Notes and Sources

1 Letter from Sen. Dorgan to Guy F. Caruso, dated July 31, 2003. See Appendix A for a copy of the original letter.

2 E-mail from Sen. Dorgan’s staff to Mary J. Hutzler, dated August 17, 2003. See Appendix A for a copy of the e-mail.

3 The base cased used for the quantitative analyses include the Annual Energy Outlook 2002, (December 2001) (AEO2002), Annual Energy Outlook 2003, (January 2003) (AEO2003), and mid-year revisions completed as part of service reports, such as the “Analysis of S.139, the Climate Stewardship Act of 2003”, (June 2003).

4 Energy Information Administration, The National Energy Modeling System: An Overview 2003, DOE/EIA-0581(2003) (Washington, DC, March 2003), web site http://www.eia.gov/oiaf/aeo/overview/index.html.

5 Energy Information Administration, Impacts of Energy Research and Development (S.1766 Sections 1211-1245, and Corresponding Sections of H.R.4) With Analyses of Price-Anderson Act and Hydroelectric Relicensing, SR/OIAF/2002-04, (Washington, DC, March 2002), web site http://www.eia.gov/oiaf/servicerpt/erd/pdf/sroiaf(2002)04.pdf.

6 For example, efficiency improvements in electricity generation would be expected to reduce the price of electricity, consequently devaluing investment in end-use energy efficiency.

7 Consumer perceptions regarding the length of payback periods apparently exceed actual payback periods, discouraging new equipment purchases, as does the fact that consumers may base their decisions on current, rather than future, prices.

8 Energy Information Administration, Analysis of Efficiency Standards for Air Conditioners, Heat Pumps, and Other Products (S. 1766 Section 921-929, H.R.4 Section 124, 142, and 143), SR/OIAF/2002-01 (Washington, DC, March 2002), web site http://www.eia.gov/oiaf/servicerpt/eff/pdf/sroiaf(2002)01.pdf.

9 Energy Information Administration, Annual Energy Outlook 2002, DOE/EIA-0383(2002) (Washington, DC, December 2001), web site http://www.eia.gov/oiaf/aeo/pdf/0383(2002).pdf.

10 Runs SEER10.D021202A and SENATE1.D081302A.

11 Runs IBASE.D081402B and CHPTAUZIN.D081502C.

12 Energy Information Administration, Annual Energy Outlook 2002, DOE/EIA-0383(2002) (Washington, DC, December 2001), web site http://www.eia.gov/oiaf/aeo/pdf/0383(2002).pdf.

13 Energy Information Administration, Analysis of S.139, the Climate Stewardship Act of 2003, SR/OIAF/2003-02 (Washington, DC, June 2003), web site http://www.eia.gov/oiaf/servicerpt/ml/pdf/summary.pdf, run MLBASE.D050303A.

14 Run BLDHR6PV.D081903A.

15 Energy Information Administration, Impacts of Energy Research and Development (S.1766 Sections 1211-1245, and Corresponding Sections of H.R.4) With Analyses of Price-Anderson Act and Hydroelectric Relicensing,SR/OIAF/2002-04 (Washington, DC, March 2002), web site http://www.eia.gov/oiaf/servicerpt/erd/pdf/sroiaf(2002)04.pdf.

16 Run HR4CONF.D082602A.

17 Energy Information Administration, Analysis of Efficiency Standards for Air Conditioners, Heat Pumps, and Other Products (S. 1766 Section 921-929, H.R.4 Section 124, 142, and 143), SR/OIAF/2002-01 (Washington, DC, March 2002), web site http://www.eia.gov/oiaf/servicerpt/eff/pdf/sroiaf(2002)01.pdf.

18 Telephone conversation between Mary J. Hutzler and Jerry Hinkle, August 15, 2003.

19 Energy Information Administration, Analysis of Corporate Average Fuel Economy Standards for Light Trucks and Increased Alternative Fuel Use, SR/OIAF/2002-05, (Washington, DC, March 2002), web site http://www.eia.gov/oiaf/servicerpt/cafe/pdf/sroiaf(2002)05.pdf.

20 Run s804base.d020702b.

21 Light trucks include vehicles defined as pickup trucks, vans or minivans, and sport utility vehicles (SUVs).

22 The difficulties in assessing R&D impacts are discussed at length in Energy Information Administration, Impacts of Energy Research and Development (S.1766 Sections 1211-1245, and Corresponding Sections of H.R.4) With Analyses of Price-Anderson Act and Hydroelectric Relicensing, SR/OIAF/2002-04, (Washington, DC, March 2002), web site http://www.eia.gov/oiaf/servicerpt/erd/pdf/sroiaf(2002)04.pdf

23 Letter from Senator Dorgan to Guy F. Caruso, dated July 31, 2003 and e-mail from Senator Dorgan’s staff to Mary J. Hutzler, dated August 17, 2003, are included in Appendix A.

24 Energy Information Administration, Annual Energy Outlook 2003, DOE/EIA-0383(2003) (Washington, DC, January 2003), web site http://www.eia.gov/oiaf/aeo/pdf/0383(2003).pdf.

25 Energy Information Administration, Analysis of S.139, the Climate Stewardship Act of 2003, SR/OIAF/2003-02, (Washington, DC, June 2003), web site http://www.eia.gov/oiaf/servicerpt/ml/pdf/sroiaf(2003)02.pdf.

26 Energy Information Administration, Renewable Motor Fuel Production Capacity Under H.R.4 (Washington, DC, March 2002), website http://www.eia.gov/FTPROOT/service/question2.pdf, run ens1mxox.d082302b.

27 Energy Information Administration, Annual Energy Outlook 2002, DOE/EIA-0383(2002) (Washington, DC, September 2002), website http://www.eia.gov/oiaf/aeo/pdf/0383(2002).pdf.

28 The existing provisions in both the House and Senate bills do not specify fuel economy standards for light duty vehicles. The House and Senate bills only require that the Department of Transportation to study and develop feasible fuel economy increases and provide proposed recommendations within a set period of time.

29 University of Delaware, Center for Energy and Environmental Policy, “Delaware Climate Change Action Plan,” prepared for Delaware Climate Change Consortium, Pg. 82, January, 2000.

30 Litman, Todd, “Implementing Pay-As-You-Drive Vehicle Insurance Policy Options”, prepared for Institute for Public Policy Research, Pg. 7, London, July, 2002.

31 Federal Highway Administration, http://www.hhh.umn.edu/centers/slp/projects/conpric/learn/types_b.htm

32 Energy Information Administration, Annual Energy Outlook 2003, DOE/EIA-0383(2003), (Washington, DC, January 2003), Table F2, web site http://www.eia.gov/oiaf/aeo/pdf/0383(2003).pdf.

33 The dates are as stated in the Senate bill. Clearly, they will not need to be updated by the conferees.

34 Energy Information Administration, Annual Energy Outlook 2002, DOE/EIA-0383(2002), (Washington, DC, December 2002), web site http://www.eia.gov/oiaf/archive/aeo02/pdf/0383(2002).pdf, run taxbas.d081202a.

35 Run s804base.d020702b.

36 Energy Information Administration, Annual Energy Outlook 2002, DOE/EIA-0383(2002), (Washington, DC, December 2002), web site http://www.eia.gov/oiaf/archive/aeo02/pdf/0383(2002).pdf.

37 Energy Information Administration, Potential Oil Production form the Coastal Plain of the Arctic National Wildlife Refuge: Updated Assessment, SR/O&G/2000-02, (Washington, DC, May 2002), http://www.eia.gov/pub/oil_gas/petroleum/analysis_publications/arctic_national_wildlife_refuge/html/anwr101.html.

38 Energy Information Administration, The Effects of the Alaska Oil and Natural Gas Provisions of H.R. 4 and S. 1766 on U.S. Energy Markets, SR/OIAF/2002-02, (Washington, DC, February 2002), web site http://www.eia.gov/oiaf/servicerpt/aong/pdf/sroiaf(2002)02.pdf, run anwr_bs.d012202a.

39 Energy Information Administration, Annual Energy Outlook 2002, DOE/EIA-0383(2002), (Washington, DC, September 2002), web site http://www.eia.gov/oiaf/aeo/pdf/0383(2002).pdf.

40 Alaska Producer Pipeline Update, sponsored by BP ExxonMobil, and Conoco Phillips, May 2002 PowerPoint presentation.

41 This Reference Case updated the AEO2003 Reference Case by 1) an adjustment in near-term natural gas supply curves to reflect higher projected prices for 2003 and 2004 and 2) increased planned natural gas generation capacity.

42 Energy Information Administration, Analysis of S.139, the Climate Stewardship Act of 2003, SR/OIAF/2003-02 (Washington, DC, June 2003), web site http://www.eia.gov/oiaf/servicerpt/ml/pdf/summary.pdf.

43 The Reference Case with a 2020 start date in the original analysis included an expansion of the pipeline, resulting in slightly different results.

44 Unconventional natural gas is produced from tight sands, Devonian/Antrim shale, and coalbed methane formations.

45 This $0.60 per mcf differential is based on an historical average differential between the annual average wellhead price in Alberta and the lower-48 wellhead price, discounting for years when the differential was elevated when pipeline constraints impeded imports from Canada to the United States. A differential between the AECO-C Hub and the lower-48 price is much more variable, given the variability of the AECO-C Hub price, making projecting the differential difficult. The average from 1990 to 2001 of the Alberta wellhead price was essentially equal to the average AECO-C hub price in real terms over the same period.

46 According to staff members on the Senate Finance Committee, this date was not selected to delay the project and will be modified to align more closely with estimates of the earliest the pipeline could potentially be brought into service. Therefore, for the purposes of this analysis this date was assumed to align with the year of the initial flow of gas on an Alaska pipeline.

47 The Alberta-to-lower-48 differential was established by averaging recent historical differences in the wellhead prices in real terms at the two locations. Selected years were removed when there were indications that the price differential had spiked in response to restricted flow of gas into the U.S. because of pipeline capacity constraints. The assumed differential for this analysis was set at $0.60 per mcf in 2001 dollars.

48 EIA examined the historical relationship between the average U.S. wellhead price and the Henry Hub price from 1996 to 2000 and determined that the Henry Hub was 10.8 percent higher on average, with a median difference of $0.236 per mcf in 2000 dollars. (www.eia.gov/oiaf/analysispaper/henryhub/index.html.)

49 In 2001 dollars per mcf these transportation rates range from $1.52 in 2013, to $0.99 in 2020, to $0.64 in 2025.

50 Renewables is defined to include solar, wind, ocean, geothermal, biomass (excluding solid waste and paper that is commonly recycles), landfill gas, a generation offset (a metered reduction in electricity usage at a site where a customer consumes energy from a renewable energy technology), or incremental hydropower.

51 Section 264 actually specifies a 3.0-cent per kilowatthour credit price limit, but Section 271 changes it to 1.5 cents per kilowatthour.

52 Energy Information Administration, Impact of a 10-Percent Renewable Portfolio Standard, SR/OIAF/2002-03, (Washington, DC, February 2002), web site http://www.eia.gov/oiaf/servicerpt/rps/pdf/sroiaf(2002)03.pdf.

53 Energy Information Administration, Analysis of a 10-Percent Renewable Portfolio Standard, SR/OIAF/2003-01, (Washington, DC, May 2003), web site http://www.eia.gov/oiaf/servicerpt/rps2/pdf/sroiaf(2003)01.pdf.

54 Energy Information Administration, Supplement to Analysis of a 10 Percent Renewable Portfolio Standard, (Washington, DC, June 2003), web site http://www.eia.gov/oiaf/servicerpt/rps2/pdf/supplement.pdf

55 The 8.8 percent is total renewable generation as a fraction of total U.S. sales, which is equivalent to the legislative target of 10 percent of eligible renewable generation as a fraction of non-exempt sales.

56 Comparisons are to the mlbase.d050303a Reference Case as published in the cited Addendum report.

57 Energy Information Administration, Annual Energy Outlook 2003, DOE/EIA-0383(2003), (Washington, DC, January 2003), web site http://www.eia.gov/oiaf/aeo/pdf/0383(2003).pdf.

58 Energy Information Administration, Analysis of S.485, the Clear Skies Act of 2003, and S.843, the Clean Air Planning Act of 2003, SR/OIAF/2003-03, (Washington, DC, September 2003). The mid-term Reference Case is imbase.d080503a.

59 For 2013 and beyond, renewable fuel volumes in each year would be equal to the share of renewable fuels relative to the total gasoline consumed in 2012.

60 The Senate bill would provide up to $250,000,000 per year for three years of Federal assistance to merchant MTBE plant conversions to produce other gasoline blending components.

61 Energy Information Administration, Renewable Motor Fuel Production Capacity Under H.R.4, (Washington, DC, September 2002), web site http://www.eia.gov/oiaf/servicerpt/fuel/pdf/question2.pdf.

62 Energy Information Administration, Annual Energy Outlook 2002, DOE/EIA-0383(2002) (Washington, DC, September 2002), web site http://www.eia.gov/oiaf/aeo/pdf/0383(2002).pdf.

63 The impact of an ethanol credit-trading program on the RFG price would likely be lower than the ethanol transportation costs from the Midwest to the California or Northeast markets. An effective ethanol credit-trading program could reduce the RFG price increases in those markets, at most 0.7 cents per gallon for California and at most 0.6 cents per gallon for the Northeast.

64 California, Colorado, Connecticut, Iowa, Illinois, Indiana, Kansas, Kentucky, Michigan, Minnesota, Missouri, Nebraska, New York, Ohio, South Dakota, Washington, and Wisconsin. Of these States, only five currently rely on MTBE (California, Connecticut, Kentucky, Missouri, and New York); together, they account for approximately 45 percent of the Nation’s MTBE consumption.

65 http://www.ethanolrfa.org/eth_prod_fac.html

66 The Reference Case used in this section is hbs1mxox.d030303a.

67 The Safe Harbor provision would provide for liability protection for renewable fuels and/or MTBE, when used as a motor fuel additive, concerning any defect claims against such product(s).

68 Energy Information Administration, Annual Energy Outlook 2003, DOE/EIA-0383(2003), (Washington, DC, January 2003), web site http://www.eia.gov/oiaf/aeo/pdf/0383(2003).pdf

69 Oxygenated gasoline is conventional gasoline, which contains 2.7 percent oxygen by weight for areas with winter carbon monoxide emission concerns.

70 http://www.masada.com/presshome.html

71 http://www.fortune.com/fortune/smallbusiness/articles/0,15114,444690-2,00.html

72 http://www.biodiesel.org/pdf_files/Capacity.PDF

73 For more background on biodiesel, see Energy Information Administration, Impact of Renewable Fuels Standard/MTBE Provisions of S. 1766 , SR/OIASF/2002-06, (Washington, DC, March 2002).