Substitute Amendment To Climate Security Act S. 2191

May 21: With little fanfare, Senators Barbara Boxer (D-CA), Joseph Lieberman (I-CT), and John Warner (R-VA) released their Substitute Amendment to Climate Security Act (S. 2191) which is expected to be voted on June 2, 2008. Back on April 10, the three unveiled legislative language that, according to the Congressional Budget Office (CBO), they said, ensures that the Climate Security Act (S.2191) would impose no cost on the Federal government. In a letter to CBO, the three Senators committed to including the new language in S.2191 when the bill is brought up in the full Senate for debate [See WIMS 4/11/08].

At the May 20 hearing of the Senate Energy & Natural Resources Committee on Energy and Related Economic Effects of Global Climate Change Legislation, Senator Pete Domenici (R-NM), Ranking Member of the Committee issued a statement warning of “dire consequences” if the proposed Lieberman-Warner cap and trade legislation becomes law [See WIMS 5/20/08]. Domenici commented that, "It is my understanding that a substitute for that bill is being developed and that substitute will be what is considered on the Senate floor in June. Obviously, that substitute has not been the subject of modeling as yet."

The Substitute Amendment calls for Capping Greenhouse Gas Emissions and allows a declining amount of greenhouse gas emissions between 2012 and 2050, reducing them by about two percent per year from 2005 levels. The bill will reduce emissions from covered facilities 19% below current levels by 2020, and 71% by 2050. It is estimated to reduce total US emissions (from all sources, capped and non‐capped) by up to 66% by 2050.

Of note, the "Emergency Off-Ramps" provision of the bill provides that if the price of carbon allowances reaches a certain price range, there is a mechanism that will automatically release additional emission allowances onto the market to lower the price. The additional allowances are borrowed so that the environmental integrity of the caps over the long term is protected. Also the Substitute includes: "Transition Assistance" through 2050 for Workers ($190 billion); Carbon‐intensive manufacturing industries ($213 billion); fossil electricity utilities ($307 billion); refiners of petroleum‐based fuel ($34 billion); natural gas processors ($20 billion); and $800 billion in tax relief for consumers.

The bill also calls for $911 billion through 2050 to consumers through local electricity and gas utilities (local distribution companies) to ensure that consumers are protected from increases in energy costs, and to promote low carbon energy, and energy efficiency. The bill also provides $254 billion through 2050 to states that rely heavily upon manufacturing and coal, to help them transition to a low‐carbon economy.

Also included through 2050 are: $171 billion in funding for mass transit; $136 billion for the Energy Efficiency and Conservation Block Grant program; rewards for states that take actions to reduce greenhouse gas emissions of $566 billion; $253 billion to states and Indian tribes to help them adapt to climate change impacts; support for state wildlife adaptation programs by providing $237 billion; $30.7 billion for recognition of companies that take early steps to reduce emissions; $51 billion for energy efficient buildings; $51 billion for the Super‐Efficient Equipment and Appliances Deployment Program; $150 billion for deployment of renewable energy technologies; $109 billion for Low Carbon Electricity and Advanced Research; $15.7 billion and bonus allowances for Carbon Capture and Sequestration; $68 billion for advanced vehicle technology; $26 billion for cellulosic biofuels; $288 billion for wildlife and natural resources adapt to climate impacts; off-set credits and $68 billion for deforestation‐prevention activities; $342 billion for international adaptation and to protect national security; and $300 billion to support agriculture and forestry programs that cut emissions but don’t qualify to be used as offset.

Senator James Inhofe (R-OK), Ranking Member of the Environment and Public Works Committee, commented on the Lieberman-Warner Substitute Amendment and said, “The latest version is nothing more than window dressing for a bill that has been exposed by numerous government and private analyses as costly and damaging to America. Lieberman-Warner will redistribute over $5.6 trillion from American consumers to pet congressional projects. Despite paying for the trillions of dollars mandated by this cap-and-trade scheme, American families and workers will only receive back $800 billion in consumer tax relief -- $7 paid for every $1 returned.

“The fact is that the Lieberman-Warner bill is the largest pork bill ever considered by Congress. No matter how many revisions this bill undergoes, it remains a massive redistribution of wealth, the largest new tax and spend program in our Nation's history. The handouts being offered by the sponsors of this bill come straight from the pocket of families and workers in the form of higher gas, power, and heating bills. The newly revised Lieberman-Warner bill offers nothing new except more pain at the gas pump and more expensive consumer goods.”

Access the 157-page Substitute Amendment for S. 2191 (click here). Access a 10-page summary of the Substitute Amendment for S. 2191 (click here). Access a release from Senator Inhofe (click here). Access an April 10 announcement from the three Senators and links to the CBO letter and statement (click here). Access legislative details on S. 2191 (click here). [*Climate, *Energy]