The policy portion of the broad energy bill containing key natural gas and electricity initiatives may have made its farewell appearance on the Senate floor for the year last week, as senators voted not to invoke cloture on an amendment that sought to piggyback energy policy provisions to unrelated legislation banning Internet access taxes. This was the latest and perhaps biggest setback in what has been a string of setbacks for the energy bill in the Senate this year.

“This may be the last chance you [senators] get” this session to vote on energy policy legislation, warned Sen. Larry Craig (R-ID) on the Senate floor last Thursday, just prior to the vote opposing cloture. Senate Minority Leader Tom Daschle (D-SD) echoed the sentiment, saying that attaching the energy policy amendment to the Internet tax bill was “our only option.”

In an unusual bipartisan display, Daschle urged Democrats to support an attempt by Sen. Pete Domenici (R-NM) to get critical energy policy provisions through the Senate on the coattails of the Internet tax bill. “This is a very much different [energy] bill” being offered by the GOP, said Daschle, adding that the controversial provision on a liability waiver for producers of the gasoline additive, methyl tertiary butyl ether (MTBE), was taken out.

The GOP-led Senate fell five votes shy of the needed 60 votes to invoke cloture on the second-degree amendment offered by Domenici, which would have added the entire 900-plus page policy part of the energy bill (S. 2095) to the Internet measure. By not invoking cloture, his amendment has been set aside indefinitely. If it had been invoked, the Senate would have proceeded with 30 more hours of debate, which is rarely used, that would have led to an up-and-down vote on the amendment.

Of the 55 senators who voted for cloture, 39 were Republicans and 16 were Democrats (including Daschle and Senate Minority Whip Harry Reid of Nevada). The opponents included 30 Democrats, and 12 Republicans/one Independent (five of whom are from Northeast states). Key GOP senators casting “no” votes were Trent Lott of Mississippi, John McCain of Arizona and Kay Bailey Hutchison of Texas.

But even if the vote had been favorable for Domenici, the victory would have been very short-lived. The Senate immediately following the vote on the Domenici initiative agreed to invoke cloture on a substitute amendment offered by McCain to the Internet tax bill (S. 150), which Domenici acknowledged would have “wiped out” his energy-policy amendment.

An energy proposal “really has no business [in] an Internet tax bill,” said McCain, who vowed that if it had been adopted by the Senate, it would be dropped during conference between the House and Senate.

Domenici’s measure would have faced tremendous opposition from House Republican leaders because it failed to include the liability waiver for MTBE. The safe-harbor provision is strongly backed by both Rep. Joe Barton (R-TX), chairman of the House Energy and Commerce Committee, and House Majority Leader Tom DeLay (R-TX).

“We’re not going to get MTBE in the United States Senate…It’s an absolute wish that cannot happen,” countered Domenici. Senate Democrats and Northeast Republicans are against an MTBE waiver.

Domenici, chairman of the Senate Energy and Natural Resources Committee, proposed the policy portion of the Senate energy bill as a second-degree amendment last Tuesday. The amendment included all aspects of the energy bill, except the 10-year, $13 billion tax package, which was piggybacked to a corporate tax cut measure in April (S. 1637).

An upcoming cloture vote on the pending corporate tax bill also is said to face an uncertain future. Senate leaders still are trying to reduce the unwieldy number of first-degree amendments (80) to the bill. In addition, McCain has threatened to filibuster the energy tax portion of the measure. The Senate is slated to vote on cloture this week.

Frustrated over the energy bill being stalled in the Senate since the start of the year, Domenici saw this as his best, and perhaps his last, opportunity to move the bulk of the energy bill through the chamber this year.

“This is as good as we’ll ever get,” he said, referring to the streamlined energy measure.

Domenici offered his proposal after Daschle moved to attach a first-degree amendment, which proposed incentives to double the production of corn-based ethanol, to the Internet bill. Daschle’s amendment opened the door for Domenici to try to jump-start Senate action on the energy bill. But Daschle’s initiative also failed to achieve cloture last Thursday, falling 19 votes short of the required 60 votes.

Although “disappointed” that the Senate didn’t throw the energy bill a badly needed life-line, an energy industry analyst believes “there’s [still] a possibility of bringing a bill back later [this year],” but he acknowledged “it will be an uphill battle.”

At the moment, “the mood in the Senate is not a constructive one in terms of getting a major comprehensive bill through,” he told NGI. But there may be “some opportunities after the summertime” to return to the energy bill, particularly if gasoline and natural gas prices continue to escalate, and power outages occur over the peak summer months.

Even if last week’s “parliamentary gymnastics” had succeeded, the prospects for an omnibus energy bill to emerge from Congress this year still would be “poor,” absent a compromise on MTBE liability and a different approach to the tax package, said energy analyst Christine Tezak of the Washington Research Group at Charles Schwab & Co. Inc.

“The House leadership has been wanting to see some compromise…before it will commit to resuscitating the energy bill on its side of Capitol Hill…We are negative on the prospects for split legislation being ultimately enacted into law,” Tezak said.

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