Energy R&D Bill Directs Oil Revenues
A bill introduced on Jan. 30 would provide an estimated $1 billion for energy research and development without raising taxes, according to authors U.S. Reps. Nick Lampson and Chet Edwards, two Texas Democrats.
H.R. 5146, the Invest in Energy Security Act, suspends the Strategic Petroleum Reserve (SPR) royalty-in-kind (RIK) oil program and directs that oil to be sold on the open market, creating a new revenue source to provide funding for energy independence research. By increasing oil supplies in the market, this legislation would protect consumers from continuously rising energy prices.
"Continuing to fill the Strategic Oil Reserve, which is at 98 percent capacity, with oil that is $91 per barrel is fiscally irresponsible and an inappropriate use of taxpayers’ dollars," said Lampson, chairman of the Energy and Environment Subcommittee. "Investing in alternative and traditional energy research will double or triple the utility of current reserves and enhance our energy security and independence while stimulating the economy with new industry and jobs."
"This is good legislation that will help add jobs to our economy, lower utility bills for families, and expand the production of traditional and renewable energy sources to help reduce our dependence on foreign oil and protect the environment," said Edwards, senior member of the House Energy and Water Appropriations Subcommittee.
The SPR was created to enhance national energy security and increase strategic assets, aimed for use during natural disasters or other shortages. Royalties are owed to the U.S. government by operators who acquire leases on the federally-owned land. The Minerals Management Service (MMS) traditionally collected royalties in cash, but in 1998 it started allowing producers to pay royalties "in kind" in the form of transferring barrels of royalty oil into the Strategic Petroleum Reserve. This strategy was meant to take advantage of low oil prices to refill the depleted SPR.
Included in the legislation is funding for the Research Partnership to Secure Energy for America (RPSEA), a non-profit national consortium headquartered in Sugar Land, Texas, which manages research and development of new technology for natural gas and oil exploration and production. RPSEA consists of more than 130 members including 26 of the nation's premier research universities such as Texas A & M University, five national laboratories, other major research institutions, large and small energy producers and energy consumers with activities in 27 states.
Although introduced as stand-alone legislation, the congressmen will work to include the language in a second economic stimulus package to help fund energy research and development that is currently under discussion.