|
Rising Energy Prices
When the President signed the Energy Policy Act of 2005 (PL109-58) into law last year, supporters of the legislation claimed that it would ease demand, increase supplies of gas and oil, and reduce energy costs consumers and small businesses. However, over the past year the law has done little more than raise energy prices and dramatically increase oil company profits. In the Hartford area alone, prices have risen 77 cents in the past year to a current average of $3.23 a gallon. While Americans are being squeezed by these record prices, oil companies are bringing in record profits and being given billions in federal tax breaks. Exxon Mobil, for example, made a profit of $36.1 billion, up 31 percent from 2004.
Rather than reward oil companies with unneeded tax breaks and letting energy lobbyists write our national energy policy, I believe that Congress needs to take real action not only to provide short term energy relief to hard working Americans, but to develop long terms solutions that will free our nation from our dependence on foreign sources of oil and secure an innovative and independent energy future for our nation.
Below you will find helpful information about the current state of energy prices and what I am doing to address the issue in
Congress, specifically:
Ending our
Dependence on Foreign Oil
In 2005, the U.S. imported an average of 13.5 million barrels of oil per day, representing nearly 65 percent of total national oil consumption. By May 2006, that average increased to nearly 14.2 million barrels a day, costing our nation over $700 million each day to import the oil needed to meet demand. The steady increase in energy prices, coupled with rising tensions in oil producing regions of the world such as the Middle East and Africa,
clearly demonstrates the need for our nation to diversify our national energy portfolio and develop alternative sources of energy that will lead us to a secure and independent energy future.
To do this, I believe that federal, state and local government must invest the development of new sources of energy, such as hydrogen fuel cells. Similar to the effort to put a man on the moon, I believe we must marshal all the resources of our government towards this goal. Since coming to Congress, I have been a strong supporter of efforts to foster the advancement of this critical technology. I am also a co-founder of the House Hydrogen and Fuel Cell Caucus. You may learn more about hydrogen fuel cells here.
Editorials
-
1/20/02
-
Larson Promotes U.S. Energy Independence (Hartford
Courant)
Correspondence
- 7/28/06 – Hydrogen and Fuel Cell Caucus letter to Energy Secretary Bodman urging his support for fuel cell funding in 2008 federal budget
Additional Information
Gas Prices
In May 2006 I asked the House Government Reform Committee Minority Staff to compile a report detailing the impact of high gas prices on the Hartford area. Their report found that gas prices in central Connecticut have risen 69 percent in the past five years, from $1.82 per gallon in May 2001 to $3.07 in May 2006. This increase will cost families in the Hartford area an average of $1,640 more for fuel costs than five years ago. In total, rising energy prices will cost Connecticut families $2.2 billion in 2006. You may view the report
here.
On August 24, 2005, I wrote to the leaders of the House Energy and Commerce Committee urging them to immediately investigate whether major oil companies were taking advantage of Americans at the pump, and provide real relief from rising gas prices. In addition, I wrote to the Secretary of Energy asking what his department has done to address rising energy costs.
In October 2005, I joined with Congresswoman Louise Slaughter (D-NY) in offering an amendment during consideration of the Gasoline for America’s Security Act that would have eliminated the practice of ‘zone pricing,’ a restrictive practice that forces gas stations to purchase their supply from a single wholesaler rather than shopping around for the best price. Although the House Republican Leadership prevented the House from considering the measure, Larson and Slaughter introduced the amendment as stand alone legislation, the
Eliminate Gas Price Discrimination Act (H.R.
3954). The bill has been referred to the House Energy and Commerce Committee, where it awaits consideration.
I am an original cosponsor of Anti-Price Gouging Act
(H.R. 3681), which would make it illegal to drastically and baselessly raise the price of oil and other critical supplies during times of national disaster. In addition, I am a cosponsor of the
Federal Response to Energy Emergencies Act (H.R.
3936) which would give the Federal Trade Commission (FTC) the explicit authority to investigate and punish those who artificially inflate the price of energy.
Floor
Speeches:
Press
Releases:
-
5/12/06
- Larson and DeLauro Blast Republican Congress for Lack of Solutions to
Rising Fuel Prices (Energy)
-
5/4/06
- Larson Offers Motion to Eliminate Oil Industry Tax Giveaways (Energy)
-
4/27/06
- Larson Introduces Bill to Repeal Tax Giveaways to Oil Industry (Energy)
-
4/26/06
- Democratic Vice Chair Promotes Package of Energy Price Legislation (Energy)
-
4/25/06
- Larson Welcomes President to Gas Price Debate (Energy)
-
4/21/06
- Larson Calls for Action on Soaring Fuel Prices (Energy)
-
10/7/05
- Larson Rejects GOP Gas Act That Rewards Oil Companies, Neglects
Consumers (Energy)
-
9/6/05
- Larson Applauds Hearing Into Spiraling Fuel Costs (Energy)
-
8/22/05
- Larson Demands Hearings on Soaring Gas Prices (Energy)
Correspondence
- 8/24/05 –
Letter to House Energy and Commerce Committee urging investigation of
gas prices and options to provide relief from spiking costs
- 8/24/05 –
Letter to Secretary of Energy Bodman asking what actions will be taken
to address high energy costs
- 9/7/05 – Letter to Attorney General Gonzales urging him to investigate gas price gouging
Additional Information
Volatility in the Futures Market
While there are a number of contributing factors in the recent price increases for oil and gasoline, there is a growing concern that the recent volatility of energy prices may be partially due to increased – and possibly excessive – speculation in energy futures. Wholesale prices for energy in the United States are driven in large part by daily trading on energy futures contracts, and as the largest energy commodities trading center in the world, futures traders on the NYMEX play an enormous role in setting the prices that are ultimately passed on to the consumer.
I believe it is critical that Congress shine the brightest possible light on the role commodities traders are playing in rising energy prices to ensure that Americans are not being taken advantage of at the pump at someone else’s profit. At my urging, the Government Accountability Office (GAO) has begun an examination of the Commodities Futures Trading Commission and their oversight of energy futures trading.
The report is expected to be completed in the fall of 2006.
In addition, I am an original cosponsor of the Prevent Unfair Manipulation at the Pump (PUMP) Act
(H.R. 5248), introduced by Rep. Bart Stupak (D-MI). The PUMP Act would require off-market speculators to play by the same rules that speculators that participate in on-market trading already do. By providing transparency and oversight of off-market trading, this legislation would allow the Commodities Futures Trading Commission (CFTC) to better monitor these deals to prevent market manipulation. This increased oversight will improve confidence in the market, and will help eliminate the unreasonable inflation of crude oil prices, helping protect American consumers at the pump. The PUMP Act would also increase penalties for market manipulation.
Correspondence
- 3/28/05 –
Letter to GAO requesting an investigation of the Commodities Futures Trading Commission’s oversight of energy futures
- 4/25/05 –
Letter to the Chairman of the CFTC expressing concern over energy futures trading on
NYMEX
- 6/10/05 – CFTC explanation of the role of futures trading in energy costs
- 8/3/05 – Notice from GAO of their intent to begin a review of futures trading at Larson’s
request
- 9/16/05 – Larson led letter to Energy & Commerce and Agriculture Committees urging their examination of the
issue
Additional Information
The Winter Home Heating Season
According to the Energy Information Administration, per-household expenditures for heating oil in New England are expected to rise an estimated 29 to 33 percent for the 2005-2006 winter season. As a result, it will cost people in Connecticut hundreds of dollars more this year to heat their homes. This increase will especially impact low income households and the elderly whose already tight budgets will be stretched thinner.
I have long been a supporter of the Low Income Heating and Energy Assistance Program (LIHEAP). This program provides critical financial assistance to individuals and families in Connecticut to help pay their energy bills in times of high prices and emergencies. I am very concerned about the impact of high prices costs on families in Connecticut and will continue to fight to ensure this program has the funding it needs to help get them through upcoming winter.
Correspondence
- 11/14/05
- Letter to the Labor-Health and Human Services Appropriations
Subcommittee urging full funding for LIHEAP
- 9/8/05 – Letter to President Bush urging him to release $900 million in emergency LIHEAP funds to address high energy costs following Hurricane
Katrina
- 9/14/05 – Letter to House and Senate Appropriators urging an allocation of $4 billion for LIHEAP for FY06 to address increased winter energy
costs
Additional Information
Excess Oil Profits
In 2005, Exxon
Mobil posted a net profit of $36.1 billion - a 31 percent increase from the
year before. Exxon earned $10 billion in the fourth quarter of 2005
alone – up from the previous quarterly record of $9.92 billion, set by
Exxon in the third quarter of 2005. Despite record breaking profits, Congress has not hesitated to give billions in hard earned taxpayer money to the oil industry in the form off tax breaks and incentives. I strongly believe that our national energy and tax policies should reflect the common sense that Americans should not be getting hit by high prices twice -- once at the pump and once again seeing their tax dollars given away to an industry enjoying unprecedented levels of profit.
To this end, I
joined with Congresswoman Rosa DeLauro (D-CT) to introduce the Consumer
Windfall Excess Oil Profits Protection Act of 2005 (H.R.
4276) which would impose a windfall profit tax on oil and natural gas.
The proceeds from these profits would be used to fund the Low-Income Home
Energy Assistance Program (LIHEAP), which provides home heating assistance
to low-income families, and for veteran's medical care provided by the
Department of Veterans Affairs.
In addition, on April 27 2006 I introduced the
Oil Subsidy Elimination Act (H.R.
5234) to rollback nearly $7 billion in federal tax breaks and incentives for the oil industry. H.R. 5234 would ensure that Connecticut consumers are not being forced to use their tax dollars to subsidize an industry that is receiving huge profits from as a result of the high priced gas they buy for their families and businesses.
On May 4, 2006, I offered a motion to instruct House conferees on the Tax Reconciliation Act (H.R. 4297) to accept three bipartisan provisions passed by the Senate that would eliminate $5.4 billion worth of tax subsidies and loopholes for large oil companies. The motion failed by a vote of 197 to 224, with almost every House Republican voting against it. You can learn more about this motion here.
Finally, I am also an original cosponsor of the
Restore a Rational Tax Rate on Petroleum Production Act of 2006 (H.R.
5218), introduced by Rep. Jim McDermott (D-WA). H.R. 5218 would eliminate an unneeded manufacturing tax deduction enacted for the oil industry in 2004. Recent reports have shown that oil companies are receiving millions of dollars as a result of this unneeded tax cut. Conoco Philips, for example, received $106 million from this tax benefit in 2005. The cost of this benefit is expected to triple by 2010 as it is fully phased in.
Statements and Editorials
Correspondence
- 11/8/05
- Letter to Speaker Hastert urging him to call oil company executives
before Congress to explain the relationship between rising oil prices
and oil company profits
Additional Information
|
