(Photo of offshore drilling from Flickr and photographer absolutwade/Beau Wade)
Washington Report 1: The Senate “Gang of 10” drew support from Barack Obama Friday for a bipartisan compromise energy package that would relax restrictions on some offshore drilling, while repealing some tax breaks on the oil industry and funding renewable energy and conservation. Obama had previously opposed more offshore drilling but said he favored some of the other provisions in the bill and compromise was needed to get anything passed. The proposal, led by Sen. Kent Conrad (D-N.D.) and Sen. Saxby Chambliss (R-Ga.) was the result of many meetings to craft a bill that would satisfy voters upset over high gas prices and reduce dependence of foreign oil. It will likely come to the floor after the August break. It would:
• Reduce the no-drilling area in the eastern Gulf of Mexico to 50 miles off the Florida coast from 150 miles offshore (both Florida senators strongly objected).
• Allow drilling offshore from four Southeastern states -- Virginia, Georgia, North and South Carolina -- if the states agree, and share some revenue with the states.
• Repeal tax breaks worth $30 billion for oil companies, which made record profits this quarter (see below).
• Extend renewable energy tax credits, due to expire this year, until 2012, to encourage development of wind, solar and other renewable sources.
• Give incentives to coal-to-liquid plants that can capture and store carbon.
• Fund R&D on advanced batteries and help automakers retool.
• Develop and demonstrate next-generation biofuels.
• Give tax credits for highly efficient cars and those that use non-petroleum fuels. Senate Majority Leader Harry Reid (D-Nev.) gave the proposal luke-warm praise as a starting point for some agreement on energy. The American Petroleum Institute opposed the repeal of some oil tax credits (calling it "tax increases), saying it would discourage domestic drilling. (Source: Greenwire)
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