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Bush Tax Cuts Threaten BPA Budget Request
The Western energy crisis has spurred lawmakers to call for national legislation addressing reliability, construction of new power plants and high-voltage transmission lines, investments in energy efficiency and new renewable resource development. In July, the House passed what it called a comprehensive energy bill loaded with incentives for the fossil fuel and nuclear industries and gave the green light to drilling in the Arctic National Wildlife Refuge . The bill provided only modest incentives for energy efficiency and renewable energy technologies.
July also saw the Bush Administration reverse a proposal to slash federal investments in conservation and renewable energy in response to strong public condemnation of those proposed cuts at hearings in Seattle, Washington D.C. , and elsewhere. The Senate Energy Committee meanwhile worked to craft a compromise bill which republicans and conservative democrats could support. But it failed to gain support from environmental and consumer advocates.
The terrorist attacks of September 11 changed the prospects for energy legislation dramatically and centered debate over energy policy squarely on national security and prospects for reducing the nation's dependence on foreign energy sources. The Senate will not take up comprehensive energy legislation this year. Drilling in the Arctic, natural gas pipeline construction from Alaska to the lower 48 states, security measures for major energy facilities and transmission system reliability, however, will likely be debated directly on the Senate floor.
Following a more normal process, the Energy and Water Appropriations Bill is set for conference committee action as the House and Senate try to resolve differences. The budget bill includes a critical piece for the Bonneville Power Administration (BPA ). As a federal power-marketing agency, BPA can borrow from the federal Treasury for capital investment projects. In 1980 BPA was granted authority to apply for as much as $3.75 billion for capital projects. But the agency projects it will run up against that cap on its borrowing authority within the next two years as it invests in upgrades and additions to the federal portion of the region's transmission system. BPA has asked Congress to grant it $2 billion in additional borrowing authority to cover needed investments in transmission, hydroelectric facilities and energy efficiency.
The Bush administration, struggling to accommodate recently enacted tax cuts and fund new national security efforts, opposes the provision and claims BPA doesn't need an immediate increase in borrowing authority. Members of the Northwest Congressional Delegation , however, are pushing hard to give the agency access to the resources BPA claims it needs to secure power reliability for the region. Environmental and salmon recovery advocates meanwhile sent a letter to Senate and House members urging them to direct BPA to invest in conservation and the agency's other public purpose obligations as part of extending BPA's borrowing authority.
Salmon recovery advocates point to actions this year they say demonstrate BPA's failure to balance the needs of salmon with the region's energy needs. They see the request for additional borrowing authority as a way for Congress to make the agency more accountable for its salmon recovery obligations. "Congress should not be granting this agency any blank checks until it has guarantees that BPA will live up to its obligations for salmon recovery," said Andrew Englander , energy policy analyst for the Save Our Wild Salmon Coalition .
The letter also calls for Congress to reject the request unless BPA evaluates alternatives to building new transmission lines, which are expensive and environmentally damaging. Targeted investments in energy efficiency and distributed generation are among the cost-effective alternatives that enhance reliability. Political analysts predict BPA will secure some increase in borrowing authority though not the full $2 billion.
Nancy Hirsh