Climate Change Update

April 21, 2009 07:00 PM

via a special arrangement with Informa Economics, Inc.

Perspective and outlook on long road ahead for climate change legislation

NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.

-- Vilsack says climate change legislation a 'net winner' for farmers: USDA Secretary Tom Vilsack said climate change legislation should be a “net winner” for farmers although details that will determine how much growers get paid for offsetting greenhouse gas emissions are not yet evident. Payments to farmers could hinge on the extent to which emission allowances for greenhouse gases are sold or given away to utilities and other polluters, Vilsack said in comments with agricultural journalists. He said a key unknown is how carbon-saving measures are analyzed and verified. Farmers need to benefit from the credit system “in a comprehensive and significant way. I think we have a lot to offer,” Vilsack said. Sen. Chuck Grassley (R-Iowa) said climate legislation could be “punitive to agriculture” unless farmers can get paid for past practices. Vilsack declined to take a position on the issue. (Source: Des Moines Register)

-- EPA analysis: impact of cutting greenhouse-gas emissions less than expected: A proposal in Congress to cut US greenhouse-gas emissions by putting a price on carbon could raise prices for electricity by 22 percent and natural gas by 17 percent in 2030, according to a study by the Environmental Protection Agency (EPA). The impact on consumers would be modest, if the federal government returns to households most of the money raised by a carbon cap-and-trade system, according to the analysis. If so, EPA said the bill’s average annual cost per household would be between $98 and $140 a year – 27 cents to 38 cents a day, leading proponents to say the bill would have a relatively modest impact.

“When you combine this analysis with cost-saving measures from updated energy efficiency measures and weatherization, the savings will pile up for consumers,” Rep. Edward Markey (D-Mass.), chairman of the Energy and Commerce Subcommittee on Energy and the Environment, said in a statement. If so, the average American household would pay an extra $98 to $140 a year -- 27 cents to 38 cents a day -- to cut greenhouse-gas emissions as proposed by the bill, which the House will begin debating today. Link to EPA analysis:

The EPA analysis found that the price of emission allowances would be less than projected for a similar bill the Senate debated but did not pass last summer. Allowance prices would range from $13 to $17 per ton of emissions in 2015, and $74 to $96 per ton in 2050, the EPA reported. Last year, the agency projected that the Senate bill would cost $20 to $50 per ton in 2015 and $160 to $200 per ton in 2050.

The agency said forecasts have changed in part due to lower projected growth in gross domestic product, which means industrial output of greenhouse gases will be lower than expected. “With lower forecast emissions, the allowance prices necessary to achieve the goals set in the discussion draft are also reduced,” EPA said.

Rep. Mike Doyle (D-Pa.) was openly critical about the EPA estimate. “I don’t know how they can have an analysis when we don’t even know how an allocation [of allowances] can be done,” Doyle said.

-- Key witnesses at hearings today on energy legislation: Congress in part will mark Earth Day today with several hearings. Environmental Protection Agency Administrator Lisa Jackson, Energy Secretary Steven Chu and Transportation Secretary Ray LaHood will testify this morning before a joint hearing of the House Energy and Commerce Committee and the energy and environment subcommittee, focusing on the American Clean Energy and Security Act of 2009. In the Senate, the Energy and Natural Resources Committee will hold a hearing on energy-efficiency resource standards; the Environment and Public Works Committee plans one on "Oversight of the GSA [General Services Administration] and Energy Efficiency in Public Buildings"; and the Foreign Relations Committee will tackle "Global Climate Change: US Leadership for a New Global Agreement."

-- Lawmakers note concerns about pending legislation: At a hearing yesterday, several lawmakers noted that the House bill does not include details surrounding one of the key fights in the cap-and-trade debate: how to allocate the emission permits, used to comply with an emissions cap, which can be distributed through an auction or distributed free. House Energy and Commerce Chairman Henry Waxman (D-Calif.) said the allocations would be worked out during the committee process. In a letter sent to Waxman, Republicans on the House Energy and Commerce Committee called for more hearings on the global warming bill and said a key concern for Republicans is “the lack of any decision on permit allocation versus auctions in the discussion draft,” according to the letter. “The manner in which you will address this issue is the cornerstone of the legislation; without it the bill is simply not finished and not ripe to be marked up or accurately discussed in the context of a hearing,” Republicans wrote.

Lawmakers from both parties suggested the bill must compel China, India and other nations that burn coal to do their part in reducing carbon emissions. The bill includes provisions allowing for import tariffs on products from countries that are not regulating greenhouse gas emissions. However, a top adviser to the Chinese government on Tuesday warned that a proposed US border tax on carbon sensitive materials “smells of protectionism” and could spark retaliation from developing countries.

During a speech at New York University, Tung Chee-hwa, vice-chairman of the Chinese People’s Political Consultative Conference (CPPCC), the Chinese government’s official advisory, said that a proposed “border adjustment” program could be challenged through the World Trade Organization and that he was “distressed” by the new bill introduced to Congress.

Sen. John McCain (R-Ariz.) criticized the Obama administration’s idea that tariffs could be used as “weapons” to force compliance, saying it would be “more damaging to apply protectionism to climate change” requirements. “Greenhouse gases don’t know borders,” he said. McCain urged the US to work with China on carbon-capture technology instead.

-- Sen. Nelson concerned about EPA move to regulate greenhouse gases: Centrist Senate Democrat Ben Nelson (Neb.) warned that the Environmental Protection Agency’s recent move to begin regulating greenhouse gases risks overstepping its bounds. “I’m very concerned about their unilaterally moving forward,” Nelson said, according to Roll Call. “If alphabet agencies can do what they want without regard to what Congress believes, there’s something wrong with the system. In other words, just because we can’t get something through the Senate or the House or can’t get something done through Congress as a whole, doesn’t justify an alphabet agency jumping out and doing it on their own, even if they believe they have the authority to do it.” Nelson said he would likely wait to see what the EPA comes up with, but he warned that Congress must be heard on the issue. “They’re not going to run the government,” Nelson said. “They administer but they’re not going to make policy or set policy. ... It’s not up to them.”

-- House legislation timeline: The climate-change bill proposed by Reps. Waxman and Markey aims to begin emission reductions by 2012, would require emissions to be 20 percent below 2005 levels by 2020, while becoming 83 percent below 2005 levels by 2050. The bill would also impose a first-time federal renewable energy standard of 25 percent by 2025, as well as other clean energy initiatives. Waxman said he plans to begin subcommittee markups of the bill next week, with a full committee markup scheduled to begin the week of May 11. House Speaker Nancy Pelosi (D-Calif.) said today she expects a climate bill to be passed by the end of the year. Pelosi’s timeline would give Congress and the Obama administration a chance to show they are making progress in time for international climate talks scheduled for December in Copenhagen, Denmark. “We’ll celebrate the progress we will have made next Earth Day,” she said. Pelosi said other committees, including House Ways and Means, would act on its provisions within the same time frame. House Ways and Means Chairman Charlie Rangel (D-N.Y.) said he expects the components of the bill will be bundled together “to make it easy for the Speaker to have a bill.”

NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.


Back to news


Spell Check

No comments have been posted to this News Article

Corn College TV Education Series


Get nearly 8 hours of educational video with Farm Journal's top agronomists. Produced in the field and neatly organized by topic, from spring prep to post-harvest. Order now!


Market Data provided by
Brought to you by Beyer