What will $16 billion buy? A Senate energy plan

updated 5:54 p.m. ET June 28, 2005

WASHINGTON - The Senate approved an energy bill Tuesday that was more favorable to conservation, wind farms and ethanol and less kind to oil and gas producers than legislation passed by the House.

Whether the sharp differences can be resolved may depend on how much pressure President Bush can bring to bear. The president urged the lawmakers to resolve their differences quickly and send him a bill before August.

"The administration's attitude is we want a bill," Energy Secretary Samuel Bodman told The Associated Press. "I think you will see the president quite proactive on this."

Hard bargaining lies ahead, especially with a pesky issue surrounding the gasoline additive MTBE remaining a potential deal breaker — as it was two years ago.

Dangerous gasoline additive under fire
The House, particularly Majority Leader Tom DeLay of Texas, wants to protect oil companies and refiners who produced MTBE from environmental lawsuits brought by communities whose drinking water has been contaminated by the additive. DeLay said Tuesday an attempt is being made to "come up with a solution" to the MTBE issue, but provided no details.

Supporters of the Senate bill, which has broad bipartisan backing and is silent on MTBE, say such liability protection would trigger a filibuster and send the bill to defeat, as it did in 2003. Sen. Pete Domenici, R-N.M., said the House needs to work out a compromise on MTBE that can pass Senate muster.

After finishing all but a final vote on the bill last week, the Senate approved the 1,250-page document Tuesday 85-12. Seven Democrats and five Republicans voted against the bill.

Despite its broad sweep, which would affect virtually every energy industry while boosting energy conservation, lawmakers acknowledged the bill would have little impact on current high gasoline and crude oil prices. Crude oil eclipsed $60 a barrel this week and gasoline averaged $2.22 a gallon nationwide, according to the Energy Department.

Bush said the Senate-passed bill would help U.S. economic growth by addressing the root causes of high energy prices and the nation's growing dependence on foreign supplies. But the bill's critics argued it does little to reduce demand for oil, two-thirds of which goes for transportation, or reduce oil imports, which account for 58 percent of U.S. demand.

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