On a largely party-line vote, the House of Representatives yesterday passed compromise energy legislation that includes a modest expansion of off-shore energy exploration and drilling, repeals tax breaks for oil companies, provides incentives for renewable energy sources, releases oil from the strategic reserve, adds "use or lose" provisions to existing oil leases, and reduces the budget deficit.
The legislation is far from perfect. Oil drilling would only occur if the affected states allowed it (a good thing). However, the states do not get any revenue from the drilling; so, they bear the risk of potential environmental damage but get few of the benefits.
Also, the legislation plays games with the strategic petroleum reserve. The reserve should be maintained for true emergencies, such as a devastating hurricane in the Gulf of Mexico, an embargo by some increasingly unfriendly producers, or a disruption in production or shipping from the Middle East.
The process for considering the legislation was also flawed, with the Democrats not releasing the text of the bill until shortly before the vote.
However, the House bill is a significant compromise, and it isn't the final version. The Senate will take up the legislation next where there will be opportunities to fix some of these provisions.
Energy policy still faces a long and tough track. Democrats and Republicans both seem to be looking for poison pill amendments to derail the legislation and then use negative votes against their opponents come November. Hopefully, the grown-ups in the parties will keep the bill moving forward.
