Below is a report from the Bloomberg site this morning.The...

Below is a report from the Bloomberg site this morning.

The future looks bright for AAE. Just need to start producing then we may be off and running.

Bush Signs Energy Bill Mandating Tougher Efficiency Standards

By Daniel Whitten

Dec. 19 (Bloomberg) -- President George W. Bush today signed legislation aimed at cutting U.S. dependence on overseas energy by setting tougher mandates for carmakers, electric- appliance manufacturers and ethanol producers.

The law contains the first new vehicle fuel economy law in 32 years and mandates a fourfold increase in the use of biofuels. It also phases out traditional light bulbs and places the first limits on the amount of water used in new washing machines and dishwashers.

The new law is `` a major step toward reducing our dependence on oil, confronting global climate change, expanding the production of renewable fuels and giving future generations of our country a nation that is stronger, cleaner and more secure,'' Bush said before signing the legislation at the Department of Energy in Washington.

Bush pinpointed ethanol production and new fuel economy standards in his January State of the Union address as crucial elements in meeting his goal of cutting gasoline use by 20 percent by 2017.

The legislation was sent to the White House last night in a hybrid Toyota Prius, according to an e-mail from House Speaker Nancy Pelosi's office. Pelosi, a California Democrat, said the law would save the average driver between $700 and $1,000 per year in gasoline costs.

Before passing the measure last week, the Senate dropped a provision that would have extended tax credits to wind, solar and biomass power producers and raised taxes on oil and gas companies by about $13 billion over 10 years to pay for that. The Senate also dropped a requirement that some utilities get 15 percent of their power from renewable sources.

Concessions for Carmakers

Many provisions in the measure were agreed to by the regulated industry groups. For example, Representative John Dingell, a Michigan Democrat, won concessions for the U.S. auto industry, including allowing carmakers to continue making large sport utility vehicles without being at a competitive disadvantage against foreign rivals that make fewer large vehicles.

Likewise, Amsterdam-based Royal Philips Electronic NV, the world's largest light-bulb maker, and Fairfield, Connecticut- based General Electric Co., which are regulated by the law, successfully argued for exemptions from the mandate for certain specialty lamps.

Perhaps the biggest winners were companies like Archer- Daniels-Midland Co. and Pacific Ethanol Inc. in the ethanol industry. The legislation requires that biofuels be blended with gasoline to reduce the amount of petroleum needed for U.S. transportation. It boosts the requirement for production of biofuels to 36 billion gallons in 2022 from 7.5 billion in 2012.

`Favorable for Ethanol'

``The outcome is a favorable one for the ethanol industry, for the crop sector, and for agribusiness companies leveraged to grains and oilseeds,'' Mark McMinimy, a Washington-based analyst for the Stanford Group Co., wrote in a note yesterday.

``I think it's a turkey,'' said Michael Carboy an analyst for Baltimore-based Signal Hill Capital Group, an investor in clean energy. Carboy, in an interview, said the bill is ``astonishingly weak'' because of its exclusion of renewable electricity incentives and its reliance on ethanol to cut oil use.

Congress ``seems to be putting a lot more care and attention in the direction of ethanol than frankly they should,'' Carboy said. Lawmakers went along ``with the agricultural support program that this administration seems to want to pursue.''

To contact the reporter on this story: Daniel Whitten in Washington at [email protected]

Last Updated: December 19, 2007 10:40 EST