09.07.05

Cantwell: Give President Power to Declare Energy Emergency, Power to Control Gas Prices

Senator’s Legislation Would Renew Presidential Emergency Authority, Put in Place New Investigation and Enforcement Measures Washington State Gas Prices Spike 19 Cents In Just One Week; Washington Drivers Paying 90 Cents A Gallon More Than Last Year

WASHINGTON, DC – At a Senate Energy Committee hearing today, U.S. Sen. Maria Cantwell (D-WA) said that she will introduce legislation this week reinstating the President’s authority to take immediate action in the face of skyrocketing gasoline prices.

"The president needs to have emergency powers to halt gas price gouging," said Cantwell, a member of the Senate Energy Committee. "In the wake of Hurricane Katrina and its tragic aftermath, our first priority must be to get help to our fellow Americans who so desperately need it. War and disaster profiteering cannot be tolerated."

"This horrible disaster has also made clear that we have a lot more work to do to make sure American consumers aren’t being taken for a ride every time they go to fill up their gas tanks. We need to make sure we have every tool in the toolbox to prohibit oil profiteers from taking advantage of this tragedy. In the wake of natural disasters and emergencies like this, the President needs to take swift and decisive action," Cantwell added. "That’s why we need to reinstate federal authorities to immediately curb price gouging at the pump."

The Senate Energy Committee today held a hearing on gas prices and the impact of Hurricane Katrina on national gas and oil supplies. The hurricane impacted about 25 percent of the domestic crude oil production, as well as more than 10 percent of domestic refining capacity—most of which supplies the East Coast and Midwest regions of the country. Meanwhile, prices surpassing $5 a gallon were reported in some markets in the Southeast, with the national average gasoline price topping $3 a gallon, according to a new survey released by the American Automobile Association. Even before the hurricane, average gas prices in Washington state rose 74 cents a gallon compared to last year according to the federal Energy Information Administration. Today, they are averaging 90 cents a gallon more than last year. Even though Washington state’s refineries are supplied primarily by Alaska rather than the Gulf—with some imports from Canada—Washington state prices have risen another 19 cents a gallon since the hurricane struck.

In 1973, Sen. Henry "Scoop" Jackson (D-WA) authored a law that gave the President specific temporary authorities to deal with oil and gas shortages and impacts on the U.S. economy. That law expired in 1981, and—according to the Congressional Research Service—there are no federal laws on the books today that specifically address price gouging for gasoline.

"This tragedy has shown we need a serious national roadmap to help kick our dangerous dependence on oil, we need a strategy for if and when disasters strike, and we need a plan to protect American consumers," Cantwell said. "We need to roll up our sleeves and work together to get this done."

Cantwell’s legislation will grant the President the authority to curb gas prices by making a number of tools available to him. Under Cantwell’s bill, upon declaring an Energy Emergency, the President would be able to:

PREVENT GAS PRICE GOUGING. Over 23 state governors have this power. Such states include, Louisiana, Florida, Georgia, Mississippi, and Alabama. Cantwell believes the President should have similar powers to address price gouging throughout the country.

REQUIRE TRANSPARENCY IN GAS AND OIL MARKETS. Cantwell’s bill would require full disclosure of wholesale gas pricing policies and stronger enforcement authority for the Federal Trade Commission, Department of Energy, and Department of Justice.

BAN ZONAL PRICING. The President would be able to end the practice of wholesalers to vary gas prices for different gas stations and instead use fair pricing practices.

PRICE CAPS. Would allow the President to put into place price mitigation to control costs during times of crisis, similar to the West Coast energy crisis a few years ago.

Last month, Cantwell, Senate Minority Leader Harry Reid (D-NV) and Senator Dick Durbin (D-IL), also asked the President to take a tough stand on skyrocketing gas prices, issue new market rules to make sure consumers aren’t getting gouged at the gas pump and institute new policies to make sure that dramatic price run-ups are investigated by federal agencies with the authority to enforce our nation’s consumer protection and anti-collusion laws.