Energy bill revives debate on gas additive

/ Source: The Associated Press

The House Energy and Commerce Committee was expected to finish work on its portion of a massive energy bill on Wednesday but not before a Democratic challenge to another controversial provision that would provide makers of the gasoline additive MTBE protection against product liability lawsuits.

House Republicans also made clear their support late Tuesday for reinforcing the federal government’s final authority over the siting of liquefied natural gas import terminals, even if states or local communities object.

The full House was expected to take up the energy bill — now being crafted by three committees — possibly as early as next week. The Senate is expected to begin considered of an energy package later this year.

Embattled House Majority Leader Tom DeLay of Texas has been the primary force behind the MTBE provision. It cleared the House two years ago but prompted such an uproar in the Senate that it scuttled an energy bill as it neared approval.

The draft GOP energy bill would protect MTBE makers, including several major oil and refinery companies in Texas, from lawsuits that contend the manufacturers knew the additive would contaminate drinking water but pushed to have it widely used anyway.

The bill’s supporters said they are confident they will defeat attempts to remove the MTBE provision as they were Tuesday evening in the case of federal jurisdiction over LNG import terminals.

Besides the MTBE product liability shield, the draft GOP bill calls for phasing out MTBE use by the end of 2014 and giving manufacturers $1.75 billion in transition assistance. The legislation also calls for expanding an existing federal program that deals with leaking gasoline storage tanks and funneling more of that money into MTBE cleanup. Democrats say those funds are inadequate to deal with a cleanup task that could eventually affect thousands of communities.

In 2003, Bush administration officials at one point tried to get the MTBE measure out of the energy bill but were rebuffed by DeLay. House Republicans say they’re as determined as ever to keep it in this year’s legislation.

MTBE, or methyl tertiary-butyl ether, is an oxygenate widely used in gasoline to reduce air pollution. But it also has been found to contaminate drinking water supplies, sometimes leaving communities with expensive cleanup bills. Traces of MTBE have been found in water in almost every state, with levels high enough for potential cleanup problems in about half the states.

A number of lawsuits have been filed — and more are expected — that target the MTBE manufacturer and not just the fuel companies and gas stations that cause the MTBE to leak into groundwater. These lawsuits claim the MTBE makers knew the additive could cause pollution problems before it was widely used, and should have withdrawn it.

DeLay has argued forcefully that the government essentially mandated MTBE use when it passed a 1990 law requiring gasoline to contain 2 percent oxygen and that Congress should now help manufacturers make the transition away from producing MTBE and protect them against product liability lawsuits.

Democrats argue the Congress never required MTBE, only an oxygenate.

“These provisions represent a direct assault on the nation’s safe drinking water supply,” said Rep. John Dingell, D-Mich., “MTBE producers have known for years that MTBE was a problem. They should not be asking the taxpayers to now pay for cleanup or for (a) corporate handout.”

LNG rules clarified
An attempt by Rep. Ed Markey, D-Mass., to remove the LNG siting provision from the proposed energy legislation failed 35-18 to win committee approval. Supporters of the bill said the authority of federal regulators over LNG terminals needed to be clarified as the demand for LNG imports increases in coming years.

Rep. Joe Barton, R-Texas, the committee chairman, said it was “imperative” that the authority of the Federal Energy Regulatory Commission over approval of LNG import sites be clarified.

FERC regulates natural gas transmission and maintains it has the final say over LNG terminals as well. But California in a lawsuit has challenged the agency’s authority in connection with a proposed LNG import facility in Long Beach.

Markey, sponsor of the amendment that would have stripped the LNG provision from the bill, said the legislation will essentially block California’s court challenge and reduce the ability of other states to be involved in LNG siting decisions.

“It’s going to pre-empt the states for the purpose of taking care of the natural gas industry,” said Markey, warning that the provision will increase the likelihood that an LNG facility will be put in a populated areas over the objections of local residents.