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What Energy, Climate Proposals Mean to You

By Dick Kamp
(This is the first of a two-part news analysis of federal lawmakers efforts to address climate change.)

By just seven votes, the House of Representatives passed a 1,428- page plan on June 26 to reduce the United States carbon emissions, the major cause of climate change as agreed upon by the vast majority of global scientists.

The American Clean Energy Stimulus bill, (ACES, also known as Waxman Markey), convinced a majority of members including eight Republicans that this country could reduce its climate-change impact and develop clean energy at no net cost. The Congressional Budget Office estimated that it would reduce debt by $24 billion while Republican opponents predicted it would lead our country to ruin.

The day before the hard-fought vote, a joint Republican-Democratic poll (Mellman Group/Public Opinion Strategies) showed that 78 percent of Americans want climate legislation implemented and that 72 percent supported the core principals behind ACES.

Climate-change legislation is moving slowly in the Senate where Environment and Public Works Chair Barbara Boxer (D-Calif.) held five climate-change hearings between July 7 and Aug. 6 and allegedly will introduce a bill modeled after Waxman Markey sometime in September. Sen. Jeff Bingaman (D-N.M.) and a very centrist core of five other senators, will begin climate-change hearings, well sometime in autumn with little publicly defined idea of what they intend to produce. Senate Majority Leader Harry Reid (D-Nev.) wants a bill and 60 probably highly compromised votes to ensure passage before the end of the year. President Barack Obama is pushing for the process.

The final law is likely to be changed from the House version as the coal industry and environmentalists simultaneously try to weaken and strengthen ACES. However, it will almost certainly have all the same issues embodied in it as Waxman Markey, said a House Energy and Commerce Committee attorney and a bill author. Committee staff involved in writing the bill spoke anonymously, saying they will later work on a joint Senate-House bill.

Whatever law passes, like ACES, it will have political pork in it for different regions, farmers, coal-country utilities, refineries, steel industry and the nuclear-power industry. The bill was lobbied and manipulated on the floor of the House right down to the last 10 minutes of voting.

Waxman-Markey purports to cut U.S. carbon emissions from large sources by 83 percent from 2005 levels (more than 6 billion metric tons) no later than 2050. The goal is 17 percent by 2020. As a comparison, in late June, Scotland passed a law reducing emissions 43 percent from 1990 levels by 2020. U.S. emissions increased 20 percent between 1990 and 2005 according to the last (2008) U.S. Energy Information Administration report.

Waxman Markey sets a goal of 450 parts per million (ppm) of carbon dioxide (CO2) in the atmosphere by 2050. Unfortunately, most scientists fear that unless that goal drops to 350 ppm, sea rise will be aggravated by far faster glacier melt than anticipated. (Original United Nations 2005 predictions of levels of glacier melt by 2050 have now been revised to within 10 years from now.)

Sea rise of only a few feet anticipated in conservative scenarios will cost trillions of dollars and a loss of major coastal development and scientists have discovered that as glaciers melt, more carbon is released by frozen soils that may raise atmospheric levels of CO2 by more than 20 percent.

Most international carbon goals call for cuts of 25 percent to 40 percent below 1990 levels by 2020 slightly less than the Scotland range but far greater than the 4 percent drop from 1990 levels by 2020 in ACES. The ACES pace grows rapidly after that.

ACES lays out how this country will control high carbon and low carbon energy consumption through a system of capitalist trading (cap and trade) to limit carbon emissions and a few other climate-changing chemicals. It funds social and investment programs to make the process easier on both industry and consumers:

It caps emissions from large sources and then sets allowances that get sold, creating a cash pot used for various items that the bill defines; it provides offset to some carbon-emitting sources, allowing them to reduce carbon at other U.S. installations if they can't do it at specific facilities; and it allows a percentage of offsets to reduce deforestation in tropical rainforests around the world since climate change is a global problem.

This cap and trade strategy politically has stomped the main alternative proposed, a carbon tax on carbon-emitting fuels. Fossil fuels would have been taxed at various points of production and usage. The alternatives are not clear-cut: Shell and Conoco-Phillips strongly back this bill and Exxon-Mobil wanted a carbon tax. Both wanted some business assurances for an inevitable policy, for which a need has been recognized by the oil industry for many years.

The cap in a cap-and-trade system sets the number of emission allowances that are available. They decline between 2012 and 2050. These allowances are freely distributed as well as auctioned through a carbon market.

Electricity is the largest carbon emitter; coal is the largest utility carbon emitter and accounts for roughly half of the electricity generation in the United States, mostly in the Midwest and northeast, New Mexico and Wyoming. Natural gas has about 40 percent of the carbon of coal per energy produced. Petroleum fuel in cars and petroleum fuel to heat houses are roughly 85 percent carbon.

With carbon, the less you burn, the more you control emissions. Department of Energy (DOE) says that residential and commercial buildings together account for 40 percent of U.S. energy consumption, and energy standards for new buildings are one major section of the bill. Wood or biomass are relatively low carbon emissions since they did not turn to fossil fuels (but emit other pollutants,) however, biomass generators are included among low-carbon renewable alternatives for electricity generation.

The goal of ACES then is to make it increasingly economically painful to use oil and coal, and after awhile natural gas, and to encourage renewable energy development.

If successful, this strategy will go a long way to make the country energy independent, which is also a goal of those who mock climate change. They just would not go at it this way, and would encourage more domestic fossil fuel use as a main goal.

Carbon dioxide is not toxic, making it entirely different from any air pollutant ever to be regulated in the past. Carbon cap and trade proponents often point to how successful trading was in reducing sulfur dioxide emissions from power plants, but the sulfur was a life threatening pollutant and if a power plant chose to reduce sulfur in one spot while spewing it out from another stack, people suffered. So, even if overall emissions were reduced, there are still many people living near coal plants emitting levels of sulfur that can cause asthma attacks. Carbon trading to reduced planetary concentrations of CO2 has little to do with sulfur trading in the context of immediate local health protection.

The bill also lowers emissions from coal-bed and landfill methane as well as hydrofluorocarbon chemicals that also exacerbate global warming.

Joe Loper is senior vice president at the political Alliance to Save Energy, one of several utility-manufacturing-environmentalist coalitions that include, among others, Duke Energy, Dow Chemical and General Electric and the Natural Resource Defense Council.

Loper says, if you think global warming and climate change is a hoax, this bill embodies something evil. If you believe it is real, as we do, it is a huge step forward on the road to energy efficiency and addressing a planetary crisis and effectively saves our country energy.

The alliance is one of a number of groups that include industries seeking ground rules for their economic future, with environmentalists fearing an unknown climatic one. Most powerful is the U.S. Climate Action Partnership that adds the big three automakers, Shell and Conoco-Philips, Alcoa Aluminum, and mining giant Rio Tinto to pro-ACES groups

Even the American Coalition for Clean Coal Electricity got a number of demands out of ACES even though there's no technology on the shelf today that scrubs the carbon out of coal power plants.

Yet, bill opponent and ultraliberal Sen. Dennis Kucinich (D-Ohio) says ACES, encourages incineration, promotes coal and makes carbon sellable instead of taxable. He is joined by Friends of the Earth and Greenpeace. And they are joined by House Republican Leader John Boehner (R-Ohio) who sees a job-killing 1,500-page national energy tax through the House that will raise electricity prices, increase gasoline prices, and ship American jobs overseas to countries like China and India."

A gain or a loss?

There is a lot of money until 2025 to develop better ways to produce renewable electricity, capture carbon and sequester it in the ground from existing coal-fired plants, and mostly to help consumers and utility purchasers pay for a transition from high-carbon to low-carbon electricity.

Over the lifetime of the bill, revenue from about 80 percent of the total available allowances is used to buffer consumers from higher energy prices, for clean energy research and climate-change adaptation efforts. Fifteen percent of allowances are returned as a rebate to low- and moderate-income households. Twenty-two percent of allowances are given to electric utility and natural gas local distribution companies, primarily in the early years of the program to create rebates for consumers to offset higher energy bills.

There is a longer term Cash for Clunkers program that is more comprehensive than the current one. Trade in your gas hog and buy a new gas-consuming vehicle that gets better than 22 miles per gallon and you can get the $4,500 maximum if that is 10 percent better than the old BMW you drive. On the other hand, if you drive an old Honda Civic you may have a hard time finding a car that gets better mileage.

During the floor vote at least a couple of dozen supporters quoted EPA that the bill would cost consumers less than a postage stamp a day, actually 22 cents to 38 cents when taking into account energy savings from the bill for consumers. The Congressional Budget Office declared a slightly larger 50 cents a day by the year 2020 without including benefits to consumers from energy-efficiency measures.

Energy and Commerce Committee staff spoke with this reporter about some of the accusations leveled during the House vote by Rep. Boehner. For example, this bill will make it illegal for you to sell your old house if it doesn't meet energy standards.

Untrue, said the staffers. The new energy-efficiency standards are for new houses and, if they become law, require 30 percent upgrade in efficiency by 2012 and 50 percent by 2016. Any standards for older houses are voluntary and recommended.

Job projections and losses are highly speculative. There are state-by-state projections. For example, EPA projects 30,000 jobs gained in Arizona from ACES.

ACES would provide a boost to new jobs in the renewable-energy field, in new government bureaucracies and in carbon trading markets. If ACES becomes law, it is difficult to imagine that investments in coal plants will continue to grow although jobs in existing coal power plants and by connection, coal mines, get protection through the mid 2020s. Then coal will probably be less competitive, although new plants could in theory be built.

Clean coal with carbon capture or sequestration into the ground may or may not ever happen in spite of the large amount of money in this bill to be spent on encouraging the technology and although some workers will gain, some will suffer.

ACES would put $90 billion into new, clean, energy-efficient and renewable technologies by 2025 out of the sale of carbon emissions, as well as $60 billion into carbon capture and sequestration in those cases where the technology works, said Energy and Commerce Committee staff. Another $20 billion will go into scientific research and development with still another $20 billion into electric cars or other transportation alternatives.

States using funds from allowances will be able to create energy efficient transportation, provide energy efficiency programs for low-income recipients, create energy efficient manufactured homes, revamp building codes to be more energy efficient, set up statewide smart grids to use renewable energy first or think of other similar energy efficient programs.

(Editorial Note: Kamp is environmental liaison for Wick Communications Co.)

To read this article in the Nogales International, click here.