Partisan battle looms over oil spill measures

With comprehensive climate and energy legislation off the table, the Senate is gearing up to battle over oil spill measures that could prove divisive when Majority Leader Harry Reid, D-Nev., brings legislation to the floor later this week.

Reid will introduce the Democrats' oil spill package Monday, after Republicans quietly introduced last week substitute legislation that includes provisions such as oil drilling revenue-sharing for coastal states and a liability cap set by the president.

By contrast, Reid's legislation will likely not include any revenue-sharing and will raise significantly or eliminate the $75 million cap oil companies pay in the wake of a spill. Republicans and moderate Democrats hailing from oil-producing states, such as Sens. Mark Begich of Alaska and Mary Landrieu of Louisiana, have said they will not support legislation that does not include oil revenue-sharing for coastal states.

Another difference between the bills is whether Congress sets up an oil spill commission with equal representation from both parties, which would be in addition to a commission President Obama appointed. Republicans have charged Obama's appointees are biased toward the environmental community.

Reid's bill is expected to include many parts of the legislation approved last month out of the Energy and Natural Resources Committee, which reforms the management of the Outer Continental Shelf, and a bill sponsored by Sen. Robert Menendez, D-N.J., which cleared the Environment and Public Works Committee last month.

The final version of the latter bill eliminates the oil-spill liability cap, but Menendez's original bill raised the cap to $10 billion. To tame opposition to the overall package, Reid could try to raise the cap substantially rather than eliminating the cap altogether. In both versions of the bill, the law would be retroactively applied to BP and the oil spill in the Gulf of Mexico.

The GOP's substitute legislation, introduced Thursday by Minority Leader Mitch McConnell, R-Ky., Energy and Natural Resources Committee ranking member Lisa Murkowski, R-Alaska, Environment and Public Works Committee Ranking Member James Inhofe, R-Okla., and Sen. John Thune, R-S.D., includes language that allows the president to set the liability cap on a case-by-case basis.

It does not retroactively apply to BP and would only apply to leases issued after the law is enacted. This difference regarding retroactivity will likely become a huge issue between the Republicans' and Democrats' bills.

Reid's bill will also include a few energy provisions, including Home Star, a program that gives rebates to homeowners to retrofit their houses to make them more energy efficient. The package is not expected to include a renewable electricity standard, despite an intense, 11th-hour lobbying push by renewable energy advocates to include it.

Reid's office would not comment ahead of the bill's introduction on specific provisions.

The Republicans' bill includes only oil spill measures.