Electric utilities now face the risk that existing assets, costs, or contract commitments may be "stranded" by increased competition, leaving shareholders rather than customers to bear the costs....
Red, White, and Ready: The Patriotic Push for Energy Legislation
gas reserves at the Arctic National Wildlife Refuge, renewing the Price-Anderson Act, which provides for prompt compensation to the victims of nuclear accidents, and extending the Strategic Petroleum Reserve.
It is important to bear in mind there is a lot we can accomplish under current law. Over the past two years, the administration has made great strides toward increasing domestic energy supplies and diversifying foreign energy sources. For example, the president's decision to move forward on Yucca Mountain will ensure the continued viability of nuclear energy in the United States. The president's Coal Research Initiative will continue to develop new technologies for cleaning-and potentially eliminating-coal emissions, thereby protecting the viability of our largest domestic energy supply.
How should Congress incentivize companies and regulators to make it easier to repair and expand our energy infrastructure?
There is no question there is a need to increase investment in energy infrastructure, particularly the electricity infrastructure. Investment in transmission facilities has been stagnant for years, resulting in transmission bottlenecks that raise prices paid by consumers. FERC has taken some steps to encourage greater investment in transmission facilities, recently signaling a willingness to approve higher rates of return for transmission investments in some situations.
How best can energy legislation increase and diversify supplies while protecting the environment?
There are a number of legislative proposals pending that would increase and diversify our energy supplies while protecting the environment. Specifically, the administration put forward legislative proposals to increase U.S. renewable energy and energy efficiency, nuclear energy, hydropower, and oil supplies. The administration proposed tax provisions to promote renewable energy and energy efficiency, and Congress embraced our proposals. The administration put forward various proposals to promote an expansion of nuclear energy in the United States, including reauthorization of the Price-Anderson Act and nuclear decommissioning tax changes. Again, those proposals were embraced by Congress. The administration proposed legislative reform to the hydropower licensing process, and Congress has included licensing reform in House and Senate energy legislation. Congress has approved most of the administration's legislative proposals to expand domestic energy supply.
Where do conservation and renewables fit into an energy bill?
Energy efficiency and renewable energy are critical components of our National Energy Policy and comprehensive and balanced energy legislation. It was no accident that energy tax provisions proposed by the administration focused largely on promoting energy efficiency and renewable energy.
We have a two-track strategy-increasing domestic energy supply and reducing domestic energy consumption. Energy efficiency is as important to us as increasing domestic energy supply. We also have taken steps to promote renewable energy. Congress has embraced our energy efficiency and renewable energy proposals, and put a lot of their own ideas on the table. We are working with Congress on these proposals.
That being said, the administration does not support a renewable portfolio standard, which would mandate purchases of renewable energy without regard to cost and availability. We tried that approach once already with PURPA, which mandated purchases of renewable energy. PURPA did not effectively promote renewable energy, but did saddle consumers with billions of dollars of above-market costs. There