GOP claims 'solid agreement;' Democrats complain

WASHINGTON - Two-thirds of the $23-billion in tax breaks in the Republican-drafted energy bill would go to the oil, gas and coal industries. Democrats slammed the legislation, one describing it as "a hodgepodge of subsidies for the politically well-connected."

Congressional estimates released Monday put the cost of the package, the first overhaul of the nation's energy priorities in a decade, at $32-billion over 10 years.

Among provisions that would affect consumers directly is a tax credit of up to $4,000 for the purchase of hybrid gas-electric cars.

A House-Senate conference began considering a string of Democratic amendments, but few if any were expected to survive. GOP conference leaders said they were determined to complete the legislation so the House could take it up as early as today.

"This is a solid agreement," Sen. Pete Domenici, R-N.M., declared as he opened the conference at which House and Senate members were to cast their final vote on the bill. "I don't think we can take a risk of undoing this."

Details of the bill's tax section were completed during the week end, ending closed negotiations that spanned 21/2 months.

Among the bill's major provisions:

Tax incentives total about $14.5-billion for oil, natural gas and coal industries.

More than $5.2-billion in tax credits and other tax benefits over 10 years for developing renewable energy sources, including tax breaks for corn-based ethanol.

Doubled use of ethanol in gasoline, a boon to farmers and widely supported by both parties.

Federal rules and standards for high-voltage power lines to lessen the likelihood of cascading power failures like the one that produced August's blackout from Michigan to New York and into Canada.

A $1.8-billion research project to develop clean coal technology and tax benefits for a new generation of nuclear power plants to ensure diversity in energy sources for electricity production.

Provisions to speed up permits and ease environmental rules to develop of oil and gas resources on federal land.

"We provide billions of dollars in dozens of ways to reduce our dependance on foreign oil," said Rep. Billy Tauzin, R-La., the chief House negotiator.

Democrats argued the legislation falls short.

Rep. Jeff Bingaman, D-N.M., said the bill lacks enough incentives to promote domestic production or foster energy conservation to reduce America's reliance on oil imports.

"The tax goodies go to huge energy conglomerates, and most subsidize things that the companies already are doing," complained Sen. Ron Wyden, D-Ore., another of the conferees. He described the bill as "a hodgepodge of subsidies for the politically well-connected."

Republicans countered that the tax incentives, estimated to total $22.9-billion over 10 years, and other provisions amount to a blueprint for diversifying the nation's energy sources and improving the reliability of electricity transmission systems.

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