Senate Rejects Subsidies to Big Wind, Pickens Payout Plan
The Senate passed its version of the highway bill, S. 1813, this week on a 74 to 22 vote. Following votes on amendments last week, several more energy-related amendments were defeated on Tuesday, March 13, before the final vote. The vote tallies on these amendments, which were not germane to the underlying legislation and so required 60 (out of 100) votes to pass, were nonetheless quite interesting.
Senator Debbie Stabenow’s (D-Mich.) amendment to extend a number of tax subsidies for renewable energy, including the wind production tax credit, was defeated 49 to 49. Forty-nine Democrats voted yes. Forty-five Republicans and four Democrats—Joe Manchin (D-WV), Claire McCaskill (D-Mo.), Mark Warner (D-Va.), and James Webb (D-Va.)— voted no. Two Republicans missed all three votes. This is an encouraging result, but is by no means the end of the massive effort by the wind industry to get their subsidy extended beyond December 31st, as I detail in the item below.
Senator Jim DeMint’s (R-SC)amendment to end all tax subsidies for conventional and renewable energy and for energy efficiency then failed on a 26 to 72 vote. The twenty-six Republicans voting to go cold turkey on their subsidy addiction were Ayotte (NH), Blunt (Mo.), Burr (NC), Chambliss (Ga.), Coats (Ind.), Coburn (Okla.), Corker (Tenn.), Crapo (Id.), DeMint (SC), Graham (SC), Inhofe (Okla.), Johanns (Neb.), Johnson (Wisc.), Kyl (Az.), Lee (Ut.), McCain (Az.), McConnell (Ky.), Paul (Ky.), Portman (Ohio), Risch (Id.), Rubio (Fla.), Sessions (Ala.), Shelby (Ala.), Toomey (Penna.), Vitter (La.), and Wicker (Miss.).
Getting twenty-six votes to end all energy subsidies is quite a stunning result, but it’s not quite as impressive as it looks. Senators Richard Burr (R-NC), Saxby Chambliss (R-Ga.), and Tom Coburn (R-Okla.) turned around and voted to create several new tax subsidies for heavy-duty trucks fueled by natural gas.
The vote on the amendment offered by Senators Robert Menendez (D-NJ) and Burr was 51 to 47 (with 60 votes required for passage). Besides the three inconsistent Republicans, three other Republicans voted for the Pickens Payoff Plan, which is also known as the NAT GAS Act. They were Senators Collins (R-Me.), Isakson (R-Ga.), and Snowe (R-Me.). Thirty-nine Republicans and eight Democrats—Harkin (D-Ia.), Leahy (D-Vt.), Levin (D-Mich.), Nelson (D-Neb.), Pryor (D-Ark.), Sanders (Socialist-Vt.), Stabenow (D-Mich.), and Webb (D-Va.)—voted against the amendment.
I have been calling the NAT GAS Act, whose chief promoter is billionaire T. Boone Pickens, the Pickens Payoff Plan or the Pickens Your Pocket Plan since last spring. One of my CEI colleagues calls it the Billionaires’ Bailout. Any doubts that these pejorative characterizations are justified have been laid to rest this week by an article by Ryan Grim and Michael McAuliff in the Huffington Post.
The general outlines of their story have been known for some time, but Grim and McAuliff provide a lot of details on the ways in which Pickens has connived with Senate Majority Leader Harry Reid (D-Nev.) to get his bill passed and the vast sums of money that Pickens, George Soros, and others will make. It has also been reported that House Minority Leader Nancy Pelosi (D-Calif.) and Senators Burr and Chambliss have significant investments in companies that will profit from federal subsidies to natural gas vehicles.
Big Wind Plots Comeback
A bill was introduced on Thursday by Senator Charles Grassley (R-Ia.) to extend the 2.2 cents per kilowatt hour production tax credit (or PTC) for wind power for two years. Senators Scott Brown (R-Mass.), Dean Heller (R-Nev.), Mark Udall (D-Colo.), Tom Harkin (D-Ia.), Ron Wyden (D-Oreg.), and Michael Bennet (D-Colo.) are original co-sponsors.
The sponsors are looking to attach their bill as an amendment to a bigger piece of legislation. One possibility is as an amendment to the JOBS Act, H. R. 3606, which recently passed the House. A more likely vehicle is the package of business tax extenders being put together. Wind lobbyists are pulling out all the stops to get the wind subsidy extended (and if they succeed, many of them will get multi-million dollar bonuses). If the wind PTC is included in the business tax extenders package, it will be very hard to stop because that bill will be strongly supported by the U. S. Chamber of Commerce and the National Association of Manufacturers.