CQ TODAY ONLINE NEWS
March 31, 2009 – 9:12 p.m.
Key Lawmakers Lay Out Plan for Limiting Greenhouse Gases
By Avery Palmer, CQ Staff
As a starting point for writing a law to address global warming, two of President Obama’s well-placed allies in the House suggest making electricity companies buy more power generated from sun and wind.
A proposal unveiled Tuesday by Reps. Henry A. Waxman , D-Calif., and Edward J. Markey , D-Mass., also would try to move the nation toward generating less heat-trapping “greenhouse gas.”
“Our goal is to strengthen our economy by making America the world leader in new clean energy and energy efficiency technologies,” Waxman said in a statement.
The core of their bill would set up a market-based trading program for businesses to meet a cap on certain kinds of air pollution.
It would limit emissions to 3 percent below 2005 levels in 2012; 20 percent in 2020; 42 percent in 2030; and 83 percent in 2050.
However, the plan leaves open the key question of how to allocate emissions allowances that industry would use for trading.
One option is for the government to sell the allowances at an auction and use the revenue for various clean-energy programs. Yet many businesses would prefer that in the early years of the program, the government should distribute some of these allowances for free to offset the costs of compliance.
How to distribute these allowances will be a major point of contention as Democrats on the House Energy and Commerce Committee work to reach consensus on the bill.
A related question, also unresolved in the draft released Tuesday, is what to do with the money the government would receive from any pollution-credit auctions. Some options include compensation for electricity consumers; research on energy technologies; tax cuts and a reduction of the deficit.
Support from Democrats will be critical if the bill is to advance beyond that committee because few Republicans on the panel are expected to vote for it, and Democrats who represent coal-intensive and manufacturing states still have reservations about the plan’s economic impact.
“We have a lot of work to do,” said Rick Boucher , D-Va., who is not yet endorsing the bill.
Waxman, the committee’s chairman, has set an aggressive schedule for taking up the bill, beginning with hearings the week of April 20.
To help address costs, the bill would let businesses meet a portion of their obligations through the use of special projects, such as tree-planting. That approach is controversial, since it requires complex assessments to make sure these projects actually lower emissions.
The plan also would establish a “strategic reserve” of carbon allowances to provide a cushion if prices rise higher than expected.
Utilities would be required to buy a portion of their electricity from renewable sources, such as wind, solar and biomass.
The requirement would begin at 6 percent in 2012 and rise to 25 percent in 2025. One-fifth of this mandate could be met through energy efficiency improvements.
The plan contains other provisions meant to encourage lower-carbon energy production, such as “green jobs” programs; standards for appliance efficiency; building codes; and research on carbon sequestration at coal-fired power plants.
A foe of that strategy, Rep. Joe L. Barton of Texas, said the bill “marks a triumph of fear over good sense and science, and it couldn’t come at a worse time because it proposes to save the planet by sacrificing the economy.”
Barton is the top Republican on Waxman’s committee.




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