Senate Passes Comprehensive Energy Bill, Future Uncertain

By an 85-12 vote, the U.S. Senate passed the first comprehensive energy bill in nearly a decade, bringing a successful conclusion to months of legislative effort and overcoming a series of roadblocks in the full Senate related to the water quality crisis in Flint, Mich.

The product of more than a year of bipartisan work by Energy and Natural Resources Committee Chair Sen. Lisa Murkowski (R-Alaska), and Ranking Member Sen. Maria Cantwell (D-Wash.), the Energy Policy Modernization Act of 2015 makes no dramatic changes in the law, but instead brings together a wide range of mostly unrelated policy and funding measures that have drawn broad, though not universal support from industry and environmental groups.

Funding and Policy Changes

The funding measures include support for grid-scale storage, advanced grid technologies, cybersecurity, wave and tidal energy, workforce development, and research on water-energy nexus issues. The bill also clarifies and streamlines elements of the Department of Energy (DOE) loan program, and also boosts spending on the DOE’s Office of Science and the Advanced Research Projects Agency-Energy.

The policy provisions are a bit more controversial. Though support for energy efficient buildings drew widespread backing, changes in the approval process for liquefied natural gas (LNG) exports were opposed by environmental groups. The energy bill makes it easier for proposed projects to get approval for exports to countries without free-trade agreements with the U.S., and sets a deadline for DOE decision-making.

“This bill will especially help state and local governments implement effective building energy codes and other policies to save Americans money,” said Steven Nadel, executive director of the American Council for an Energy-Efficient Economy. “It will help many middle-income families finance energy improvements in their homes and earn the benefits of energy savings.”

Christopher Mansour, vice president of federal affairs for the Solar Energy Industries Association, said, “This legislation contains several notable wins for solar energy. Chief among them are the inclusion of solar heating and cooling as technologies that can meet the federal government’s renewable portfolio standard, language directing the Energy Department to identify appropriate costs and benefits for the valuation of distributed generation solar, provisions to improve permitting of solar power plants sited on federal lands, and directing the Energy Department to study avian populations and to establish baseline scientific information.”

Support for LNG Exports

“This legislation represents a growing, bipartisan commitment from Congressional leaders to expand domestic LNG exports so that we can boost our global competitiveness and strengthen our energy security,” said Andrew Ware, a spokesman for Our Energy Moment, a group that has lobbied for expanded LNG exports. “We thank Senate leadership on both sides of the aisle for their hard work on this important issue, and urge House and Senate leadership to reconcile a final bill to help America compete in the global energy economy.”

Though the changes in LNG export project approvals have been a goal of the natural gas industry for years, the effects now may be limited, one energy sector observer said.

“Improvements in the time required to complete the regulatory approvals for new projects are always nice to have,” said Ken Irvin, co-leader of Sidley Austin’s global Energy practice told POWER by email. “The main driver behind successful completion or not of LNG export facilities in the U.S. right now appears to be economic and not regulatory approvals. Given the softening demand reflected in lower LNG prices, faster approval process right now at FERC may be a moot issue. Long term, however, it would be nice to see the agency improve the total time needed for the full regulatory review.”

Conflicts with House Energy Bill

The Senate measure must still be reconciled with a House energy bill containing a number of provisions that the White House has threatened to veto. Environmental groups oppose additional support for fossil fuels in the House bill, and House GOP members have sought to eliminate the DOE loan program.

At a press conference after the vote, Murkowski expressed confidence that the differences in the two bills would eventually be resolved.

—Thomas W. Overton, JD is a POWER associate editor (@thomas_overton, @POWERmagazine).