Robert Menendez

Bills To Lower Gas Prices, Spur Development Of Renewable Energy Blocked In US Senate; Menendez Reacts

Member of Energy and Natural Resources Committee was strong supporters of both bills

June 10, 2008

Washington - Today, separate pieces of legislation to take steps to lower gas prices in the near term and develop renewable energy in the long term were blocked by Republicans in the U.S. Senate. The Consumer First Energy Act and the Renewable Energy and Job Creation Act each garnered the support of a majority of the Senate, but a Republican tactic required 60 votes to proceed to a final vote on the bills, and neither reached that threshold.

Senator Robert Menendez (D-NJ), a member of the Energy and Natural Resources Committee who strongly supported both bills, said that a golden opportunity was missed to help families struggling with the price of gas and to help end the dependence on oil.

"At $4 a gallon, gas prices are forcing American families into a painful choice when it comes time to fill-up - do they fill up their gas tank, or do they forego a gallon of gas to buy a gallon of milk?" said Senator Menendez. "Today we had the opportunity to target some of the practices that keep gas prices artificially high, but the Republican ‘No' Machine seems to want to protect oil companies at all costs - even when it comes at the expense of American families.

"As if the obstruction of legislation to bring relief to families wasn't enough, the obstruction of legislation to create jobs while helping ending our dependence on oil in the long run was just as disappointing. The future is in green jobs, renewable energy and energy efficiency, not in oil. When we proposed a renewable energy package earlier this year, our Republican colleagues objected to how the tax credits were funded. This bill addressed those concerns, and they still objected. It seems they are just opposed to renewable energy because they do not want increased competition for fossil fuels."

The Consumer First Energy Act includes provisions to:

• Protect families from price gouging by giving the administration authority to levy stiff penalties and expediting cases against oil companies before the Federal Trade Commission;
• Ensure that oil companies raking in record profits pay their fair share with a tax on excessive profits, unless an they invest in renewable fuel, and by rolling back $17 billion in tax breaks to oil companies to be invested in consumer price protection, renewable fuels and energy efficiency;
• Stop oil traders from inflating the price of oil by preventing them from evading American reporting requirements and increasing the authority of the Federal Trade Commission;
• Stand up to price fixing among OPEC nations by giving the Attorney General additional authority.

The Renewable Energy and Job Creation Act includes provisions to:

• Create renewable energy incentives by providing almost $20 billion of tax incentives for investment in renewable energy related to energy production, transportation and domestic fuel security, and energy conservation and efficiency;
• Extend $27 billion of expiring temporary tax provisions for individuals and businesses, including the research and development credit, special rules for active financing income, the state and local sales tax deduction, the deduction for out-of-pocket expenses for teachers, and the deduction for qualified tuition expenses; and
• Provide additional tax relief for individuals and businesses, including almost $10 billion of additional tax relief for individuals through an expansion of the refundable child tax credit and a new standard deduction for property taxes.

This morning, Senator Menendez delivered a speech on the Senate floor regarding gas prices and the Consumer First Energy Act. The full text of those remarks, as prepared for delivery, are below:

M. President,

Every day Americans are watching the price of oil and gas shoot up higher and higher, and are watching as it gets harder and harder to make ends meet.

This week, the national average price of gasoline broke the $4 per gallon mark. When George Bush took office, gas cost just $1.46 a gallon. This dramatic increase in oil prices has brought prices for food up along with it, and American families are faced with a painful financial choice when it comes time to fill-up - do they fill up their gas tank or do they forego a gallon of gas to buy a gallon of milk?

Businesses are cutting jobs. Families have already eliminated non-essentials and are now cutting back on meals. Some Americans are even contemplating quitting their jobs because they can't afford the gas to get there. It's become painfully clear: we are in an oil crisis. And we'd better start taking action to get out of this mess.

Fuel efficiency, alternative fuels, and mass transit are the long-term answers that I will soon discuss, but consumers need immediate help, and the Consumer-First Energy Act will provide that relief.

The first thing the Democratic bill will do is make sure that our commodities markets are functioning fairly. The supply and demand equation is roughly the same as it was 2 years ago and yet we have seen prices go through the roof.

We all remember the damage Enron did to our nation's economy by manipulating unregulated electricity markets. The Consumer-First Energy Act will make sure that oil is traded on well-regulated, transparent markets which are free from manipulation. It requires Commodities Futures Trading Commission oversight, sensible margin requirements, and standard participant disclosures.

By making the oil futures market conform to usual standards and practices, we can combat excessive speculation and insure that the markets are free from manipulation.

The Consumer-First Energy Act also makes sure that oil companies are not taking advantage of American consumers. The Bush energy policy was written by energy companies for energy companies. And while it has worked well for energy companies, it has completely failed the American public. The major oil companies made $124 billion in profits last year and will earn even higher profits this year.

Are the oil companies using these enormous profits to give consumers a break at the pump? No. Are they using those profits to investment in new refineries or develop alternative fuels? No. Despite what my friends on the other side of the aisle might claim, Big Oil is not looking out for the American driver. Big Oil is looking out for itself.

And yet, despite the fact that Big Oil is doing all it can to reap record profits at the expense of our economy, Big Oil is in line to receive over $17 billion in tax breaks.

The Consumer-First Energy Act will fix this problem and make sure that Big Oil is paying its fair share of taxes, and isn't profiteering at the expense of American consumers. It includes a windfall profits tax which would raise revenue to invest in sustainable, domestic sources of energy and to provide relief to consumers suffering under high energy prices.

M. President, we must act now to provide immediate relief to American families. But in addition to relief and protections included in the Consumer-First Energy Act, we also need to think about what we can do to reduce consumption and rein in costs in the long term.

My friends on the other side of the aisle do not want to address this oil crisis. Instead they want to exploit it to try to provide even more government help for their Big Oil supporters. They tell their constituents that the answer to our oil addiction is to drill, drill, drill. But feeding the addiction by tapping another vein just drills us into a deeper hole.

The fact is that the world's largest remaining oil reserves are in the hands of foreign governments. That means it is difficult if not impossible for us to control our supply of oil. But the one thing we can control is our demand. In the long term, we need to invest in alternative energy, mass transit, and increasing fuel efficiency.

While we work to make alternative fuel technologies more affordable we need to drastically improve fuel economy. If we had increased fuel economy a modest 2% per year since 1981, our fleet would now average 34 miles per gallon. This alone would have cut our demand for oil by 30% while saving over 30 billion barrels of oil. 30 billion barrels of oil. According to the Energy Information Agency that is more than the proven oil reserves remaining in the United States. It's commendable that we finally raised CAFE standards this year, but we're going to have to make our vehicles a lot more efficient to make up for lost time.

We also need tax incentives for hybrids and plug-in hybrids, and need to support advanced battery research. Once our transportation infrastructure can run on alternative fuels like electricity or cellulosic ethanol, consumers will finally have a choice. We will be able to choose not to buy oil, and that will force gas prices back to earth.

And the last, but perhaps most important, long term solution to our current oil crisis is an immediate and substantial investment in mass transit. More people are taking commuter trains, buses, and even ferries now than in the past 50 years. For millions, having the option to use these alternative transportation modes has been essential to getting to work affordably. It is time we finally funded mass transit at the level it deserves.

M. President, it is time for a real cure, not the tired old policies of the past. This bill gives the American people what they need right now to get through the immediate problem, and starts us down the path to real, effective and sustainable long-term solutions to our energy crisis. I hope our energy security and our economic health is something we can eventually all agree on, and that we can deliver the bipartisan solution that American needs.

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