Energy issues are heating up in Congress

Get ready for a furious congressional debate over energy for the next three weeks. Democrats appear ready to give in to the drill-drill-drill mentality, but only on the condition that clean energy be part of the picture.

One idea is to drop the federal moratorium on drilling off the Atlantic and Gulf coasts in exchange for revoking subsidies to oil companies and shifting those dollars into research and development of solar and wind power.

Zachary Coile, a reporter for the San Francisco Chronicle, calls the political posturing “a chess match over energy with high stakes for both the November elections and the nation’s energy future.”

He writes in today’s editions:

Kevin Book, a senior energy policy analyst at FBR Capital Markets, said he’s betting the only energy legislation that’s likely to pass is an extension of the tax credits for wind and solar, which expire at the end of the year and are popular with both parties.

“The Republicans could still potentially strike a deal, but it’s not clear whether the Democrats have any incentive,” Book said. “They can paint Republicans as objecting to cutting a deal – particularly as all the political analysis suggests they are going to come back next year with the upper hand” by picking up seats in the House and Senate in November.

Two members of Washington’s congressional delegation — U.S. Rep. Jay Inslee, D-Bainbridge Island, and U.S. Sen. Maria Cantwell — have thrust themselves into the middle of this debate. Inslee, who wrote a book on the clean-energy revolution, has complained about the stranglehold that oil companies have on the Bush administration. (Watch video on his site.) Cantwell has spent a lot of time looking into possible market manipulations that may have led to artificial spikes in gasoline prices earlier this year.

On Thursday, an official with the Commodity Futures Trading Commission is expected to testify before Congress, according to David Ivanovich of the Houston Chronicle.

“If the agency were to uncover real evidence of market manipulation, that could spark its own congressional stampede,” said Ivanovich, also quoting David Book.

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