Fuel prices are Peter Welch?ÇÖs top priority

By Christian Avard

June 12, 2008?á

He?ÇÖs almost through his first term and Peter Welch is not slowing down. The freshman congressman has been at the forefront on several issues ranging from veterans?ÇÖ benefits to middle class tax relief, health care, and the environment. He also is responsible for securing funds for programs and services throughout the state. Right now, Welch?ÇÖs top concern is fuel prices. With gasoline more than $4 a gallon, he is concerned that more Vermonters are struggling to make ends meet.

Last month, Welch co-sponsored a bill that escaped the headlines. The Strategic Petroleum Reserve Fill Suspension and Consumer Protection Act, , H.R. 6022, directs President George W. Bush to suspend shipments to the Strategic Petroleum Reserve (SPR) through the end of the year or until prices drop below $75 per barrel. The bill would reduce gas prices by 5 cents to 24 cents per gallon, according to experts. The House version passed both chambers by wide bipartisan margins, 385 to 25 in the House and 97 to 1 in the Senate. Bush signed the bill into law and according to a May 16 CNN report, the Department of Energy temporarily suspended oil shipments to the Strategic Petroleum Reserve for the remainder of 2008.

According to Welch, the United States purchases about 70,000 barrels a day to top off the SPR. Taxpayers, he said, are paying $134 a barrel. While H.R. 6022 isn?ÇÖt an end-all solution to fuel prices, giving consumers a break until the end of the year was necessary. ?Ç£It?ÇÖs a modest first step,?Ç¥ said Welch. ?Ç£The goal here was two-fold: To take a concrete if modest step in favor of the consumer and to take an important first step in standing up to the oil companies and the Bush administration.?Ç¥

The day after the Department of Energy suspended purchases, the price of oil went down $5 to $7 a barrel.

Despite the temporary relief, Welch also noted other factors are in play. He said oil prices are going back up now and as of Wednesday, the oil price was at $136.67 a barrel. When asked if H.R. 6022 could be extended to 2009, Welch didn?ÇÖt say no. Instead, Congress needs to take more steps.

The biggest one, he believes, is squeezing the speculative premium out of the cost of energy.

Last year, Senator Carl Levin, of Michigan, introduced legislation to close ?Ç£the Enron loophole.?Ç¥ For years, speculators used ?Ç£the Enron loophole?Ç¥ to artificially inflate oil prices and reap profits. Welch sponsored the House version of Levin?ÇÖs bill and the final version was attached to the 2008 Farm Bill. The final version would close the loophole and establish regulatory oversight over speculators and oil companies.

In May, both chambers passed the Farm Bill. President Bush vetoed it but Congress overrode Bush?ÇÖs veto. Welch believes this is another modest step.

?Ç£This could have much more of an impact because there?ÇÖs consensus that speculation is a significant factor in the cost of gas and home heating fuel,?Ç¥ said Welch. ?Ç£But in the long term, clearly, we need a new energy policy. If we invest the ranch on our ability to drill our way out, we?ÇÖre going to lose.?Ç¥

Welch believes the way to go is alternative energy. On May 21, Welch supported H.R. 6049, the Renewable Energy and Job Creation Act. The bill, passed in the House, extends and expands tax incentives for renewable energy and energy efficiency.

The legislation offers $18 billion in renewable energy and green job creation tax incentives including a six-year extension of the investment tax credit (ITC) for solar energy; a three-year extension of the production tax credit (PTC) for energy derived from biomass, geothermal, hydropower, landfill gas, and solid waste; and a one-year extension of the PTC for energy derived from wind. In addition to providing incentives for renewable energy, H.R. 6049 provides tax deductions for tuition and other education expenses and expands the refundable child tax credit to taxpayers earning as little as $8,500 a year. ?Ç£Eighteen billion went to the oil companies and we steered those toward alternative energy. That?ÇÖs the future.?Ç¥

In the bigger picture, Welch believes there?ÇÖs no silver bullet to the oil crisis. Congress, he believes, can only do so much, but citizens can do their part to save on energy costs. With current fuel prices, he is seeing more people beginning to make lifestyle changes. ?Ç£I really urge Vermonters to speak to Efficiency Vermont and talk to the fuel dealers,?Ç¥ said Welch. ?Ç£What are the practical steps they can take that will cut their energy bills??Ç¥

According to Welch, the time is now to consider alternatives. ?Ç£My biggest fear is how are families going to contend with the winter heating bills next year,?Ç¥ said Welch. ?Ç£I can see this winter that fuel bills are going to be so high that you?ÇÖre going to have some families doubling up, living together to try and save costs.?Ç¥