STATEMENT OF CONGRESSMAN RICK BOUCHER

Energy and Commerce Committee

Subcommittee on Energy and Air Quality

"Legislative Hearing on Discussion Drafts concerning Energy Efficiency, Smart Electricity Grid, Energy Policy Act of 2005 Title XVII Loan Guarantees, and Standby Loans for Coal-to-Liquids Projects"

May 24, 2007 

           The Speaker has announced that in July the House will debate a comprehensive measure to reduce U.S. reliance on petroleum, 60% of which is imported.  That importation comes from some of the world's least politically stable nations. To enhance both our economic health and our national security there is a broad consensus that we should develop domestically produced alternatives to petroleum to power transportation and reduce our energy consumption through broader energy efficiency and conservation measures.

          A number of House Committees are developing legislation for the July energy independence measure, and this committee is making a major contribution to that effort.

          This morning the subcommittee is conducting a legislative hearing on 4 titles that will be a portion of our contribution to the Speaker's energy independence legislation.

          In June, we will conduct a second legislative hearing on additional titles that are presently being constructed.

          For purposes of subcommittee markup, we will combine the subject matter of today's hearing with the additional titles, so that our entire contribution to the Speaker's energy Independence Day measure will be subject to a single markup.

          The titles we are discussing this morning address 4 objectives.

          We propose to reduce energy consumption through the adoption of 29 separate new energy efficiency measures.

          They range from new consensus appliance standards to requirements for improvements in lighting efficiency, green building provisions, industrial waste energy recovery and new processes under which DoE will expedite the approval of future energy efficiency standards.

          Another title will promote the deployment of a smart electricity grid so that consumers can elect to save money by shifting electricity consumption to off peak hours, a step which will help maximize the capacity of power generating stations.  Many exciting uses for the smart grid lie ahead, including using plug in vehicles as storage units for electricity generated by utilities during non-peak hours, which can be drawn from the vehicle batteries during times of higher electricity demand.

          Our provisions will help to bring the smart grid into being.

          Our other 2 titles are designed to promote domestic alternatives to petroleum. 

          An EPACT 05 we enacted loan guarantee authority for DoE to help bring innovative technologies and bio-fuels to the commercial market.  To date loan guaruntees have not been awarded, and DoE has misconstrued Congressional intent by refusing to offer guarantees equal to the full 80% of project cost that the statute contemplates.

          Consequently, commercial scale cellulostic ethonal production in the US has been held back. 

          Our loan guarantee language corrects that misrepresentation and upon its passage, and the award of guarantees, we can expect commercial scale ethanol production from cellulose to commerce in at least one state with additional with additional plants to follow.

          The final title will offer a federal price guarantee for 6 coal-to-liquids facilities, resolving uncertainties in the long-term outlook for oil prices that have inhibited the flow of private capital into coal-to-liquids facilities. 

          If we truly want to substantially lessen our reliance on petroleum, cellulosic ethanol form biomass and coal-to-liquids from our single most abundant energy resource offer the promise of success.

          The developers of these new liquid fuel resources have signaled a willingness to construct plants if our provisions become law.

          Finally, let me reemphasize that the purpose of the legislation we are developing for the Speaker's July floor action is energy independence.  It is not greenhouse gas control.

          In September this Subcommittee and the full Energy and Commerce Committee will process a mandatory greenhouse gas control measure.  We have conducted 10 days of hearings on climate change, and immediately following the July passage of the energy independence bill in the House, we will return our attention to climate change and the construction of our mandatory legislation.

          I want to thank all members who have shared suggestions with us for alternative fuels and energy efficiency.  Many of the member's ideas are reflected in the legislative titles we are hearing this morning and those we will have a hearing on in June.

          This has been a broad bi-partisan process, and I want to thank all members for their cooperation.