Refinery Construction Bill Is Drawing Broad Criticism - New York Times
Refinery Construction Bill Is Drawing Broad Criticism - New York Times
By FELICITY BARRINGER
WASHINGTON, Oct. 6 - A Texas congressman's bill to give the oil industry incentives to increase refinery capacity would gut air-quality protections that currently govern the refining and power industries, Democrats, environmental groups and state and local regulators are charging.
The legislation's sponsor, Representative Joe L. Barton, the Republican chairman of the House Energy and Commerce Committee, said that no new domestic refineries had been completed in the past three decades.
"We've got to do something to change the status quo," Mr. Barton added, "and this bill intends to do it but it does it without messing with any environmental laws."
The measure is scheduled for a vote on the House floor Friday. Mr. Barton and leading Democrats predicted a close vote; the bill was approved by Mr. Barton's committee on a voice vote last week. It was introduced within weeks of the passage of major energy legislation that had been a goal of the Republican leadership for two years or more and includes some provisions that were dropped from that bill.
But Hurricanes Katrina and Rita hit the Gulf Coast in the weeks after the energy bill, and the subsequent rise in gasoline prices created a new political climate, prompting Mr. Barton to reintroduce some of the ideas that had not survived in the earlier legislation.
Mr. Barton's legislation would give regions downwind of polluted areas more time to comply with national standards on ozone levels and would limit the government's ability to prosecute utilities or refineries if they make plant changes that increase their overall emissions of pollutants.
It also provides for government reimbursement of an energy company if a private or state lawsuit delays construction of a new refinery.
In a letter to the House majority and minority leaders Thursday, nine state attorneys general, including Eliot Spitzer of New York, said that enactment of the bill "would be a major setback for air quality across the nation," adding that it "permanently eviscerates key protections of the Clean Air Act" governing refineries and power plants.
And Representative Edward J. Markey, Democrat of Massachusetts, who is on Mr. Barton's committee, said that its stated purpose of encouraging expanded refinery capacity flew in the face of the energy industry's interest in keeping supplies tight to maximize profit margins.
"They thrive in an environment where markets are tight," he said. "They have no financial incentive to create a refining glut either here or in the world."
In response, Marc Meteyer, a spokesman for the American Petroleum Institute, said "We have indicated over time that increasing refinery capacity is a priority issue for us - something we think is necessary and something that has been hindered over time" by environmental regulations.
Mr. Meteyer added that, while his association did not request the legislation, "The bottom line here is that the bill is helpful."
On Thursday night the measure seemed headed for a narrow - perhaps very narrow - victory in the House.
Its Senate prospects were far more dubious. Legislation containing some of the same provisions failed to clear the Senate Environment and Public Works Committee this year.
In addition to its other provisions, the legislation directs the Environmental Protection Agency to cut back to 6 from 17 the number of gasoline and diesel fuel blends that states may require as part of their air-pollution control efforts.
It is unclear exactly what costs the various air-pollution requirements impose on refiners, but the annual report of Valero Energy Corporation, a fast-growing refining company based in San Antonio, provides its own accounting.
In its 2005 annual report, Valero said that it spent $523 million last year to comply with environmental regulations and estimated it would spend $900 million in 2005. The company reported net income of $1.8 billion in 2004 and $1.38 billion for the first six months of 2005.
The timing of the Barton legislation, coming so soon after passage of the more comprehensive energy bill and including some provisions eliminated from that measure, prompted Democrats and environmental groups to charge that the Texas Republican was exploiting the hurricanes to help the energy industry shed long-standing environmental obligations.
In response, Mr. Barton said, "One thing that I'm not is an exploiter. What I am, though, is a realist."
With the arrival of $3-a-gallon gasoline, he said, his constituents are clamoring for relief - the kind he said his bill will offer.
Representative Sherwood Boehlert, a New York Republican who is chairman of the House Science Committee, announced his opposition to the Barton measure Thursday.
In a press release, Mr. Boehlert said, "The bill is based on false premises. The facts are that U.S. refining capacity has been increasing since 1994," despite the reduction in the total number of refineries.
He added, "Oil companies now have all the profits and incentives they need to build new refineries."
By FELICITY BARRINGER
WASHINGTON, Oct. 6 - A Texas congressman's bill to give the oil industry incentives to increase refinery capacity would gut air-quality protections that currently govern the refining and power industries, Democrats, environmental groups and state and local regulators are charging.
The legislation's sponsor, Representative Joe L. Barton, the Republican chairman of the House Energy and Commerce Committee, said that no new domestic refineries had been completed in the past three decades.
"We've got to do something to change the status quo," Mr. Barton added, "and this bill intends to do it but it does it without messing with any environmental laws."
The measure is scheduled for a vote on the House floor Friday. Mr. Barton and leading Democrats predicted a close vote; the bill was approved by Mr. Barton's committee on a voice vote last week. It was introduced within weeks of the passage of major energy legislation that had been a goal of the Republican leadership for two years or more and includes some provisions that were dropped from that bill.
But Hurricanes Katrina and Rita hit the Gulf Coast in the weeks after the energy bill, and the subsequent rise in gasoline prices created a new political climate, prompting Mr. Barton to reintroduce some of the ideas that had not survived in the earlier legislation.
Mr. Barton's legislation would give regions downwind of polluted areas more time to comply with national standards on ozone levels and would limit the government's ability to prosecute utilities or refineries if they make plant changes that increase their overall emissions of pollutants.
It also provides for government reimbursement of an energy company if a private or state lawsuit delays construction of a new refinery.
In a letter to the House majority and minority leaders Thursday, nine state attorneys general, including Eliot Spitzer of New York, said that enactment of the bill "would be a major setback for air quality across the nation," adding that it "permanently eviscerates key protections of the Clean Air Act" governing refineries and power plants.
And Representative Edward J. Markey, Democrat of Massachusetts, who is on Mr. Barton's committee, said that its stated purpose of encouraging expanded refinery capacity flew in the face of the energy industry's interest in keeping supplies tight to maximize profit margins.
"They thrive in an environment where markets are tight," he said. "They have no financial incentive to create a refining glut either here or in the world."
In response, Marc Meteyer, a spokesman for the American Petroleum Institute, said "We have indicated over time that increasing refinery capacity is a priority issue for us - something we think is necessary and something that has been hindered over time" by environmental regulations.
Mr. Meteyer added that, while his association did not request the legislation, "The bottom line here is that the bill is helpful."
On Thursday night the measure seemed headed for a narrow - perhaps very narrow - victory in the House.
Its Senate prospects were far more dubious. Legislation containing some of the same provisions failed to clear the Senate Environment and Public Works Committee this year.
In addition to its other provisions, the legislation directs the Environmental Protection Agency to cut back to 6 from 17 the number of gasoline and diesel fuel blends that states may require as part of their air-pollution control efforts.
It is unclear exactly what costs the various air-pollution requirements impose on refiners, but the annual report of Valero Energy Corporation, a fast-growing refining company based in San Antonio, provides its own accounting.
In its 2005 annual report, Valero said that it spent $523 million last year to comply with environmental regulations and estimated it would spend $900 million in 2005. The company reported net income of $1.8 billion in 2004 and $1.38 billion for the first six months of 2005.
The timing of the Barton legislation, coming so soon after passage of the more comprehensive energy bill and including some provisions eliminated from that measure, prompted Democrats and environmental groups to charge that the Texas Republican was exploiting the hurricanes to help the energy industry shed long-standing environmental obligations.
In response, Mr. Barton said, "One thing that I'm not is an exploiter. What I am, though, is a realist."
With the arrival of $3-a-gallon gasoline, he said, his constituents are clamoring for relief - the kind he said his bill will offer.
Representative Sherwood Boehlert, a New York Republican who is chairman of the House Science Committee, announced his opposition to the Barton measure Thursday.
In a press release, Mr. Boehlert said, "The bill is based on false premises. The facts are that U.S. refining capacity has been increasing since 1994," despite the reduction in the total number of refineries.
He added, "Oil companies now have all the profits and incentives they need to build new refineries."
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