Senate energy bill is good for S.D. by Tom Daschle Senate Minority Leader On July 31, the Senate put philosophical differences aside and passed a bipartisan comprehensive energy bill by a vote of 84 to 14. This measure, which is identical to what the Senate passed last year, would expand domestic energy supply and help moderate rising energy prices. It is also great for South Dakota.
For me, the highlight of this legislation is the establishment of a renewable fuels standard (RFS) that would nearly triple the use of ethanol in the U.S. over the next 10 years. It has been estimated that the RFS would inject $620 million into the South Dakota economy and create 10,000 jobs in the state over this period.
The RFS would also displace hundreds of millions of barrels of imported oil, which currently constitutes over 60 percent of the oil used in the United States today.
The bill also envisions a new source of natural gas for the Plains states. Natural gas heats over 50 percent of our homes, and it is predicted that this winter South Dakotans may pay twice what they paid last winter for natural gas.
That could mean as much as $87 million more that South Dakotans will have to pay for natural gas in 2004. Also, higher natural gas prices threaten the profitability of many South Dakota businesses, including agricultural and ethanol producers.
For example, the cost of natural gas accounts for over 70 percent of the cost of producing nitrogen fertilizer. According to USDA, fertilizer prices increased by one-third this year, increasing the cost to a typical farmer by $10 to $15 per acre.
The Senate energy bill directly affects future natural gas prices in South Dakota by encouraging the construction of a pipeline to bring the 35 trillion cubic feet of known natural gas reserves on the North Slope of Alaska to states in the Midwest.
That gas is currently being pumped back into the ground, because there is no way of getting it to consumers in the lower 48 states.
The bill also helps ensure that large energy conglomerates such as Enron cannot use their market power to squeeze out our local electricity cooperatives that provide service to over 200,000 homes in South Dakota. We are fortunate to have a reliable, stable electricity infrastructure in South Dakota, and the Senate energy bill will ensure that large investor-owned utilities do not muscle in and artificially raise our electric bills.
Finally, the bill encourages a variety of energy conservation initiatives and increases the funding level for the Low Income Home Energy Assistance Program, which helps individuals and families pay their energy bills.
LIHEAP served nearly 14,500 South Dakota families last winter, and this bill would allow more assistance to be available this winter.
I am gratified that, in passing this comprehensive energy bill, the Senate abandoned partisan wrangling in favor of bipartisan achievement. I hope this constructive, cooperative spirit will continue in September, when Senate and House negotiators meet to work through the differences in the Senate and House-passed energy bills so that Congress can send a final, bipartisan energy bill to the president for signature into law this fall.