SUMMER ON CAPITOL HILL WITH THE ENERGY/CLIMATE BILL

House Dem chairmen preview a summer of maneuvering on climate bill
Darren Samuelsohn (w/Allison Winter and Lauren Morello), May 21, 2009 (E&E Publishing via NY Times)

SUMMARY
The House of Representatives’ breakthrough energy and climate change legislation, H.R. 2454, the American Clean Energy and Security Act of 2009 (ACESA), co-written by Representative Henry Waxman (D-Calif), Chair of the House Energy and Commerce Committee, and Representative Ed Markey (D-Mass), Chair of the House Energy Subcommittee, has moved by its first hurdle on its way to becoming law but still faces serious obstacles to passage despite a dominant House Democratic majority.

The legislation, which contains what would become the first ever national Renewable Electricity Standard (RES) and the first ever mandatory cap&trade system for greenhouse gas emissions (GHGs), was passed by the Energy and Commerce Committee 33-25. Ominously, 3 Democrats voted with the Republicans against the bill while only Republican Congresswoman Mary Bono Mack, from a wind-rich California district, voted with the Democrats.

On its way. (click to enlarge)

H.R. 2454 must next win approval from the House Ways and Means Committee. Representative Charles Rangel (D-NY), Chair of the Committee, intends to put national health insurance legislation ahead of the Waxman-Markey energy/climate bill. Mr. Rangel has also indicated he is still considering a carbon tax in preference to a cap&trade system as the best method of combating global climate change.

Other elements of H.R. 2454 are stirring controversy on both ends of the political spectrum as it faces consideration in the 8 other committees to which the House parliamentarian has referred it (Ways and Means, Agriculture, Science, Transportation and Infrastructure, Financial Services, Foreign Affairs, Natural Resources, and Labor). Some of the committees will usher it through. Others will wrestle with it.

The Financial Services Committee is expected to approve the bill’s language pretty much as written. The Transportation and Infrastructure Committee will likely be too busy with a federal highway bill to spend much time on energy/climate. A spokesman for the House House Education and Labor Committee has said they will waive jurisdiction. Bart Gordon (D-Tenn.), Chair of the House Science and Technology Committee, has said he will complete work shortly after the Memorial Day recess.

Collin Peterson (D-Minn.), Chair of the House Agriculture Committee, on the other hand, is not satisfied with the bill’s provisions to protect farmers from the impacts of changing power prices that some think might be associated with cap&trade.

Nick Rahall (D-W.Va.), Chair of the House Natural Resources Committee, represents a group of conservative Democrats who want the bill to provide more for fossil fuels interests. Representative Rick Boucher (D-Va), a member of the Energy and Commerce Committee, negotiated on behalf of those interests with the bill’s authors and remains a part of the coalition they have pulled together to win Committee approval. Rahall says he may interrupt the progress of the bill by presenting alternate language that better represents his oil and gas industry constituents. If his maneuver gets traction, it could split the alliance formed by Waxman and Boucher.

Waxman says he believes his coalition will hold and does not see threat from other committees as substantial. He also says he thinks his legislation and other legislation can go forward simultaneously. But he does not believe the energy/climate law will get done in the early part of the summer because the agenda is so full.

Next stop - Chairman Rangel. (click to enlarge)

House leaders agree with Waxman. Majority Leader Steny Hoyer (D-Md.) said he is getting the energy/climate bill ready to come to the House floor in late June or early July. Majority Whip James Clyburn (D-S.C.) said he now has the 218 votes necessary to pass the legislation.

Speaker of the House Nancy Pelosi (D-Calif.) continues to promise to pass energy/climate legislation this year. She said she can force the legislation through the different committees by limiting their time for considering the legislation and using its last stop in the Rules Committee to bring all the pieces together.

With the energy/climate legislation on its way to the House floor by the Memorial Day recess as Mr. Waxman has promised since the beginning of the session, both Democrats and Repubicans will initiate strategy meetings after the recess to plan their next moves.

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COMMENTARY
Mr. Rangel's interest in a carbon tax keps alive the rich and vital and crucial debate between the tax and cap&trade concepts.

The tax is a simpler, more straightforward-seeming device that appeals to prominent people at both ends of the political spectrum. Purists on the left such as climate change prophet and premier climate scientist James Hansen favors it over the complexities of cap&trade. Small government types in the fossil fuels establishment such as notoriously conservative ExxonMobil CEO Rex Tillerson may not like new taxes but distrust even more market systems that impact the way they do business.

As a veteran of the 3-decade long struggle to develop the cap&trade concept observed recently, a tax system would surely be a better choice if the world was ruled by Plato’s philosopher-king.

But this world, which urgently needs a method of reversing global climate change, is not run by a philosopher-king and the idea of a tax is widely seen as not politically viable. That is why eminently pragmatic leaders in Europe have, for 4 years, been working out the complexities of an international emissions trading system and why equally pragmatic U.S. leaders like President Obama and former Vice President Al Gore are backers of the Waxman-Markey cap&trade plan.

Because cap&trade to control GhGs is untried in the U.S., the debate is riddled with speculation and half-truths passionately asserted to be panaceas and abominations. In the case of the farmer, for instance, opponents of the energy and climate legislation worry about increased power and fuel prices that might come with a cap&trade system while proponents promise financial windfalls that will come from credits earned for wise stewardship.

From RepMarkey via YouTube

Also still roiling below the surface of Democratic unanimity is the debate over the specifics in H.R. 2454’s Renewable Electricity Standard (RES). The original version of the Waxman-Markey legislation called for a standard that required regulated utilities to obtain 25% of their power from New Energy sources by 2025. The pre-markup negotiation and coalition-building process reduced that standard to 15% by 2020. Many leaders in the New Energy community are still dissatisfied with the reduction and are encouraging their followers to protest. Meanwhile, the other side of the aisle remains resentful of what they describe as “one size fits all” legislation. Post-Memorial Day colloquies could easily generate legislative movement on the RES.

The most serious threat to the Waxman-Markey legislation in the House of Representatives is a split between factions the authors have brought together with the help of Representative Boucher (and Representative John Dingell, D-Mich). Boucher has taken care of Big Coal and the utilities by getting them lots of free allowances. Although Texas Democrats have won some concessions for refineries, neither they nor Boucher have done much for oil and gas producers.

While “drill, baby, drill” was a chant that will be long-remembered in association with the 2008 Republican convention, there is also an element of the Democratic party that is inextricably interwined with independent oil and gas producers. That faction could easily bring demands for more offshore and Alaskan drilling to the table that would alienate pro-environmental groups and push them to demands for a stronger cap&trade system with fewer free allowances. That would drive Mr. Boucher out of the coalition now supporting Waxman-Markey.

Don’t think the 4-day, 40-hour grind of getting the bill passed wasn’t a lot of fun. From NewsPoliticsNews via YouTube.

QUOTES
- Representative Charles Rangel (D-NY), Chair, House Ways and Means Committee: "We have to deal with health care first…[and it will take as] long as it takes… Maybe at some point we can do both at the same time. But health being first is a priority."
Rangel, on a carbon tax instead of a cap&trade system: "It's on the table…Of course it is. How can it not be on the table?"
- Representative Nick Rahall (D-W.Va.), Chair, House Natural Resources Committee, on adding provisions for domestic oil and gas production to the bill: "We know gas prices are inching back up. More than inching back up, as we speak. And it's what I think should be part of a responsible, comprehensive, pro-energy bill."
- Representative Henry Waxman (D-Calif), Chair, House Energy and Commerce Committee: "You have to figure out the time to do both [national health insurance legislation and energy/climate legislation]… I think that's what we're doing with our committee, and that's what he'll have to do in his committee and other committees."

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- Waxman, on the threat of a carbon tax eroding support for cap&trade: "I'm not worried about it…We're going to sit down and talk this all over. And then we'll see where we go from there. But I think we have a formidable coalition behind our legislation, and I think they will see the wisdom of some of our decisions. And then we're going to talk through where we have differences and then we'll resolve them."
- Barney Frank (D-Mass.), Chair, House Financial Services Committee: "We won't hold it up…Yes, there needs to be some regulation…It's not a serious problem. I've not looked at it yet. But I think it can be resolved very quickly."