House Starts Grilling on Gas Companies

House Bill 5351 has been sitting without discussion in the Senate Finance Committee for over a month, after being delivered by the House on February 28. This may not seem like such a major delay, except HR5351 is an extension of tax credits for solar, wind and other renewable energy sources, which has driven the massive investment in these technologies which will be critical for energy independence for the United States. The problem with the bill: Big Oil and President George W. Bush oppose the redistribution of $18 billion of subsidies that Big Oil receives, spread out over the next 10 years.

And Rep. Edward Markey, D-Massachusetts, wants to know why Big Oil should continue reaping massive profits, as well as special benefits from the government.

"We have to move beyond this oil economy," Markey said Tuesday on CBS' "The Early Show." "We have to move to a renewable energy economy."

The House's Select Committee on Energy Independence and Global Warming chaired by Markey started grilling top executives of Exxon Mobil Corp., Shell Oil Co., BP America Inc., Chevron Corp. and ConocoPhillips April 1 on why these massive companies, with a combined total profit in 2007 of over $120 billion, should still receive this subsidy. The bill would instead give those subsidies via tax credits to private individuals to install renewable energy systems in their homes and businesses.

Alternative energy lobbying groups consider the extension of the tax credits critical to the continued acceleration of the investment and installation of new renewable energy generating facilities.

"This remarkable and accelerating growth is driven by strong demand, favorable economics, and a period of welcome relief from the on-again, off-again, boom-and-bust, cycle of the federal production tax credit (PTC) for wind power," American Wind Energy Association Executive Director Randall Swisher said in a press release from the Global Wind Energy Council.

According to the Congressional Budget Office, the net impact on the federal government's budget of HR 5351 would be a net increase in revenues of $2.3 billion over the next ten years, and decrease in the budget deficit of $620 million. The CBO did not include estimates of the impact on domestic security the bill would have.

Big Oil's lobbying organization, American Petroleum Institute, has attempted a preemptive information campaign aimed at Congressman, Senators, and of course the White House to try to block what amounts to a 1.5% loss in profits if the tax subsidies are removed. It has met at least one deaf ear, in Markey.

"We can never get out of this trap as long as the oil companies want to hold us hostage to this old agenda," Markey said.