The new energy package would revoke $17 billion in tax breaks extended to big oil companies like ExxonMobil and levy a 25 percent windfall profits tax on firms that refuse to invest in new energy sources.
Senate Majority Leader Harry Reid and Senators Jeff Bingaman, Max Baucus, Charles Schumer, Byron Dorgan, Maria Cantwell and Bernie Sanders unveiled the proposed legislation that addresses the root causes of high gas prices.
According to Reid: "Instead of helping Big Oil make more money at the expense of average Americans, we are forcing oil companies to change their ways. We will hold them accountable for unconscionable price-gouging and force them to invest in renewable energy or pay a price for refusing to do so.”
Key provisions of the new bill include:
- Roll Back Tax Breaks for Oil Companies and Invest in Renewable Energy – In 2004 and 2005, the Big Oil companies received tax breaks worth $17 billion over 10 years. The Consumer-First Energy Act will roll back $17 billion in tax breaks for oil and gas companies and instead invest those taxpayer dollars to improve consumer price protection, renewable energy development and energy efficiency technology through a designated Energy Independence and Security Trust Fund.
- Force Big Oil to Pay Their Fair Share through a Windfall Profits Tax – The proceeds of the tax will be invested in consumer price protection, renewable energy development and energy efficiency technologies through a designated Energy Independence and Security Trust Fund.
- Halt Government Purchases of Oil for the Strategic Petroleum Reserve – The Consumer-First Energy Act calls for suspending through December 2008 oil purchases for the SPR. Filling could resume when the 90 day average price of crude oil recedes to $75 or less.
- Protect Consumers from Price Gouging – The Consumer-First Energy Act would give the President the authority to declare an energy emergency should there be a shortage, disruption or significant pricing anomalies in the oil market.
- Stop Market Price Speculation – First, the bill prevents traders of U.S. crude oil from routing transactions through off-shore markets to evade speculative limits and sets forth reporting requirements. The bill also requires the Commodities Futures Trading Commission to set a substantial increase in the margin requirement for all oil futures trades, contracts or transactions.
- Stand Up to OPEC – OPEC’s near-monopolistic control over oil prices has lead to record oil prices which have driven up the cost Americans pay at the pump. The Consumer-First Energy Act allows the U.S. Attorney General to bring an enforcement action against any country or company that is colluding to set the price of oil, natural gas, or any other petroleum product.
Source: US Senate Democrats
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