Senators voted 74 to 26 to enact a measure that touches on virtually every aspect of American energy production and consumption, from new nuclear power plants to energy efficient appliances. The bill provides $14.5 billion in tax breaks, encourages much greater use of renewable fuels and takes steps to make the power grid more reliable.

"This bill represents a compromise," said Sen. Maria Cantwell, D-Wash., expressing the view of a number of Democrats who had pushed for greater conservation and efficiency provisions in the bill but seemed satisfied with the final deal crafted by House and Senate negotiators.
Cantwell said the bill is "not a complete answer to all of our energy needs ... but it is an important first step."

A crucial win for the electric utilities is the repeal of the Public Utility Holding Company Act of 1935, which would ease industry merger rules put in place to protect consumers from monopolistic utilities.
"This change should assist in the approval process of the Duke-Cinergy merger," according to a research note from RBC Capital Markets, referring to the proposed merger of Duke Energy Corp. (DUK: news, chart, profile) and Cinergy Corp. (CIN: news, chart, profile) announced in May.
New facilities that generate electricity from renewable energy sources such as wind power that are started up by the close 2007 would receive a 10-year production tax credit at a cost of $2.75 billion.
Firms that invest in wind power sites such as FPL Corp. (FPL: news, chart, profile) , Berkshire Hathaway's (BRKA: news, chart, profile) Iowa-based MidAmerican, and Scottish Power's (SPI: news, chart, profile) PPM Energy, would benefit from this provisions, according to Christine Tezak, an electricity analyst with Stanford Washington Research Group.
Coal-burning power plants built after 1975 and outfitted with pollution control devices since then would be able to depreciate costs over seven years. Some of the nation's largest utilities may be eligible for the credit including AES Corp. (AES: news, chart, profile) , American Electric Power Co. (AEP: news, chart, profile) , Entergy Corp. (ETR: news, chart, profile) , Progress Energy Inc. (PGN: news, chart, profile) , Southern Co. (SO: news, chart, profile) , Reliant Energy Inc. (RRI: news, chart, profile) , TXU Energy (TXU: news, chart, profile) , and Xcel Energy (XEL: news, chart, profile) , according to Tezak.
Power companies that undertake new high-voltage transmission projects would also be eligible for 15-year depreciation rather than the standard 20-years, at a cost of $1.2 billion to Treasury.