House Democrats unveil sweeping plan to reshape energy in America

Apr 01, 2009 By Renee Schoof and David Lightman

Democrats in the House of Representatives on Tuesday announced a sweeping plan to change how the nation produces and uses energy in order to reduce the risk of dangerous climate change.

No environmental legislation in America has ever attempted such wide-reaching changes. The bill -- an incomplete draft that will evolve in the months ahead -- would provide incentives to boost wind, solar and other renewable energy, would improve efficiency so that homes and businesses need less fuel and would support the development of cars that run on biofuels and electricity.

It also would make using more expensive -- and that will be the central issue of debate in Congress, with armies of lobbyists on both sides.

The measure contains a variety of terms intended to help businesses survive the energy transition, but it leaves open for debate the central question: how revenues from pollution permits would be used. That means the question of how consumers would be helped also remains to be worked out.

The plan calls for a system to limit for the first time the amount of global warming pollution -- mainly from coal and oil combustion -- that's permitted from utilities, oil companies and large-scale industries, which make up 85 percent of the U.S. economy. They'd have to buy permits for each ton of emissions.

The total emissions amount would be lowered each year until it was 83 percent below 2005 levels in 2050. That's the amount that science suggests will be needed as part of a global effort to prevent irreversible problems from steadily increasing warming.

Companies that need more permits could buy them from companies that need fewer of them. This system of a declining cap on overall emissions and a market for permits is known as "cap and trade."

Sponsors declared that their plan would create jobs in that couldn't be shipped offshore, would reduce dependence on foreign oil and would make the United States an exporter of energy technology, all while making sure that American consumers and coal-dependent parts of the nation are spared from sharp cost increases.

"This legislation will create millions of clean energy jobs, put America on the path to energy independence and cut global warming pollution," said Rep. Henry Waxman, D-Calif., the chairman of the House Energy and Commerce Committee, who sponsored the draft along with Rep. Edward Markey, D-Mass., the chairman of the committee's Energy and Environment Subcommittee.

Waxman and Markey modeled their cap and trade plan on a consensus report that U.S. Climate Action Partnership, a group of 26 large businesses _ including ConocoPhillips, Shell, BP America Inc., Duke Energy, Alcoa and the U.S. automakers -- and five environmental groups released in January.

Environmental groups supported the draft.

Democrats are pushing for ambitious legislation this year before a global conference in Copenhagen, Denmark, in December that aims to set new goals for reducing the emissions that contribute to global warming.

Republican Sen. Mitch McConnell, R-Ky., called the Waxman-Markey plan a "new national energy tax" and asserted that it would cost households up to $3,100 a year and reduce the number of U.S. jobs.

House Republican leader John Boehner of Ohio attacked the plan with similar arguments and added that AK Steel, which is in his district, would pay more under cap and trade than competitors in places such as China would.

"Their costs will skyrocket and their customers will simply buy cheaper imported steel," Boehner said.

The draft, however, contains provisions to protect businesses from foreign competition and leaves open for debate how consumers will be protected. One idea that has some bipartisan support is returning all or most revenue from pollution permit sales to taxpayers.

Another suggestion is to give permits to companies free in the plan's early years. That also could help hold down costs to consumers if the companies passed the benefits along.

In a sign of the argument to come, Republicans unleashed a series of ads Tuesday aimed at 54 politically vulnerable House Democrats, charging that a cap and trade plan would send energy prices soaring. Ken Spain, a spokesman for the National Republican Congressional Committee, warned of a "fiscally irresponsible cap and tax proposal that will increase energy bills, raise taxes and overwhelm the budgets of American families."

Scott Paul, the executive director of the Alliance for American Manufacturing, said he was glad that the draft bill included plans to protect American industries from competitive disadvantage. Still, he said it would take time to analyze the 640-page draft to determine how effective and how costly the bill would be.

The bill's section on global competitiveness calls for some industrial sectors to receive rebates to compensate for additional costs. If the rebates aren't sufficient, the president could impose tariffs on foreign manufacturers and importers to cover the carbon they emitted in making their exported products.

James Mulva, the chairman and chief executive officer of ConocoPhillips, said at the National Academy of Sciences on Monday that businesses wanted certainty about energy prices so they could make investment decisions. He predicted that this issue will be a difficult fight in Congress and called for work toward an "environmentally effective, economically sustainable and fair" approach.

Mulva said that a "significant proportion" of the permits should be given free to businesses to help consumers and protect against competition from foreign countries without mandatory controls.

The measure offers other provisions that businesses sought. One is offsets; companies can increase their emissions if they obtain reductions of emissions elsewhere at a lower cost which offsets those increases. Total offsets would be limited.

___

(c) 2009, McClatchy-Tribune Information Services.
Visit the McClatchy Washington Bureau on the World Wide Web at www.mcclatchydc.com

Explore further: UN climate talks shuffle to a close in Bonn

add to favorites email to friend print save as pdf

Related Stories

Emissions trading could misfire, economists warn

May 30, 2007

With the report of the Prime Minister’s Task Group on Emissions Trading due to be handed to Prime Minister John Howard tomorrow, environmental economists from The Australian National University have warned that an emissions ...

Recommended for you

UN climate talks shuffle to a close in Bonn

15 hours ago

Concern was high at a perceived lack of urgency as UN climate negotiations shuffled towards a close in Bonn on Saturday with just 14 months left to finalise a new, global pact.

Study shows no lead pollution in oilsands region

Oct 24, 2014

New research from a world-renowned soil and water expert at the University of Alberta reveals that there's no atmospheric lead pollution in Alberta's oilsands region—a finding that contradicts current scientific ...

User comments : 21

Adjust slider to filter visible comments by rank

Display comments: newest first

lengould100
3.8 / 5 (10) Apr 01, 2009
Ken Spain, a spokesman for the National Republican Congressional Committee, warned of a "fiscally irresponsible cap and tax proposal


A brilliant bit of misleading, substituting "tax" for "trade". No wonder the world is so messed up.
Velanarris
3.1 / 5 (13) Apr 01, 2009
Ken Spain, a spokesman for the National Republican Congressional Committee, warned of a "fiscally irresponsible cap and tax proposal

A brilliant bit of misleading, substituting "tax" for "trade". No wonder the world is so messed up.

"Cap and trade" is a tax and fine system, not a trade system. Trade systems generate wealth, tax systems impose a cost. Cap and trade imposes an additional cost to doing business, hence the term "cap and tax".
QubitTamer
3.4 / 5 (15) Apr 01, 2009
This is an all out declaration of war against the people of the united states by their own government. The far left in America, funded and spurred on by the real-life Dr. Evil, George Soros, finally have the people in place to destroy free market capitalism that has been so hated by the socialist one world government cabal.

The restrictions to be forced on Americans will not even be thought or talked of for Russia, China, India, Brazil, or any other growing economy.

Soon entrepreneurial Americans will begin emigrating to China for more freedom and less government impediment of capitalism and free trade!! How laughably ironic is that!
Doug_Huffman
3.2 / 5 (9) Apr 01, 2009
Nuclear power is secure power beyond the reach of a depauperate culture that Obongo's Obamination is promoting.
dbren
4.1 / 5 (9) Apr 01, 2009
This plan is pointless and futile if the world's biggest polluters, India and China, do nothing to reduce their own emissions. We'd might as well just institute our own tariff against goods made here in the US.
freethinking
1.8 / 5 (5) Apr 02, 2009
I found the site www.democratsareajoke.com Ill bet they will put this story in their joke section
lengould100
2.6 / 5 (5) Apr 02, 2009
Ken Spain, a spokesman for the National Republican Congressional Committee, warned of a "fiscally irresponsible cap and tax proposal

A brilliant bit of misleading, substituting "tax" for "trade". No wonder the world is so messed up.

"Cap and trade" is a tax and fine system, not a trade system. Trade systems generate wealth, tax systems impose a cost. Cap and trade imposes an additional cost to doing business, hence the term "cap and tax".

If the worthy Mr Spain wants to re-define the wording of the debate that's been ongoing for several years, he needs to get widespread agreement on that first.

1) Since years ago, there have been TWO options available to limit CO2 emissions. "Carbon TAX" OR "Cap-And-Trade". Quit trying to further confuse it.
2) "Carbon Tax" is provably cheaper for the same result, to operate than the trading scheme, which is strictly designed to further enrich bankers, brokerage shareholders and market gamblers who belong in Vegas casinos, not as self-defined "Masters of the Universe".
3) The only thing "Cap-and-Trade" has going for it is that it's name does NOT include the word "Tax", which for some unfathomable reason drives childish Americans nuts.

So now, this stupid Repub. tries to stick the word "Tax" into the traders scheme as well? What an #$$%^
3432682
3.4 / 5 (5) Apr 02, 2009
Big government IS the problem.
lengould100
2.3 / 5 (9) Apr 02, 2009
"Big" government is far less a problem than "Big" private healthcare, "Big" private run schools, "Big" private-run prisons, "Big" private-run police forces, "Big" private-run military etc. etc.

For a country which just LOVES its HUGE military, which by definition MUST be government run, its wierd to see such anti-government crap coming from its citizens. Ok, don't like "Big" government? Then CUT THE MILITARY!
Velanarris
3.4 / 5 (5) Apr 02, 2009
"Big" government is far less a problem than "Big" private healthcare, "Big" private run schools, "Big" private-run prisons, "Big" private-run police forces, "Big" private-run military etc. etc.



For a country which just LOVES its HUGE military, which by definition MUST be government run, its wierd to see such anti-government crap coming from its citizens. Ok, don't like "Big" government? Then CUT THE MILITARY!


Name one thing that the government does better than private industry.

And the term Big government doesn't refer to the size, it refers to the scope. Current US government scope is far too large and has too many links into home and personal life.
jimbo92107
2.3 / 5 (6) Apr 02, 2009
A $1 dollar per gallon gas tax would pay for a complete overhaul of America's energy infrastructure. That would put gas at $3 per gallon, a buck less than its peak under BushCo.
Velanarris
4 / 5 (4) Apr 02, 2009
A $1 dollar per gallon gas tax would pay for a complete overhaul of America's energy infrastructure. That would put gas at $3 per gallon, a buck less than its peak under BushCo.

Until OPEC decided that oil should cost $150 a barrel again.
Nartoon
3.7 / 5 (3) Apr 04, 2009
there have been TWO options available to limit CO2 emissions. "Carbon TAX" OR "Cap-And-Trade"

Both are taxes, one is direct and visible, the other is non-direct and less visible. Cap and Trade is also much less efficient, therefore it costs more in the long run. Al Gore loves it, Jim Hansen doesn't -- it's about the only good thing J.H. has ever said!
superhuman
1 / 5 (3) Apr 05, 2009
This plan is pointless and futile if the world's biggest polluters, India and China, do nothing to reduce their own emissions. We'd might as well just institute our own tariff against goods made here in the US.


CO2 per capita:
US 20.4
China 3.84
India 1.2

So if anything it's USA who is "the biggest polluter" among those countries. If USA won't do anything it won't ever have the right to demand that others do (USA will still do whatever it wants but others won't like it).

Besides what should be compared are total emissions per capita and then USA position is still much worse. The developing countries may join when they reach the same development stage. So far their total emissions per capita are insignificant compared to developed nations.
http://en.wikiped...r_capita

Sancho
3.7 / 5 (3) Apr 05, 2009
Feed the trees, not the government bureaucracy in DC. Carbon dioxide is good for plants and other living things. Was last winter cold? Reduce CO2 levels and we'll return to 19th century winter conditions. Think Valley Forge. Sorry, but the admixture of politics and "environmental science" is going to prove toxic to our economy and ultimately our climate.
Arikin
1 / 5 (2) Apr 06, 2009
I think they may be trying to bite off more than they can chew. Thus the comments above and fighting on the Hill.

Might want to strip the bill down to a basic first step. Like more incentives to companies that use renewable energy and supplies.
Velanarris
5 / 5 (3) Apr 06, 2009
This plan is pointless and futile if the world's biggest polluters, India and China, do nothing to reduce their own emissions. We'd might as well just institute our own tariff against goods made here in the US.

CO2 per capita:
US 20.4
China 3.84
India 1.2

So if anything it's USA who is "the biggest polluter" among those countries. If USA won't do anything it won't ever have the right to demand that others do (USA will still do whatever it wants but others won't like it).

Besides what should be compared are total emissions per capita and then USA position is still much worse. The developing countries may join when they reach the same development stage. So far their total emissions per capita are insignificant compared to developed nations.

http://en.wikiped...r_capita

There's a problem with calculating emissions per capita, especially when comparing countries that don't have an all-encompassing electrical grid.

To use your own reference list so we're on the same page:

Qatar 69.2

Trinidad and Tabago 24.7

Brunei 24.1

Kuwait 38.0

Are these countries that should be cornered with a Carbon tax or cap and trade scenario? The majority of the top 20 on that list are underdeveloped countries. Of course, the US, Canada, The Netherlands, Norway, and Austrailia are there but every other country is considered third world, or first world through tourism alone.

You have to look at emissions compared to usage to determine waste first, then looking at per capita makes more sense.
superhuman
1 / 5 (3) Apr 06, 2009
There's a problem with calculating emissions per capita, especially when comparing countries that don't have an all-encompassing electrical grid.

What problem? It's the only meaningful way to compare emissions.
To use your own reference list so we're on the same page:
Qatar 69.2
Trinidad and Tabago 24.7
Brunei 24.1
Kuwait 38.0

Are these countries that should be cornered with a Carbon tax or cap and trade scenario?

Of course they should, they are too small to matter however so others probably won't bother with trying to impose it on them.
You have to look at emissions compared to usage to determine waste first, then looking at per capita makes more sense.

What are you talking about? Emissions are emissions the usage is completely irrelevant.

If each US citizen is on average producing 5 times the amount of carbon dioxide each Chinese citizen is producing then US is 5 times "bigger polluter" then China.

The only way to question this conclusion is to argue that the Earth does not belong equally to all people and some have more right to produce emissions then others.
Velanarris
5 / 5 (3) Apr 06, 2009
What are you talking about? Emissions are emissions the usage is completely irrelevant.
I think the usage is the most relevant part of the equation. Efficient usage is just as important to look at as usage total.
If each US citizen is on average producing 5 times the amount of carbon dioxide each Chinese citizen is producing then US is 5 times "bigger polluter" then China.
Or China has 5 times the people, or their industry is not modernized, or they're utilizing less fuel to deliver the same amount of electricity, there are many many variables to this. To pin it to one statistic is not going to come up with a relevant way to determine regulation.

The only way to question this conclusion is to argue that the Earth does not belong equally to all people and some have more right to produce emissions then others.
That is blatantly false.

The US generates more emissions per capita due to many things, one of which is our electricity usage. Are you saying that China produces fewer emissions on a level playing field with the US? So that would mean that electricity is equally available on a per capita basis, which it is not. Employment, heavy industry, standard of living, none of these things are equall between the US and China. What will the numbers look like a decade from now, when China has already upgraded their infrastructure and style of living? When their per capital emissions match that of the US will the total amount of emissions be equal? Of course not, no one is suggesting it will. Based on population alone China will become at least 3x the polluter that the US is.

Should we address it now or wait until they've already put an infrastructure in place?

I'm not trying to justify the US emissions figures, I certainly can't, but as we all know, it's easier to build an infrastructure once than it is to build it, and then rebuild it better later on. If emissions are to be addressed, then address them unilaterally by all nations with no exceptions.
GrayMouser
5 / 5 (2) Apr 06, 2009

CO2 per capita:

US 20.4
China 3.84
India 1.2


This is a good example on how to lie with numbers. If CO2 were a pollutant you would be worried about the total emissions and not the per person quantities.

Add to that the attempt to make it appear the the US is emitting far more that the rest of the world on that same per person basis (by removing other countries where they emit far more per person.) You are either interested in total emissions or per person emissions.
dachpyarvile
5 / 5 (2) Apr 08, 2009
Has anyone else actually read the draft legislation? It is a precursor of things to come, I fear. And, yes, it WILL harm the economy further.