Clean Energy Act’s Details Debated

American Association of Petroleum Geologists (AAPG)

Throughout the 2008 U.S. election cycle the need to deal with climate change was a recurring theme.

Both President Obama and Democratic leaders in Congress promised swift action to reduce U.S. carbon and other greenhouse gas emissions. And within the first 100 days of the new administration, both ends of Pennsylvania Avenue began work to fulfill that promise.

On April 17, the U.S. Environmental Protection Agency (EPA) issued a finding that carbon dioxide and several other greenhouse gases endangered public health and welfare – a finding that requires EPA to issue a rule to regulate emission of these gases under the Clean Air Act.

This move was anticipated based on the president’s previous statements. But the White House and EPA admit they would prefer to have Congress develop a specific legislative framework for regulating greenhouse gases rather than use the 30-year-old Clean Air Act.

The wrangling to develop legislation began just after the November 2008 election, as Democrats elected leaders and committee chairs.

In a surprise move, and with the tacit support of Speaker Nancy Pelosi (D-Calif.), Rep. Henry Waxman (D-Calif.) challenged and beat incumbent chair John Dingell (D-Mich.) for leadership of the House Energy and Commerce Committee.

Waxman, a supporter of limits on greenhouse gas emissions, then shuffled the subcommittee chairs, asking Rep. Ed Markey (D-Mass.), another strong supporter, to head the Energy and Environment subcommittee.

Waxman and Markey started working on a climate change bill, and in early April unveiled the American Clean Energy and Security Act of 2009. The bill has not been formally introduced as of early May, and still lacks detail on a number of critical provisions.

It is a discussion draft to explore the issues, address the legislative gaps and gauge where members stand.

That is, are there sufficient votes to pass the legislation out of subcommittee and full committee?

The discussion draft has four titles:

The first is a clean energy title with several provisions, including a federal renewable energy standard, requiring power suppliers to begin supplying at least 6 percent of their base load from renewable sources in 2012, growing to 25 percent in 2025.

It promotes the development and deployment of carbon capture and storage technologies. It introduces a low carbon fuel standard for transportation fuels, designed to stimulate the development of advanced biofuels. And it promotes the deployment of a modernized, smart electrical grid.

The second title deals with energy efficiency of all kinds, ranging from buildings and homes, to appliances, transportation and utilities.

The third title seeks to address global warming by establishing a federal cap and trade system for greenhouse gases.

The model proposed is based closely on recommendations from the United States Climate Action Partnership, which includes oil and gas producers ConocoPhillips and Shell. The goal of this title is to reduce greenhouse gas emissions by 83 percent below 2005 levels in 2050.

The fourth title deals with the impact of transitioning to a clean energy economy. It creates a program to compensate for the costs associated with this transition, to ensure U.S. businesses remain competitive with overseas firms not operating under similar restrictions.

It provides assistance to consumers, and for those transitioning into green jobs.

The title also encourages broad deployment of clean energy technologies to other countries and forms an interagency commission to develop a coordinated federal response to adapt to changes induced by global warming.

During the week of April 20, the House Energy and Environment subcommittee held four hearings on the draft legislation to receive testimony from 68 witnesses and begin deliberating the draft provisions.

Where is all of this heading?

The initial timeline was for the subcommittee to “mark up” the bill the week of April 27, but that was postponed to the first week of May and then postponed again. The full committee hoped to mark up the bill the week of May 11, enabling a committee vote before Memorial Day to meet Chairman Waxman’s self-imposed deadline.

Speaker Pelosi had indicated a desire to have the House vote on the measure before the August recess.

But the politics of this legislation are very difficult. It is not clear that subcommittee chairman Markey has support to pass it out of subcommittee. So he is working with subcommittee members to make changes to the draft to gain the necessary votes for passage.

This is the legislative process in action, and its outcome is uncertain as we go to press.

On April 27, The Hill newspaper quoted Democratic leader Chris Van Hollen (Md.) saying, “The first thing we need to do is see whether we can come together around a consensus position in the committees in the House, and that’s what we’re working on. And then, of course, if we were able to arrive at that, the question is whether you would take it to the floor, or do you wait to see if anything develops on the Senate side.

“The chances of doing cap-and-trade in the Senate are much more difficult,” he continued. “We recognize that.”

Indeed, Senate leaders are trying to determine if and how to move climate change legislation this year. Senate Majority Leader Harry Reid (D-Nev.) has clashed with Senate Energy and Natural Resources Committee chair Jeff Bingaman (D-N.M.) about including a cap and trade provision in the committee’s energy bill, currently being drafted.

Bingaman supports cap and trade, but fears that such a highly politicized provision could prevent passage of the entire energy bill.

The challenge in the Senate is perhaps best described by Reid, who indicated in an article by National Journal that global warming legislation would be his biggest headache between now and the 2010 election.

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