CNBC Business Center - Transcript

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SHOW: Business Center (5:00 PM ET) - CNBC

HEADLINE: Senator Peter Domenici discusses the energy bill

ANCHORS: RON INSANA

BODY:
RON INSANA, co-anchor:

As Congress races to adjourn by mid-November, two key pieces of legislation remain to be passed. Medicare drug coverage and the energy bill. The three-year-old bill, which is up to 1,600 pages long, is said to be hung up still on the ith-issue of ethanol subsidies. Tomorrow congressional leaders will go into conference committee to hammer out some final details; at least we think so. Senate Energy and Natural Resources Committee Chairman Pete Domenici is here now to give us the latest on where this crucial piece of legislation stands.

Senator, good to see you. Thanks for being with us tonight.

Senator PETE DOMENICI (Republican, New Mexico): Thank you. It's nice to be on with you, Ron.

INSANA: You going to have a conference committee meeting tomorrow or not?

Sen. DOMENICI: Well, let me make sure that you and your listeners understand. There's more than one conference going on. Substantially, three-quarters of the bill are under my jurisdiction, and that part has been in conference for weeks. My counterpart is-is Chairman Billy Tauzin. We've made great strides. We're one or two issues away from finishing that. The other part of it is-is totally within the jurisdiction of the tax writing, ways and means, finance. Chairman Thomas, Chairman Grassley and a small entourage were conferees on just the energy tax portion. The tax portion is-is totally and unequivocally necessary for the-for this bill. A big piece of it is the ethanol creation of a very major ethanol program that has a tax provision that is complex...

INSANA: Yeah.

Sen. DOMENICI: ...and essentially, it's just a matter of which year do you charge that to?

INSANA: Let me-let me ask you, Senator, though.

Sen. DOMENICI: Sure.

INSANA: I mean, how on earth are-are you folks still grappling with ethanol tax subsidies when this is a-really a product that has gone nowhere over the years. It is usually a boon to the corn-producing states and companies.

Sen. DOMENICI: Well, listen.

INSANA: How are we stuck on this?

Sen. DOMENICI: OK. Now wait. Look, if you-if you want-both houses have already voted this in. And when you go to conference, what you're doing is trying to get rid of the arguments and disputes between the two houses. Ethanol has already passed...

INSANA: Yeah.

Sen. DOMENICI: ...as an integral part of a very major bill that includes electricity reform. We're finished with that. We think it's a terrific reform measure. All the other provisions-enhancing production of coal producing fire plants, enhancing in the future some nuclear, enhancing renewables, such as wind, which is making some significant progress and on and on-but right in the middle of it are the tax credits that go with these-with these various types of energy, and those are subject to just that group headed by those two members.

INSANA: Well...

Sen. DOMENICI: They just don't seem to be able to get together. We're very hopeful that by tomorrow or the next day, they will, and then we'll get you a full bill before we get out of here. And I think it will be something that over time we will say did the country a pretty good job.

INSANA: Who gets control of the electricity grid? You mentioned that it's included there. Is it...

Sen. DOMENICI: The electricity grid-the electricity grid will remain a compromise. A portion of it will be totally within the jurisdiction of FERC. A portion of it, FERC will have partial authority, but the local authority will-will also be in there in a compromised measure, which, let me tell you, the chairman of FERC has said, 'I wouldn't write it that way, but I can live with it,' meaning that it will work. In addition, we have other provisions with reference to that grid that he has total control of.

INSANA: What about drilling in Alaska? I mean, you have made the point...

Sen. DOMENICI: All right. You understand...

INSANA: Yeah.

Sen. DOMENICI: ...that drilling in Alaska, United States Senate has said yes by a large number of votes, but no if you want-if you need 60 votes. That means if it's filibusterable. We have an understanding. They've given us the names of their votes. They say if you can change any of them, have at it. If you can't, we urge that you not waste everybody's time. We're doing that.

INSANA: All right. Let...

Sen. DOMENICI: If we can't find them, we won't do it, 'cause it'll just get voted down.

INSANA: You mentioned reducing this country's dependence on foreign oil. Is there any provision, and a meaningful provision, to reduce the country's dependence on oil, period, so that when it comes to issues like national security, the US does not have to scramble all over the world to deal either with Middle East problems or new problems that appear to be emerging in Russia's oil industry that could affect us down the line as well?

Sen. DOMENICI: We-we will be producing a maximum amount of oil ourselves. There are no provisions of any major significance that will reduce our consumption of-of oil other than we are pursuing with a great deal of vigor alternative automobiles. But if one is looking for a mandate that we all start driving small cars in three or four years, that's not in here. We are-we are struggling today with another one that we're going to become dependent upon; that is, if we don't do something so that we don't build any more power plants with natural gas, we're going to be looking overseas for natural gas. So one of the big efforts here is minimize our dependence on foreign oil, but at the same time, see if we're going to find ways that we can be sure we have enough natural gas for our future.

INSANA: All right. Senator...

Sen. DOMENICI: That's the major issue.

INSANA: I have to leave it there. I know you've got votes to-to cast tonight...

Sen. DOMENICI: Thank you.

INSANA: ...so we thank you for your time. Always good to see you.

Sen. DOMENICI: A pleasure.