Senate partisans figured out how to work together for at least one week and passed two bills with generally bi-partisan support: a measure overhauling (and perhaps saving) the U.S. Postal Service and a second extending the Violence Against Women Act. House Members were somewhat more partisan while focusing on a series of bills designed to address the increasing threat of cyber attack against U.S. government agency and private sector information networks; the main divide in the lower chamber involved differences of opinion over how much government oversight and regulation of the internet was necessary to prevent a potentially crippling attack.
By the end of the week, the House gave its approval to all of the measures produced by various Committees over the past few weeks and months, including a controversial plan from the House Intelligence Committee called the Cyber Intelligence Sharing and Protection Act (CISPA) that was attacked from civil libertarians as allowing too much government surveillance of the internet (notwithstanding a series of amendments adopted to the bill that were designed to address those complaints). Others, including most Democrats on the Homeland Security Committee, argued that CISPA, which primarily relies on more robust information sharing between the government and the private sector on the nature of cyber threats and existing regulatory structures and authorities to combat those threats, is a poor substitute for a more robust regulatory program that should be administered by the Department of Homeland Security (DHS). Ultimately, the House easily passed the measure 248-168 with 140 Democrats and 28 Republicans voting no.
In combination with other bills passed by the House last week – dealing with federal information technology systems, advance networking and information technology R&D and cyber security technical standards development – the ball on cyber legislation has been passed to the Senate, which so far has been deadlocked in a debate between an almost equal number of supporters of competing information sharing and top-down regulatory approaches. While the two sides are said to be talking, there has been no word from the leadership as to when a floor debate might be scheduled. Both the House and Senate will be in recess this week.
In Committee action, the House and Senate Appropriations panels completed action on their respective FY ’13 Energy and Water Development Appropriation bills, clearing the measures for action in both chambers; as such, the bill is the first of 12 regular appropriation bills in a position for floor action. Of interest, both panels rejected the Administration’s suggestion that Congress reinstate the utility fee (originally enacted in 1992 and expired in 2007) to raise additional funds for the decontamination and decommissioning of old government uranium enrichment facilities used for both commercial and defense programs. In an area of disagreement, the House Committee approved the recommendation of its Subcommittee, chaired by Rep. Frelinghuysen, that $25 million should be spent for the continued review of the DOE license application for Yucca Mountain, while the Senate panel approved a recommendation of it’s Subcommittee, chaired by Senator Feinstein (D-CA), that DOE receive limited Nuclear Waste Fund monies to begin a consent-based program for the siting, licensing and operation of a centralized interim storage facility or facilities. During the Committee action last week, Senator Feinstein indicated that the provision, based on the recommendations of the Blue Ribbon Commission on Americas Nuclear Future (BRC), had the support of Senators Alexander (R-TN), Bingaman (D-NM) and Murkowski (R-AK). According to Senator Feinstein, the four members are continuing a joint effort to develop legislation encompassing the full range of BRC recommendations and she expects that a bill will be introduced and referred to the Senate Energy and Natural Resources Committee in the next few weeks.
We close with two short takes.
As anticipated, Members of the House and Senate marked their return from a two-week spring recess by casting generally partisan votes on tax bills having no chance of enactment, but consistent with the fall election themes of the two parties. The House bill providing a tax cut for small business passed, but will not see action in the Senate; the Senate bill, instituting the so-called Buffett rule, achieved a majority vote, but fell short of the 60 needed to cut off a Republican filibuster.
Perhaps the most significant events on the Senate floor last week of interest to the energy community were the speeches given by Minority Leader Mitch McConnell in support of the re-nomination of current Nuclear Regulatory Commissioner Kristine Svinicki (whose term expires on June 30). McConnell, on Wednesday, decried the fact that the White House had yet to formally submit her paperwork, even though reviews and clearances were completed months ago, indicating his view that the only possible reason for the delay “is the fact that she had the courage to blow the whistle on the commission’s chairman, Gregory Jaczko, a guy whose temper and condescension toward subordinates – particularly women – nearly cost him his job.” When queried later on Wednesday about McConnell’s charge, White House spokesmen said that the President would shortly be sending Svinicki’s nomination papers to the Senate. Several stories late in the week indicated that Senate Environment and Public Works (EPW) Chairman Barbara Boxer (D-CA) was opposed to Svinicki’s re-nomination, as are Majority Leader Reid and his fellow Nevadan, Dean Heller. Boxer, Reid and Heller’s opposition is said to be rooted in Svinicki’s support for the continued review of Yucca Mountain as a potential used nuclear fuel repository and testimony she gave at her original confirmation hearing about her previous work at DOE in relation to the project. Reid and Boxer’s spokesmen also indicated that the Senators had concerns about unspecified votes Svinicki has taken that show, as Boxer’s staff put it “she’s bad on safety.” Given that Boxer’s EPW committee has jurisdiction over the nomination once the paperwork is submitted and that Reid will need to schedule floor time for the nomination, this story will stay at a high boil over the next few weeks.
In Committee action, the House Energy and Water Development Appropriations Subcommittee, chaired by Rep. Frelinghuysen, marked up his FY ’13 bill and again rebuffed the Administration’s suggestion that Congress reinstate the utility fee (originally enacted in 1992 and expired in 2007) to raise additional funds for the decontamination and decommissioning of old government uranium enrichment facilities used for both commercial and defense programs. Frelinghuysen’s panel added $25 million for the continued review of the DOE license application for Yucca Mountain, even though the NRC has halted the process and DOE has shuttered the project. The bill, scheduled for review by the full House Appropriations panel this week, also grants DOE access to $5 million to review requests from communities that have expressed interest in hosting a used fuel facility, but further action is barred absent approval from Congress.
In other Committee news, the House Homeland Security Committee joined several others in developing legislation dealing with cyber security that will be the subject of floor action during this self-declared “cyber week” in the House of Representatives. The Homeland Security panel’s bill underwent significant changes during the mark-up process and generally creates an information sharing and advisory role for the Department of Homeland Security (DHS) that will guide both the private sector and regulators of jurisdiction (such as FERC, NERC and the NRC) in securing cyber systems; earlier versions granted more regulatory power to the agency. The bill will be one of five measures the Republican leadership intends to bring to the floor at the end of the week; others include the information-sharing proposal from the House Intelligence Committee discussed in last week’s update, two research measures from the House Science Committee and a proposal outlining steps federal civilian agencies need to take to protect their networks. Electric-sector specific legislation, such as the GRID Act from the last Congress, is still being examined in the House Energy and Commerce Committee and will not become an official part of this week’s debate.
In agency action, the Commodity Futures Trading Commission (CFTC) voted 4-1 last week in approving final “entity definitions” that will determine which market participants are required to register with the agency as “swap dealers” and “major swap participants.” While the final rule, said to be close to 400-pages long, has not yet been published in the Federal Register, many utilities are cautiously optimistic that this action represents a significant improvement over the situation they faced when the proposed rules were first issued in December of 2010 and feel more comfortable that they will most likely be classified as an end user and exempt from regulation. Among the major changes is the establishment of at least a $3 billion “de minimis” level of activity, below which an entity is not required to register (an initial phase-in period will use an even higher de minimis level of $8 billion); the proposed rule set this level at $100 million. The final rule will also provide a clarification of the difference between a “dealer” and a “hedger” and include language that excludes certain transactions entered into for the purpose of hedging a physical position from the definition of swap dealing.
Three short takes this week:
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The House and Senate managed to reach agreement on two pieces of legislation this past week: one that prohibits Members of Congress from trading in the stock of companies about which they have learned inside information as a result of their official duties, and a second that lessens disclosure and other requirements for smaller start-up companies under the 1933 and 1934 Securities Acts, as well as more recent Dodd-Frank requirements. The former is headed to the White House; the latter will require House approval of minor Senate amendments. President Obama has indicated his support for both measures.
The reaction to the latest proposal from House Budget Committee Chairman Paul Ryan (R-WI) was not quite as bi-partisan. Two principle lines of attack launched by Democrats against the proposed FY ’13 budget resolution are its deviation (downward) from the total discretionary spending amounts agreed to last August as part of the debt ceiling deal and its inclusion of a proposal to reform the Medicare program, even though the Medicare proposal is different from the one included in last year’s budget proposal and is based on a plan Ryan developed in conjunction with Senator Ron Wyden (D-OR). The resolution negates the sequestration of defense funds scheduled to take effect in 2013 by proposing larger cuts in other discretionary programs and it also provides an outline for the future consideration of tax reform, creating two individual brackets of 10 and 25 percent, and lowering the top corporate rate to 25 percent as well. While the resolution does not specifically address either the eventual tax rate of, or parity between, dividend and capital gain income, it does make clear that Ryan rejects the simple expiration of current rates on December 31. Details on “special interest loopholes” that would be closed to keep the proposal revenue neutral are also scant.
Approved by the Budget Committee late last week on a party-line basis, the resolution will be debated on the House floor late this week and passage is likely, but it is likely to be a close vote as some conservatives want an even lower overall discretionary spending level. Given that the Senate leadership has indicated that last year’s debt deal obviates the need for a budget resolution, it now seems clear that the chambers will again fail to agree on a budget and the federal government will begin the new fiscal year on October 1 funded through at least one short-term continuing resolution and full year funding decisions will be added to an already daunting list of issues in need of resolution after the national elections in November.
If one thing was made clear during the past week, it was the need to take seriously Congressional interest in legislation dealing with cyber security. Both Senate Energy and Natural Resource Committee ranking Member Lisa Murkowski (R-AK) and House Energy and Commerce Committee Chairman Fred Upton (R-MI), in separate addresses at a meeting of the Edison Electric Institute noted that the issue will be front and center when Congress returns from its two-week spring break, scheduled to start at the end of this week. For utilities, the generic issue is the primacy of existing regulations by FERC and NERC under the Federal Power Act, without the addition of a new layer of oversight imposed by the Department of Homeland Security (DHS). A similar duplication of effort as between DHS and the Nuclear Regulatory Commission (NRC) with respect to utility nuclear plants is equally problematic. Such is the likely result of legislation authored by Senate Homeland Security and Governmental Affairs Committee leadership (Senators Lieberman (I-CT) and Collins (R-ME)) with the support of the Obama Administration. The leading alternative, co-sponsored by Murkowski and other Senate Committee ranking Republicans, focuses instead on information sharing between federal agencies and the private sector. Upton’s panel has yet to develop a proposal this year, although in the last Congress a bi-partisan proposal authored by Rep. Ed Markey (D-MA) that focused on an enhanced FERC role in emergency circumstances came through the Committee and passed the House before languishing in the Senate.
]]>With the House in recess, the political give and take on energy and environmental issues was largely confined to a further series of Senate votes in relation to a two-year transportation bill and continued exchanges between Senators and Administration witnesses at various hearings reviewing the FY ’13 budget request. Before final passage of the transportation bill, Senators voted:
As was the case with votes on other policy riders the previous week, the agreement between Senators Reid and McConnell that made these amendments in order established a 60-vote threshold for passage. During debate on the amendments, it became obvious that the vast majority of Republican Senators have decided to oppose the 1603 grant program (labeled “politically tainted” by the National Journal) with some Republican supporters of the wind PTC voting no on the Stabenow amendment because it also included the grant program.
DOE Secretary Chu had another opportunity to spar with Republican critics of the Administration’s energy policy during an appearance before the Senate Energy and Water Development Appropriations Committee. During the hearing, Senator Collins (R-ME) asked Chu about the Administration’s willingness to support the construction of a “backbone” that could support offshore wind development. Chu indicated that he was aware of a private consortium’s interest in the matter and would be happy to “look into it” and respond further for the record. Meanwhile, the White House, trying to stay on top of growing public concerns about energy policy, issued a 19-page report on its energy agenda, titled “A Blueprint for A Secure Energy Future: Progress Report.” The report calls the enactment of an 80 percent Clean Energy Standard by 2035 as the “centerpiece” of the Administration’s clean energy strategy, along with the advancement of electric and other advanced technology vehicles. An internal review of the CES proposal from Energy Committee Chairman Jeff Bingaman has found it results in unfavorable treatment for our existing nuclear fleet.
Last week’s Environment and Public Works (EPW) Committee hearing with the five Members of the Nuclear Regulatory Commission was most notable for the strong push by the panel’s Republican members for the re-appointment of Commissioner Kristine Svinicki. In his opening statement, Senator Sessions (R-AL) noted that the NRC works best when it has a full complement of five commissioners, that Commissioner Svinicki had proved herself to be an excellent Commissioner and that he would bring the work of the Senate to a “grinding halt” if the Administration did not move to re-nominate her. Senator Carper, in his opening statement, echoed the remarks of Senator Sessions in regards to the qualifications of Commissioner Svinicki and expressed his support for her re-nomination. Beyond that, the hearing was a rather pro-forma exchange in regard to actions taken by the agency in the wake of the Fukushima Daiichi accident, although Senator Sanders (I-VT) used the hearing to complain about the “enormous and never ending subsidies” that he believes flow to the nuclear energy industry.
Efforts to produce an agreement that would allow the Nation’s debt ceiling to be raised intensified, with daily discussions between the President and Congressional leaders; so far, the main protagonists in the debate seem unwilling to compromise – the President insisting on a “balanced” approach that includes both spending cuts and new revenues and House Republicans vowing to block any deal that includes new taxes. By most accounts, a breakthrough will need to occur by the end of this week to allow the time necessary to draft, debate and pass a measure by August 2. As negotiators continue searching for a magic formula this week, the House will be debating their “Cut, Cap and Balance” bill, legislation that among other features would require that a balanced budget constitutional amendment be submitted to the states for ratification and a super majority vote in Congress be obtained for any tax increase.
Elsewhere, the Nuclear Regulatory Commission’s special task force investigating the nuclear emergency at Fukushima Daiichi released its so-called 90-Day Report last week. The report, while noting the continued safe operation of U.S. reactors, nonetheless termed the existing regulatory regime as “patchwork” and made several recommendations for regulatory changes that are likely to spark debate on Capitol Hill. Congressional Committees were busy on energy policy matters last week: the House Appropriations Committee cleared a spending plan for FY ’12 that would delay action on a number of regulatory initiatives by the Environmental Protection Agency (EPA), including any rules pertaining to section 316(b) of the Clean Water Act; the House Energy and Commerce Committee reported legislation that establishes an interagency panel to study the combined economic impact of pending EPA air regulations and a second bill that establishes a regulatory regime for coal combustion residuals that prohibits EPA regulation of such material as a hazardous waste; the House Natural Resources Committee reported legislation that promotes offshore wind energy development; the Senate Energy and Natural Resources Committee reported several bills, including legislation that establishes a new entity to provide financing for clean energy projects; and two House hearings examined pipeline safety issues, as well as a new draft bill to reauthorize the federal pipeline safety regulatory program.
Some Details
Initial reaction to the NRC task force report has been muted, likely due to the educational effort involved in understanding the potential implications of a report that proposes a number of new regulatory initiatives. We should begin to get a better sense of Congressional reaction to the report in the coming weeks. Chairman Jaczko is scheduled to appear at a monthly “newsmakers” luncheon hosted by the National Press Club this coming Monday; the full Commission will be briefed by the task force during a meeting on Tuesday morning; an afternoon stakeholders meeting is scheduled for July 28; and Senator Boxer (D-CA) indicated last week that she will hold a hearing on the report on August 2.
Of the measures advanced in various Committee actions last week, two especially noteworthy items are the coal combustion residual (CCR) bill and the so-called TRAIN Act, both of which achieved healthy bi-partisan votes. During consideration of the TRAIN Act (which establishes an interagency group to review the cumulative impact of certain EPA regulations), the Committee adopted an amendment by Rep. Whitfield that would delay both the Utility MACT and Cross-State Air Pollution Rule by 18 months. Due to Committee jurisdictional issues, the revised TRAIN Act does not include regulations under 316(b) of the Clean Water Act among those subject to review. The CCR legislation generally establishes a state administered program for regulating coal ash and prohibits regulation as a hazardous waste.
One short take:
Deficit reduction/debt ceiling issues remained the overarching central focus of the President and Congress last week. The President opted out of invitations to separate caucus meetings and invited a bi-partisan, bi-cameral group of legislators to the White House for a session mid-week that gave rise to varying opinions about the prospects for agreement, although all sides generally recognized that time is beginning to run short. Speaker Boehner’s announcement on Saturday that he was abandoning efforts to reach a longer-term solution likely forces all parties into a series of negotiations over stopgap measures designed to keep the fiscal ship of state afloat until sometime after next years’ elections. The House, back in session after the July 4 recess, matched the show of purpose put forward by the Senate last week by canceling its next recess – originally scheduled for the week of July 18. Senate Democrats, continually belittled by Senate Republicans for having gone more than two years without producing a budget, allowed press reports to leak late in the week about the outline of a proposal from Senate Budget Committee Chairman Conrad (D-ND). The proposal, said to reduce deficits by close to $4 trillion over 10 years, relies on large defense spending cuts and increased taxes on the wealthy; Conrad said it shows “how easy” it is to attain deficit reduction “in a balanced manner.” On other policy fronts, Congressional reaction to EPA’s release of its final Cross-State Air Pollution Rule (CSAPR) followed predictable political and regional fault lines; Senator Inhofe was among the critics, Senator Carper among the supporters. The House Energy and Commerce Energy and Power Subcommittee marked up legislation that that establishes an interagency group to conduct a comprehensive analysis of costs associated with several regulations recently developed, or under development, by the EPA.
Three short takes: