Senate Bill Aims To Affect Entire Energy Industry

THREE and a half months after the Senate dropped it, wide-ranging energy legislation is alive again - and set for passage.

Senate dealmaker J. Bennett Johnston (D) of Louisiana, the bill's sponsor, has engineered compromises for the bill's most controversial elements. The bill could be passed as early as today.

However, Alaska's two senators, Frank Murkowski and Ted Stevens, both Republicans, could throw a monkey wrench into the proceedings by reintroducing an amendment to allow oil exploration in Alaska's Arctic National Wildlife Refuge (ANWR). But on the eve of debate, it appeared the two would hold off and leave ANWR out of the revised energy bill.

As long as ANWR and the other most contentious aspect of the bill - a proposal to set standards for stricter fuel efficiency in American cars, known as "corporate average fuel economy," or CAFE - remain on the sidelines, it has a good chance of passing.

Aside from losing ANWR, the Bush administration seems satisfied with the new energy bill.

"We are encouraged by the bill so far," says a senior Energy Department official. "So far so good, if things continue as they have been."

Environmental groups are less than pleased, but trying to put a positive face on it.

"It's got some good things," says Melanie Griffin, Washington director for energy programs at the Sierra Club.

One positive aspect of the bill, says Ms. Griffin, is its provisions to boost energy efficiency. Still, she adds, the House version of the bill, which is further from completion, is better on renewable sources of energy, such as biomass and solar.

Sierra Club's "biggest problem" with the bill, says Ms. Griffin, is its provision to streamline the licensing of nuclear-power plants. Currently, the construction of a plant and then its startup are separately licensed by the Nuclear Regulatory Commission.

Under the new procedure, there would be just one review, a move designed to boost the struggling nuclear industry. Opponents of nuclear power argue that requiring only one review could jeopardize public safety.

The nuclear-power streamlining provision seems assured of passage in the Senate, since its approval earlier this month as an amendment to the bill was by a unanimous voice vote.

Environmentalists seem satisfied that at least they got ANWR oil exploration out of the bill, a victory that even administration officials grudgingly admire as a textbook lobbying success.

The Bush administration keenly wants exploration in ANWR, where oil companies believe there is at least 3 billion barrels of oil. Last March, President Bush called it a "vetoable" issue. Last fall, Energy Secretary James Watkins said he would recommend a veto of any energy bill that did not include ANWR oil exploration.

The administration has now backed off its veto threat. Instead, it has included ANWR drilling in its economic growth package, arguing that the Alaska drilling would create upward of 700,000 new jobs. Environmentalists argue that drilling could damage the environment of the region, which is a caribou mating ground.

"The votes on the energy bill for ANWR just don't exist," says the senior Energy Department official. An unsuccessful direct vote on ANWR now could be fatal to the plan, he says, because it would lock in senators as having one position or the other and make it difficult to win a majority in the future.

One factor driving the energy bill toward passage is a desire by both Congress and the Bush administration to show the American voters in an election year that they are capable of completing major legislation. The campaign will shorten Congress's work time this spring, so time is of the essence.

The initial impetus for the bill was Iraq's invasion of Kuwait, which pointed up the nation's vulnerability in its energy supply. The bill touches almost every aspect of the energy industry. Aside from the streamlined procedure for nuclear-power licensing, key provisions of the bill include a plan to ease federal regulation of the wholesale electric-power market, including allowing utilities to branch across state lines; wider use of nongasoline fuels; and establishment of national energy-efficiency stan dards for electric motors and lamps.

In another energy-efficiency measure, the bill would have federal agencies make efficiency improvements that would pay for themselves within 10 years.