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Major hurdles ahead in House, and especially
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controversial climate-change bill (HR 2454), which faces a rocky road
ahead in the House and an even steeper uphill climb in the Senate, where
it needs 60 votes to overcome a filibuster, cleared one hurdle Thursday
evening, passing the House Energy and Committee Committee by a mostly
party-line 33-25 vote.
Four Democrats voted against the bill -- Reps. Mike
Ross of Arkansas, Jim Matheson of Utah, Charlie Melancon of Louisiana,
and John Barrow of Georgia. Those four Democrats are members of the
fiscally conservative Blue Dog Coalition. Ross said the bill needs to
have a broader definition of biomass as a renewable resource. “While
I agree with the intent of this bill, I cannot support its current approach
which lacks certain provisions that protect rural areas — like
Arkansas — that do not have the same renewable energy sources
as places like California.”
One Republican, California Rep. Mary Bono Mack, supported
the legislation because, she said, the bill would level the
playing field for California, which already has some of the nation’s
most aggressive controls on greenhouse gases.
Background on legislation.The
nearly 1,000-page measure would cap emissions at 17 percent below 2005
levels by 2020, 42 percent below in 2030 and 83 percent below in 2050.
It creates a cap-and-trade system in which a company could buy pollution
allowances from another business in lieu of meeting its obligation to
reduce emissions. The bill contains some safeguards to make sure consumers
are not hit with higher utility bills.
The measure also would require 15 percent of the nation’s
electricity to come from renewable sources including wind,
solar, biomass and geothermal by 2020. An additional 5 percent in energy
savings would have to come through greater efficiency. States could
petition to meet a standard for 12 percent renewable use and 8 percent
Waxman said he intends to hold at least one hearing on how pollution
credits would be allocated under the bill.
The strategy used to get it out of the
Energy panel. To woo more Democrats to back the bill,
Energy Chairman Henry Waxman (D-Calif.) and Ed Markey (D-Mass.), chairman
of the Subcommittee on Energy and Environment, agreed to lower emissions
caps and renewable fuel standards. Their proposal gives away, for several
years, nearly 85 percent of the emissions allowances for free to utilities,
manufactures, oil refiners, and other industries to help business transition
to the new requirements.
Republicans argue the proposal will increase energy costs for
already-strapped consumers and push energy-intensive, trade-sensitive
industries like steel, aluminum, and paper abroad to less-regulated
Next steps. House leaders
have not announced a schedule for bringing the measure to the floor, although
Majority Leader Steny Hoyer (D-Md.) has indicated it could come up in
June or July. “I believe there’s support on the Republican
side of the House for this bill,” Markey said. The bill co-sponsors
said tonight they’d like to have a bill ready for President Barack
Obama’s desk and an international climate summit in Copenhagen by
the end of the year.
Before House floor action can occur, eight other committee
chairmen who share jurisdiction over the legislation must consider the
bill, notably the Ways and Means Committee because of its revenue-raising
proposals. (The panels will only take up bill sections under their
jurisdiction.) Besides Ways and Means, other panels with jurisdiction
include Foreign Affairs, Financial Services, Education and Labor, Science
and Technology, Transportation and Infrastructure, Natural Resources,
Farm-state lawmakers are wary. House
Agriculture Committee members, led by Chairman Collin Peterson (D-Minn.),
have expressed major differences with the pending bill. Peterson said
Thursday that the House bill is “an urban-dominated bill" that
"is going no place in the Senate.” Peterson is particularly
concerned about the Environmental Protection Agency (EPA) proposing to
count international land-use toward calculating the climate-impact of
using corn-based ethanol. Waxman's committee defeated an amendment from
Rep. Lee Terry (R-Neb.) that would have eliminated the requirement that
an EPA lifecycle greenhouse gas analysis for ethanol had to take into
account possible international deforestation.
Peterson has also noted concern expressed by some Ways and
Means panel members that a carbon market would lead to widespread speculation
and manipulation that will adversely affect commodity and financial
markets. "I'm not for Wall Street having anything to do with carbon
... because you can't trust them," Peterson said, according to
CongressDaily. He promised that 45 or so other House Democrats
share at least some of these concerns, particularly regarding ethanol.
Peterson wants to add language that would require USDA approval
before the EPA could move forward. “We have been bankrupted
three times over my lifetime in the ethanol industry,” Peterson
Peterson also criticized the measure's provisions to allow
businesses to comply by funding special projects that reduce or sequester
emissions; for example, by planting trees on farmland. Half
of these would have to be international projects such as preserving
rain forests, which Peterson called a “non-starter."
A list of agriculture groups have sent
letters to Congress expressing opposition to or serious concerns about
the Waxman/Markey climate change and energy legislation.
“As it becomes clearer the extent of damage this bill will cause
to agriculture without providing any benefits, more and more farm groups
are writing to encourage their Members of Congress to oppose this bill,”
said Rep. Frank Lucas (R-Okla.), ranking member on the House Ag Committee.
Among the groups opposed to the bill are the American
Farm Bureau Federation, the National Corn Growers Association, the National
Chicken Council, the Fertilizer Institute, the National Turkey Federation
and the United Egg Producers.
The Obama administration strongly backs
the legislation, although some House bill provisions are
weaker than what President Obama advocated during his presidential campaign.
Obama called the bill “historic” in a statement.
“And this achievement is all the more historic for bringing together
many who have in the past opposed a common effort, from labor unions
to corporate CEOs, and environmentalists to energy companies,”
While only a small segment of businesses
would have to buy pollution allowances, because the U.S.
depends heavily on fossil fuels, the new costs resulting from the legislation
would probably be spread through the economy.
While the EPA estimated that the overall impact would be too small
to significantly dampen economic growth, the conservative Heritage Foundation
has said it might cost a family $4,300 per year in a few decades.
Key amendments. An amendment
on Thursday, offered and then withdrawn, would have specified the types
of agricultural projects that would be eligible for credit for greenhouse
gas reduction. The bill would leave it up to the EPA to determine eligibility.
Waxman said it would be premature to list specific projects before the
EPA figures out how to measure their effects on the environment. He agreed
to add language in the panel’s report on the bill directing the
agency to consider these types of projects. “I think we need to
make sure that EPA has the measurement methodologies in place before we
give offset credits to specific activities,” Waxman said.
Amendments adopted would:
-- expand Energy Department funding for advanced nuclear and other
-- ensure that free emissions allowances set aside for electric utilities
are in fact used to offset increased rates for ratepayers.
-- authorize a “cash-for-clunkers” provision within the
climate and energy bill. The provision would provide temporary vouchers
worth up to $4,500 to allow consumers to trade in older, less fuel-efficient
cars and trucks for new, more efficient vehicles.
-- adjust a requirement for the EPA to set emissions standards for
new vehicles and construction equipment, directing the agency to target
large polluters from which the greatest reductions are achievable.
-- provide loan guarantees for pipelines that transport renewable fuels.
-- direct utilities to make “net metering” available to
federal agencies, allowing them to receive credit for energy they generate.
-- authorize grants and a loan-guarantee program for the adoption of
high-capacity transmission technology.
-- require any entity receiving credits under the cap-and-trade system
abide by Davis-Bacon Act prevailing wage rates.
Comments: As previously
noted, several hurdles both in the House and notably in the Senate stand
in the way of this bill's possible end zone. Many observers believe this
topic will be pushed to 2010 or later for any conclusion. Should Congress
not eventually find a way to get the bill to President Obama's desk, the
president has shown he will take the regulatory route if needed. And there
is ample authority for the EPA to accomplish the task should Congress
fail to get a bill to Obama.
As for Rep. Peterson, veteran sources signal he is taking "the
bad cop" role in this matter, clearly hoping to win some
concessions that would allow him and some other farm-state lawmakers
to eventually vote for the measure. But Peterson's history shows that
if he doesn't get the bulk of what he wants, he will vote against the
measure, despite his chairmanship role, and a Peterson no-vote could
include more than a few other farm-state lawmakers.
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