol mandate requiring fuel manufacturers to use 7.5
> billion gallons of ethanol in gasoline by 2012 -- a move that will
> reduce oil consumption by 80,000 barrels of oil a day by 2012,
> according to Energy Information Administration.**

-   The Farm Bureau estimates that the ethanol provisions

    -   Reduces crude oil imports by 2 billion barrels and reduce the
        outflow of dollars largely to foreign oil producers by \$64
        billion;

    -   Creates 234,840 new jobs in all sectors of the U.S. economy;

    -   Increases U.S. household income by \$43 billion;

    -   Adds \$200 billion to GDP between 2005-2012;

    -   Creates \$6 billion in new investment in renewable fuel
        production facilities; and

    -   Results in the spending of \$70 billion on goods and services
        required to produce 7.5 billion gallons of ethanol and biodiesel
        by 2012.

**Efficiency and Conservation in Home and Commercial Businesses:**

> **Creates ambitious efficiency and conservation program that sets
> first-time efficiency standards for 14 large appliances and raises the
> efficiency standards for others. Provides a total of \$2.7 billion in
> tax incentives to encourage efficiency and conservation.**

-   These provisions will shave between 10 and 40 percent off the
    anticipated growth of energy demand by 2015. The American Council
    for an Energy Efficient Economy reports that these provisions will
    save 50,000 MW of peak electricity demand by 2020. That's the
    equivalent of 170 300-MW power plants.

-   Efficiency and conservation tax credits encourage the construction
    of energy-efficient offices and homes, the purchase of energy
    efficient heating and cooling systems and appliances.

-   Expands an existing business solar investment tax credit from the
    current 10 percent to 30 percent for the purchase of solar
    equipment.

-   A tax deduction equaling the cost of energy efficient equipment
    installed if the equipment reduces the energy and power consumption
    of a commercial building by 50 percent.

-   Tax credits for the contractors of new energy efficient homes if the
    homes achieve an energy savings of 50 percent or more over the 2003
    International Energy Conservation Code.

-   Tax credits for the purchase of water heaters, heat pumps, air
    conditioners, furnaces and other equipment that achieve certain
    efficiency levels when purchased for residential properties.

-   A new tax credit for manufacturers who produce highly
    energy-efficient dishwashers, clothes washers and refrigerators.

-   30 percent tax credit for the purchase of solar, photovoltaic and
    fuel cell properties for use in residences

**Efficiency and Conservation in Government Buildings**

-   The energy bill also provides long-term authorization of Energy
    Savings Performance Contracts, a program which provides incentives
    for energy-saving improvements in federal buildings.

-   The energy bill helps state governments save energy, too, by
    authorizing grants to states with up-to-date building codes to
    increase compliance with those codes.

**Fuel Efficiency**

-   Offers business and consumers tax credits for the purchase of
    alternative-fuel and hybrid vehicles. The value of the tax credit
    ranges from \$2,000 for smaller, personal cars to \$40,000 for the
    purchase of buses, etc. This conservation incentive alone totals
    \$874 million.

-   Provides a 30 percent credit (up to \$30,000) for investments in
    alternative fuel refueling stations. Qualifying fuels include E-85,
    natural gas, hydrogen, and biodiesel, among others. The credit
    expires after December 31, 2007.

-   Instructions to NHTSA to look for ways to improve Corporate
    Automobile Fuel Efficiency standards while taking into consideration
    the impact on automobile safety, jobs and the economy.

-   Tougher requirements for federal alternative fuel fleets to ensure
    these vehicles actually use clean alternative fuels.

-   Creates the joint flexible fuel hybrid vehicle commercialization
    initiative to improve technologies for the commercialization of
    hybrid/flexible fuel vehicles. The program is intended to reduce
    petroleum consumption by bringing new clean technologies to the
    market faster.

-   Creates new programs to create railroad efficiency, aviation fuel
    conservation and emission reductions, reduce heavy engine idling
    times to reduce fuel consumption and pollution and to promote
    ultra-efficient energy technology for air crafts.

-   Gives NHTSA more money to promote implementation and enforcement of
    fuel economy standards.

**Renewable Energy**

-   Provides \$2.7 billion in production tax credits to encourage the
    production of clean renewable energies for wind, closed-loop
    biomass, open-loop biomass, geothermal, small irrigation power,
    landfill gas, and trash combustion.

-   Expands the production tax credit to incremental hydropower. In
    addition, allows pass through of the credit to members of a
    cooperative.

-   Authorizes the issuance of \$800 million of tax-credit bonds before
    December 31, 2007 to support renewable investment by municipal power
    authorities, rural cooperatives and others.

**Hydropower**

**Improves regulation on hydroelectric dams to allow for more
hydroelectric power generation while preserving existing protections for
fish and the environment.**

-   Hydroelectric dams are the nation's largest renewable energy source
    and account for 7 percent of America's electricity supply.

-   Nearly half of America's non-federal dams need to be relicensed by
    2020 -- the provisions in the energy bill pave the way for that
    relicensing in a way that protects the environment and allows for
    input from the public and special interest groups.

**Electricity Modernization and Reliability**

> **Includes provisions to encourage the expansion and modernization of
> the electricity grid as well as new mandatory reliability rules
> designed to prevent future blackouts.**
>
> **Protects consumers by preventing the manipulation of gas and
> electricity prices and increasing the penalties for violating federal
> prohibitions against these crimes.**

-   The bill authorizes FERC to proscribe rules necessary to protect
    price transparency. FERC can establish an electronic reporting
    system if existing price reporting is not adequate.

```{=html}
<!-- -->
```
-   It includes an explicit prohibition on filing false information and
    a tougher ban on general manipulation as well as increased penalties
    for violating the Federal Power Act.

-   Protection for utility consumers in the Enron bankruptcy from unfair
    contract termination fees by authorizing FERC to determine those
    fees.

**Hydrogen**

**The Senate Energy bill authorizes \$3.7 billion over 5 years for
hydrogen and fuel-cell research as well as infrastructure to support
hydrogen-powered cars. If just 20 percent of cars used fuel cell
technology, we could cut oil imports by 1.5 million barrels every day,
according to the U.S. Fuel Cell Council.**

-   The bill creates a hydrogen research program in conjunction with
    federal labs, universities and auto manufacturers to design hydrogen
    cars.

-   It authorizes the construction of nuclear reactor at the DOE Idaho
    National Laboratory which will generate both electricity and
    hydrogen which could be used as fuel in the hydrogen economy.
    Building a first-of-its-kind nuclear reactor to co-generate hydrogen
    will create 3,000 construction jobs and 500 long-term, high-paying,
    high-tech jobs. (Nuclear Energy Institute)

-   Hydrogen-powered cars reduce our reliance on foreign oil and protect
    our environment. With hydrogen fuel, a zero-emission car is
    possible. Safe and affordable hydrogen-powered fuel-cell vehicles
    would emit water vapor instead of exhaust fumes.

-   Two years ago, the President launched his Hydrogen Fuel Initiative
    to develop the technology to produce, store, and distribute hydrogen
    for use in fuel-cell vehicles. Hydrogen can be produced from
    domestic fossil, nuclear, or renewable resources.

-   The authorization in the energy bill will add to the \$440 million
    already spent on federal research. This investment is helping to
    move hydrogen fuel-cell cars from the laboratory to the showroom.
    Provisions in the energy bill will help overcome critical technology
    barriers in the production, transportation, storage, and use of
    hydrogen.

-   Some barriers are already being overcome. While gasoline prices
    climb, hydrogen fuel is becoming more affordable. New technologies
    have driven the cost of natural gas-based hydrogen down from \$5.00
    per gallon in 2003 to \$3.60 today.

-   The movement toward a hydrogen economy is gaining momentum in the
    United States. Five major energy companies have joined as partners
    in the President's FreedomCAR and Hydrogen Fuel Initiatives. In
    addition, over 70 projects at universities and federal laboratories
    have been selected to conduct basic research in support of the
    hydrogen economy.

-   The United States has also organized support from around the world
    for hydrogen technology. Sixteen nations and the European Commission
    have joined the U.S.-initiated International Partnership for The
    Hydrogen Economy, an international effort to collaborate on hydrogen
    research and establish global codes and standards necessary for all
    countries to realize competitively priced hydrogen vehicles and
    fueling infrastructure by 2020.

-   The United States currently produces about 9 megatons of hydrogen
    per year, almost all of it by reforming natural gas. The Department
    of Energy estimates that by 2040 cars and light trucks powered by
    fuel cells will require about 150 megatons per year of hydrogen.

-   The higher efficiency of fuel cells would dramatically improve the
    efficiency of future energy use. Today's fuel cells achieve
    efficiencies of 60 percent compared to 22 percent for gasoline
    engines and 45 percent for diesel engines.

-   Unlike electricity, which must be produced and used at the same
    rate, stored hydrogen can be stockpiled for much later use. Fuel
    cells can also supplement the conventional electric grid during
    periods of peak consumption. This approach could lead to lower
    electricity costs and a more reliable grid.

**Climate Change**

-   The bill creates a Climate Technology program that directs the
    Secretary of Energy to lead an inter-agency process to develop and
    implement a national climate technology strategy.

-   It also establishes an executive branch Climate Coordinating
    Committee and Climate Credit Board to assess, approve and fund these
    projects.

-   Using greenhouse gas intensity as a measure of success, the bill
    creates incentives for innovative technologies and encourages
    partnership with other developing nations.

**Nuclear Power**

> **Nuclear energy is the world\'s largest source of emission-free
> energy. Nuclear power plants produce no controlled air pollutants,
> such as sulfur and particulates, or greenhouse gases. The use of
> nuclear energy in place of other energy sources helps to keep the air
> clean, preserve the Earth\'s climate, avoid ground-level ozone
> formation and prevent acid rain.**

-   The bill has several provisions to ensure that nuclear energy
    remains a major component of the Nation's energy supply. Nuclear
    power currently provides 20 percent of America's electricity. It is
    our cheapest form of electricity, second only to hydropower. It one
    of our safest, most reliable and cleanest energies.

-   The energy bill offers a 1.8 cent per kilowatt hour production tax
    credit for electricity produced by new nuclear power. This applies
    only to the first half dozen advanced nuclear power plants.

-   It offers federal loan guarantees for innovative technologies --
    including new advanced nuclear reactors -- that will diversify and
    increase energy supply while protecting the environment. These
    guarantees are available only for new technologies that provide
    clean energy and protect the environment. Those seeking guarantees
    pay into the U.S. Treasury a sum equal to the financial risk
    assessed by the CBO, thus not costing taxpayers a dime.

-   Establishes standby support framework through the DOE for new
    nuclear plant construction against regulatory or judicial delays for
    six reactors. This standby support would cover the delay before
    plant is put into operation.

-   Extends Price Anderson liability protection is extended through 2025
    for both NRC licensees and DOE contractors.

-   Creates a stand-by support program to ensure that consumers do not
    have to pay higher electricity bills because of unforeseen delays in
    the construction of new nuclear power plants due to bureaucratic red
    tape or litigation. The program insures the utilities for the cost
    of these delays.

-   Provides for the export of high enriched uranium to Canada, Belgium,
    France, Germany or the Netherlands for the sole purpose of producing
    diagnostic and life saving medical isotopes until a low enriched
    uranium alternative is commercially viable and available.

-   Requires the DOE to propose a permanent disposal facility to
    Congress for Greater Than Class C waste within one-year of
    enactment.

-   Strengthens security of nuclear facilities, including improved
    federal oversight of plant security and the expansion of federal
    statutes for sabotage of nuclear facilities.

**Coal**

**Coal is one of America's most abundant resources. It accounts for more
than half of our electricity and we have enough of it to last nearly
three centuries.**

-   The energy bill creates a strong federal program to design and
    deploy clean coal technologies so America can use this vital
    resource while protecting our air and water.

```{=html}
<!-- -->
```
-   The clean coal program will help protect vital jobs in America's
    coal states. It will help create 62,000 jobs, according to the Coal
    Utilization Research Council.

-   The program ensures Americans new electricity that is abundant,
    reliable, affordable and cleaner than ever before.

-   The bill includes tax incentives to encourage the construction of
    clean coal facilities, including a new 20 percent investment tax
    credit for clean coal facilities and a new 20 percent investment tax
    credit for coal gasification units that produce fuels and
    chemicals. 

**Oil and Gas**

**In the last three years, crude oil prices have gone up 171 percent,
according to NYMEX. Gasoline prices have climbed 36 percent and diesel
prices are up 55 percent, according to AAA. A prosperous economy and
strong job sector requires affordable oil and gas. Strong domestic
production of these energies is critical to keeping energy affordable.**

-   The energy bill includes provisions to streamline oil and gas
    development on existing federal lease sites to bring the fuels to
    market sooner.

-   The bill permanently authorizes the Strategic Petroleum Reserve and
    authorizes the DOE Secretary to fill the reserve to 1 billion
    barrels.

-   Calls for a DOI inventory of oil and gas resources on the Outer
    Continental Shelf to enable to the federal government to better
    assess the extent of these resources.

-   Facilitates the construction of needed gas infrastructure by
    improving and streamlining the process to permit pipeline
    infrastructure with FERC as the lead agency and with a consolidated
    record

-   Provides coastal impact assistance of \$1 billion over four years to
    energy-producing states to encourage ongoing production by assisting
    in coastal enhancement and conservation programs.

-   Ensures an adequate supply of natural gas in the coming years,
    including clarification of FERC's exclusive authority to site LNG
    facilities. The bill further ensures supply by creating a clear
    process for siting natural gas infrastructure such as pipelines and
    storage.

**Indian Energy**

**Millions of acres of tribal lands are rich in diverse energy
resources, including wind, hydropower, geothermal, solar, oil, gas and
coal energies. The energy bill creates a legislative framework to help
Indian tribes develop those resources in environmentally friendly ways
without unnecessary bureaucratic red tape. This empowers tribes to
provide more energy resources to homes and business in Indian land,
contribute energy to regional energy markets and create new jobs.**

-   The bill allows Indian tribes to propose to the Department of
    Interior Tribal Energy Resources Development Plans for the
    development of the tribe's energy resources. Once DOI approves the
    plan, the Tribes can enter into leases and business agreements with
    private companies for the development of their energy resources
    within that plan.

```{=html}
<!-- -->
```
-   Creates in the Department of Energy the Office of Indian Energy
    Policy and Programs to assist Indian tribes in developing their
    tribal energy resources.

-   Provides grants, low-interest loans and loan guarantees to tribes to
    promote energy resource development. Authorizes \$20 million
    annually for this program.

```{=html}
<!-- -->
```
-   Requires complete compliance with existing state and federal
    environmental laws.

**Geothermal**

**Geothermal energy is an abundant energy in various parts of the
country that is under-utilized. Geothermal energy is clean, renewable
and, in countries like Iceland, is a primary source of energy.**

-   The energy bill creates a competitive geothermal leasing program
    that allows the private sector -- not just government geologists --
    to identify geothermal areas for leasing. The program is intended to
    bring geothermal energy to the market sooner.

-   The bill also includes incentives to counties to encourage
    geothermal development by allowing them to keep a percentage of the
    royalties from that development.

**Oil Shale and Tar Sands**

**The U.S. Geological Survey estimates the United States has 2 trillion
barrels of oil locked in oil shale, primarily in western states. The
country has an additional 80 billion barrels of oil in tar sands.**

-   The energy bill establishes of a task force to make recommendations
    on a national oil shale and tar sands leasing program.

-   The bill creates an oil shale R&D program.

-   The bill also directs the DOI Secretary to conduct a commercial
    lease sale for oil shale in states where the Secretary finds support
    and interest for doing so.