Home Energy and Environment Preview of Kerry-Lieberman Clean Energy/Climate Bill

Preview of Kerry-Lieberman Clean Energy/Climate Bill

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Tomorrow will be the unveiling of the long-awaited, Kerry-Lieberman clean energy/climate change bill (the “American Power Act”). Based on what I’m hearing, my understanding is that the Act will…

*…refund 2/3 of revenues raised not dedicated to reducing the deficit right back to consumers. Eventually, that will rise to 100% of revenues not dedicated to reducing the deficit going back to consumers.

*…invest in all domestic energy sources – renewables, coal, oil, natural gas, and nuclear – while rebuilding our nation’s energy infrastructure.

*…aim to kick our foreign oil addiction.

*…use different approaches for different sectors (e.g., power plants, heavy industry, transportation).

*…set up a carbon market that is simple and secure, with no chance of being manipulated.

*…invest $2 billion per year for development of carbon capture and sequestration methods.

*…encourage the use of American natural gas.

*…exempt farmers from carbon pollution compliance provisions of the bill.

*…invest in clean energy R&D.

*…have industrial sources enter the program in 2016, at which point industries that are energy-intensive and trade-exposed will receive allowances to offset compliance costs.

*…improve transportation infrastructure and efficiency.

*…set a hard price collar to ensure price predictability.

*…lay out one set of national rules, as opposed to a patchwork of conflicting state and federal regulations.

*…forbid states from operating their own cap-and-trade programs.

*…allow states to opt out of drilling up to 75 miles from their coasts.

*…give states that pursue offshore oil drilling 37.5% of revenues, in part to help them protect their coastlines from environmental harm.

*…reduce CO2 emissions by 17% in 2020 and 80% in 2050.

At first glance, this looks promising to me, but as the saying goes, “the devil’s in the details” (and there are a LOT of details in this bill)!  Still, we badly need to get clean energy and climate change legislation, including a meaningful price (one way or the other) on CO2, for powerful economic, environmental, and national security (e.g., stop funding countries and non-state actors that want to hurt us) reasons. The main reason why, despite its flaws, I supported the Waxman-Markey bill in the House of Representatives, is because it enshrined the principle that there has to be a price signal for CO2. Currently, this is a huge “externality” and also a huge market failure.

By putting a price on CO2, we can harness the power of the marketplace to jumpstart a clean energy, low-carbon revolution in this country, one that will pay huge dividends for years to come. That’s why I strongly urge the Congress to move forward on strong, serious clean energy and climate change legislation this year. We have no more time to waste.

UPDATE: The Washington Post now has a copy of the bill posted on its website.

  • cvllelaw

    I hope not…  I haven’t said anything nice about him in a VERY long time.

  • Elaine in Roanoke

    I hope that the proposed law will dictate that states may receive that 37.5% only if they have in place plans for protection of the coastal environment. Otherwise, Virginia will purchase asphalt with 100% of the revenue.

  • jack

    *…refund 2/3 of revenues raised not dedicated to reducing the deficit right back to consumers. Eventually, that will rise to 100% of revenues not dedicated to reducing the deficit going back to consumers.

    Does anyone really expect any revenue to NOT be “dedicated to reducing the deficit”?  Please.  That just means they’ll spend more money elsewhere.

    *…reduce CO2 emissions by 17% in 2020 and 80% in 2050.

    Let’s be very clear about the sources of CO2.  Autotrophic (plant) respiration produces 60 Pg C each year as CO2, and heterotrophic respiration (decomposition) produces another 55 Pg C per year as CO2.  In comparison, human activity produces about 12.5 Pg C each year as CO2.  In short, we humans are responsible for a mere 9.8% of the CO2 emissions every year.  So how are we supposed to reduce CO2 emissions by 80%?  And if we only reduce OUR CO2 emissions, will that have any effect?

    It is also interesting to note that scientists estimate that, 500 million years ago, the atmospheric CO2 concentration was 20 times higher than it is today.  “It dropped, then rose again some 200 million years ago to 4-5 times present levels–a period that saw the rise of giant fern forests–and then continued a slow decline until recent pre-industrial time.”

    I think it’s time for a little George Carlin.