Feeling the heat over the budget deficit in Washington, Senate Republicans have used razor-sharp knives to cut the cost of the one-time $31 billion omnibus energy bill by more than half.

The net cost of the energy bill (HR 6) now is approximately $13-$14 billion, said Marnie Funk, a spokeswoman for Chairman Pete Domenici (R-NM) of the Senate Energy and Natural Resources Committee. “I have significantly reduced the cost of this bill and I’m confident it will get broad support in the Senate when it is considered,” Domenici said.

Funk dismissed published reports that the energy measure could be offered as an amendment to a larger bill as early as Tuesday. Domenici had wanted the energy bill to be tacked onto the $318 billion highway bill currently on the Senate floor, but other GOP leaders did not favor this strategy, said a Capitol Hill aide.

At a policy lunch Tuesday, Chairman James Inhofe (R-OK) of the Environment and Public Works Committee “asked me not to offer my bill as an amendment to his highway bill,” Domenici said. “I am a chairman; I understand the challenges Chairman Inhofe faces with his bill. I will respect his wishes and wait.”

The stripped-down energy bill would maintain many of the tax breaks and incentives for the crude oil and natural gas industries, such as royalty relief for marginal oil and gas well production and expanded drilling incentives in the Gulf of Mexico. However, the effective date of the provisions would be postponed until fiscal year 2005, the aide noted.

Sen. Jeff Bingaman of New Mexico, the ranking minority member on the Senate Energy Committee, is opposed to attaching the energy measure to the six-year highway transportation bill, spokesman Bill Wicker said. “My boss thinks a highway bill ought to be a highway bill.”

The highway measure “has been shaky all along,” he noted, adding that if you attach energy to it, “you might gum it up even more.”

The House passed the broad energy bill last November, but the measure stalled in the Senate when GOP leaders failed to garner enough votes to bring the measure to the floor. The House will be required to vote on the bill again, given the major changes that have been made to the measure.

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