The Senate voted almost unanimously Dec. 13 to raise car and truck fuel economy standards for the first time in 30 years. The bill, passed 86-8, requires a 40 percent increase in fuel economy for U.S. vehicles, to an average of 35 miles a gallon by 2020.
It is considered a landmark step toward cutting greenhouse gas emissions, equivalent to taking some 60 million cars off the road. Sixty percent of the oil consumed in the U.S. is for car and truck fuel.
The House quickly passed the bill on Dec. 18, 314-100, and it was signed into law by President Bush on Dec. 19.
But to get passage of the measure, the Senate’s Democratic leadership dropped two key environmental provisions that were blocked by a Republican filibuster. The two provisions were strenuously opposed by the oil, gas and electric utilities industries.
One would have provided $22 billion in tax credits for wind, solar and other renewable energy sources, as well as for fuel cell and “clean” coal technology development. Much of it would have been funded by repealing oil industry tax breaks to the tune of approximately $12 billion.
The other provision would have required utilities to produce 15 percent of their electricity from renewable sources.
Both provisions were part of an energy bill previously passed by the House over Republican objections.
Although the Senate voted 59-40 to end the GOP filibuster, it was one vote short of the 60 required.
League of Conservation Voters President Gene Karpinski hailed raising vehicle fuel standards as a “significant first step.” But, he said, “at a time when the oil industry is enjoying near-$100-per-barrel oil and record profits,” the Senate had, by one vote, “sided with Big Oil and against the American people and the environment.”
Joan Claybrook, president of Public Citizen, said it “shows the extent to which the oil and fossil fuel industries hold sway over the U.S. Senate.”
“Apparently, lawmakers didn’t want to bite the oil industry hand that feeds them,” Claybrook said in a statement. “The 40 senators who voted against advancing the [original] bill have accepted $7 million in campaign contributions from oil companies, PACs and executives since 2001.”
Sen. Dick Durbin (D-Ill.) commented, “The oil companies are now celebrating in their boardrooms. Not only do they have the highest profits in history, they continue to have a death grip on this Senate.”
For the 2006 elections, with Republican control of Congress on the line, oil and gas corporations gave $20 million to candidates for federal office and 82 percent went to Republicans, according to the watchdog group Center for Responsive Politics. Exxon Mobil alone gave over $800,000, 90 percent of it to Republicans.
For the 2008 election cycle, oil and gas industry donations as of the end of October were going nearly 75 percent to Republicans.
The American Petroleum Institute claimed that repealing the industry’s tax breaks would be “counterproductive in that it takes capital away from expanding domestic oil and natural gas production and refining capacity.” The oil lobby organization produced a 30-page report threatening that the measure would have “significant adverse effects on the economy and consumers — including nearly 5 million lost jobs and $1 trillion in lost economic output.”
In testimony to Congress last May, Tyson Slocum, director of Public Citizen’s energy program, debunked these claims, documenting how U.S. oil companies are raking in profits hand over fist and devoting the bulk of those profits to enriching their shareholders, rather than expanding energy supplies or developing alternative energy.
Slocum called for repealing government subsidies to the industry “with the proceeds invested in renewables, alternative fuels, energy efficiency and mass transit.”
Also lobbying heavily against the tax and renewable electricity provisions were the Edison Electric Institute, which represents electric utility companies, the National Association of Manufacturers, the Chamber of Commerce and the paper, mining, petrochemical and refining industries.
Auto companies grudgingly supported increasing vehicle fuel efficiency standards this time, after having long battled such moves. Slocum noted that raising the fuel standards could actually benefit the auto industry by making it produce cars that meet consumer concerns about fuel economy and the environment.
The bill passed by the Senate also requires a fivefold increase in biofuel production and tightened energy efficiency standards for government buildings and consumer products. Some environmentalists criticize the focus on biofuels, saying production of biofuels like ethanol actually creates greenhouse gases, and use of food crops such as corn for fuel drives up food prices.