The Senate opened debate on the high stakes natural gas compromise yesterday with the outcome rated too close to call but supporters showing growing optimism.
The debate on what has become the key part of President Carter's vaunted plan to save energy, for which he is waging an all-out fight, opened with only half a dozen senators on the floor. No votes are expected before tomorrow, when absentees running in today's primary elections are expected to return.
Opponents of the plan to end federal price controls on newly discovered natural gas by 1985 are expected to try first to kill it by sending it back to the House-Senate conference that produced the compromise after eight months of negotiations. If that fails, supporters would file a cloture petition to try to limit debate and achieve a final vote on the bill next week.
If the Senate approves the conference report, it must then be approved by the House, which is as closely divided on the multibillion-dollar issue as is the Senate.
Congress has fought over natural gas pricing for a quarter century since the Supreme Court ruled that gas shipped across state lines, but not gas consumed in the state where it is produced, was subject to federal regulation. President Carter proposed to continue regulation at higher levels and extend it to include intrastate gas, which is 40 percent of the national supply.
The two houses of Congress went in opposite directions on the issue, with the House backing Carter and the Senate voting to deregulate after two years.
The agreement to phaseout controls over seven years in opposed by a coalition of senate convervatives who want instant deregulation and liberals who want price controls preserved. It is also opposed by most gas producer and consumer groups and labor and business organizations. But the president and his aides have converted some business leaders with arguments that it is needed to bolster the dollar abroad and with talk of tax incentives.
Sen. Henry M. Jackson (D-Wash.), leader of the compromise supporters, said yesterday both sides are still short of a majority but that "momentum is on our side." He said Carter's hard lobbying for the compromise has picked up Senate support for it. Jackson also said he believes some potential opponents are bothered by how to justify voting to kill a bill dealing with a serious problem when they have no alternative to offer.
As of now, the opponents' plan is to move to send the bill back to conference with instructions that Senate conferees insist on a bill that would simply extend an existing act. This act permits waiving price controls on interstate shipments to meet shortages. Jackson said approval of such a motion to recommit would assure death of the bill because House conferees would never accept it. Majority Leader Robert C. Byrd (D-W. Va.), said he is "increasingly optimistic" that the recommittal motion can be defeated.
Eight years ago, the price ceiling on new gas at the wellhead was about 17 cents per thousand cubic feet (MCF). Today the ceiling has been raised by periodic federal orders to $1.50. Under the compromise, the ceiling would go to nearly $2 per MCF now and rise by about 10 percent a year until 1985. After that either the president or Congress could reimpose controls for one 18-month period if prices rose too high.
Jackson, who has opposed decontrol during his 25 years in the Senate, called the agreement an acceptable compromise that would provide price certainly and increased production. Extending controls to the intrastate market would end shortages in northern consuming states and higher production would reduce reliance on foreign oil by 1 million barrels a day by 1985, he said. That, in turn, would strengthen the dollar abroad, he argued.
There is vast disagreement over what the compromise means in terms of added cost to consumers. Some opponents have said it would add up to $50 billion to producer revenues by 1985. Jackson, on the other hand, said it could mean less cost to consumers over the next seven years because shortages created by the dual market would, if present law continues in effect, force consumers to pay more for other fuels such as imported liquefied natural gas.
Sen. Howard Metzenbaum (D-Ohio), a leading opponent who favors continued regulation, called the agreement "bad legislation - bad for consumers, bad for producers and bad for the economy as a whole." It would he said, saddle consumers with higher costs without leading to any substantial increase in production.
The administration is supporting it, said Metzenbaum, only because it wants anything it can get that can be labeled an energy bill. "I have been among the top 5 percent of President Carter's legislative supporters," said Metzenbaum, "But I cannot support him when he is wrong."
Sen. James Pearson (R. Kan.), cosponsor of the deregulation bill passed by the Senate last year, announced his support of the phased deregulation plan as an acceptable compromise. Sen. Robert Griffin (R-Mich.), former party whip who could be influential with some undecided Senate Republicans, also announced his support.