Administration Officials Discuss Mountaintop Removal Coal Mining

Jun 11: Nancy Sutley, Chair of the White House Council on Environmental Quality; Bob Sussman, U.S. EPA Senior Policy Counsel to the Administrator; Deputy Secretary of the Interior David Hayes; and Terrence “Rock” Salt, Acting Assistant Secretary of the Army for Civil Works; held a conference call with reporters on mountaintop removal coal mining. The officials announced that they are taking "unprecedented steps" to reduce the environmental impacts of mountaintop coal mining in the six Appalachian states of Kentucky, Ohio, Pennsylvania, Tennessee, Virginia, and West Virginia through a coordinated approach between U.S. EPA, Department of the Interior (DOI) and Army Corps of Engineers.

Through a Memorandum of Understanding signed by the agency officials, the Administration will implement an Interagency Action Plan on mountaintop coal mining that will: - Minimize the adverse environmental consequences of mountaintop coal mining through short-term actions to be completed in 2009; - Undertake longer-term actions to tighten the regulation of mountaintop coal mining; - Ensure coordinated and stringent environmental reviews of permit applications under the Clean Water Act (CWA) and Surface Mining Control and Reclamation Act of 1997(SMCRA); - Engage the public through outreach events in the Appalachian region to help inform the development of Federal policy; and - Federal Agencies will work in coordination with appropriate regional, state, and local entities to help diversify and strengthen the Appalachian regional economy and promote the health and welfare of Appalachian communities.

EPA Administrator Lisa Jackson said, “Mountaintop coal mining cannot be predicated on the assumption of minimal oversight of its environmental impacts, and its permanent degradation of water quality. Stronger reviews and protections will safeguard the health of local waters, and thousands of acres of watersheds in Appalachia. Our announcement today reaffirms EPA's fundamental responsibility for protecting the water quality and environmental integrity of streams, rivers, and wetlands under the Clean Water Act. Getting this right is important to coalfield communities that count on a livable environment, both during mining and after coal companies move to other sites.”

Department of Interior Secretary Ken Salazar said, “The steps we are taking today are a firm departure from the previous Administration's approach to mountaintop coal mining, which failed to protect our communities, water, and wildlife in Appalachia. By toughening enforcement standards, by looking for common-sense improvements to our rules and regulations, and by coordinating our efforts with other agencies, we will immediately make progress toward reducing the environmental impacts ofmountaintop coal mining.”

Some of the immediate steps to be taken include: Requiring more stringent environmental reviews for future permit applications for mountaintop coal mining; proposing to modify Nationwide Permit (NWP) 21 to preclude its use to authorize the discharge of fill material into streams for surface coal mining activities in the Appalachian region; Strengthening permit reviews under CWA; Strengthening EPA coordination with states; and Improving stream mitigation projects.

According to a release, if the U.S. District Court vacates the 2008 Stream Buffer Zone Rule, as requested by the Secretary of the Interior on April 27, 2009 [See WIMS 4/29/09], Interior will issue guidance clarifying the application of stream buffer zone provisions in a preexisting 1983 SMCRA regulation to ensure mining activities will occur in a more environmentally protective way in or near Appalachian streams.

EPA and the Army Corps of Engineers said they are taking steps to enhance coordination in the environmental review of pending Clean Water Act permits for surface coal mining activities in Appalachian States. The Federal agencies said they will also work in coordination with appropriate regional, state, and local entities to help diversify and strengthen the Appalachian regional economy and promote the health and welfare of Appalachian communities.

Access a release with additional details (click here). Access more information on the Memorandum of Agreement (click here).

Report Outlines A New Vision For U.S. Transportation Policy

Jun 9: Calling its recommendations a "framework for comprehensive reform," the Bipartisan Policy Center’s National Transportation Policy Project (NTPP) released its plan for transforming Federal surface transportation policy. If adopted by the Administration and Congress in this year’s authorization bill, the plan would constitute the first major overhaul of transportation policy in more than 50 years. It proposes restructuring Federal programs, updating the criteria for formulas, and creating a performance-based system that directly ties transportation spending to broader national goals, including economic growth, connectivity, accessibility, safety, energy security and environmental protection. Currently, transportation funding is distributed on a politically-driven basis with little analysis of benefits and no accountability for results.

According to a release, the plan has a strong bipartisan foundation. Under the leadership of former Detroit Mayor Dennis Archer, former Congressman Sherwood Boehlert, former Senator Slade Gorton, and former Congressman Martin Sabo, the NTPP -- a bipartisan group of 26 diverse members -- produced its plan -- Performance Driven: A New Vision for U.S. Transportation Policy -- as a blueprint for a new national transportation system that is efficient, effective, and accountable for performance.

As Congress is scheduled to take up reauthorization of the nation’s surface transportation law, SAFETEA-LU, this year, NTPP is calling for a complete restructuring of the Federal transportation funding system. To date, there is no Federal requirement to optimize returns on public investments, and programs are not structured to reward outcomes, or even to document them. Moreover, existing programs do little to target Federal support for transportation programs to further economic growth or link to jobs and productivity.

Senator Mark Warner (D-VA), an original co-founding chair of NTPP, attended the release announcement and commended NTPP’s bipartisan report. He especially praised the NTPP for advocating "a bottom-up approach to reform whereby states and metropolitan areas can develop their own solutions to transportation problems." He said, “This idea, called mode-neutrality, enables states like Virginia to make their own decisions about how to spend federal money as long as their investments meet accountability standards and promote national goals.”

NTPP also proposes holding all funding recipients accountable for their contributions to national goals. A new system of metrics would measure project performance in several areas: improved access, a more efficient national network, reduced corridor congestion and petroleum consumption, reduced CO2 emissions, and reduced fatalities and injuries. States and regions whose investments performed well against those goals would be entitled to bonus funding; areas that did not would be subject to greater Federal scrutiny in receiving transportation funding.

World Resources Institute (WRI), a member of the NTPP, issued a release on the report saying the recommendations are intended to create a thorough framework within the reauthorization of the transportation bill, which expires September 30. The NTPP calls for U.S. transportation funding to directly serve five clear goals: economic growth, connectivity, metropolitan access, energy and environment, and safety.

Nancy Kete, director of EMBARQ -- The World Resources Institute Center for Sustainable Transport, and one of the NTPP’s key members focused on the energy and environment goals said, "A transportation system that emits a full third of our greenhouse gases and is almost entirely dependent on oil is not sustainable from an economic, national security, or environmental perspective. I am pleased with how much the members have focused on ensuring that transportation policy is responsive to the 21st century challenges of energy security and climate change. We’re calling for a dramatic change in the way transportation investment decisions are made. A new bill must play a fundamental role in reducing greenhouse gases over the coming decades. Low-carbon fuels and the Obama administration’s decision to improve fuel economy standards will not be enough for us to reach our targets."

She continued saying, "States and localities will need to consider transportation-demand management measures. Congestion pricing, increasing the quality and supply of transit, and improving integrated transportation and land-use planning will help avoid GHG emissions in the future. The proposed new programs under the NTPP recommendations would allow states and localities full flexibility to meet national goals according to their needs and priorities. The accountability measures and incentive provisions will keep everyone on track towards cutting U.S. GHG emissions potentially required under the Waxman-Markey bill.”

Access a lengthy release (click here). Access the NTPP website for links to an executive summary, the complete report, a video of the launch press conference, project members and more (click here). Access a release and links to further information from WRI (click here).

CBO Cost Estimate For Waxman-Markey H.R. 2454 Climate Bill

Jun 5: The Congressional Budget Office (CBO) released a cost estimate for the American Clean Energy and Security Act of 2009 (H.R. 2454), which was recently approved by the House Committee on Energy and Commerce [See WIMS 5/22/09]. CBO indicates that this legislation would make a number of changes in energy and environmental policies largely aimed at reducing emissions of gases that contribute to global warming. The bill would limit (or cap) the quantity of certain greenhouse gases emitted from facilities that generate electricity and from other industrial activities over the 2012-2050 period.

Under the provisions of the bill, U.S. EPA would establish two separate regulatory initiatives known as cap-and-trade programs -- one covering emissions of most types of greenhouse gases and one covering hydrofluorocarbons. Both cap-and-trade programs would set a limit on total emissions for each year and would require regulated entities to hold rights, or allowances, to the emissions permitted under that cap. Some of those allowances would be auctioned by the Federal government, and the remainder would be distributed at no charge.

CBO lists other major provisions of the legislation as: Provide energy tax credits or energy rebates to certain low-income families to offset the impact of higher energy-related prices from the cap-and-trade programs; Require certain retail electricity suppliers to provide a minimum percentage of their electricity sales with electricity generated by facilities that use qualifying renewable fuels or energy sources; Establish a Carbon Storage Research Corporation to support research and development of technologies related to carbon capture and sequestration; Increase, by $25 billion, the aggregate amount of loans Department of Energy is authorized to make to automobile manufacturers and component suppliers under the existing Advanced Technology Vehicle Manufacturing Loan Program; Establish a Clean Energy Deployment Administration within the Department of Energy, which would be authorized to provide direct loans, loan guarantees, and letters of credit for clean energy projects; Authorize the Department of Transportation to provide individuals with vouchers to acquire new vehicles that achieve greater fuel efficiency than the existing qualifying vehicles owned by the individuals; and Authorize appropriations for various programs.

CBO and the Joint Committee on Taxation (JCT) estimate that over the 2010-2019 period enacting this legislation would: Increase federal revenues by about $846 billion; and Increase direct spending by about $821 billion. In total, those changes would reduce budget deficits (or increase future surpluses) by about $24 billion over the 2010-2019 period. In addition, assuming appropriation of the necessary amounts, CBO estimates that implementing H.R. 2454 would increase discretionary spending by about $50 billion over the 2010-2019 period. Most of that funding would stem from spending auction proceeds from various funds established under this legislation.

Access the complete 40-page CBO report (click here). Access a CBO blog posting on the report (click here). Access additional CBO reports relating to climate change (click here).

DOI Report On Carbon Sequestration On Public Land

Jun 3: Department of Interior (DOI) Secretary Ken Salazar sent Congress his recommendations for a national program to help reduce greenhouse gases (GHG) by selecting appropriate underground geological formations on public lands to inject and store carbon dioxide emissions from coal-fired power plants and other carbon-dioxide producing facilities. The DOI report, prepared by the Bureau of Land Management (BLM) with assistance from the U.S. Geological Survey (USGS), U.S. EPA and Department of Energy’s (DOE's) Office of Fossil Energy, recommends criteria for identifying potential sites for geological carbon sequestration and a proposed regulatory framework for leasing these public lands. It also discusses an array of issues that are being addressed, including environmental protection, public participation, rights-of-way and federal liability.

Salazar said, “President Obama’s national energy plan calls for reducing greenhouse gas emissions by 80 percent by 2050. Capturing carbon dioxide emissions in secure geologic formations prevents their release into the atmosphere, reducing the carbon intensity of our economy. These recommendations provide a structure for a national initiative to identify appropriate public land geological sequestration sites that will help us reach our clean energy goals.”

DOI said the report entitled, Framework for Geological Carbon Sequestration on Public Land, is an important step in developing a national program that makes effective use of the vast underground storage capacity of Federal lands, the expertise of BLM and the science capabilities of the USGS to reduce the amount of harmful carbon dioxide emissions into the atmosphere. Geological storage of carbon dioxide in subsurface rocks involves injection of carbon dioxide underground into the pore space of permeable rock units, such as oil and gas fields, deep saline water-bearing formations or coal beds. Operating and depleted oil and gas fields are considered potentially suitable sequestration sites, but most of the probable storage capacity for carbon dioxide in the United States is in deep saline formations.

A critical issue for evaluating storage capacity is the integrity and effectiveness of geologic formations for sealing carbon dioxide underground, preventing its release into underground sources of drinking water, mineral resources or the atmosphere. The report recommends that candidate sites must have sufficient capacity to accept the volume of carbon dioxide expected for the life of the sequestration project and the geologic structure to ensure long-term containment of the carbon dioxide.

The recommendations call for research to address several unknowns related to carbon sequestration, so that proper mitigating measures to protect the environment can be included in land use authorizations. DOI supports efforts to ensure science-based monitoring and verification of the injected carbon dioxide plume throughout the life of a project to beyond the closure phase. The Department also supports the need for large-scale demonstration projects to address key questions of long-term carbon storage. As the nation’s largest land manager, Interior’s Bureau of Land Management administers 256 million acres of land, known as the National System of Public Lands, and 700 million acres of sub-surface mineral estate. The Interior report to Congress, which fulfills the requirements of Section 714 of the Energy Independence and Security Act of 2007, also examines existing authorities under the Mineral Leasing Act and the Federal Land Policy and Management Act that could be used to permit carbon sequestration activities.

Access a release from DOI (click here). Access the complete 22-page Framework report (click here).

2nd Round Pre-Copenhagen Climate Talks Begin In Bonn

Jun 1: Immediately following last week's Major Economies Forum on Energy and Climate meeting in Paris from May 25-26 [See WIMS 5/28/09], delegates from 182 nations are gathering in Bonn, Germany, to initiate discussions on negotiating texts [See WIMS 5/21/09] which could form the basis of an ambitious United Nations-backed climate change deal, to slash greenhouse gas emissions, expected to be clinched in December. The two-week Bonn talks, the second round of UN climate change talks this year, are expected to draw over 4,000 participants, including representatives from Governments, the private sector, environmental organizations and research institutions.

The new pact, to be concluded in Copenhagen, Denmark, is intended to succeed the Kyoto Protocol, whose first commitment period ends in 2012. Yvo de Boer, Executive Secretary of the UN Framework Convention on Climate Change (UNFCCC) said, “The political moment is right to reach an agreement. There is no doubt in my mind that the Copenhagen climate conference in December is going to lead to a result.” He said the current financial crisis has reinforced the need for a global response to global issues.

The Bonn meetings include the thirtieth sessions of the Subsidiary Body for Implementation (SBI) and Subsidiary Body for Scientific and Technological Advice (SBSTA) under UNFCCC; the sixth session of the Ad Hoc Working Group on Long-term Cooperative Action under the Convention (AWG-LCA); and the eighth session of the Ad Hoc Working Group on Further Commitments for Annex I Parties under the Kyoto Protocol (AWG-KP).

Michael Zammit Cutajar, Chair of AWG-LCA noted that the negotiating text that is on the table did not prejudge or preclude any particular outcome. He said, "The text is a starting point and now is the time for parties to take position and enrich it." The negotiating text for consideration by the AWG-LCA, which comprises all 192 Parties to the UNFCCC, covers issues of a shared vision for long-term cooperative action, enhanced action on adaptation, mitigation and finance, technology and capacity-building.

AWG-KP will focus on a proposal for amendments to the Kyoto Protocol, including the annex relating to emission reduction commitments of 37 industrialized countries for the second phase of the protocol (post-2012). On this subject there is considerable disagreement between the parties, as well as major outside participants in the negotiations. For example the World Wildlife Fund and other groups are pressuring delegates to commit to an aggregate reduction goal for developed countries of at least 40% below 1990 levels by 2020. On the other hand, the European Union has called for an ambitious interim target of 20-30% less than 1990 levels; while President Obama has called for a 14 percent cut from 2005 levels by 2020; or a 0% reduction from 1990 levels. The recent, Committee-approved Waxman-Markey ACES bills calls for a 17% reduction from 2005 levels by 2020.

The argument came to a head at last week's Major Economies meeting where French Environment Minister Jean-Louis Borloo complained it was "unimaginable" that the biggest power, the United States, with carbon emissions twice that of the EU, was doing less. He said that developed countries as bigger polluters, should deepen their cuts by 25 percent to 40 percent, especially the United States."

Other issues intended for discussion under the protocol, in Bonn, are how to improve emissions trading, coverage of emissions credits, the Kyoto Protocol's so-called "project-based mechanisms" and options for the treatment of land-use, land-use change and forestry (LULUCF). John Ashe, the newly-elected Chair of AWG-KP said, "It is important that we complete some of the more solvable issues here in Bonn so that we can then focus on the more difficult ones later on in the negotiations."

The UNFCCC gathering in Bonn, Germany constitutes the second in a series of five major UN negotiating sessions this year leading up to the UNFCCC meeting in Copenhagen (COP 15) in December 7 to 18. The next meeting, informal consultations comprising the LCA and KP groups, will take place August 10 to 14, also in Bonn; followed by a gathering in Bangkok from September 28 to October 9; and a further gathering from November 2 to 6 in Barcelona.

Access a release from UN (click here). Access a release from UNFCCC (click here). Access the UNFCCC website for links to complete details on the meetings and the negotiating text (click here). Access a release from WWF (click here). Access a background and summary report from the International Institute for Sustainable Development (IISD, click here). Access daily reporting from the Bonn meeting from IISD (click here).

Extensive R&D Necessary For Liquid Fuels From Biomass & Coal

May 20: A new report from the National Academy of Sciences (NAS) National Research Council (NRC) indicates that liquid fuels from biomass and coal have the potential to reduce petroleum fuel use and CO2 emissions in the U.S. transportation sector over the next 25 years. However, even with abundant resources in biomass and coal, substantial investments in research, development, and commercial demonstration projects will be needed to produce these alternative liquid fuels in an environmentally conscious way, and at a level that could impact U.S. dependence on imported oil.

Michael Ramage, retired executive vice president of ExxonMobil Research and Engineering Co. and chair of the committee that wrote the report said, "A lot of work remains to be done before these alternative fuels can make up a significant share of the U.S. transportation fuel market. Making the transition will require financial investments and technological developments. Newer, more efficient technologies and strong policy measures will be needed to drive market penetration. These fuels will not be cost competitive at current oil prices. They could be competitive with the higher oil prices we've seen in recent years, although it will take focused research, development, and policy efforts to get there."

According to the report, coal, which can be converted into gasoline or diesel, exists in sufficient reserves in the U.S. to meet the nation’s needs for more than 100 years at current rates of coal consumption, mainly for electric power. It should not be assumed, however, that there will be enough coal mined to support the demands for both electrical power and transportation fuels. Providing coal-based liquid fuel for transportation would require significant increases in coal mining activities. The U.S. transportation sector consumes 14 million barrels of oil per day. If coal mining activities in the U.S. increase by 50 percent -- an additional 580 million tons of coal mined each year -- up to 3 million barrels of fuel per day could be produced. To achieve this, two or three new coal-to-fuel plants would need to be built each year over the next 20 years.

The report also indicates that without geologic storage of the CO2 produced in the conversion process, life-time greenhouse gas emissions from coal-based fuel would be about twice that of oil. With geologic storage, CO2 emissions would be nearly equivalent to those from oil. Coal-based fuel with CO2 emissions equivalent to petroleum-based fuels will be possible by 2020 only if geologic storage of carbon dioxide is demonstrated as safe and viable in the next five to six years. As a relatively abundant resource, coal-based fuels could be cost-competitive with gasoline at oil prices around $60 to $70 per barrel. However, if a carbon price were set, the costs of coal-based fuels could rise significantly.

According to the report, biofuels -- primarily ethanol in the short term -- should be produced from dedicated grass crops, agricultural and forestry residues, and municipal solid wastes rather than food crops such as corn grain or soybean, which can induce competition between food and fuel. The report estimates that the U.S. could produce 550 million dry tons of biomass annually by 2020. Assuming significant market penetration and construction of ethanol plants, this amount of biomass could be used to produce up to 1.6 million barrels per day of gasoline-equivalent ethanol by 2030, leading to a potential 15 percent reduction in oil use for light-duty transportation.

The net carbon impact of biomass-derived fuels can be close to zero, because biomass crops consume CO2 from the air while growing and sequester carbon in the soil, thereby offsetting the CO2 released during fuel production and combustion. If the CO2 released from the conversion process is geologically stored, then biomass-derived fuels can have negative CO2 effects, with the biomass removing more carbon from the environment than is released during the fuel’s life cycle. The costs of producing biomass-derived fuels can be higher than petroleum fuels, comparable to oil prices of approximately $100 per barrel; however, if a carbon price is set high enough, the cost of biomass-based fuels could decrease due to the potential for net negative CO2 effects.

Although a relatively new technology, several combined coal-and-biomass demonstration plants are operating in Europe. This technology could be an important part of U.S. energy strategy, as it combines the environmental benefits of biomass with the relative abundance and lower costs of coal. According to the report, if the 550 million tons of biomass estimated to be available by 2020 were combined with coal (at a 60:40 ratio of coal energy to biomass energy), 60 billion gallons of gasoline equivalent could be produced each year, which equates to approximately 45 percent of annual light-duty vehicle U.S. gasoline usage. If CO2 produced in the conversion process is geologically stored, the greenhouse gas emissions of this combined fuel over its life cycle could be close to zero.

The report says, these combined coal-and-biomass plants are not yet available in the U.S., but if geologic carbon storage is developed by 2015, the first combination plants could be built by 2020. Assuming a 20 percent growth rate in construction, by 2035 the U.S. could produce 2.5 million barrels of gasoline equivalent per day from combined coal-and-biomass sources.

The report is the first of a series of reports to be released from the National Academies' America's Energy Future project, which was undertaken to stimulate and inform a constructive national dialogue about the nation’s energy future. Upcoming reports are Electricity From Renewable Resources; Realistic Prospects For Energy Efficiency In The United States; and an overarching final report entitled, America's Energy Future: Technology And Transformation. The America's Energy Future project sponsored by the U.S. Department of Energy, BP America, Dow Chemical Company Foundation, Fred Kavli and the Kavli Foundation, GE Energy, General Motors Corp., Intel Corp and endowed funds, mostly from major foundations, created to perpetually support the work of the National Research Council.

Access a release from NAS (click here). Access links to the complete report and an executive summary (click here).

Parties Still At Odds Over Midterm GHG Reduction Targets

May 27: With little reporting in the U.S., the Major Economies Forum on Energy and Climate meeting in Paris from May 25-26, produced little progress on agreement among the 17 parties on the subject of targets for greenhouse gas (GHG) reduction related to 1990 levels. The 17 major economies including Australia, Brazil, Canada, China, the European Union, France, Germany, India, Indonesia, Italy, Japan, Korea, Mexico, Russia, South Africa, the United Kingdom, and the United States; met to continue negotiations from their meeting in the U.S. April 27-28 [See WIMS 4/29/09]. The preparatory meeting was held in advance of a "leaders' meeting" of the Major Economies scheduled for La Maddalena, Italy, in July 2009. Another preparatory meeting is scheduled for June 22-23 in Mexico City.

The issue of the so-called "midterm targets" was also a point of contention at the recent meetings of the UN Framework Convention on Climate Change (UNFCCC) in Bonn, Germany [See WIMS 4/9/09], which concluded with wide disparities and no agreement on interim targets for industrialized countries for the year 2020. Experts say the interim targets are critical to reversing the growth in emissions. The European Union has called for ambitious interim targets of 20-30% less than 1990 levels; Australia (minus 4-14%); Canada (+2%); Japan (+4% to – 25%); Russia (not available); and the Obama Administration has said it would reduce GHG levels to 1990 levels by 2020 or a 0% reduction from 1990 levels.

In part, the contentions come from the differences in the "base year" for measuring reductions. President Obama has called for a 14 percent cut from 2005 levels by 2020. The recent, Committee-approved Waxman-Markey ACES bills calls for a 17% reduction from 2005 levels by 2020. European countries are pushing for the U.S. to increase its target levels with greater reductions from the 1990 base year. The 1990 base year was part of the so-called Bali Agreement and is used in the Intergovernmental Panel on Climate Change (IPCC) reports.

According to a CRIEnglish report, "French Environment Minister Jean-Louis Borloo, host of the two-day meeting, complained it was 'unimaginable' that the biggest power, the United States, with carbon emissions twice that of the EU, was doing less than the latter. . . He said that developed countries as bigger polluters, should deepen their cuts by 25 percent to 40 percent, especially the United States."

According to the CRIEnglish report, Todd Stern, U.S. Special Envoy for Climate Change told the media the U.S. was making progress, though it could not match the efforts of the EU. He said the Obama administration had included the development of clean energy and green technology its economic revival plan.

The negotiations will continue in Bonn, Germany at the United Nations Framework Convention on Climate Change (UNFCCC) Bonn Climate Change Talks from June 1-12, 2009. UNFCCC is hosting the thirtieth sessions of the UNFCCC Convention subsidiary bodies - SBSTA [Subsidiary Body for Scientific and Technological Advice] and SBI [Subsidiary Body for Implementation], sixth session of the AWG-LCA [Ad hoc Working Group on Long-term Cooperative Action] and the eighth session of the AWG-KP [Ad hoc Working Group on Further Commitments for Annex I Parties under the Kyoto Protocol].

The second round of UN Climate Change Talks in 2009 in Bonn is expected to be attended by around 3,000 participants, including government delegates, representatives from business and industry, environmental organizations and research institutions. The Bonn meeting will be politically highly significant because for the first time, the full draft of the negotiating text of an effective and ambitious international climate change deal [See WIMS 5/21/09], to be clinched in December in Copenhagen, will be on the table.

The May 26, 2009, edition of the Times of London included an opinion piece from U.S. Energy Secretary Steven Chu highlighting President Obama's commitment to improving America's energy policy and addressing the global climate crisis. Chu said, "This week, the St James's Palace Nobel Laureate Symposium is bringing together scientists and leaders to concentrate on solving the climate challenge. This effort is an example of the growing worldwide awareness of the severity of the threat to our very way of life from a changing climate. . .

"Under Mr. Obama, America is embracing a leadership role in addressing the world's energy and climate change problems. At home, we are committed to reducing our carbon emissions by more than 80 per cent by 2050, and a key committee in the US Congress passed a Bill last week to do just that. Abroad, the United States has pledged to do its part to ensure a successful outcome when the world meets in Copenhagen later this year. . .

"Only science can give us these breakthroughs, which is why this week's Nobel Laureate Symposium is so important. Scientists must step up and do our part in this great effort. With a serious commitment to energy efficiency, widespread deployment of the technologies we have, and an aggressive investment in science, we can dramatically reduce our carbon emissions and reinvigorate our economy at the same time. That is not only our opportunity - it is our responsibility to future generations. We can and must rise to meet this challenge, and I am convinced that we will."

Access the CRIEnglish report (click here). Access a report from EurActiv (click here). Access an article from France24 (click here).Access complete information on the upcoming UNFCCC Bonn meetings (click here). Access the complete opinion piece from Secretary Chu (click here).

President Announces 100th Day Recovery Act Report

May 26: President Barack Obama marked the 100th day of the Recovery Act by releasing "100 Days, 100 Projects," a report from the Vice President that highlights the progress the country has made in the first 100 days of the American Recovery and Reinvestment Act and the work that is already being done to build a new foundation for America’s economic recovery. President Obama said, "One hundred days ago, in the midst of the worst economic crisis in half a century, we passed the most sweeping economic recovery act in history -- a plan designed to save jobs, create new ones, and put money in people’s pockets. Now, one hundred days later, we are meeting our economic challenges head-on and beginning to see early signs of progress across the country."

Among the projects in the report are two new Recovery Act investments totaling over $467 million to expand and accelerate the development and use of geothermal and solar energy throughout the country that the President announced during a visit to Nellis Air Force Base in Las Vegas, Nevada with Senate Majority Leader Harry Reid. Nellis Air Force Base is home to the largest solar photovoltaic array in the United States, and 25 percent of the energy used by the 12,000 people that live and work on the base is generated by the 72,000 solar panel installation. The Recovery Act funds announced represent a substantial down payment on bringing renewable energy technology like that used at Nellis to the mass market and is expected to create thousands of jobs, particularly in the western United States.

According to the White House, the announcement is just one of the many ways the Recovery Act is jump-starting the economy today and building a new foundation for sustained economic growth in the future. "Across the country, the Recovery Act is already at work, providing essential financial relief for American families and businesses, creating and saving jobs, and spurring technology and infrastructure investments that will lay the groundwork for the new economy – and work is just getting started."

President Obama signed the American Recovery and Reinvestment Act (ARRA) into law on February 17, 2009. Just 100 days into the two-year economic recovery program, over $112 billion in Recovery Act funds has been obligated to stimulative programs and projects and the White House says over 150,000 jobs have been created or saved by the Recovery Act.

Access a release from the White House and link to the 100 days report and additional information on geothermal and solar energy technology (click here).

World Business Summit On Climate Change Concludes

May 26: Global business leaders assembled in Copenhagen at the at the World Business Summit on Climate Change May 24-26 2009, concluded their meeting calling for what they say is "ambitious, global action on climate change." The businesses announced that a new global climate treaty must set bold targets for emissions reductions by 2020 and 2050, limiting the global average rise in temperature to a maximum of 2°C compared to pre-industrial levels. They said this requires immediate and substantial action leading to an abatement of around 17Gt versus business-as-usual by 2020 and a 50% reduction in greenhouse gases over 1990 levels by 2050.

The business leaders indicated in their recommendations, referred to as "The Copenhagen Call," that emissions reduction at this scale will profoundly affect business but the "Call" states that they stand ready to make those changes and support ambitious political decisions that support economic recovery and safeguard the planet. The "Call" forms the basis of a concise statement, which sets out the elements business believes are required for an effective new global climate treaty to be forged.

The Copenhagen Call was developed by discussion with the World Business Council on Sustainable Development; 3C; the World Economic Forum; the UN Global Compact and The Climate Group, and deliberations among participants at the Summit.The recommendations were presented to the Danish Prime Minister, Lars Løkke Rasmussen and Yvo de Boer, the Executive Secretary of the UN Framework Convention on Climate Change (UNFCCC) in advance of the COP 15 Conference in December.

Tim Flannery, an internationally acclaimed scientist, explorer, conservationist and Chair of the Copenhagen Climate Council said, "The ambition of the Copenhagen Call shows that business need not be a conservative voice on climate change. Many of the businesses represented at this significant event in the lead up to COP15 want brave decisions that will tackle this most wicked of problems." According to the Call, "Economic recovery and urgent action to tackle climate change are complementary -- boosting the economy and jobs through investment in the new infrastructure needed to reduce emissions."

Erik Rasmussen, Founder of the Copenhagen Climate Council said, "Reducing the emissions that until now have been so linked to our economic growth and betterment will be an enormous, unprecedented global challenge but will also provide significant opportunities for sustainable growth, green jobs, development and innovation."

In order to set a firm foundation for a sustainable economic future, the leaders said it is imperative that the following six steps are implemented: (1) Agreement on a science-based greenhouse gas stabilization path with 2020 and 2050 emissions reduction targets that will achieve it; (2) Effective measurement, reporting and verification of emissions performance by business; (3) Incentives for a dramatic increase in financing low emissions technologies; (4) Deployment of existing low-emissions technologies and the development of new ones; (5) Funds to make communities more resilient and able to adapt to the effects of climate change, and (6) Means to finance forest protection.

The Copenhagen Climate Council is a global collaboration between business and science founded by the leading independent think tank in Scandinavia, Monday Morning, based in Copenhagen. Major business partners include: Combat Climate Change (3C) a business leaders' initiative endorsed and actively promoted by the top executives of 65 of the world's largest corporations; and the World Business Council for Sustainable Development (WBCSD), a CEO-led, global association of some 200 companies dealing exclusively with business and sustainable development.

Access a release from the Summit (click here). Access the Copenhagen Call document (click here). Access the Copenhagen Climate Council website for additional information (click here).

House Committee Approves Waxman-Markey ACES (H.R. 2454) 33 To 25

May 21: Following the marathon, 4-day markup session, the House Energy and Commerce Committee approved H.R. 2454, the American Clean Energy and Security Act (ACES), by a vote of 33 to 25, at about 8:30 PM. In the end, 32 Democrats and 1 Republican voted for the Committee amended bill. Three Democrats voted against the bill: Mike Ross, AR; Jim Matheson, UT; and G.K. Butterfield, NC. The one Republican voting for the bill was Representative Mary Bono Mack, CA. Despite the mostly party-line vote, the Republican leadership on the bill, Ranking Member Joe Barton (R-TX) and Fred Upton (R-MI), congratulated Committee Chairman Henry Waxman on his leadership, control and fairness in allowing the Republican minority to present and debate their amendments. The Republicans encouraged the Democrats to exercise the same leadership when the bill reaches the House Floor.

Chairman Waxman called the legislation "a comprehensive approach to America's energy policy that charts a new course towards a clean energy economy." He said, "Today the Committee took decisive and historic action to promote America's energy security and to create millions of clean energy jobs that will drive our economic recovery and long-term growth. This bill, when enacted into law this year, will break our dependence on foreign oil, make our nation the world leader in clean energy jobs and technology, and cut global warming pollution. I am grateful to my colleagues who supported this legislation and to President Obama for his outstanding leadership on these critical issues."

Energy and Environment Subcommittee Chairman Ed Markey (D-MA) said, "With this plan, we will shape a new energy destiny for our country, where we innovate more and pollute less. Today we have chosen bold action to preserve good paying jobs here in America and preserve our planet. In just eight weeks, Chairman Waxman and I, working with our entire committee, have moved us farther down the path toward energy independence than our country had moved in the past eight years."

According to a release from the Committee, the 900+ page ACES, will create millions of new clean energy jobs, save consumers hundreds of billions of dollars in energy costs, enhance America's energy independence, and cut global warming pollution. The Committee indicated that the legislation has received wide support from electric utilities; energy companies; manufacturing, industry, and corporate companies; labor unions; and community and environmental organizations.

To meet these goals, the legislation has four titles: (1) A clean energy title that promotes renewable sources of energy, carbon capture and sequestration technologies, clean electric vehicles, and the smart grid and electricity transmission. (2) An energy efficiency title that increases energy efficiency across all sectors of the economy, including buildings, appliances, transportation, and industry. (3) A global warming title that places limits on emissions of heat-trapping pollutants. The legislation would cut global warming pollution by 17% compared to 2005 levels in 2020, by 42% in 2030, and by 83% in 2050. These are science-based targets and within the range agreed to by the U.S. Climate Action Partnership (USCAP) -- a diverse coalition of leading businesses and environmental NGOs. (4) A title that protects U.S. consumers and industry and promotes green jobs during the transition to a clean energy economy.

A release from Ranking Member Barton indicated that, "House Democrats used political muscle and party loyalty on Thursday to ram through an anti-global warming bill that opponents caution could cost a family of four $2,937.38 a year. The action came after a marathon committee session that spent 37 hours over four days methodically rejecting 56 separate Republican efforts to learn the full cost of the bill, to prevent scams in its trading system and even get the feds out of hot tubs."

Barton said, “We have legitimate and serious concerns about the redirection of our energy policy in America, which is the foundation and bedrock of our free market economy, the most productive and the largest in the world. A third of the world’s GDP is based on the United States economy and that economy for over 150 years has been based on a free market allocation of resources in the energy sector. This bill makes fundamental changes in that basic philosophy. One estimate puts its price per family of four at $29,373.85 over 10 years. Another estimate is that it will raise electricity rates 90 percent after adjusting for inflation, and boost gasoline prices 74 percent and natural gas prices 55 percent.”

On a macro level, Barton predicted that “a cap-and-trade program will never be made to work in an economy as diverse and complex as the United States. It’s just not possible, and trying to make it work is going to cost money and jobs. How many U.S. industries do we want to bankrupt in one markup, just to achieve a temperature impact of less than one degree Fahrenheit in the next 100 years?”

Republicans offered a major alternative substitute (See link below) to the ACES bill which was defeated by a vote of 35 no, 19 for, and 2 present. Barton said, “This substitute in any other Congress would be considered very progressive and very moderate. But because it still attempts to use the market system and the price mechanism to let people make free choices on which forms of energy to use and how to use them, it is not as directive and invasive by government as the pending legislation. It does not have a cap and trade program. We do accept that it would be better for the economy if we were less carbon-intensive, so instead of a cap-and-trade mechanism that’s very complicated, we take a page out of the current the law, the Clean Air Act, and set performance standards. We set a limit on the amount of CO2. This substitute is comprehensive. It would work. It would be good law.”

In a release from USCAP, the industry-environmental coalition said, "While the current bill does not reflect every USCAP recommendation - and in some instances addresses issues not considered in the Blueprint or in more detail than the Blueprint - it is a good foundation for moving forward in the Congress. As this process unfolds, we are committed to pursuing further opportunities to make the bill even more effective and economically sustainable. In the weeks ahead, USCAP and its members will be working actively with all members of Congress in both chambers and all parties to seek common ground - and to find common sense solutions. We are committed to a path forward that will reduce greenhouse gas emissions, protect consumers and advance new technologies that will lead the transition to a low carbon economy."

USCAP members include: Alcoa - Boston Scientific - BP America - Caterpillar - Chrysler - ConocoPhillips - Dow - Duke Energy - DuPont - Environmental Defense Fund - Exelon - Ford - FPL Group - GE - GM - John Deere - Johnson & Johnson - Natural Resources Defense Council - The Nature Conservancy - NRG Energy - PepsiCo - Pew Center on Global Climate Change - PG&E - PNM Resources - Rio Tinto - Shell - Siemens - World Resources Institute - Xerox.

The American Petroleum Institute (API) issued a statement from President Jack Gerard saying, “While the bill has laudable environmental and economic goals, its inequitable system of allocations remains intact and if enacted would have a disproportionate adverse impact on consumers, businesses and producers of gasoline, diesel fuel, jet fuel, crude oil and natural gas. . . As a recent independent analysis shows, this inequitable approach, by itself, will produce additional unemployment, driving annual job destruction totals related to the legislation to more than one million. Another independent study projects job losses more than double this – up to 2.7 million net jobs lost annually, even with new green jobs created. According to one of these reports, an average family will pay an additional $1,500 a year for energy and 74 percent more for gasoline. Today, that would mean gasoline prices above $4.00 a gallon, an increase nearly equivalent to a ten-fold rise in the federal gasoline tax.”

A broad coalition of environmental and other advocacy groups indicated, "While a week of debate failed to adequately strengthen protections for consumers, communities, and the climate in this bill, it erased all doubt of who will benefit most from it: Big Business. Despite the best efforts of Chairman Waxman, the decision-making process was co-opted by oil and coal lobbyists determined to sustain our addiction to dirty fossil fuels, even as the country stands ready to rebuild our economy and clean up the environment with real clean energy. The resulting bill reflects the triumph of politics over science, and the triumph of industry influence over the public interest. . ."

The coalition (Greenpeace, et al) includes: Greenpeace USA * Friends of the Earth * Public Citizen * Citizen Power * Center for Biological Diversity * Citizens Action Coalition of Indiana * TURN—The Utility Reform Network * Sustainable Energy & Economy Network * Green Delaware * Massachusetts Environmental Energy Alliance * Massachusetts Forest Watch * Coal Moratorium Now! * Rainforest Action Network * International Rivers * Energy Justice Network.

Access a release from the Committee and link to the bill, supporting documents and the 4 individual days of markup including amendments and videos (click here). Access a lengthy release from Rep. Barton (click here). Access a release on the Republican alternative and link to a summary of the substitute (click here). Access a release from USCAP with links to additional information (click here). Access a release from API (click here). Access a release from Greenpeace, et al (click here).

UNFCCC Releases Kyoto Protocol Replacement Negotiating Text

Yvo de Boer, Executive Secretary of the United Nations
Framework Convention on Climate Change

May 20: Yvo de Boer, Executive Secretary of the UN Framework Convention on Climate Change (UNFCCC) announced that progress towards achieving an ambitious new treaty on the reduction of greenhouse gas (GHG) emissions is gathering pace. The UNFCCC posted online the text to be negotiated by nations this December 7-18, in Copenhagen. De Boer said, “This document marks an important point on our road. It's the first time [a] real negotiating text will be on the table which can serve as a basis for governments to start drafting a Copenhagen agreed outcome.”

Governments attending the Copenhagen conference on climate change are expected to adopt an agreement to succeed the Kyoto Protocol, whose first commitment period for reducing greenhouse gas emissions ends in 2012. The negotiations on reductions to be achieved by industrialized countries after 2012 center on issues related to the scale of the reductions, improvements to emissions trading and the Kyoto Protocol's carbon offset mechanisms, as well as concerns relating to land-use change and forestry.

The 53-page negotiating text covers a shared vision for long-term cooperative action, along with an action plan for strengthening adaptation and mitigation measures, as well as finance, technology and capacity-building. De Boer said, “Meanwhile, the United States has committed to a Copenhagen agreement and a clean energy future. Industrialized countries are giving developing nations due credit for the climate change strategies they already have in place." He stressed that with only 199 days before Copenhagen, time gets tighter but the world is not standing still on climate change.”

According to the brief document summary, "This document was prepared by the Chair of the Ad Hoc Working Group on Long-term Cooperative Action under the Convention (AWG-LCA) in response to the request from the AWG-LCA at its fourth session. The document presents a negotiating text, contained in the annex, which aims to provide a starting point for the negotiations at the sixth session of the group by reflecting ideas and proposals by Parties in a structured and comprehensive but concise manner. The text takes account of ideas and proposals contained in the most recent submissions from Parties received by the secretariat from the end of the fifth session up to 5 May 2009, of the ideas and proposals submitted previously. . ."

Before the UNFCCC conference in Copenhagen, some 3,000 participants, including government delegates, representatives from business and industry, environmental organizations and research institutions will gather in Bonn from June 1-12, for talks on the negotiating text. The meeting follows an early April meeting of the UNFCCC parties in Bonn [See WIMS 4/9/09] and a meeting of the "Major Economies" in late April in Washington, DC [See WIMS 4/29/09]. Following the Bonn meeting in June, and prior to the Copenhagen meeting, the Major Economies Forum on Energy and Climate Change will hold another meeting in June, the Group of 8 summit will be held in July, and the UN Secretary-General will hold a high-level meeting in September.

Access a release from the UN (click here). Access the Negotiating Document (click here). Access the Agendas and more information on the June meetings (click here). Access the Danish COP 15 host website (click here). Access the UNFCCC website for more information (click here). Access the United Nations Climate Change Gateway (click here).

New UCS National Blueprint For A Clean Energy Economy

May 19: According to the findings of a two-year, peer-reviewed study by the Union of Concerned Scientists (UCS), with the right policies in place, the United States could dramatically cut the heat-trapping emissions that cause global warming and, at the same time, lower energy costs in every region of the country. UCS President Kevin Knobloch said, "We can protect the environment and Americans' pocketbooks by adopting the right policies. Our analysis shows we have the technology and the know-how to do this. What we now need is the political will."

The report, Climate 2030: A National Blueprint for a Clean Energy Economy, used a modified version of the Department of Energy's National Energy Modeling System and concluded that the United States could meet an emissions-reduction cap of 26 percent below 2005 levels by 2020 and 56 percent below 2005 levels by 2030. The average U.S. household would realize net savings of $300 in 2020 and $900 in 2030, while businesses collectively would see net savings of $35 billion in 2020 and nearly $130 billion in 2030. Collectively, households and businesses would see net savings of $255 billion in 2030.

UCS found that implementing a cap on emissions with a suite of energy and transportation policies would trigger investments in efficiency improvements, renewable energy technologies, clean vehicles, better transportation choices, and low-carbon technologies and fuels. Household and business savings on transportation fuel costs and on electricity, natural gas and heating oil bills would more than offset those investments and any rise in energy prices.

UCS calculated net savings for nine regions of the country, basing the geographic designations on the Department of Energy's modeling system. As an example, in the East North Central region, which includes Illinois, Indiana, Michigan, Ohio and Wisconsin, the UCS blueprint’s combined policies would provide net savings of $213 for the average household in 2020 and $808 in 2030. Businesses in the region collectively would save $2.2 billion in 2020 and $15.8 billion in 2030.

Access a lengthy release and links to various regional analyses (click here). Access an overview and links to an executive summary and the complete 239-page report and more (click here).

President Resolves Differences On CAFE & Auto GHG Management

May 19: In a White House Rose Garden event with many distinguished attendees, President Obama announced his national autos program to adopt uniform Federal standards to regulate both fuel economy and greenhouse gas (GHG) emissions while preserving the legal authorities of DOT, EPA and California. Attending the ceremony were the CEO's of major U.S. and foreign auto companies, the heads of U.S EPA and DOT, and other departments, Governors of MI, CA, and MA, Senators from MI and CA, major environmental organizations and others. The President's program resolves years of bitter controversy and legal wrangling over CAFE (Corporate Average Fuel Economy] standards, the "California waiver" and related energy and climate change issues.

The program covers model year 2012 to model year 2016 and ultimately requires an average fuel economy standard of 35.5 mpg in 2016. The result is a projected reduction in oil consumption of approximately 1.8 billion barrels over the life of the program and a projected total reduction in greenhouse gas emissions of approximately 900 million metric tons. This groundbreaking policy is good for consumers, good for the auto industry and it helps our country by reducing pollution and promoting energy independence.

Ten car companies and the UAW have embraced the national program because it provides certainty and predictability to 2016 and includes flexibilities that will significantly reduce the cost of compliance. The program also honors President Obama’s commitment to reconsider the denial of the California waiver by the Bush Administration. Under the agreement, EPA would grant California's request to enforce its state clean car standards while the U.S. develops harmonized national emission standards and fuel economy standards under Federal law. Significantly, the nation's automakers would drop long-standing litigation over the state clean car standards.

According to a White House fact sheet, the resolution would be good for consumers, the economy and the country. The fact sheet indicates that consumers will receive savings in increased fuel efficiency; maintain a choice of vehicles such as size of cars, trucks and SUVs; and benefit from reduced air pollution, the reduction of greenhouse gas emissions and other conventional pollutants.

The economy and auto companies would benefit by having one national policy for all automakers; the potential to lower compliance costs for automakers by avoiding a patchwork of fuel efficiency and pollution rules; providing clarity, predictability and certainty concerning the rules; and providing flexibility on how to meet the expected outcomes and the lead time needed to innovate.

Finally, the country would benefit by reducing the dependence on oil (1.8 Billion barrels of oil cumulatively, over the lifetime of the program) and significant reductions in greenhouse gas emissions (savings equivalent to taking 177 million of today's cars off the road). And, the program would result in historic collaboration between EPA and DOT, and cooperation and support between CEOs, Governors, the UAW, the environmental community and others.

President Obama said, "In the past, an agreement such as this would have been considered impossible. That is why this announcement is so important, for it represents not only a change in policy in Washington, but the harbinger of a change in the way business is done in Washington. As a result of this agreement, we will save 1.8 billion barrels of oil over the lifetime of the vehicles sold in the next five years. And at a time of historic crisis in our auto industry, this rule provides the clear certainty that will allow these companies to plan for a future in which they are building the cars of the 21st century."

According to a White House release, this groundbreaking policy delivers on the President’s commitment to enact more stringent fuel economy standards and represents an unprecedented collaboration between the Department of Transportation (DOT), the Environmental Protection Agency (EPA), the world’s largest auto manufacturers, the United Auto Workers, leaders in the environmental community, the State of California, and other state governments.

EPA Administrator Lisa P. Jackson said, "The President brought all stakeholders to the table and came up with a plan to help the auto industry, safeguard consumers, and protect human health and the environment for all Americans. A supposedly 'unsolvable' problem was solved by unprecedented partnerships. As a result, we will keep Americans healthier, cut tons of pollution from the air we breathe, and make a lasting down payment on cutting our greenhouse gas emissions." Carol Browner, Assistant to the President for Energy and Climate Change said, "A clear and uniform national policy is not only good news for consumers who will save money at the pump, but this policy is also good news for the auto industry which will no longer be subject to a costly patchwork of differing rules and regulations. This an incredible step forward for our country and another way for Americans to become more energy independent and reduce air pollution."

Dave McCurdy, president and CEO, Alliance of Automobile Manufacturers said, "For seven long years, there has been a debate over whether states or the federal government should regulate autos. President Obama’s announcement ends that old debate by starting a federal rulemaking to set a National Program. Automakers are committed to working with the President to develop a National Program administered by the federal government. What’s significant about the announcement is it launches a new beginning, an era of cooperation. The President has succeeded in bringing three regulatory bodies, 15 states, a dozen automakers and many environmental groups to the table. We’re all agreeing to work together on a National Program."

Frances Beinecke, President of the Natural Resources Defense Council (NRDC) said, "President Obama, the state of California, the auto industry, and environmental leaders have come together around a global warming solution that will strengthen our economy and put the auto industry on the path to a clean energy future. The future of the auto industry lies in making cleaner, more fuel-efficient vehicles that reduce global warming pollution and our dependence on oil. These new national rules build on California's ground-breaking standards to tackle global warming pollution from cars and trucks. Starting in model year 2012, the new standards will deliver cleaner, higher-mileage cars nationwide, cut global warming pollution, and save drivers money every time they fill up."

Access a release from the White House (click here). Access a White House fact sheet (click here). Access a lengthy release from Alliance of Automobile Manufacturers with an historical summary (click here). Access a release from the NRDC (click here). [Note: Many others issued releases on this development; too numerous to cover all]

Markup Begins On Waxman-Markey ACES Bill

May 18: Chairman Henry Waxman (D-CA) and Subcommittee Chairman Edward Markey (D-MA) officially introduced H.R. 2454, The American Clean Energy and Security Act (ACES), late Friday, May 15. The Energy and Commerce Committee began markup of the bill today (May 18) at 1:00 PM and will complete consideration before the Memorial Day recess. The hearing today, began with opening statements from Committee members. There are 36 Democrats and 23 Republicans on the full Committee. Opening comments were completed and the Committee will reconvene tomorrow at 10:AM for what will likely be an all day and into the night session; with more to follow this week. Live video of the meetings is available at the website below.

Republicans remained united in their opposition to the bill. On May 14, Republicans members of the Committee, led by Ranking Member Joe Barton, (R-TX), outlined what they are proposing as an alternative to the Waxman-Markey -- the Energy Production, Innovation, and Conservation Act, which has not yet been formally introduced [See WIMS 5/15/09]. Republicans are expected to offer a large number of amendments to the Waxman-Markey bill; and a complete substitute.

Waxman said, "The legislation will create millions of new clean energy jobs, save consumers hundreds of billions of dollars in energy costs, promote America's energy independence and security, and cut global warming pollution. In support of these goals, this legislation ensures that consumers and industries in all regions of the country are protected. I look forward to working with all members of the Committee to approve this legislation to make America the world leader in new clean energy and energy efficiency technologies." Markey said, "This bill marks the dawn of the clean energy age. This is a once-in-a-generation opportunity to revive our economy and create millions of good-paying clean energy jobs. After months of hearings and discussions with my colleagues, I am pleased that we have produced a bill that has widespread support from all regions of the country."

The formal release of the 932-page bill Friday followed a release earlier the same day of a document summarizing how the emission allowances would be allocated in the current version of the bill [See WIMS 5/15/09]. The bill has been referred to the Waxman's Committee on Energy and Commerce, and in addition to the Committees on Foreign Affairs, Financial Services, Education and Labor, Science and Technology, Transportation and Infrastructure, Natural Resources, Agriculture, and Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.

Fred Krupp, president of Environmental Defense Fund (EDF) commented on the latest version of the bill saying, "This bill can win not only the support of environmentalists and business, but also the diverse group of regional interests that make up the Congress. It's a watershed agreement. The bill includes an important and aggressive short-term target to reduce greenhouse gas emissions 17% below 2005 levels by 2020 -- right in the middle of the range called for by the 30 leading companies and non-profit groups in the U.S. Climate Action Partnership [USCAP], of which EDF is a member.

"The agreement delivers a strong cap on pollution with a smart plan to protect family budgets and economic competitiveness, and that's precisely the formula we need. The latest government study of the Waxman-Markey bill estimates that the emissions cap can be achieved for as little as $98 per household per year -- about a dime a day per person -- if the legislation is designed to keep costs down. Importantly, more than half of the value of emissions permits under the agreement will be used to protect consumers and keep utility rates low. In the early years of the program, it will allocate permits at no cost to regulated local electricity and natural gas distributors, which will pass the value of the permits directly to households. Permit value will also be used to keep energy-intensive U.S. industries competitive. Ultimately, all permits under the cap will be auctioned."

The Union of Concerned Scientists (UCS) did an analysis of the latest draft and commented that, "Congressmen Waxman and Markey have done an admirable job satisfying a lot of competing interests. But now, as the bill moves forward, Congress needs to strengthen many of the bill's provisions to ensure that we dramatically cut emissions, save consumers money, and strengthen our economy with a well-designed climate and energy policy." UCS reviewed the allocation categories listed by the committee. Below is the group's assessment, including its estimates of how much money Congress would allocate. (Note: Based on a projected carbon price of $17 per ton in 2020, when most emissions sources will be covered under the bill, each 1 percent of allowance allocation would be worth approximately $750 million.)

Access a brief announcement from Waxman and Markey (click here). Access legislative details for H.R. 2454 (click here). Access the complete statement from EDF (click here). Access a release with a summary of the UCS allocation analysis (click here). Access the Committee website for a link to the live video (click here).

Details On Allocation Of Emission Allowances Under ACES

May 15: Following yesterday's release by the Committee on Energy and Commerce of details of agreements on a Combined Efficiency and Renewable Electricity Standard (RES); allocation of allowances to the automobile industry; and major provision for the allocation of allowances to major energy-intensive, trade-exposed industries [See WIMS 5/14/09] ; Chairman Henry Waxman (D-CA) and Subcommittee Chairman Ed Markey (D-MA) released a document summarizing how the emission allowances will be allocated in the current version of the American Clean Energy and Security Act of 2009 (ACES). The Committee is scheduled to begin the markup on Monday, May 18, at 1:00 PM, and Chairman Waxman has pledged to get the bill approved by the full Committee before the Memorial Day recess.

According to the 2-page summary, emission allowances will be allocated to accomplish three primary goals: (1) to protect consumers from energy price increases; (2) to assist industry in the transition to a clean energy economy; and (3) to spur energy efficiency and the development and deployment of clean energy technology. A small amount of allowances will be allocated to prevent deforestation and support national and international adaptation efforts and for other purposes.

Under consumer protections the Committee lists protection from Electricity Price Increases; Natural Gas Price Increases; Home Heating Oil Price Increases; and protections for Low- and Moderate-Income Households. The electricity sector will receive 35% of the allowances, representing 90% of current utility emissions; and local electric distribution companies will receive 30% of the allowances. Merchant coal and long-term power purchase agreements will receive 5% of the allowances. The allowances will be distributed according to a formula recommended by the utility industry. Local natural gas distribution companies will receive 9% of allowances, and states will receive 1.5% of allowances for programs to benefit users of home heating oil and propane. All allowances would phase out over a five-year period from 2026 through 2030.

15% of allowances will be auctioned each year and the proceeds of these allowances will be distributed to low- and moderate-income families to protect them from other energy cost increases. These allowances will be distributed through tax credits, direct payments, and electronic benefit payments and will not phase out.

Under the Transition Assistance for Industry, protection would be provided for Energy-Intensive, Trade-Exposed Industries, as described in the Inslee-Doyle agreement announced earlier [See WIMS 5/14/09]. In addition, oil refiners will receive 2% of allowances starting in 2014 and ending in 2026.

Under Energy Efficiency and Clean Energy Technology allowances would be provided for: Investments in Carbon Capture and Sequestration; Renewable Energy and Energy Efficiency; Advanced Automobile Technology; Research and Development. Additional allowances would be provided for Other Public Purposes including: Supplemental Reductions from Preventing Tropical Deforestation; Domestic Adaptation (wildlife and natural resource protection, public health and other domestic adaptation purposes); International Adaptation and Clean Technology Transfer; and Worker Assistance and Job Training. Unallocated allowances will be auctioned to ensure budget neutrality and the remainder will be used for consumer protection.

While the Committee Democrats have generally agreed to the compromise bill designed to accommodate the diversity of issues and interests within their party, Republicans have remained opposed to the bill. On May 14, Republicans members of the Committee, led by Ranking Member Joe Barton, (R-TX), outlined what they are proposing as an alternative to the Waxman-Markey. They said their bill will be offered during the bill’s markup beginning next week.

Among other items the Republican bill would amend the Clean Air Act to overturn Massachusetts v. EPA; preempts state authority to regulate certain fuels and all gases from CAA regulation; provide regulatory certainty to once again invest in coal-fired generation; provide an all-encompassing alternative to a renewable portfolio standard; expand nuclear power development and open Yucca Mountain; repeals “decoupling” mandates; Retire the Vehicle Incentive Rebate program; create federal transmission grid facility siting authority; create a Volunteer Service Corps to focus on reforestation; expand exploration & production in the Outer Continental Shelf, Arctic coastal plain, and Oil Shale; provide tax incentives for alternative fuel vehicles and a $500 million prize for the first U.S. automobile manufacturer to produce and sell 50,000 economically feasible, super-fuel-efficient vehicles reaching 100 miles-per-gallon; encourage the use of clean coal-to-liquid technology; and provide a trust fund to promote the development of renewable and alternative energy.

Access the complete summary of allocation of the allowances (click here). Access a summary of the Republican bill (click here); and the complete draft (click here).

Major Breakthroughs Welcomed On Waxman-Markey ACES Bill

May 13: Following yesterday's official announcement that the full Committee on Energy and Commerce will begin formal markup of the American Clean Energy and Security Act of 2009 (ACES) bill on Monday, May 18, the Committee released details of an agreement on a Combined Efficiency and Renewable Electricity Standard (RES); an agreement on allocation of allowances to the automobile industry; and an agreement on a major provision for the allocation of allowances to major energy-intensive, trade-exposed industries.

Following the announcement of the agreements House Speaker Nancy Pelosi (D-CA) issued a statement saying, “I commend all the Members of the House Energy and Commerce Committee who have been working in good faith to find the first meaningful common ground on this landmark legislative effort to create millions of clean energy American jobs. Chairman Waxman and Chairman Markey have led this effort and have shown, with the diversity on their committee, that this Congress can craft national legislation that creates millions of jobs, puts us on a path toward energy independence, reduces the pollution that creates catastrophic climate change, and recognizes the regional differences that give this country its character and will provide a strong and diverse foundation for economic recovery. . .

“This bill will create entire new industries in the United States -- while preserving the manufacturing base that has been the foundation of our economy, helping industries such as steel, glass, and cement remain competitive in the global marketplace, and pioneering cleaner coal technologies for use here and around the world. This bill will strengthen our national security and make America a strong world leader in the new technologies to fight climate change. Perhaps most importantly, this bill makes sure that hard-working Americans reap the rewards of a clean energy economy, instead of paying the price.”

Representatives Henry Waxman, Edward Markey (D-MA), John Dingell (D-MI), Rick Boucher (D-VA), Bart Gordon (D-TN), and Mike Doyle (D-PA) released the details of the agreement on a Combined Efficiency and RES. The agreement provides for a combined 20% renewable energy and energy efficiency standard by 2020. By 2020, utilities would be required to obtain 15% of their electricity from renewable energy sources and demonstrate annual electricity savings of 5% from energy efficiency measures. If the governor of a state determines that utilities in the state cannot meet the 15% renewable requirement, the governor may reduce the renewable requirement to 12% and increase the efficiency requirement to 8%.

Representatives Waxman, Markey, and Dingell released the details of the agreement on allocation of allowances to the automobile industry. Under the agreement, the automobile industries will be provided incentives to make electric and advanced technology vehicles. The industry will receive 3% of allowances from 2012 through 2017, and after that will receive 1% of allowances through 2025.

Representatives Waxman, Markey, Doyle, and Jay Inslee (D-WA) released the details of the agreement on a major provision for the allocation of allowances to major energy-intensive, trade-exposed industries. Under the agreement, energy-intensive industries that compete in global markets will be provided incentives to improve their energy efficiency, as well as assistance to address the costs of transitioning to a clean energy economy. The incentives will be based on the amount of domestic production. Under the agreement: 15% of allowances in 2014 will be distributed to U.S. manufacturers that are in energy-intensive, trade-exposed industries; Manufacturers will receive allowances based on the average carbon emissions from the sector, scaled by the manufacturer's U.S. production; and to provide adequate transition time, the industries will receive allowances through 2025, at which time the President will determine whether they are still needed.

The announcement of the markup meeting and the agreements reached was also welcomed by the President. At the daily White House press briefing, press secretary Robert Gibbs responded to questions regarding the what was called, a "pretty substantial watering down of what the President wanted" in a bill and what the Democrats on the Committee had agreed to. Gibbs said, ". . .an overall emission target for 2050 is what the President campaigned on. Some of the intermediate standards for -- I think is it 2020 or 2025, the target instead of a 20 percent reduction below the 2005 levels is a 17 percent reduction. . . There's some slightly smaller targets in a renewable electricity standard, but . . . I think we would argue that while we may have intermediate hurdles, different slight changes in the hurdles along the path, we're addressing the need to do something about harmful greenhouse gas emissions; that we are incentivizing the creation of clean-energy jobs to meet both those emission targets as well as that renewable energy standard or electricity standard target.

"And finally, we're creating a market incentive to deal with pollution by setting that standard at a certain level and decreasing that standard so that the market can decide the actions that individual companies and businesses might take to deal with those changing standards. . . "

On a question about free allowances as opposed to auctioning them, Gibbs responded, "I think if this week for energy independence represents the clearing of a fairly large hurdle in getting a bill through committee and getting the House of Representatives on its way to getting something through to the Senate to the point where the President can sign a bill into law that creates a market incentive to create clean-energy jobs, a market incentive to reduce the amount of greenhouse gas we emit, and puts us a path toward energy independence, the President will find that to be a great success even if there are some slight changes in what he campaigned on. . . I think that represents quite a change in the way this debate has been conducted. And again, if we can look back at this being the beginning of something that we get on down the road, I think the President will believe it to be a tremendous success."

Access a release from Speaker Pelosi (click here). Access a statement and further details on the Combined Efficiency & RES agreement (click here). Access a statement and further details on the auto industry allowances agreement (click here). Access a statement and further details on the trade-exposed industries agreement (click here). Access the transcript of the White House press briefing (click here).

Democrats Reach Compromise On Waxman-Markey ACES Bill

May 13: Although no official announcement had been posted at press time, the Sierra Club issued a release indicating that the House Energy and Commerce Committee has reportedly reached agreement on a compromise version of the American Clean Energy & Security Act (ACES) [See WIMS 5/6/09], a comprehensive clean energy and climate plan. Other reports indicate that Chairman Henry Waxman (D-CA) is still planning to get a vote before Memorial Day and that markup could begin on Monday.

The Roll Call reported last evening that Waxman said, “We have resolved a good number of the issues" and adding that the bill remains on track to clear his panel next week. Member opening statements are reportedly planned for Thursday with the markup beginning on Monday. Roll Call said Waxman indicated, “I am optimistic. I believe we will have the votes to pass the bill [next week].”

Resolving the highly contentious issues among the broad diversity of the Democrats on the full Committee (i.e. Midwest, South, Oil States, Coal States, etc.), would be a major victory for the Obama Administration and there is a feeling that if Democrats can resolve their differences and agree to a compromise bill it could increase the chances for approval in the Senate. It is assumed that all Republicans will vote against the bill. There are 36 Democrats and 23 Republicans on the full Committee. Further details on tentative compromises are reported in a May 13, New York Times article (see link below).

Sierra Club's Executive Director Carl Pope issued a statement saying, "Chairmen Waxman and Markey have done heroic work in reaching agreement on the Energy and Commerce Committee around a comprehensive clean energy and climate plan, a critically important milestone that has faced seemingly insuperable obstacles. Their leadership has been truly remarkable. But it is clear that Big Oil, Big Coal and other polluters are still holding out for a Congressional bailout. They will continue to try to riddle this legislation with loopholes, water it down, and load it up with hundreds of billions of dollars in giveaways. They don't want it to deliver a recovery fueled by the clean energy jobs that America needs.

"These polluters are trying to strangle the clean energy economy in its cradle, steal the benefits of the clean energy future from the American people, and keep us addicted to oil and dirty coal. As this bill moves through the many remaining steps in the legislative process, we will work to strengthen this bill, so that it meets President Obama's challenge to Congress and the American people. Only a bill which accomplishes these three things can really jumpstart the green recovery, build the clean energy future, and end our addiction to oil and coal: (1) Dramatically ramp up America's transition to cleaner, cheaper energy sources like wind, solar, biomass, and geothermal; (2) Slash energy waste in order to cut emissions quickly and cheaply, while saving consumers money on their energy bills; and (3) Close the carbon pollution loophole and make polluters pay for the carbon pollution they emit."

Update at press time: Chairman Waxman officially announced the Committee on Energy and Commerce will meet in open markup session on Monday, May 18, 2009, at 1:00 PM, and subsequent days as necessary, in room 2123 Rayburn House Office Building, to consider the American Clean Energy and Security Act of 2009.

Access a release from Sierra Club (click here). Access the article from Roll Call (click here). Access the NYT article (click here). Access a Twitter feed for the latest update reports (click here).