SENATE CAP-AND-TRADE LEGISLATION: A SAMPLE

NewEnergyNews cannot help but be suspicious of legislation put forward by a Senator who goes out of his way to refer to electricity generated from natural gas as “clean.” Yes, it is cleaner than coal. No, it does not by any stretch of the imagination solve the problem of greenhouse gas (GHG) emissions. Still, the bill’s co-sponsor is Senator Bingaman, who has proven himself a stalwart.

The legislation allows over-emitters to avoid rigid caps by paying an up-front fee. This may get the legislation passed but it also dooms it to fail. By virtue of the provision, the company is not capped, its emissions continue and it passes the price to consumers.

Specter promotes energy bill at Lebanon plant
Barbara Miller, October 8, 2007 (Penn Live)

WHO
Sen. Arlen Specter (R-Pennsylvania), Sen. Jeff Bingaman (D-New Mexico)

This NY Times graphic contains a lot of information about competing cap-and-trade proposals and is very much worth studying. (click to enlarge)

WHAT
On a visit to an AES Corp natural gas-fired power plant, Senator Specter touted his “climate change” legislation: The Low Carbon Economy Act of 2007.

WHEN
The Low Carbon Economy Act of 2007 seeks to cut GHG emissions to 2006 levels by 2020 and 1990 levels by 2030.

WHERE
- The natural gas plant at which Specter appeared was in South Lebanon, Pennsylvania.
- AES has 121 plants in 14 states and around the world, generating 40,000 megawatts from coal, gas, petroleum coke, diesel and oil. 20% comes from renewables (hydroelectric, biomass and wind).

WHY
- The Low Carbon Economy Act of 2007 mandates a cap-and-trade system similar to the one which curbed acid rain.
- It also provides funding for R & D on GHG emissions-cutting technologies (which presumably would bring federal funds for “clean” coal and emissions sequestration projects undertaken by companies like AES).
- Cap-and-trade sets rigid limits on GHG emissions but allows over-emitters to buy “permissions” (credits) for emissions from under-emitters to avoid worse fines for exceeding their limits. The credits would initially be free but become more expensive over a 5-year process.
- Other cosponsors: Sens. Tom Harkin (D-IA), Ted Stevens (R-AK), Lisa Murkowski (R-AK) and Daniel Akaka (D-HI). The legislation is, with many others, in committee.

This graph shows that the Specter-Bingaman proposal is unlikely to be much more effective than President Bush's proposal for capping GHG emissions. The McCain-Lieberman bill looks to be the likely compromise. (click to enlarge)

QUOTES
- Specter: “I am very much concerned about the problem of global warming…My granddaughter is very worried about what this planet will be like when she will be a grandparent herself…[But] we have to deal with it in a way that we don’t lose our competitive edge...” (NewEnergyNews note to Specter's granddaughter: You'll be dating guys like him when you grow up, sweetie. Don't believe too much of what they tell you.)
- Peter Bajc, AES plant engineer: “[The Specter legislation is] one of the fairest bills of all, in my opinion…”