Iron Range coal plant gets Senate OK

06/29/2005

Associated Press
June 29, 2005

WASHINGTON, D.C.—The Senate approved an energy bill Tuesday that was more favorable to conservation, wind farms and ethanol and less kind to oil and gas producers than legislation passed by the House.

It includes unspecified loan guarantees for a coal gasification plant on Minnesota’s Iron Range.

Whether the sharp differences can be resolved may depend on how much pressure President Bush can bring to bear. He urged negotiators to work quickly so he can get a bill to sign before August.

“The administration’s attitude is we want a bill,” Energy Secretary Samuel Bodman said. “I think you will see the president quite proactive on this.”

Hard bargaining lies ahead, especially with a pesky issue surrounding the gasoline additive MTBE remaining a potential deal breaker, as it was two years ago.

The House wants to protect oil companies and refiners that produced MTBE from environmental lawsuits brought by communities whose drinking water has been contaminated by the additive.

Supporters of the Senate bill, which has broad bipartisan backing and is silent on MTBE, say such liability protection would trigger a filibuster and send the bill to defeat, as it did in 2003.

After finishing all but a final vote on the bill last week, the Senate approved the 1,250-page document Tuesday 85-12. Seven Democrats and five Republicans voted against the bill.

Bush said the Senate-passed bill would help economic growth by addressing the root causes of high energy prices and the nation’s growing dependence on foreign supplies.

The bill’s critics argued that it does little to reduce demand for oil, two-thirds of which goes for transportation, or reduce oil imports, which account for 58 percent of U.S. demand.

More environmentally friendly than the bill passed by the House in April, the Senate bill would funnel 40 percent of $18 billion in tax breaks over 10 years to boost renewable energy sources, energy conservation and alternative transportation fuels.

The $1.2 billion Minnesota project, proposed for Hoyt Lakes, calls for using a clean-burning technology for making electricity from coal in a process called coal gasification.

It has been proposed by Excelsior Energy, a partnership of former Northern States Power Co. executives. Last year, the project won a $36 million grant from the Energy Department.

“This project will put Minnesotans on the forefront of cleaner energy sources and help expand the Iron Range’s economy,” said Sen. Norm Coleman, R-Minn., who championed the provision.

House votes itself a pay raise next year

The House agreed to a pay raise for Congress next year after defeating an effort to roll it back.

In a 263-152 vote, the House blocked a bid by Rep. Jim Matheson, D-Utah, to force an up-or-down vote.

Instead, members will receive the $3,100 “cost of living adjustment,” or COLA, as provided for in a 1989 law that barred them from pocketing big speaking fees in exchange for an annual COLA.

The 1.9 percent adjustment will raise members’ salaries in January to $165,200.

An attempt to block the raise when it comes up in the Senate is not likely to succeed either.