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Overview of EPAct2005

Overview of EPAct2005. Joe Nipper Senior Vice President, Government Relations American Public Power Association Presented at APPA’s Workshop Overview of the Energy Policy Act of 2005 Thursday, November 10, 2005 Washington, D.C. Energy Policy Act of 2005.

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Overview of EPAct2005

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  1. Overview of EPAct2005 Joe Nipper Senior Vice President, Government Relations American Public Power Association Presented at APPA’s Workshop Overview of the Energy Policy Act of 2005 Thursday, November 10, 2005 Washington, D.C.

  2. Energy Policy Act of 2005 • Signed into law by President Bush on August 8, 2005 • EPAct05 is the culmination of several years of Congressional consideration, dozens of hearings, and a wide variety of proposals • Final Legislation was supported by all industry sectors; public power, co-ops, IOU’s, IPP’s, RTO’s, etc. • Bill spans 18 titles, several hundred pages

  3. Controversial Issues Not Included in the Final Bill • Drilling in ANWR • MTBE Liability • Renewable portfolio standard • Mandatory reductions of greenhouse gas emission • Clean Air Act issues e.g. non-attainment areas

  4. Organization of EPAct05 Title I Energy Efficiency Title II Renewable Energy Title III Oil and Gas Title IV Coal Title V Indian Energy Title VI Nuclear Matters Title VII Vehicles and Fuels Title VIII Hydrogen Title IX Research and Development

  5. Organization of EPAct05 (Cont’d) Title X DOE Management Title XI Personnel Training Title XII Electricity Title XIII Energy Policy Tax Incentives Title XIV Miscellaneous Title XV Ethanol and Motor Fuels Title XVI Climate Change Title XVII Incentives for Innovative Technologies Title XVIII Studies

  6. Oil Industry Priorities • Increase production • Improve infrastructure • Enhance conservation • Develop new technologies • Modernize regulation

  7. Natural Gas Industry Priorities • Infrastructure development • Reduce depreciation on distribution pipelines from 20 to 15 years • Increasing Supplies • Additional royalties from Gulf of Mexico wells • “Expeditious Compliance” with NEPA requirements • New inventories of potential energy resources • Clarify state and federal roles in siting LNG facilities • Relieve regulatory burden and uncertainty regarding hydraulic fracturing • Efficient use of energy through a range of tax credits • Diversify the sources of energy used to generate electricity (clean coal, renewables, nuclear)

  8. Nuclear Issues • Extension of Price –Anderson Act liability indemnification • Applications for new licenses to construct or operate are exempt from anti-trust review • Next Generation Nuclear Plant Project

  9. Provisions Important to the IOU’s • Tax incentives (accelerated depreciation, production tax credit) • PUHCA repeal • Incentive transmission rates • Repeal of PURPA Sec. 210 mandatory purchase requirements • Limiting FERC regulation of themselves while increasing FERC regulation of public power

  10. Provisions Important to the Co-ops • Tax issues (CREBS, “85/15” limitations) • Statutory exemption under section 201 (f) of the Federal Power Act • Native load protection • Exemption from refund authority

  11. Useless, But Interesting, Factoids • Bill spanned 3 House committee chairs – Bliley, Tauzin, and Barton • Three Senate committee chairs – Murkowski, Bingaman, and Domenici • Two presidents – Clinton and Bush

  12. What Might Have Been Remember; July 11, 1996 • H.R. 3790 by Sen. Schaefer (R-CO) to mandate national retail completion by Dec. 15, 2000 (Also included a 4% RPS) • H.R. 3792 by Ed Markey (D-MA) also mandated retail competition • “Every year of delay will cost millions of dollars in lost economic growth and customer savings” – Holly Propst, CoS to Rep. Schaefer at 1996 APPA Legal Seminar

  13. Remember • “There is no longer any question that there will be retail wheeling” • Senate Energy Committee Chair Frank Murkowski (R- AK) March 6, 1996 • 1997 Sen. Dale Bumpers introduced comprehensive legislation that also included a national retail wheeling mandate

  14. Remember • The turning point (toward legislation focused solely on wholesale markets) came in 1998 with the Clinton Administration's comprehensive bill that included the “flexible mandate” encouraging states and “unregulated” utilities to consider retail access • Sen. Murkowski subsequently adopted this approach

  15. Remember October, 1999 • H.R. 2944 by Rep. Joe Barton (R-TX) • First bill to be passed by either committee; opposed by APPA; died before it got to the House floor • Included such issues as • bundled vs. unbundled transmission service; who has jurisdiction • Mandatory RTOs • Anti-municipal wholesale standard cost recovery rules for FERC • Interconnection standards • Did not include a hard or “flexible” mandate for retail competition

  16. Remember • Senate passage of S. 517 on April 25, 2002 on a vote of 88 – 11, and after six weeks of floor debate, marks the turning point leading ultimately to the enactment of EPAct05

  17. www.appanet.org

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