Working to Ensure Balanced Energy Policies

Getting it Right is Vital to a Strong Economic Future

Because a reliable, affordable energy supply is a foundation block for a strong economy, the North Carolina Chamber is committed to ensuring that balanced, comprehensive energy policies are put into effect that will provide a sufficient supply for businesses and residents and protect our environment and quality of life. 

Recently federal legislation was passed that originally included several harmful provisions that would have directly affected our state’s utility industry. After tough negotiations, however, the Energy Independence and Security Act increases energy efficiency without placing an undue burden on the utility industry. While the final legislation did not include many of the erroneous provisions, our Chamber believes that the final version could have done a better job of ensuring new energy supply domestically. Our Chamber’s national partners fought hard to ensure that the most harmful provisions were not included in the final version of the legislation.

Keeping Our Utility Industry Competitive:

Additional Regulation is Not the Answer

Congress and various Administrations have perhaps imposed more regulations on the oil and gas industry than any other industry in the United States. The original version of the Energy Act contained several new regulatory burdens that our national partners, such as the National Association of Manufacturers (NAM), vigorously fought to remove. The following are the key provisions that NAM and our Chamber opposed:

• Mandatory Renewable Portfolio Standard
  
  The original legislation contained a provision was included that would have required that 15 percent of electricity from private utilities come from solar, wind, or other renewable energy sources. It would have been the first such requirement to apply to all states. In effect, the renewable portfolio provision would have translated into a new tax on electricity, raising costs for consumers – including NC energy providers.  If passed as initially introduced, the legislation also would have negated new North Carolina law relative to renewable energy.
  
  Our Chamber is proud to have supported state legislation last year that made North Carolina the first state in the southeast to implement renewable energy efficiency standards. While our Chamber stands behind renewable energy and new energy efficiency programs, we realize our state, not the federal government, needs to consider how best to generate electricity in the best interest of North Carolina’s economy, our environment and consumers.  One size-fits-all policies are hardly ever a good idea.

• Targeted Tax Hikes
  
  The original legislation also included a $22 billion tax on energy producers. The provision would have ended the current tax deduction for energy producers, resulting in an additional tax burden for energy producers nationwide. This tax would have unfairly targeted the energy industry, adding to the already high costs of energy production, thereby discouraging new domestic oil and natural gas production and raising costs for businesses and even costing US jobs.
  
  As Representative Ted Poe (Illinois) said, “By raising taxes and fees on oil and gas companies that choose to manufacture in America, the U.S. will become a less attractive place to produce oil and natural gas. This essentially creates incentives for foreign importation and could kill manufacturing jobs in an industry that employs nearly 1.8 million Americans.”

Final Energy Bill Achieves Balanced Approach

The original version of the Energy Independence and Security Act included measures that would have resulted in tremendous burdens and increased costs on our state’s energy industry. Our Chamber commends NAM for its strong efforts in ensuring that the final legislation represented a more balanced approach to national energy policy. Among the provisions that were enacted are the following:

• Fuel Standards
  
  The new Energy Act establishes new requirements for both the fuel economy standard and the renewable fuels standard. The national average fleet fuel economy standards for cars and light trucks will be raised to 35 miles per gallon by 2020. Additionally the renewable fuels standard will be 9 billion gallons in 2008 and progressively increase to 36 billion gallons by 2022.

• Energy Efficiency Policies
  
  Most notable for our Chamber about the Energy Act are the provisions promoting energy conservation through efficiency programs and increased efficiency standards. The Act establishes programs for a wide range of appliances as well as lighting efficiency and standards. Included also are key research and development incentives for energy efficiency.

Our Chamber supports the advancement of energy policies for North Carolina that balance growth and the increased demand that comes with it while protecting our environment and quality of life. To meet growing demand for electricity, industry and government must work together to increase energy efficiency and supply simultaneously.  To do otherwise is simply not an option if North Carolina and our nation are going to remain leaders in the rising global competition for international energy resources and commerce. Click here to learn more about the Energy Independence and Security Act.

Energy Policy: A Continuing Priority on our Agenda

Our Chamber and its members are committed to a clean environment and strong economy and will continue to work to meet the challenge in partnership on the national and state levels. Energy and the environment will continue to be important issues during 2008. Climate change in particular is predicted to be one of the issues to receive continued attention in Congress. The Low Carbon Economy Act of 2007, which was introduced by Senators Jeff Bingaman (D-NM) and Arlen Specter (R-PA) could potentially result in increased regulations and costs for our state’s utility industry. Our Chamber will continue to monitor these important energy policies and provide an update in future publications.