Broad energy bill coming before Senate with promise of fights over Arctic drilling, gas mileage, electricity competition

Monday, February 25th 2002, 12:00 am

By: News On 6

WASHINGTON (AP) _ The Senate is ready to take up broad energy legislation that has caused splits over automobile gas mileage, drilling in an Arctic refuge and electricity competition in the shadow of Enron Corp.'s collapse.

Debate expected this week comes nine months after President Bush outlined his plan to increase the nation's energy supply by expanding oil and gas drilling on public land and rejuvenating nuclear power.

The House passed its version, but in the Senate, majority Democrats have offered legislation that relies more heavily on conservation.

The crisis atmosphere of a year ago has all but disappeared _ energy prices are low, supplies plentiful _ and the urgency to act, too, may have lost steam, say lawmakers and lobbyists.

President Bush, in a weekend push to promote his plan, dismissed claims that it focuses too much on fossil fuel production and not enough on conservation and renewable energy sources such as wind and solar.

``Conservation technology and renewables are important. Yet they alone cannot solve our energy problems,'' he said in his weekly radio address.

During his recent trip to Asia, Bush stopped in Alaska where he again stressed the need to drill for oil in an Arctic wildlife refuge. The idea won mention in his Saturday broadcast, with the president saying drilling can go ahead without hurting the environment while also providing jobs.

Environmentalists have pledged to protect the Arctic National Wildlife Refuge, and some Senate Democrats say they will stall energy legislation if Republicans press the refuge drilling issue _ as most expect them to do.

Senate Majority Leader Tom Daschle, D-S.D., has offered a broad proposal that senators probably will consider this week.

``We have a real opportunity here,'' Daschle said Sunday on ABC's ``This Week.''

``There are some big differences between what the Republicans are proposing, which is really the policies of the past, and what the Democrats proposing, which is a real look to a future for energy policy that is vastly different and exciting.''

At least two weeks of debate are predicted.

There are ``a lot of ways ... this legislation might go off the rails,'' said Sen. Jeff Bingaman, D-N.M., a principal architect of the Democratic bill.

The House bill, strongly endorsed by Republicans and the White House, tilts strongly toward expanding energy production and would allow drilling in the refuge. It also offers billions of dollars in tax subsidies to producers.

Senate Democrats reject development of the refuge and emphasize conservation: sharp increases in fuel economy for automobiles, tougher federal energy efficiency standards and greater support for renewable fuels and natural gas as opposed to oil.

Tax breaks in the Democratic proposal _ about $16 billion worth, or about half of what the House has offered _ lean more toward conservation and renewable fuel sources as opposed to the oil, gas and nuclear industries focused on in the House version.

Sen. Frank Murkowski, R-Alaska, says drilling in the refuge is essential to lessening U.S. dependence on foreign oil. He plans an amendment that would give oil companies access to the refuge's coastal plain, where billions of barrels of oil are believed available.

Murkowski says he has the majority needed to get it passed, but not _ at least so far _ the 60 votes needed to overcome a sure filibuster.

Other issues also could scuttle a potential compromise:

_automobile mileage. A Democratic proposal would increase fuel economy by 30 percent, to an average of 35 miles per gallon by 2013, and remove preferences now given to sport utility vehicles. Currently, new automobiles are required to meet a fleet average of 27.5 mpg and SUVs and minivans 20.7 mpg.

_ethanol. Farm interests and the oil industry are fighting over whether to increase the use of corn-based ethanol as a motor fuel by establishing a ``renewable fuels'' requirement for gasoline.

_the $16 billion in tax breaks over 10 years. A Democratic version would give more of the money to conservation. Republican proposals tilt toward helping producers.

_electricity competition. With Enron's bankruptcy fresh in their minds, senators will consider how much say the federal government should have over siting transmission lines, managing power grids and monitoring the business practices of large energy holding companies.

The bill Daschle is introducing may attract more than 200 amendments.

``The big question is whether along the way the bill gets killed because it's just too big and cumbersome,'' says Dan Becker of the Sierra Club. ``The conventional wisdom is that this is a bill that's just too heavy to fly.''

With some many contested issues, David Owens of the Edison Electric Institute thinks it is ``unavoidable'' that the bill will bog down.

The group's members, investor-owned utilities, want the repeal _ as the bill provides _ of a Depression-era law that restricts the activities of utility holding companies.

Since the Sept. 11 attacks, Republicans have stepped up the argument that more domestic oil production is needed to enhance national security by reducing America's reliance on Middle East oil.

Drilling foes counter that the refuge does not hold enough oil to reduce imports significantly and that tougher fuel economy standards for vehicles would go further in lessening U.S. dependence on foreign oil.

While Congress works on the legislation, its investigative arm has sued Vice President Dick Cheney to force the release of industry figures who met with his task force as its developed the administration's energy plan.

The White House has refused to hand over the information, contending that doing so would encroach on the president's ability to get candid views from people outside the government.