Congressional Action

House Passes Bill To Expand Drilling, Fund Renewables

By Paul Kane
Washington Post Staff Writer
Wednesday, September 17, 2008

The House approved a package of energy initiatives yesterday, including measures that would allow oil drilling as close as 50 miles off the Atlantic and Pacific coasts and finance the long-term development of alternative energy sources.

In the first substantive votes since gasoline prices rose above $4 a gallon this summer, the House divided largely along party lines, 236 to 189, with most Republicans rejecting the Democratic-sponsored legislation because it would prohibit exploration of much of the known oil reserves closer to the coasts and in the Gulf of Mexico.

As they reversed their long-held opposition to more offshore oil exploration, Democrats said the increased taxes on oil companies in the bill and the collection of royalty payments from the drilling would yield billions of dollars to help finance the development of cleaner, renewable energy sources.

"We're not trying to give incentives to drill, we're giving incentives to invest in renewables and natural gas that will take us where we need to go," House Speaker Nancy Pelosi (Calif.) told reporters before the vote.

The legislation now moves to the Senate, where it will compete with three alternative proposals, each of which faces a difficult road to securing the 60 votes needed for passage.

If Congress does not act on the measures by Sept. 30, the current ban on offshore oil drilling will expire, and exploration will be allowed as close as three miles off all U.S. coastlines. In July, President Bush lifted an executive order that had blocked drilling on the outer continental shelf.

Yesterday's action came two months after the average price of gas peaked at more than $4.10 a gallon, prompting Republicans to make offshore drilling one of their central political planks as they headed into the party conventions and the fall elections. But as Democrats buckled under the political pressure for more drilling and began assembling the legislation, oil prices began falling. The cost of a barrel of oil has dropped about $55, or about a third, from its peak this summer.

The unexpected boon of falling oil prices did little to change the tenor of the political debate yesterday. Pelosi brushed aside suggestions that lower prices would discourage more domestic drilling, in turn reducing the amount of money available for renewable resources.

"I think once you go past $35 a barrel, there's incentive for them to drill. It's not just about the drilling revenues, it's about ending the subsidies" and securing greater royalties, she said.

Republicans vowed to continue their push right up to Election Day for a more expansive drilling program and more funding for nuclear power, which was not included in the Pelosi bill.

"The American people understand that we need an 'all of the above' approach to securing our energy future -- including drilling offshore, nuclear power, conservation and renewable energy," said Brian Rogers, spokesman for Sen. John McCain's presidential campaign.

Sen. Richard Burr (R-N.C.), a McCain supporter who favors more drilling, said the summer price spike was such a shock to consumers that they will demand increased domestic production to protect against future run-ups.

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