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A key lawmaker indicated Thursday that Congress is likely to get an energy bill on President Bush’s desk before Congress’ August recess, downplaying concerns that the expected repeal of the Public Utility Holding Company Act — a provision of the bill that restricts deals involving power utilities — could be delayed until the fall. Rep. Joe Barton, the Texas Republican who chairs the House Energy and Commerce Committee, told reporters that the chances are “over 50 percent, maybe over 75 percent, and hopefully 100 percent” that the bill will be ready before the recess. Barton’s committee approved an energy bill, passed by the full House in April, that repeals PUHCA. The Senate is to commence floor debate Tuesday on an energy bill that would also repeal PUHCA, a goal of Bush and many in the power industry. Analysts have said repeal would put as much as $1 trillion of utility assets into play. The Senate debate over PUHCA is expected to turn on whether the Federal Energy Regulatory Commission should be given expanded merger-review powers to make up for those that would be lost if PUHCA is repealed. The draft Senate bill increases FERC’s powers, but the House bill does not. Given that difference, some have suggested that Senate repeal of PUHCA with the FERC conditions attached would set up a protracted struggle in conference committee over the summer as the two chambers seek to reconcile their differences. But Barton hinted Thursday at House willingness to consider expanded powers for FERC. “We really didn’t have that much debate on that this time around,” he said, alluding to PUHCA discussions in his committee. “We have outright repeal of PUHCA in the House bill, and I think the House is going to insist that PUHCA be repealed. But having said that, some additional requirements for reporting and transparency and perhaps merger review wouldn’t be automatically be off the table from the House perspective.” To be sure, even if PUHCA is not divisive enough to kill or delay the overall energy bill, other issues might be. One is a provision that would grant a liability waiver to oil companies that produced methyl tertiary-butyl ether, or MTBE, a gasoline additive that has been found to pollute groundwater. The waiver issue killed the energy bill in 2003. The House bill contains such a “safe harbor” provision but the Senate bill does not. Barton said a task force is negotiating a compromise on the MTBE matter. “Our task force is very engaged and we have a deal to have a deal, but we’re not ready to disclose the deal,” he said. “When the time comes for the deal to be done, I’m very confident it’s going to be done.” But Senator Pete Domenici, R-N.M., chairman of the Senate Energy and Natural Resources Committee, said he didn’t think any provision regarding MTBE would be offered as an amendment on the Senate floor. “I can’t imagine it,” he said during a briefing with reporters Thursday. “I don’t know of any senator that would offer a ‘hold harmless’ provision. And I want to be fair now: The ‘hold harmless’ in the House is not a ‘hold harmless’ from liability for MTBE damage. It’s a ‘hold harmless’ for those who manufacture it, not [for] anyone that was negligent in the application, storage, etcetera, of MTBE.” Other matters that promise to be contentious relate to offshore natural-gas and oil reserves, renewable fuels, climate change and the siting of liquefied natural gas terminals. Domenici and Jeff Bingaman of New Mexico, ranking Democrat on the Senate Energy committee, said there will be “serious debate” on these issues. Nevertheless, Bingaman indicated he would vote for the current bill even as it stands if necessary, saying its benefits outweigh its deficiencies. “I would think we would have missed a great opportunity to do some very, very needed and responsible things,” he said. “But I think if you’re talking about, are we better off with current law, or with this legislation on the books, I clearly would believe that this legislation should be enacted.” Meanwhile, pro-PUHCA groups weighed in to try and save the law. In a letter to the Senate, 76 national and state consumer and public-interest groups said repeal of PUHCA “is one of the most harmful provisions” in the House bill, according to consumer group Public Citizen, which led the effort. The letter said PUHCA has protected customers from excessive concentration of energy ownership since it was passed in 1935. It also noted that the top five oil companies now control 50 percent of all U.S. oil production. “If they also controlled public utilities, they would be too powerful for any government to regulate.” PUHCA forbids non-utilities from owning power producers. The group also said language in the Senate bill shoring up FERC’s merger oversight is inadequate, saying it is “clearly impossible” for state or federal regulators, with limited staff, “to review, much less understand and control, the books and records of huge conglomerates like AIG, Goldman Sachs [& Co.] or ExxonMobil.” Lynn Hargis, an attorney with Public Citizen, said “giving FERC more merger authority is meaningless. FERC has no structural or geographic limitations for utility mergers, which is essential for regulating the size and scope of utility holding companies and preventing the kind of abuses that led to the enactment of PUHCA in 1935.” Copyright �2005 TDD, LLC. All rights reserved.

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