The Senate plan for gradual removal of federal price controls from new natural gas was presented yesterday to senior House conferees who prefer continued price regulation but fervently want to see the long-delayed energy bill enacted.
Rep. Thomas Ashley (D-Ohio), the House Democratic leadership's man in the energy conference to settle House-Senate differences, said the Senate proposal closely resembled a plan drafted just before Christmas and approved by most House Democratic conferees but rejected by the Senate group. He predicted that the new proposal, approved by a bare majority of nine middle-of-the-road senators of the 17-member Senate conferees, would be accepted in its basic form by House conferees.
Natural gas is not the only prickly issue the conferees have left to resolve, however. They must also deal with the tax parts of President Carter's energy plan, and the Senate is resisting the big crude oil tax which the president has proposed. House members also are wincing at having to vote for this tax in an election year, so the president's energy legislation still has big problems.
Rep. John Dingell (D-Mich.), the House's leading specialist on the 24-year natural gas pricing controversy, commended the Senate group for its hard work. However, he said he had problems with the cost of the Senate proposal, which is estimated to be considerably higher than the House
The House has supported Carter's plan to continue gas price controls but the Senate voted for deregulation after two years. Producers contend deregulation is essential to encourage more production and reduce dependence on foreign oil.
The House-Senate energy conference bogged down because the Senate conferees were evenly split on natural gas. It took 3 1/2 months for a Senate majority to agree on a proposal which they submitted to the House yesterday to start negotiations.
But if the gas issue is resolved, the tax part of Carter's energy package may still be in trouble. Sen. Russell B. Long (D-La.), Finance Committee chairman, told Carter Tuesday there is no way the tax on domestic crude oil, the centerpiece of his conservation program, could pass the Senate today. The White House checked its head counters and said yesterday it agreed.
But at a caucus yesterday of House Democrats who pushed the crude oil proposal through the House last August, House Ways and Means Committee Chairman Al Ullman (D-Ore.) urged the House to resist pressures to enact portions of the energy bill already approved by the conferees.
He predicted: "If the House has the courage to do what we started out to do [pass one comprehensive tax and regulation bill], there is no way the Senate can avoid the issue and I think they will pass it [the crude oil tax] too." bill, and by the absence of any permanent protection against too-high prices such as a so-called floating cap that was in the December plan. Dingell said the Senate proposition "needs refining."
Rep. Harley Staggers (D-W.Va.), chairman of the House conferees, said the 25 House conferees would Senate proopsal. He would not estimate when the conference would meet again formally in public session. It has not met since the week before Christmas.
Everyone present at the 1 1/2 - hour meeting seemed to share Ashley's feeling that the long deadlocked gas issue was on the way to a solution. There was an "upbeat" atmosphere, he said. Sen. Dale Bumpers (D-Ark.) said there was "an air of cooperation, almost of enthusiasm" at the meeting "about reaching agreement in the near future."
Meanwhile, the Senate compromise was being shot at from left and right as giving the oil-gas industry too much or too little. Three liberal Senate Democratic conferees - Howard Metzenbaum (Ohio). James Abourezk (S.D.) and John Durkin (N.H.) - denounced the compromise as "capitulation to the natural gas industry." They said it would cost the American people $23 billion more than the House bill by 1985 and more than double the price of new gas. So would the administration's proposal but it would have continued price controls at higher levels indefinitely.
Two Senate Republican conferees - Clifford Hansen (Wyo.) and Dewey Bartlett (Okla.) also criticized the complaints were that it would continue price controls for seven years, extend them to the intrastate market and provide no guarantee that the ceiling price would be sufficiently high to encourage more production of gas.
The compromise fashioned by four senators who supported President Carter's plan for continued regulation of new gas would deregulate newly discovered gas after seven years, although Congress or the President could reimpose controls for two more years if prices rose too high.
The ceiling price of new gas would rise from the present figure of $1.48 per thousand cubic feet (MCF) to about $1.85 per MCF now, about the same as Carter's proposal for a $1.75 price last April with increases for inflation, plus 3.5 percent since. It could rise by that amount or slightly more each year.