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September 26, 2003

MBTE Fight Stalls Lawmakers' Ethanol Deal

H. JOSEF HEBERT
Associated Press

WASHINGTON - Congressional Republicans working on an energy bill were close to agreeing Thursday on a proposal to at least double the use of corn-based ethanol, although a last-minute glitch developed over banning another fuel additive that has been found to contaminate drinking water.

Both Senate and House sources involved in the discussion said the disagreements over the fuel additive, MTBE, that has held up the widely popular ethanol package could be worked out as early as Friday.

There is little disagreement over the proposal - already given a tentative nod by both the House and Senate - to require that refiners double the use of ethanol in gasoline to 5 billion barrels a year, which is seen as a huge boost to farmers and has the support of both Republicans and Democrats in Congress as well as the White House.

But wide Senate support hinged on making the ethanol provision part of a broader package that also would ban MTBE as a gas additive because it has been found to contaminate drinking water from California to New England. House negotiators have insisted the future of MTBE should be left up to states - many of which have already taken steps to phase out MTBE - and the marketplace.

Rep. Billy Tauzin, R-La., also has insisted that the compromise energy bill provide protection to MTBE manufacturers against product liability lawsuits arising out of water pollution cases. The liability protection also has been pushed by House Majority Leader Tom Delay and Rep. Joe Barton, Texas Democrats whose districts includes MTBE manufacturers.

Discussions on how to resolve the differences over MTBE went into the evening Thursday, according to both House and Senate sources.

Meanwhile, Sen. Pete Domenici, R-N.M., chairman of the energy talks, released a statement saying he hoped to finish a compromise energy bill by the end of next week. Republican drafts of much of the bill - apart from the ethanol proposal as well as electricity and tax issues - have essentially been completed, aides to the senator said.

But participants in the talks acknowledged that several electricity issues remained highly contentious.

Last month's blackout that hit parts of the Midwest and Northeast focused renewed attention on the need to improve and modernize the nation's transmission lines. However, lawmakers were divided over how much power to give federal regulators in establishing a national grid management program and whether to give them authority to order the taking of private land for key transmission lines.

Senators, largely from the South and Northwest, have insisted that the energy bill put the brakes on a proposal by the Federal Energy Regulatory Commission to require a national transmission plan and a requirement that utilities join regional grid management groups. They argue such a rule would take too much control away from state regulators and should be delayed at least three years.

At the same time, aides to Domenici said Thursday that the senator had not yet decided whether to keep a section that would allow oil drilling in Alaska's Arctic National Wildlife Refuge in the draft energy legislation. Domenici has said he won't take out the refuge provision if he determines it might jeopardize final approval of the energy bill in the Senate.

A number of Democratic senators have vowed to filibuster any energy bill that contains drilling in the Alaska refuge. It would take 60 votes to overcome such a filibuster and aides to Domenici said Thursday they were still five or more votes short.
 

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