74–354

107TH CONGRESS REPT. 107–162 " ! HOUSE OF REPRESENTATIVES 1st Session Part 2

ENERGY ADVANCEMENT AND CONSERVATION ACT OF 2001

AUGUST 1, 2001.—Ordered to be printed

Mr. TAUZIN, from the Committee on Energy and Commerce,

submitted the following

SUPPLEMENTAL REPORT

[To accompany H.R. 2587]

This supplemental report shows the cost estimate of the Congressional Budget Office with respect to the bill (H.R. 2587), as reported, which was not included in part 1 of the report submitted

by the Committee on Energy and Commerce on July 25, 2001 (H.

Rept. 107–162, pt. 1).

This supplemental report is submitted in accordance with clause

3(a)(2) of rule XIII of the Rules of the House of Representatives.

CONTENTS

Page

Committee Cost Estimate ....................................................................................... 1

Congressional Budget Office Estimate ................................................................... 1

Federal Mandates Statement ................................................................................. 12

Exchange of Committee Correspondence ............................................................... 12

COMMITTEE COST ESTIMATE

The Committee adopts as its own the cost estimate prepared by

the Director of the Congressional Budget Office pursuant to section

402 of the Congressional Budget Act of 1974.

CONGRESSIONAL BUDGET OFFICE ESTIMATE

Pursuant to clause 3(c)(3) of rule XIII of the Rules of the House

of Representatives, the following is the cost estimate provided by

the Congressional Budget Office pursuant to section 402 of the

Congressional Budget Act of 1974:

H.R. 2587—Energy Advancement and Conservation Act of 2001

Summary: H.R. 2587 would authorize funding for several programs aimed at energy production, conservation, and research and

development. It also would authorize new tax credits for certain

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electric power plant operators, and would result in additional direct

spending for assistance to rural electric cooperatives, work at uranium enrichment facilities, and new authority under energy savings performance contracts. CBO estimates that enacting H.R.

2587 would increase direct spending by $3.5 billion over the 2002– 2011 period. The Joint Committee on Taxation (JCT) estimates

that enacting the bill would reduce revenues by $31.1 billion over

the 2002–2011 period. Because the bill would affect direct spending

and receipts, pay-as-you-go procedures would apply. CBO also estimates that implementing H.R. 2587 would cost $15.8 billion over

the 2002–2006 period, assuming appropriation of the necessary

amounts.

The bill would require that the receipts and disbursements of the

Nuclear Waste Fund not be counted as new budget authority, outlays, or receipts in the President’s budget request, the Congressional budget, or for purposes of estimates made under the Balanced Budget and Emergency Deficit Control Act. By moving the

receipts and expenditures of the Nuclear Waste Fund off-budget,

the bill would not directly change the federal budgetary impact of

the program, but that treatment could result in increased spending

on the nuclear waste program by exempting such spending from

budgetary controls. Under the bill, future spending for this program would remain subject to appropriation.

H.R. 2587 contains no intergovernmental mandates as defined in

the Unfunded Mandates Reform Act (UMRA). State, local and tribal governments would benefit from enactment of this legislation

and any costs they incur would result from complying with conditions of aid.

H.R. 2587 would impose private-sector mandates as defined by

the Unfunded Mandates Reform Act by requiring certain manufacturers and importers to comply with new energy efficiency standards. Because those new requirements would depend on specific

standards that would be established by the Secretary of Energy,

CBO cannot determine whether the direct cost to the private sector

would exceed the annual threshold established in UMRA ($13 million in 2001, adjusted annually for inflation) in any of the first five

years that the mandates are in effect.

Major provisions: Title I would authorize funds to be appropriated for several energy conservation programs, including the

low-income home energy assistance program (LIHEAP), and weatherization and state energy grants program. It also would require

federal agencies to meet certain energy efficiency standards and

would expand the federal government’s use of energy savings performance contracts (ESPCs). Further, the title would establish new

energy efficiency standards for small household appliances and encourage the use of energy efficient vehicles.

Title II would require the Department of Transportation to

amend its regulations on mileage standards to reduce the amount

of gasoline used in motor vehicles. It also would extend the requirement for the Environmental Protection Agency (EPA) to calculate

the fuel economy of motor vehicles through 2008. In addition, it

would require fleets of vehicles operated by federal agencies to

meet certain fuel efficiency standards.

Title III would change the budgetary status of the Nuclear Waste

Fund, moving it from the on-budget category to the off-budget catVerDate 11-MAY-2000 03:53 Aug 07, 2001 Jkt 074354 PO 00000 Frm 00002 Fmt 6659 Sfmt 6602 E:\HR\OC\HR162P2.XXX pfrm07 PsN: HR162P2
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egory. It also would authorize the Nuclear Regulatory Commission

to charge federal agencies for licensing and certificate fees. In addition, title III would authorize the Department of Energy (DOE) to

spend an estimated $595 million over the 2002–2006 period, without further appropriation, for activities related to uranium enrichment facilities and enrichment technology. The bill also would repeal a requirement in current law for DOE to sell certain quantities of uranium by 2003 and would prohibit DOE from selling this

material before 2009.

Title V would establish four new tax credits for firms that use

certain clean coal technologies to generate electricity. This title also

would allow the Tennessee Valley Authority (TVA) and rural electric cooperatives to use amounts equivalent to these credits, to reduce other payments owed to the Treasury. If the credit-equivalent

amounts exceed the amounts payable to the Treasury in a given

year, TVA could apply the balance to offset payments due in future

years.

Title VI would authorize appropriations from the Leaking Underground Storage Trust Fund (LUST) for clean-up activities associated with methyl tertiary butyl ether (MTBE) contamination.

Title VII would reauthorize the Renewable Energy Production Incentive program for an additional 10 years, and make Indian tribes

eligible for payments under the program. Title VIII would require

several agencies to act to improve pipeline safety. Last, title IX

would require studies on the energy dependence of the United

States, and on aircraft emissions.

Estimated cost to the Federal Government: The estimated budgetary impact of H.R. 2587 is shown in the following table. The costs

of this legislation fall within budget function 270 (energy), 300

(natural resources and environment, 400 (transportation), 600 (income security), and 800 (general government).

By fiscal year, in millions of dollars—

2001 2002 2003 2004 2005 2006

CHANGES IN DIRECT SPENDING

Estimated budget authority ......................................... 0 1,270 219 206 289 237

Estimated outlays ......................................................... 0 1,043 246 194 264 275

CHANGES IN REVENUES

Title V tax credits: Estimated revenues 1 .................... 0 ¥222 ¥1,396 ¥3,079 ¥3,838 ¥4,076

SPENDING SUBJECT TO APPROPRIATION

Spending under current law:

Estimated authorization level 2 ........................... 3,040 2,650 2,650 2,650 0 0

Estimated outlays ................................................ 3,166 3,008 2,636 2,501 731 76

Proposed changes:

Specified authorization level ............................... 0 2,892 3,046 3,171 5,901 1,276

Estimated outlays ................................................ 0 1,419 2,555 2,938 4,817 2,666

Estimated authorization level ............................. 0 453 413 424 127 129

Estimated outlays ................................................ 0 165 349 403 358 173

Spending under H.R. 2587:

Estimated authorization level ............................. 3,040 5,995 6,109 6,245 6,028 1,405

Estimated outlays ................................................ 3,166 4,592 5,540 5,842 5,906 2,915

1 Estimate provided by JCT.

2 The 2001 level is the amount appropriated for that year affected energy programs. The amounts authorized under current law over the

2002–2004 period are for LIHEAP.

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Basis of estimate

For the purposes of this estimate, CBO assumes that H.R. 2587

will be enacted near the beginning of fiscal year 2002. Significant

components of the estimated costs are described below.

Direct spending

H.R. 2587 has several provisions that would affect direct spending. CBO estimates that enacting these provisions would result in

an increase in direct spending of $2 billion over the 2002–2006 pe- riod, and an increase of $3.5 billion over the 2002–2011 period.

Nuclear Energy.—Subtitle B of title III would allow DOE to

spend funds without further appropriation on activities related to

uranium enrichment technology and would repeal existing requirements to sell certain uranium products. CBO estimates that these

provisions would increase direct spending by a total of $696 million

over the 2002–2011 period. This estimate reflects the amount specified in the bill for each of the fiscal years 2002 through 2006 for

developing advanced centrifuge technologies (a total of $254 million

over the five years) and for putting the gaseous diffusion plant in

Portsmouth, Ohio, in cold-standby status (a total of $169 million

over that period). For this estimate, CBO assumes that the additional $169 million specified for activities at the gaseous diffusion

plant in Paducah, Kentucky, would be available in 2002 and would

be spent over several years. The bill also would provide direct

spending authority for studies related to these projects, which CBO

estimates would cost about $3 million. Finally, we estimate that

provisions repealing the existing requirement to sell uranium products would reduce offsetting receipts by $101 million in 2003.

Expanded Use of Energy Savings Performance Contracts.—Currently, federal agencies can enter into a specific type of long-term

contract, called an ESPC, for the purchase of energy efficiency

equipment, such as new windows and lighting. The use of such

equipment can reduce the cost of a facility’s energy use. When

using an ESPC, the savings from reduced energy bills are used to

pay for the purchase of the new equipment over several years. Currently, agencies can use ESPCs to purchase new equipment over a

25-year period, without an appropriation for the full amount of the

purchase price. H.R. 2587 would expand the use of such contracts

to cover the purchase of a new building, if the cost of the new

building is less than the present value of estimated savings from

lower costs of operations, maintenance, and energy consumption.

A November 2000 report from the General Services Administration’s Office of the Inspector General estimates that it would take

several billion dollars to bring the federal building inventory up to

appropriate operations, maintenance, and energy efficiency standards. Thus, we assume that the opportunity for cost savings that

could be generated from reduced operations, maintenance, and energy expenses at new buildings would be significant. We expect

that the new authority provided by the bill would be used only in

a few cases in the first few years, but that as buildings continue

to deteriorate and requirements for energy efficiency continue to increase, the authority would be used at an increasing rate.

DOE has plans to use the new authority under this provision to

build a new facility in New Mexico, at an estimated cost of $35 million. While the precise number of new facilities planned for conVerDate 11-MAY-2000 03:53 Aug 07, 2001 Jkt 074354 PO 00000 Frm 00004 Fmt 6659 Sfmt 6602 E:\HR\OC\HR162P2.XXX pfrm07 PsN: HR162P2
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struction that could qualify for funding under the authority that

would be provided by the bill cannot be determined at this time,

CBO estimates that this new authority would be used at least 15

times over the next five years at an estimated cost of about $400

million over the 2002–2006 period. We expect that the use of this

funding mechanism would grow after 2006 and that total spending

over the 2002–2011 period would be $1.6 billion.

Use of Tax Credits by TVA and Rural Electric Cooperatives.— Title V would establish four tax credits for electric power facilities

that use certain clean coal technologies (see revenues section

below). This bill would allow power generators that are exempt

from federal taxation to receive similar financial benefits through

various mechanisms. These special rules would apply to two federally financed power producers—rural electric cooperatives and

TVA.

Rural electric cooperatives would have two options under this

bill. They could assign, sell, or transfer the tax credit to a taxable

entity or they could use the credit to prepay loans made by the

Federal government without paying the prepayment penalties required under current law. For this estimate, CBO assumes that

most cooperatives would elect to use the credit-equivalent amounts

to prepay outstanding federal loans.

The budgetary impact of the provisions regarding loans to rural

electric cooperatives are governed by the Federal Credit Reform

Act. Under that act, the subsidy cost of loans or loan guarantees

is measured over the life of the loan on a present value basis. Legislation that changes the terms or conditions for payments is considered a loan modification; any cost or savings resulting from such

modifications are measured on a present value basis and recorded

in the year in which the legislation making the change is enacted.

Title V would modify the terms of outstanding loans to the cooperatives by allowing them to use a noncash transaction to prepay

loans and to prepay such loans without paying the penalties that

would be due under current law.

Based on information from industry analysts, CBO expects that

rural cooperatives that own coal-fired power plants will make significant investments in pollution control technologies and advanced

clean coal technologies in the next 10 years, making them eligible

for credits equivalent to the investment and production tax credits

that would be available for taxable entities. Assuming these investments generally follow industry trends, CBO estimates that this

provision would cost about $1 billion on a present value basis. CBO

expects that this would be recorded in 2002, when the credits

would first become available.

Title V also would allow TVA to reduce its payments to the

Treasury for past appropriations by amounts equivalent to the tax

credits. If the credit-equivalent amounts exceed the amounts payable to the Treasury in a given year, TVA could apply the balance

to offset payments due in future years. Based on published reports,

CBO expects that TVA also will make significant investments in

pollution control and clean coal technologies over the next 10 years

and would be eligible for the payment offsets provided by this bill.

For this estimate, CBO assumes that TVA would pass such savings

on to its customers by lowering the price it charges for electricity.

We estimate that this price adjustment would reduce TVA’s power

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revenues by an average of $35 million a year beginning in 2007,

which is the year we expect the agency to revise its rates. Hence,

CBO estimates that this provision would cost a total of about $175

million over the 2007–2011 period.

Revenues

H.R. 2587 would create four new tax credits as incentives for

emissions reduction and efficiency improvements in existing coalbased electricity generation facilities, as well as credits for new or

advanced technologies used in coal-based electricity generation.

The Joint Committee on Taxation estimates that these provisions

would reduce revenues by $222 million in 2002, by $12.6 billion

over the 2002–2006 period, and by $31.1 billion over the 2002–2011

period.

Spending subject to appropriation

H.R. 2587 contains several provisions that specify amounts authorized to be appropriated for energy conservation programs,

LIHEAP, and weatherization and state energy grants. In addition,

the bill would authorize unspecified amounts to be appropriated to

achieve energy efficiency in publicly owned buildings and provide

incentives for the use of renewable energy. Assuming the appropriation of the necessary amounts, CBO estimates that it would

cost $15.8 billion over the 2002–2006 period to implement these

provisions. Estimates of outlays are based on historical spending

patterns for ongoing and similar activities.

Provisions with specified authorizations

CBO estimates that implementing programs with specified authorizations in the bill would cost about $14.4 billion over the

2002–2006 period. That estimate assumes that all amounts authorized to be appropriated for those programs—about $16.3 billion

over the next five years—would be provided each year.

The largest program authorized in the legislation would raise the

current law authorization for the Low-Income Home Energy Assistance Program and extend the program through fiscal year 2005.

Assuming appropriation of the authorized amounts, CBO estimates

that implementing this provision would cost about $1 billion in

2002, and $7.8 billion over the 2002–2006 period.

Under current law, a total of $2.65 billion is authorized to be appropriated for each of fiscal years 2002 through 2004. These funds

include $2 billion for the basic formula grant for states to provide

energy assistance for low-income households, $50 million for grants

to states to develop nonfederal energy resources and for Residential

Energy Assistance Challenge (REACH) grants, and $600 million for

additional energy assistance for emergency needs. The emergency

funds are made available only after a formal request by the President that includes a designation of the amount requested as an

emergency requirement as defined in the Balanced Budget and

Emergency Deficit Control Act. The bill would authorize $3.4 billion in basic grants for each of fiscal years 2002 through 2005, and

extend the authorization of $600 million for emergency funds

through 2005. It would make no changes to the authorization for

incentive and REACH grants.

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For this estimate, CBO assumes that the full authorized level

would be appropriated, and that spending would follow the historical rates. Other amounts specifically authorized to be appropriated

over the 2002–2006 period by the bill include: $5.25 billion for energy-efficiency and conservation programs

administered by DOE; $1.475 billion for the Weatherization Assistance Program to

help low-income households enhance energy efficiency; $500 million to encourage the use of new coal technology in

the electricity, chemical, and transportation industries; $400 million over the 2002–2006 period for grants to states

to promote energy-efficient technologies through the State Energy Program; $200 million from the Leaking Underground Storage Trust

Fund for cleanup activities associated with MTBE contamination;

$90 million for a new program to research, develop, and

demonstrate technology that would increase the fuel efficiency

of trains;

$80 million for DOE to encourage the production and marketing of energy-efficient and renewable energy products and

services;

$30 million for research and development programs related

to uranium technology; $18 million for DOE to establish a new program for developing, testing, and demonstrating advanced building technologies; $10 million for public education on realizing energy savings

through regular maintenance of air conditioning and ventilation systems; and $33 million for DOE, EPA, and certain other federal agencies

to complete various studies, reports, and activities that would

be required under the bill.

Provisions with estimated authorizations

H.R. 2587 would reauthorize the Energy Conservation Program

for Schools and Hospitals, and the Renewable Energy Production

Incentive Program (REPI). It also would establish new programs to

promote energy conservation, and require several studies and reports. Based on information from DOE, EPA, and other affected

agencies, in addition to industry sources, CBO estimates that H.R.

2587 would authorize the appropriation of $1.45 billion over the

2002–2006 period.

Energy Conservation at Federal Agencies.—H.R 2587 would establish several energy conservation goals and requirements for the

federal government. Some of these goals, such as reducing energy

use by certain percentages relative to 1985 use, are being done

under current executive orders. Others, such as the requirement to

meter electricity use and to use this information to reduce energy

consumption, are not. Based on information from DOE and the Alliance to Save Energy, we expect that it would only be economical

to require federal buildings at least 50,000 square feet or larger to

install and manage metering systems. Based on information from

DOE, we assume that about 80 percent of the more than 400,000

buildings in federal inventory would be economical to meter.

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While metering can be done in several ways and using several

technologies, we assume that generally, an agency would not spend

more than 7 percent of its annual electricity bill to establish a metering system. Based on information from DOE on federal electricity bills, CBO estimates that the requirement to install metering in federal buildings by the start of fiscal year 2005 would cost

about $250 million over the 2002–2004 period. Based on experience

in the private sector, in many cases, metering can lead to reduced

energy consumption and reduce costs enough to recoup the investment cost of metering within two to four years. It is possible that

this requirement could lead to a future reduction in appropriations

for federal building energy use, but any such savings would depend

on how metering information is used by federal agencies.

Federal Energy Bank.—Section 125 of the bill would establish a

Federal Energy Bank that would provide funding to federal agencies for energy efficiency projects. Under the bill, 5 percent of total

federal utility payments would be authorized to be appropriated for

energy efficiency projects in years 2002, 2003, and 2004. Based on

information from DOE, we estimate that eligible utility costs total

about $4 billion in recent years. We estimate that implementing

this provision would cost about $650 million over the 2002–2006

period. Assuming these funds are invested in cost effective projects,

the net cost of this provision could be significantly lower because

greater energy efficiency could reduce future spending on federal

energy consumption, but CBO cannot estimate the potential savings at this time.

Grants for High-Performance Public Buildings.—The bill would

authorize the appropriation of such sums as may be necessary for

each of fiscal years 2002 through 2010 for grants to states for the

construction and renovation of energy-efficient, environmentally

friendly public buildings. Based on information from DOE, CBO estimates that the program would cost $170 million over the 2002–

2006 period. This amount would allow DOE to provide grants to all

50 states over the next five years.

Energy Star Program.—The bill would authorize such sums as

may be necessary to carry out the Energy Star program at DOE

and EPA over the 2002–2006 period. This program evaluates and

certifies various consumer products as energy efficient, and promotes the use of such products through the use of the Energy Star

label. The bill would require DOE and EPA to study several additional products to determine if the label would apply. Based on information from these agencies, CBO estimates that it would cost

$30 million over the 2002–2006 period to study several new products, and to support the marketing and partnerships required

under the program.

Energy Conservation for Schools and Hospitals.—H.R. 2587

would reauthorize DOE’s Energy Conservation for Schools and

Hospitals program through 2010 and authorize the appropriation of

such sums as may be necessary through that time. The program

provides grants for public schools and hospitals to enhance energy

efficiency. In the past it has been funded at amounts ranging from

$20 million a year to $100 million a year. Based on information

from DOE, CBO estimates that implementing this provision would

cost $127 million over the 2002–2006 period.

9

Renewable Energy Production Incentive.—The REPI program currently provides cash payments to public utilities that generate energy using renewable sources. The payment is based on the annual

kilowatt-hours of electricity generated using qualified renewable

energy sources. Section 702 of the bill would reauthorize the REPI

program for an additional 10 years, and make Indian tribes eligible

for the program. Annual appropriations have not kept up with applications for payment from eligible utilities. Specifically, eligible

utilities have generated electricity from renewable resources since

1994 in an amount that qualifies for almost $60 million in payments from the REPI program. However, only about $25 million

has been appropriated thus far. Based on information from DOE,

CBO estimates that fully funding this program would cost $168

million over the 2002–2006 period.

Inspector General Energy Audits.—Current law encourages certain Inspectors General to perform audits of the use of ESPCs and

other energy-efficiency programs by federal agencies. H.R. 2587

would require that the 28 Inspectors General do such audits periodically. Based on information from the DOE Office of the Inspector General we assume that such audits would occur every three

years, beginning in 2002. We estimate that these audits would be

more expensive the first year that they occur, and that future audits would be less time-consuming and labor-intensive to conduct.

CBO estimates that audits would cost $11 million over the 2002– 2006 period.

Nuclear Regulatory Fees from Government Agencies.—Under current law, there are about 400 licenses provided by the Nuclear Regulatory Commission (NRC) to federal agencies for the use of nuclear material. H.R. 2587 would allow NRC to charge government

agencies fees for the cost of providing such licensing. Currently, the

NRC charges private licensees fees for the costs of issuing licenses

to other government agencies. Based on information from NRC,

CBO estimates that such fees would total about $20 million over

the 2002–2006 period. Because those fees would come from appropriated funds instead of from the private sector, the government

would incur a net cost relative to current law.

Other Provisions.—Finally, H.R. 2587 includes several provisions

that would authorize several new studies, reports, and activities.

Those provisions would require certain federal agencies to:

Undertake a review to determine practical ways to reduce

energy and water consumption and implement such methods;

Review the use of ESPCs and determine methods to allow

agencies to more easily use them;

Perform a study on the manner in which providing money

through LIHEAP reduces energy conservation and energy efficiency;

Review regulations to eliminate barriers to emerging energy

technology;

Study the use of gas flares at petrochemical facilities to reduce electricity costs;

Study the energy conservation implications of telecommuting;

Review the use of credits for air pollution emissions;

Review the mobile source air emissions models used under

the Clean Air Act;

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Study the benefits and feasibility of oil by-pass filtration

technology; and

Report on the energy dependence of the United States.

Based on information from the agencies that would be responsible for implementing these provisions, CBO estimates that they

would cost $17 million over the 2002–2006 period.

Change in budget status

Section 301, by itself, moving the Nuclear Waste Fund off-budget

would not change total spending of the federal government. Under

scorekeeping rule 13 in the conference report on the Balanced

Budget Act this provision would not be scored as affecting spending

or receipts for congressional scorekeeping purposes.

Pay-as-you-go considerations: The Balanced Budget and Emergency Deficit Control Act sets up pay-as-you-go procedures for legislation affecting direct spending or receipts. The net changes in

outlays and governmental receipts that are subject to pay-as-yougo procedures are shown in the following table. For the purposes

of enforcing pay-as-you-go procedures, only the effects in the current year, the budget year, and the succeeding four years are

counted.

By fiscal year, in millions of dollars—

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Changes in outlays ................... 0 1,043 246 194 264 275 278 286 301 343 256

Changes in receipts .................. 0 ¥222 ¥1,396 ¥3,079 ¥3,838 ¥4,076 ¥3,957 ¥3,751 ¥3,631 ¥3,572 ¥3,575

Estimated impact on State, local, and tribal governments: H.R.

2587 contains no intergovernmental mandates as defined in

UMRA. The bill would benefit state, local, and tribal governments

by authorizing more than $5 billion over the 2002–2006 period for

energy conservation plans, weatherization programs and the

LIHEAP program. These authorizations represent a significant increase (over 50 percent) in funding for these programs. In addition,

the bill authorizes such sums as may be necessary to establish a

pilot program, targeting units of local government, which encourages the development of high-performance public buildings. Any

costs incurred by state, local, or tribal governments as a result of

this legislation would result from complying with conditions of aid.

Estimated impact on the private sector: H.R. 2587 would impose

several private-sector mandates as defined by the Unfunded Mandates Reform Act. By requiring that their products meet certain energy efficiency standards, the bill would impose mandates on manufacturers of cold-drink vending machines, and manufacturers and

importers of certain household appliances. Because the new requirements on manufacturers would depend on specific standards

that would be established by the Secretary of Energy, CBO cannot

determine whether the direct cost to the private sector would exceed the annual threshold established in UMRA ($113 million in

2001, adjusted annually for inflation).

H.R. 2587 would require that household appliances manufactured, or imported for sale, in the United States consume less than

one watt of electricity when in standby mode. The bill would direct

DOE to establish such an efficiency standard to take effect two

years after enactment. According to industry sources and DOE, up

to nine thousand types of household appliances could be affected by

11

this provision and further, many such products would require significant modification in order to meet a one-watt standard. The bill

would however, allow the Secretary of Energy to exempt products

from the requirement under certain circumstances related to technical infeasibility, compatibility with existing energy conservation

standards, and expected cost savings to consumers. DOE could not,

however, indicate which products would qualify for an exemption.

Accordingly, CBO cannot determine the products that would be affected, and hence, cannot estimate the cost to the industry of meeting such a requirement. If DOE determines that only a small portion of products are exempt, the costs to industry of compliance

with such a standard could be well over the threshold established

in UMRA.

H.R. 2587 also would require that the affected manufacturers of

vending machines meet energy consumption testing, labeling, and

conservation requirements to be prescribed by the Secretary of Energy. Currently, there are no standards for cold-drink vending machines. According to the Department of Energy, the testing and labeling requirements would be based upon current practice and

would not be costly for the industry to implement. Further, industry sources indicate that manufacturers are already engaged in energy conservation efforts which are likely to render the machines

compliant with the standards at the time they are issued. Consequently, CBO expects that the cost of compliance with the new

requirements would be minimal.

The bill would direct the Department of Transportation (DOT) to

increase the fuel-economy standard for light trucks in order to save

an aggregate of at least 5 billion gallons of gasoline in model years

2004 through 2010 relative to the standard in place for model year

2002. Light trucks include sport utility vehicles, minivans, and

pickup trucks with a gross vehicle weight rating of less than 8,500

pounds. Current statute requires DOT through the National Highway Traffic Safety Administration (NHTSA) to prescribe by regulation, at least 18 months before the beginning of each model year,

‘‘the maximum feasible average fuel economy level’’ that DOT decides manufacturers can achieve in the next model year. Such adjustments have been prohibited by appropriations acts through fiscal year 2001, and the fuel economy standard for light trucks has

remained constant at the model year 1996 level of 20.7 miles per

gallon. Currently, there is no prohibition on DOT action after fiscal

year 2001. Based on information from DOT, CBO expects that

NHTSA would issue standards resulting in fuel savings that would

exceed those required by this bill. Thus, the fuel savings requirements in H.R. 2587 would not constitute a mandate as defined by

UMRA.

Estimate prepared by: Federal costs: Lisa Cash Driskill (energy

conservation programs, Nuclear Waste Fund, NRC, clean coal, renewable energy); Rachel Milberg (energy efficient vehicles, automobile fuel economy, and pipelines); Susanne Mehlman (LUST);

Kathleen Gramp (domestic uranium and TVA); Mark Hadley and

Melissa Zimmerman (Rural Utilities Service)—(all at 226–2860);

Valerie A. Baxter (LIHEAP); and Erin Whitaker (revenues). Impact

on State, local, and tribal governments: Elyse Goldman. Impact on

the private sector: Lauren Marks.

12

Estimate approved by: Peter H. Fontaine, Deputy Assistant Director for Budget Analysis; G. Thomas Woodward, Assistant Director for Tax Analysis Division.

FEDERAL MANDATES STATEMENT

The Committee adopts as its own the estimate of Federal mandates prepared by the Director of the Congressional Budget Office

pursuant to section 423 of the Unfunded Mandates Reform Act.

EXCHANGE OF COMMITTEE CORRESPONDENCE

HOUSE OF REPRESENTATIVES,

COMMITTEE ON ENERGY AND COMMERCE,

Washington, DC, July 25, 2001.

Hon. JAMES V. HANSEN,

Chairman, Committee on Resources, House of Representatives,

Longworth House Office Building, Washington, DC.

DEAR CHAIRMAN HANSEN: Thank you for your letter regarding

H.R. 2587, the Energy Advancement and Conservation Act of 2001.

I appreciate your willingness not to seek a referral of H.R. 2587.

I agree that your decision to forgo action on the bill will not prejudice the Committee on Resources with respect to its jurisdictional

prerogatives on this or similar legislation. Further, I recognize your

right to request conferees on those provisions within the Committee on Resource’s jurisdiction should they be the subject of a

House-Senate conference.

I will include your letter and this response in the Committee’s

report on H.R. 2587, and I look forward to working with you as we

bring comprehensive energy legislation to the Floor.

Sincerely,

W.J. ‘‘BILLY’’ TAUZIN, Chairman.

HOUSE OF REPRESENTATIVES,

COMMITTEE ON RESOURCES,

Washington, DC, July 20, 2001.

Hon. W.J. ‘‘BILLY’’ TAUZIN, Chairman, Committee on Energy and Commerce,

Rayburn House Office Building, Washington, DC.

DEAR MR. CHAIRMAN: Thank you for sharing a copy of the recently adopted Committee on Energy and Commerce Committee

print which encompasses your Committee’s contribution to the

President’s national energy plan.

There are several provisions in this bill which affect matters

within the Committee on Resources jurisdiction, including the National Historic Preservation Act, fish and waivers of several laws

implicated in the construction of a natural gas pipeline in the State

of Alaska.

I support these provisions and thank you for addressing them in

your bill. In the interest of assisting our Leadership in moving a

energy legislative package before the August district work period

begins, I will not insist on a referral of the bill to the Committee

on Resources. I ask that you include this letter in any report you

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may file on the bill or in the Congressional Record during debate

on its provisions if no report is filed.

Thank you again for your efforts in helping guide America to a

more secure energy future.

Sincerely,

JAMES V. HANSEN,

Chairman.

HOUSE OF REPRESENTATIVES, COMMITTEE ON ENERGY AND COMMERCE, Washington, DC, July 25, 2001.

Hon. SHERWOOD L. BOEHLERT, Chairman, Committee on Science, House of Representatives, Rayburn House Office Building, Washington, DC.

DEAR CHAIRMAN BOEHLERT: Thank you for your letter regarding

H.R. 2587, the Energy Advancement and Conservation Act of 2001.

I appreciate your willingness not to exercise your referral of H.R.

2587. I agree that your decision to forgo action on the bill will not

prejudice the Committee on Science with respect to its jurisdictional prerogatives on this or similar legislation. Further, I recognize your right to request conferees on those provisions within the

Committee on Science’s jurisdiction should they be the subject of a

House-Senate conference.

I will include your letter and this response in the Committee’s

report on H.R. 2587, and I look forward to working with you as we

bring comprehensive energy legislation to the Floor.

Sincerely,

W.J. ‘‘BILLY’’ TAUZIN,

Chairman.

HOUSE OF REPRESENTATIVES,

COMMITTEE ON SCIENCE,

Washington, DC, July 25, 2001.

Hon. W.J. ‘‘BILLY’’ TAUZIN,

Chairman, Committee on Energy and Commerce,

House of Representatives, Washington, DC.

DEAR CHAIRMAN TAUZIN: On July 23, 2001, you introduced H.R.

2587, the ‘‘Energy Advancement and Conservation Act of 2001.’’ The bill was referred to the Committee on Energy and Commerce,

and in addition to the Committee on Science (among others). The

bill contains provisions that fall within the jurisdiction of the Committee on Science.

In deference to your desire to bring this legislation before the

House in an expeditious manner as part of H.R. 4, the ‘‘Securing

America’s Future Energy Act of 2001,’’ I will not exercise this Committee’s right to consider H.R. 2587. Despite waiving its consideration of H.R. 2587, the Science Committee does not waive its jurisdiction over H.R. 2587. Additionally, the Science Committee expressly reserves its authority to seek conferees on any provisions

that are within its jurisdiction during any House-Senate conference

that may be convened on this legislation or like provisions in H.R.

4 or similar legislation which falls within the Science Committee’s

jurisdiction. I ask for your commitment to support any request by

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the Science Committee for conferees on H.R. 2587 as well as any

similar or related legislation.

I request that you include this letter as part of the Record during

consideration of the legislation on the House floor.

Thank you for your consideration and attention regarding these

matters.

Sincerely,

SHERWOOD L. BOEHLERT, Chairman.

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