OIL IMPORT FEES Mr. Conte. What is the status of the inter-agency study of oil import fees? I hope that the Department of Energy is maintaining its previous opposition to such fees. I have strongly opposed the imposition of such fees because they would be inflationary, they would have an inequitable regional impact, and they would provide a windfall to domestic energy producers. Would you comment on the Department's analysis of this issue with regard to these three considerations and any others that you consider particularly significant? Mr. Herrington. The Department of Energy review of energy security issues is due to be released in March. The study contains extensive analysis of oil import fees and notes their economic costs. The energy security and other benefits of an import fee are obtained only at significant cost to the national economy. The study estimates the costs and benefits in an even-handed manner. Upon its release, we anticipate that the report will stimulate an informed public debate on a wide range of energy security issues in addition to the question of import fees. BUY AMERICAN Mr. Conte. What is the status of the Department's implementation of the PMA Buy American provision contained in last year's Energy and Water measure? What remains to be done? Have there been any purchases of EHV equipment pursuant to this provision so far in fiscal year 1987? Mr. Herrington. Section 507 of Public Law 99-591, enacted October 30, 1986, requires a Buy American price differential of 30 percent for procurements of Extra High Voltage (EHV) power equipment by the Power Marketing Administrations (PMA's) and the Tennessee Valley Authority. This FY 1987 provision has been incorporated into the PMA's processes. Further, the Department continues to work with staff of the United States Trade Representative to identify those countries whose EHV power equipment trade practices entitle them to an exclusion from the 30 percent differential. Working out this exclusion process has been quite complicated and time consuming, but we are making good progress. The Department has had little experience in applying the 30 percent differential, as the PMA's are not procuring much EHV equipment in this fiscal year. Bonneville Power Administration (BPA) has awarded only one FY 1987 EHV procurement contract to date, and the contract went to a foreign producer despite the differential. Two additional BPA EHV procurements are in process. In late February, Western Area Power Administration (WAPA) issued its first procurement solicitation for EHV equipment in FY 1987. Until the solicitation closes, WAPA will not know whether any bids were received from foreign EHV manufacturers. Two further WAPA EHV equipment solicitations may occur later in this fiscal year. BUY AMERICAN Mr. Conte. In implementing the Buy American provision, series capacitors and relays have apparently been left off of the tentative list of covered equipment, even when such components are specifically included in an EHV installation. Would you take another look at this question, which is of particular concern to me, and outline the results of your review. Mr. Herrington. A tentative list of EHV power equipment was developed in implementing the Buy American provision. That list included all power components that the Department believed were consistent with the Committee's definition of EHV power equipment as stated in the Conference Report. The tentative list was circulated for review within the EHV power equipment industry and the Federal sector. Based on the comments received, the Department has recently decided to include capacitors and relays on the list. In order to clarify our position on this matter I would like to submit our revised list to be included in the record. (The information follows:) EHV Power Equipment For the purposes of Section 507 of Pub. L. 99-591, EHV power equipment is alternating current (ac) and direct current (dc) electrical equipment designed to be operated on systems rated above 242 kilovolts. Such equipment includes: (a) Alternating Current (ac) Equipment Power Transformers Circuit Breakers Shunt Reactors Voltage and Current Transformers Disconnect and Grounding Switches Surge Arrestors Coupling Capacitors Phase Shifting Transformers Series and Shunt Power Capacitor Banks |