Rep. Henry Waxman (r.), Chair of the House Energy and Commerce Committee talks with Rep. Rick Boucher on Thursday during markup of a climate change bill, the American Clean Energy and Security Act of 2009.
(Scott J. Ferrell/Congressional Quarterly/Newscom)Photos (1 of 1)
Sweeping climate-energy bill clears first big hurdle in Congress
The compromise measure would mandate reductions in greenhouse-gas emissions and require greater use of renewable energy. The Senate could be a major stumbling block.
By Mark Clayton | Staff writer/ May 22, 2009 edition
New climate-energy legislation approved by a key congressional committee marks what some are calling the most significant tipping point in US energy policy in 30 years, thrusting the economy toward renewable energy and away from fossil fuels.
The American Climate and Energy Act of 2009 (ACES) bill, approved by the House Energy and Commerce Committee Thursday evening, is the second major step this week by US political leaders to boost energy efficiency and curb global climate change.
The first step came a few days ago when President Obama toughened vehicle tailpipe standards. If the president is able to sign a climate-energy bill ahead of December climate talks in Copenhagen, as some suggest is now possible, the two measures would give the US – the world’s largest greenhouse-gas emitter per capita – far more clout in shaping a multinational response to the climate problem.
“This is a historic breakthrough for clean energy and the environment,” says Dan Lashof, climate center director for the Natural Resources Defense Council (NRDC). “It’s now absolutely feasible to get this bill enacted into law this year – before Copenhagen – and to give the US renewed credibility going into those talks.”
Energy and climate change linked
Because stemming carbon dioxide (CO2) emissions from burning fossil fuels is central to the climate conundrum, bill architects Reps. Henry Waxman (D) of California and Ed Markey (D) of Massachusetts combined the twin puzzles of energy and climate into one piece of legislation.
Some see it as a recipe for disaster – too big for Capitol Hill to swallow. But it appears the 946-page bill may achieve safe passage this year. If it does, it may be because Mr. Waxman spent weeks behind closed doors compromising and doling out valuable emissions allowances to industry and consumers to soften the blow of higher electricity rates.
Some environmental groups, including Greenpeace, Friends of the Earth, and others say there has been one compromise too many.
“We’re disappointed we can’t support the bill,” says Nick Berning, a spokesman for Friends of the Earth. “There just was not enough in it to reduce pollution while billions were given to big oil, dirty coal.”
Yet others read the compromises as adding political strength, paving the way for tougher future measures.
“This vote showed [that] the nation has reached a major tipping point on energy and climate,” says Kevin Book, managing director of ClearView Energy Partners, an energy research and consulting firm. “Historically, the problem has always been getting this kind of environmental bill through Congress the first time. After that, the laws just ratchet tighter.”
But some business groups criticized the bill. Its “inequitable approach, by itself, will produce additional unemployment,” warned the American Petroleum Institute in a statement. “While the bill has laudable environmental and economic goals, its inequitable system of allocations remains intact,” API said, “and if enacted would have a disproportionate adverse impact on consumers, businesses, and producers of gasoline, diesel fuel, jet fuel, crude oil and natural gas.”
Democrats beat back GOP amendments
Despite an onslaught of Republican amendments, the Democratic bill won broad support from Democrats in various regions of the US – including those from coal-reliant states in the Midwest and the South. The Republican alternative, which proposed more nuclear and hydropower, was handily defeated.
The ACES bill focuses on smokestacks that pump out 85 percent of US greenhouse emissions. It follows a three-way path to shift the nation toward a low-carbon economy: boosting energy efficiency, developing renewable energy sources like solar and wind, and curbing greenhouse-gas emissions (GHGs).
Together these are intended to cut US emissions to 17 percent below 2005 levels by 2020 – a major compromise from the previously suggested 20 percent cut. Still, it would launch America down a 30-year path of continual emissions cuts – reaching 83 percent under 2005 levels by 2050 – to help avoid the worst effects of global warming. The bill is also intended to jump-start a US push into energy-efficient technologies, grow green jobs, and advance national security by shifting the US vehicle fleet toward use of domestic electricity instead of imported oil.
‘Cap-and-trade’ the key
To do that, the bill’s main mechanism to limit emissions is a market-based “cap-and-trade” system for industrial CO2 emitters. Beginning in 2012, a national “cap” – or total maximum CO2 emissions – would be set and then ratcheted downward annually. Electric utilities, cement and steel plants, and others would need one “allowance” for every ton of CO2 sent up smokestacks. Power plants emit about 2.4 billion tons of CO2 annually – nearly 40 percent of total US greenhouse-gas emissions.
In addition to GHG limits, the bill combines a national renewable energy standard combined with an energy efficiency standard. By 2020, US electric utilities would be required to get 20 percent of their power from a combination of renewable sources (15 percent) and energy efficiency (5 percent).
But in a major compromise, governors would be permitted to petition to increase the energy-efficiency share up to 8 percent, with just 12 percent coming from renewables. Waxman accepted the lesser standard for renewables to win support of Democratic lawmakers from states where coal-fired power plants predominate, Mr. Book says.
Cost has been a major debating point. Rep. Joe Barton (R) of Texas, in a letter to Waxman this week, warned that the bill will “impact every person, every family, and every business” to the tune of “trillions of dollars.”
Others say the cost will be far less. Abatement costs would reach $22 billion in 2015, rising to $31 billion in 2020 and then up to $64 billion in 2030, the Environmental Protection Agency estimated last month. This would slightly curtail average annual US economic growth from 2.71 percent to 2.69 percent. The cost per household is estimated at $98 to $140 per year, the EPA says, although Republican critics say it would be far higher.
The EPA looked at the numbers again this week, concluding that final costs will be reduced by the compromise to achieve a 17 percent (instead of 20 percent) emissions cut by 2020. That change, EPA said in a memorandum, would “likely result in lower allowance prices, a smaller impact on energy bills, and a smaller impact on household consumption” – although it would mean “a somewhat higher use of coal in 2020.”
Costs tied to economic growth
Others note that overall costs will be minuscule relative to the size of the economy. By the time abatement costs reach $64 billion a year in 2030, the US economy will have grown more than $9 trillion – about 150 times the amount spent on CO2 abatement, NRDC economists say.
What happens to the valuable allowances in the cap-and-trade program – worth more than $600 billion, ClearView estimates – is a critical question. President Obama has long proposed auctioning all of the emissions allowances to avoid a windfall for polluters, as occurred in Europe.
But to win enough congressional support, the bill doles out some 85 percent of the allowances for free (with just 15 percent auctioned), ClearView calculates. The point of most free allowances is to blunt the impact of higher energy prices on households and energy-intensive industries.
For instance, in 2012 when the cap kicks in, electric utilities would get 35 percent of allowances – though the bill requires utilities to pass the benefit along to consumers. By 2020, however, the percentage of auctioned allowances would rise to 90 percent.
“The vast majority of these allowances are being distributed for purposes that make sense,” says NRDC’s Mr. Lashof. “The allowances going to electric utilities require those companies to use their value to benefit customers, and the result of that, in our analysis, is that consumer energy bills will actually decline under this bill.”
Indeed, 15 percent of the value of allowances would go to low- and moderate-income households to defray higher energy costs. But energy-intensive industries such as steel, cement, pulp, and paper would also get 2 percent of the allowances to soften the blow from competition by foreign rivals that don’t have emissions requirements. Refineries would get 2 percent of allowances.
If the ACES bill passes the House, as Lashof and others predict, all eyes will fall on the Senate, where companion legislation is under way. Whether Republicans will be able to filibuster there is an open question.
“This puts a lot of pressure on the Senate and makes it much more likely that the president will have a climate-energy bill to sign this year,” says Book of ClearView.
Comments
2. Melvin | 05.22.09
If the Europeans jumped off the cliff, would we follow them? This bill will raise the cost of every single thing that we produce, and consume. The EU has been referenced multiple times in the crafting of this bill, what is necessarily good for the EU is not necessarily good for us.
3. lizvv009 | 05.22.09
What has become of common sense - this legislation will destroy our country. When I was in grade school we learned that planting trees were the simplest way to controlling CO2. They are like little air scrubbers. Why can’t we have a huge national plan/investment of planting trees - it would be cheaper, a great beautification project, get everyone involved, and stop the insanity of destroying industry in America.
This whole Congressional plan is another tax — not a cleaner air initiative.
4. college kid | 05.22.09
Having read quite a few “comments” sections responding to news stories such as this, I can anticipate the reactions that will flow in from quite a few people. “Horrors,” they will say — “new taxes.” “Perfidy,” they will cry — “higher utility bills.” “Disaster,” they will shout — “a ruined economy.” “Big brother,” they will moan — “I can’t drive whatever car I want to…who cares how much it pollutes.”
From my perspective, these people have — whatever their age — grumpy old minds. They don’t see that things have changed. They don’t want to think anew. They deny that problems exist.
Putting it simply — they don’t want to be “disturbed.” They’re unwilling to make any kind of personal sacrifice for the sake of everybody else, not even a $100 a year more in utility bills or taxes.
My generation — people call us the “millennials,” which I hate — sees things very differently. Now, it’s fine for the “me-me-me” people to rant and rave as much as they want to. But I hope the governmental decision makers will tune out their strident voices. I hope they will think about the future, and not about the fears of grumpy old minds.
5. Rmoen | 05.22.09
Before we increase the cost of energy for Americans with cap-and-trade and also enrich a new class of financial traders, I believe it’s imperative that the United States establishes a non-political, scientific commission to review all facts and evidence surrounding global warming. Currently, we are relying upon a political organization, the United Nations, for their assessment of global warming. This is not good for America. The stakes are huge.
I am a Democrat. For the past 20 years I believed global warming was caused by CO2. Now I’m not so sure, after taking an objective look at the wellspring of man-made global warming theory, the United Nations’ Climate Change 2007 report. Whereas the report should have considered all possible global warming culprits then narrow the field, it instead removed from consideration the possibility that natural forces might drive global warming. It is little wonder that the report pinned the blame on CO2 when in their own words (p. 95), “The topics have been chosen for…assessing…risks of human-induced climate change.” The fix was in. It was politics not science. The mission statement should have read, “Topics have been chosen for assessing risks of human-induced and NATURE-INDUCED climate change.” Remember, the UN developed in Kyoto Protocol. They have a vested interest in demonizing CO2. For further discussion of the report see
http://energyplanusa.com/ipcc_reports_dont_pass_smell_test.htm
6. Tegiri Nenashi | 05.22.09
Google “climate change is faster than previously thought”. The first article can be traced to 1999! So one is fooled to believe the global temperature accelerates as on infamous hockey stick?
Seriously, you don’t solve the [nonexistent] problem with scattered low density energy such as wind and solar. No matter how advanced the technology is you can’t easily collect it. [Inexpensive] solar panel on the roof sounds nice, but in reality google where the most solar manufacturers are located (China). So far the domestic jobs argument. Installation and wind turbine maintenance are, but don’t expect these to be highly paid!
7. Jim Smith | 05.22.09
We can pay a little now (and over time) in increased costs for electricity, concrete, steel, etc. Or we can pay a LOT later when our cities and counties are SUBMERGED.
Easy choice.
8. Phillip Lemay | 05.22.09
Comments are made that renewable energy would drive up the cost of goods manufactured in the US. After the bankruptcies of Chrysler and GM and others to come, one is left asking “What?” will be left to produce at home? Manufacturing renewable energy technologies, building plants on all roofs and all unused land and building solar powered car ports to charge up millions of electric cars made in the US is the only constructive vision of the future that I can imagine. Creating hundred of thousands of jobs at home and eleminating the need to import trillions of dollars worth of oil that creates jobs in a series of unfriendly countries. How can any rational individual, being blue or red, be against that? Our politicians are determined to sink their opponents and drown the country with it. It is so depressing that I am planning on leaving before it happens.
9. dizizcamron | 05.22.09
Controlling CO2 emissions by planting trees as #3 suggested above is a noble idea. I think planting trees everywhere possible is definitely a good idea for CO2 reduction and for making things look nicer. However the issue here is scale. It would require an area the size of Australia to be completely covered in brand new trees in order to offset the amount of CO2 we have added to the atmosphere by burning fossil fuels. This would not be in any way cheaper than this bill. Not to mention, where are we gonna get that much fertile land that isn’t already being used? By all practical measure planting our way out of this problem is not possible.
However, this bill doesn’t seem to address bio-fuels. Growing plants, like trees, and then burning them to produce heat and electricity is a carbon neutral process. Burning trees instead of coal is also an effective tool for lowering CO2 emissions. I also agree that nuclear and hydro power should not have been forced out of this bill unless they were trying to be inserted in place of solar and wind. We need more of all of it. For states like Tennessee, where solar and wind aren’t as available as california, nuclear is a very good option that should be pursued.
10. dizizcamron | 05.22.09
Controlling CO2 emissions by planting trees as #3 suggested above is a noble idea. I think planting trees everywhere possible is definitely a good idea for CO2 reduction and for making things look nicer. However the issue here is scale. It would require an area the size of Australia to be completely covered in brand new trees in order to offset the amount of CO2 we have added to the atmosphere by burning fossil fuels. This would not be in any way cheaper than this bill. Not to mention, where are we gonna get that much fertile land that isn’t already being used? By all practical measure planting our way out of this problem is not possible.
However, this bill doesn’t seem to address bio-fuels. Growing plants, like trees, and then burning them to produce heat and electricity is a carbon neutral process. Burning trees instead of coal is also an effective tool for lowering CO2 emissions. I also agree that nuclear and hydro power should not have been forced out of this bill unless they were trying to be inserted in place of solar and wind. We need more of all of it. For states like Tennessee, where solar and wind aren’t as available as california, nuclear is a very good option that should be pursued.
11. Rick Saxton | 05.22.09
For over a century, the ME generations have been polluting and skunking up the environment for perceived prosperity. But we apparently don’t give a tinker’s damn about unborn generations. It’s just ME, ME, ME. We in the U.S. have not only polluted the planet, but we have built a national debt which is out of control. We apparently think it is O.K. for somebody else can pay our debts and live in a unhealthy environment. Just as long as we can have our STUFF.
The way I see it, with the bad economy, wild national debt, pollution, and the final realization that we can’t continue running towards the cliff like a bunch of lemmings; we will be paying much more for our basic needs. That is necessary to pay the piper for unsustainable life styles we and other generations have lived. So future generations will be able to thrive. The party train has arrived at the station and it is time to pay the bar tab.
12. Pete | 05.22.09
I agree with blocking amendments concerning hydro power, while relatively clean, it can have a very damaging impact on local environments, especially along river ways and around dams. But nuclear power, aside from having to store the waste, could outright replace dirty coal fired plants, and older generation nuclear reactors that aren’t as safe. There seems to be a public fear and social stigma towards nuclear power, based largely on ignorance and hype.
Other than that, I approve of the tone of the bill, though the glacial pace of progress bothers me a bit. It is my ardent hope that down the road there will be further legislation towards “going green” and hopefully some of it will be decided by rational people thinking of real progress and less of party lines and lobbyists.
13. Arthur LEMAY | 05.22.09
We have had this cap and trade system in Europe since 2005. So far, all it has done is raise energy costs. Except for England and Germany, most European countries have seen double digit increases in CO2 emissions. Companies are leaving the EU because they cannot compete with companies in non-EU countries. Cap and trade is essentially an energy tax. All costs go up and obviously it does nothing for the environment because CO2 concentrations increase, even in the face of these controls.
Environmentalists have been preaching this “solution” of reducing man-made CO2 to control the climate for years — but there is no evidence, none, that it is true. The people who associate increasing CO2 concentrations with temperature have three issues which they fail to address: 1) Increasing CO2 concentrations are just as likely to be the result, not the cause of warming, 2) The so-called scientists use the period of 1975 to 1998 to claim warming, but if they used 1940 to 1975, using the same methods, they would claim cooling, and, 3) The CO2 models have never predicted anything correctly, but the solar climate models do, so why is a method which does not work trump a model which does work? These people are politicians, not scientists.
Green energy is a fantasy. The world’s leading country in wind power is Denmark, but the Danes have found it is uneconomic, requires a new electricity infrastructure, is intermittent and requires carbon power based backup running all the time. It is a joke.
The trade part of this cap and trade scheme is being fiddled by crooks who sell credits based on planting trees. So, they take pictures of trees in out of the way places, put the money in their pockets nd actually do nothing except bribe politicians to pass laws to increase their profits. The carbon traders can make billions out of these frauds and Al Gore stands to be the first carbon billionaire. Yes, billionaire not millionaire. Your money diverted to his wallet. Nice, isn’t it?
The Mauna Loa Observatory says the CO2 concentration is less than 4/10 of one percent. And the environmentalists say this controls the climate because the concentration goes up by 1/100 of one percent per year. To say that 1/100 of one percent controls anything is a joke.
And to put CO2 taxes in place to control the climate is just insane. There is no evidence this will work, because all the CO2 climate models fail utterly to predict anything. This will cost trillions, do nothing for the climate and will destroy companies, cause unemployment, deaths of the elderly by freezing to death, cause poverty and hardship so people in Washington can feel good, get rich, and have hundreds of billions if not trillions of dollars to waste or embezzle.
What a deal! Brought to you by Democrats and the Obama dictator.
14. alanstorm | 05.22.09
How lovely - we’re about to waste tremendous amounts of time, money and energy to solve a problem that does not exist, with a method that’s already failed in Europe. And people are cheering this lunacy.
“This vote showed [that] the nation has reached a major tipping point on energy and climate,” says Kevin Book, managing director of ClearView Energy Partners, an energy research and consulting firm. “Historically, the problem has always been getting this kind of environmental bill through Congress the first time. After that, the laws just ratchet tighter.”
Of that, I have no doubt. My only consolation is that the mental midgets supporting this will get to suffer along with us sane people. It’s not much, but it will have to do.
15. Dave | 05.22.09
Global warming due to CO2 is a fabrication by the left to create the CO2 Complex.
16. Shamil | 05.22.09
Amerca need to stop indstry and becom farming land. All indstry should be from china and india and also contrys that need work for all its people.. The contrys can then be in hopes of all in the world. Amerca needs no more stuff to.
17. Olivia | 05.23.09
Yay, college kid. Yay, Rick Saxton. Grumpy old minds, get over yourselves. The future of “we we we” is being born, out of the ashes of “me me me.”
I can’t wait for the day when it’s considered normal for the idea of growth and development to go hand-in-hand with the desire to preserve our natural resources instead of exploit them and to protect animals’ habitat instead of crowd them out of existence.
“Blessed are the meek: for they shall inherit the earth.” (Matthew 5)
18. RoB68 | 05.23.09
What is most disconcerting about this whole process is that no one read the bill proposal and yet they still voted for it along party lines of course with almost zero bi-partisanship.
What happened to the 5 days of review promised by the then campaigning Senator Obama. It was not even reviewed for two full days and it was almost a 1,000 pages long. Not to mention it was loaded with special interest perks(pork).
Also, Mr. Waxman brought in a speed reader because the people were critical that they didn’t read the “Stimulus Bill” before they vote unanimously (again along party lines) without having read it. How completely arrogant and condescending and arrogant is that to the people that gave these peole their jobs.
As far as energy concerns go,they are there granted. Why now when we are in a recession and mosy certainly the onset of depression with inflation and possibly hyper-inflation on the way because of this out of control spending?
Not to mention trying to nationalize healthcare, which in my opinion and a lot others is going to be a disaster.
The only answer I can come up with is that the Democrats have the control and will push through everything they can irregardless of what the people want.
In other words, it’s all about agenda and that isn’t represntative of why they were given the jobs we provided them with.
That’s my two or three hundred-thousand trillion cents worth.
19. Peter Lionel Griffiths | 05.23.09
Obviously it’s a waste of time and money to support any group that’s battling Cap and Trade and Carbon Reduction Laws. The legislation is passing the Committees and it is going to be passed all the way. Now, the smartest strategy is positioning so that it works best for you.
What is tragic, and way beyond comprehension is that governments continue to throw billions at Carbon Capture and Storage (CCS) designed to bury Carbon (CO2) and do not focus on the actual reduction of CO2 at the source so it does not go into the atmosphere.
Whatever it takes to bring enough pressure to bear to get polluting companies to take responsibility for their own company’s neglect of the environment is obviously what is needed - these companies are without a social conscience. There is technology available to reduce CO2 emissions which responsible companies can adopt without causing all this international uproar. The company or companies that lead the way will benefit enormously.
20. Dave | 06.26.09
Too bad almost no one knows that the real greenhouse gas is water vapor and not CO2. This is what is driving these climate models to predict large warming in the atmosphere. They make the assumption that as CO2 builds up there will be more water vapor in the atmosphere, however, this may or may not be the case. CO2 adds about 1.5 watts / meter^2 if we double from here…which is about a 1 degree C rise in Earth’s temperature. Meanwhile, the climate models (written by math whizzes and not meteorologists) predict 4-8C rise with a doubling of CO2…which is unrealistic. And while we pass legislation, China and India will continue to pump CO2 into the atmosphere, and we will pay more for energy.
22. Greg | 06.26.09
Climate change is real. The science did not start in 1999 as some have claimed here. In fact Linden B Johnson’s scientific advisory board voiced concerns about man made carbon emissions. We have been tracking this since the 40’s, gathering data, looking for counter arguments and verifying global temperature shifts. We understand the internal forcing to our climate system very well, oceanic cycles like El Nino & La Nina, solar cycles, orbital variations, and on and on. The current OBSERVED AND MEASURED changes we see are ONLY EXPLAINABLE when we factor in human carbon emissions into the models. Put another way, Climate Change is happening and we are causing it. Read the scientific journals not armchair science from some shmuck on a blog (myself included).
As for ACESA… The bill stinks 5 ways to Sunday. Frankly I do not think it is nearly strong enough but… I blame all those who did not call their Congressman and Senator as much as I blame our Reps for listening to the interests of Coal and Oil who obviously did lobby. If you did not make a call or write a letter or OPED a newspaper you’ve got no one to blame but yourself. That said I do think we need to have something on the books before the fall run up to Copenhagen. (Man I wish it were better, held to stronger targets, and had less givebacks to coal though). So here’s my plan. The bill now goes back to the Senate for one last round. I’m going to lobby every Senator I can reach as hard as I can to make these changes http://pdamerica.org/articles/news/2009-06-23-02-39-15-news.php God help us all if we blow this! Educate yourself with PEER REVIEWED SCIENCE no popular press articles and thinktank BS!
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1. Lou | 05.22.09
As the saying in business goes, if both sides leave the table angry, its probably a good deal. That seems to be what’s happened here. I do wish Democrats hadn’t blocked Republican amendments for nuclear and hydro power though. Its nice that they want to focus on safer energy sources like wind and solar, but the problem is those technologies are not advanced enough to support our energy needs yet. The question then becomes, what to do in the mean time?