Federal climate change legislation update
Just what is in the latest version of Federal climate change legislation and what is its status? Missouri legislators are hearing from all sides as pressure continues to mount for Congress to act. Senator Bond has made his opposition to any bill clear, while Senator McCaskill has remained uncommitted as she recognizes the need for energy legislation, but is protective of her heavily coal-dependent state.
President Obama will likely shed light on this controversial topic as he speaks from the Oval Office tomorrow night. For now, energy consumers and businesses wait for the Senate to act on their version of the bill. Below is a brief rundown of some of the key provisions in the Senate bill:
The American Power Act—introduced by U.S. Senators Kerry (D-MA) and Lieberman (I-CT)—is designed to protect consumers and provide the regulatory and legislative certainty needed to unleash investment and create jobs.
- The American Power Act would reduce greenhouse gas (GHG) emissions by 17% in 2020 and by over 80% in 2050.
- The bill establishes a list of GHGs to be regulated, including carbon dioxide, methane, nitrous oxide, sulfur hexafluoride, hydrofluorocarbons emitted as a byproduct, perfluorocarbons and nitrogen trifluoride. The Environmental Protection Agency administrator may designate additional anthropogenic GHGs by rule.
- An annual tonnage limit will be placed on GHG emissions, and a pricing system for carbon will be created. According to the bill, introductory floor and ceiling prices are set at $12 (increasing at 3% over inflation annually) and $25 (increasing at 5% over inflation annually), respectively.
- The American Power Act does NOT include a national electricity mandate unlike H.R.2454 – the American Clean Energy and Security Act of 2009 – which establishes a national renewable electricity standard of 20% by 2020.
- The American Power Act promotes renewable energy by funding investments in clean energy research and development. The bill directs the Secretary of Education to award competitive grants in order to develop programs that focus on employment in emerging fields, including renewable energy and climate change mitigation.
- The Secretaries of Labor, Energy and Education are required to develop a Web-based information and clearinghouse to aid career and technical education and job training programs for the renewable energy field.
- In the wake of the oil spill off the coast of Louisiana, the climate legislation adds new protection to coastal communities by allowing states to opt out of drilling up to 75 miles off their shores. States can also block drilling plans “if they stand to suffer significant adverse impacts in the event of an accident.”
- The American Power Act also encourages domestic nuclear production. The bill increases the funding for the Innovative Technology Loan Guarantee Program to $54 billion and establishes a loan-guarantee retention fee to ensure that money is returned to the program as expeditiously as practicable. There is also a clause for the extension of a suspension on tax duty for “certain components used in nuclear facilities that are not available in the United States” for another 10 years, a tacit admission that the domestic supply chain is incomplete and in all likelihood cannot be ramped up in time.
- In terms of the impact on coal-dependent states like Missouri, the American Power Act appears to be designed to substantially increase the cost of coal and other forms of fossil fuel-based energy in the immediate near-term, and, given the limits of available and anticipated carbon capture technology, to close down coal-fired power plants ten years from now.
The general mood in Washington around passage of the bill is fairly bleak, with Senate Majority Leader Harry Reid (D-Nev.) and Speaker Nancy Pelosi (D-Calif.) clashing over the legislation. In addition, Sen. Lindsey Graham (R-S.C.) tells CongressDaily that he’ll vote against the Kerry-Lieberman climate bill—the very bill which Graham helped to write. Senate Majority Leader Reid is poised for a vote however, so what concessions will come to get the necessary votes, stay tuned.
MBEF will continue to closely monitor the progress of the bill, and keep our members updated on its progress and developments. We welcome your comments and thoughts on the American Power Act, and the impact on Missourians.
As always, thank you for your support of Missourians for a Balanced Energy Future.
