Johnny is part of a bipartisan coalition that is led by Senator Kent Conrad (D-N.D.) and Senator Saxby Chambliss (R-Ga.)  Other senators in the coalition include: John Thune (R-S.D.), Blanche Lincoln (D-Ark.), Mary Landrieu (D-La.), Bob Corker (R-Tenn.), Lindsey Graham (R-S.C.), Mark Pryor (D-Ark.), and Ben Nelson (D-Neb.).

On August 1, the coalition unveiled its energy proposal to reduce gas prices, lessen our nation’s dependence on foreign oil, and strengthen America’s economy.

The comprehensive New Energy Reform Act of 2008 — better known as the “New Era”— calls for increased domestic production through offshore drilling, a commitment to nuclear energy, a focused effort to transition the nation’s motor vehicle fleets to fuels other than gasoline and diesel, and conservation provisions.

The New ERA proposal contains three main components:

• Urgently needed, timely domestic production of energy resources, including drilling offshore for oil and natural gas and utilizing nuclear energy;
• An intensive effort to transition vehicles to non-petroleum based fuels; and
• A robust federal commitment to conservation and energy efficiency.

Johnny fully supports offshore drilling and believes we must utilize all of our domestic resources. Specifically, this proposal would open additional acreage in the Gulf of Mexico off the coast of Florida, Alabama, Mississippi and Louisiana for leasing. It would also allow the states of Virginia, North Carolina, South Carolina and Georgia to opt in to leasing off their shores. The proposal focused on these areas because they are the areas that would allow us to get oil and gas out of the ground and to American consumers the fastest.

The proposal includes support for nuclear energy by increasing staff at the Nuclear Regulatory Commission, providing workforce training, accelerating depreciation for nuclear plants, and supporting research and development on spent fuel recycling to reduce nuclear waste.

To ease gas prices and protect our environment in the long term, the proposal includes a significant federal commitment to promoting conservation and efficiency, including $2.5 billion in research and development on next generation biofuels and infrastructure. Georgia is a leader in the emerging cellulosic ethanol industry and would directly benefit from this new federal commitment.

The proposal would also fund a $20 billion “Apollo Project”-like effort to support the goal of transitioning 85 percent of America’s new motor vehicles to non- petroleum-based fuels within 20 years.

The $84 billion in investments in conservation and efficiency in the New ERA proposal will be fully offset with loophole closers and other revenues. Approximately $30 billion will come from new revenues from the oil and gas industry through such measures as modifying the Section 199 manufacturing deduction for oil and natural gas production and other appropriate measures to ensure that the federal government receives its fair share of revenue from Gulf of Mexico leases. Plans to modify the Section 199 manufacturing deduction are not a windfall profit tax. It is the elimination of a domestic production tax credit.  

In terms of speculation or manipulation of the oil market, the coalition decided to focus on increasing supply and reducing demand and will await the mid-September report of the Commodity Futures Trading Commission to consider this subject.

Johnny believes doing nothing is not an option. Georgia families and businesses are suffering because of the escalating high cost of energy. Johnny has been calling for weeks for Republicans and Democrats to put aside their differences on energy and come together with a solution. This proposal is exactly the kind of productive result Johnny has been seeking and exactly the kind of action thousands of Georgians have told Johnny they want to see from Congress on the energy issue.

Additional details of the proposal are below.

Urgently Needed, Increased Domestic Energy Production
To help meet our energy needs until our economy transitions to advanced alternative fuel vehicles, the New ERA proposal increases domestic energy production in environmentally responsible ways. The legislation:

• Provides a CO2 sequestration credit for use in enhanced oil recovery to increase production from existing oil wells while reducing greenhouse gas emissions;
• Opens additional acreage in the Gulf of Mexico for leasing (in consultation with the Defense Department to ensure that drilling is done in a manner consistent with national security) and allows Virginia, North and South Carolina and Georgia to opt in to leasing off their shores.
• Retains an environmental buffer zone extending 50 miles offshore where new oil production will not be allowed.
• Requires all new production to be used domestically.
• Creates a commission to make recommendations to Congress on future areas that should be considered for leasing.
• Provides for appropriate revenue sharing for states that allow leasing off their shores;
• Provides grants and loan guarantees for the development of coal-to-liquid fuel plants with carbon capture capability. Plants must have lifecycle greenhouse gas emissions below those of the petroleum fuels they are replacing; and
• Supports nuclear energy by increasing staff at the NRC, providing workforce training, accelerating depreciation for nuclear plants, and supporting R&D on spent fuel recycling to reduce nuclear waste.

Converting Cars and Trucks to Non-Oil Fuel Sources to Regain Energy Independence
The New ERA proposal funds a $20 billion “Apollo Project” like effort to support the goal of transitioning 85 percent of America’s new motor vehicles to non- petroleum-based fuels within 20 years. To accelerate this transition, the legislation includes:

• $7.5 billion for R&D focused on the major technological barriers to alternative fuel vehicles, such as advanced batteries;
• $7.5 billion to help U.S. automakers and parts makers re-tool and re-equip to become the world leader in making alternative fuel vehicles;
• Consumer tax credits of up to $7,500 per vehicle to incentivize Americans to purchase advanced alternative fuel vehicles (those that run primarily on non-petroleum fuels) and up to $2,500 to retrofit existing vehicles with advanced alternative fuel engines.

Enhancing Conservation
To ease gas prices and protect our environment during the transition, the proposal includes a significant federal commitment to promoting conservation and efficiency. These include:

• Extending renewable energy, carbon mitigation and energy conservation and efficiency tax incentives, including the production tax credit, through 2012 to create greater certainty and spur greater investment;
• New consumer tax credits of up to $2,500 to purchase highly fuel efficient vehicles, to help Americans reduce their annual gas costs and reduce oil imports;
• Extending and expanding the $2,500 tax credit for hybrid electric vehicles;
• $500 million for R&D into new materials and other innovations to improve vehicle fuel efficiency;
• $2.5 billion in R&D on next generation biofuels and infrastructure;
• Tax incentives for the installation of alternative fueling stations, pipelines and other infrastructure;
• Expanding transmission capacity for power from renewable sources; and
• New dedicated funding for the weatherization assistance program.

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