The latest chatter on the Hill is that climate legislation is not likely to pass this year. High jobless numbers, financial reform and the health care debate continue to thwart efforts focused on the environment. It is possible that the Senate will settle for an energy-only bill and call it a day. The likelihood of this strategy was echoed by comments made by President Obama on Tuesday February 2, 2010 at a town hall meeting in Nashua, New Hampshire. The President said that he would be open to the possibility of the Senate passing an energy bill without a carbon dioxide cap-and-trade program. These comments have put him at odds with Senate Democrats who have insisted that an energy bill be combined with a climate change bill.
The idea of splitting up the energy bill, which was passed last year by the Energy and Natural Resources Committee, is a departure from the strategy advocated by Senate Majority Leader Harry Reid of Nevada. Reid wants an energy bill with a renewable electricity standard, efficiency standards and other provisions to be combined with a cap-and-trade bill. The centerpiece of that bill is a renewable electricity standard (RES) that would require electric utilities to generate 15 percent of their power from renewable sources by 2021.
Republican Senator Judd Gregg of New Hampshire responded to President Obama’s notion of splitting the bills by saying “I think cap and trade has a long road here obviously, and there’s a lot of good initiatives on energy policy that are on a shorter track and will hopefully be pursued aggressively.”
South Carolina Republican Senator Lindsey Graham slammed the push for an energy only bill. Graham, who has been among the 20 most conservative U.S. Senators, has been very clear in his support for a comprehensive bill. “The idea of not pricing carbon, in my view, means you’re not serious about energy independence.” He bluntly states that “Every day that we delay trying to find a price for carbon is a day that China uses to dominate the green economy.”
To clarify, President Obama has made it clear that he still prefers comprehensive energy legislation including a cap on greenhouse gasses. He has reiterated that his energy agenda centers on promoting energy efficiency and clean energy technologies, including renewables, nuclear power and carbon capture and storage at coal-fired power plants. He believes that at some point cap and trade needs to be in the mix in order to promote cleaner forms of energy at the lowest cost to industry. Obama has also noted that the two parties should try and find a way to work together, even if there is disagreement over the threat of global climate change.
Not acting now may be appealing to some people, but several problems grow only more expensive, complicated and politically challenging if delayed significantly. There is hope, however, that the climate bill currently being developed by Senators Kerry, Lieberman and Graham can garner the required 60 votes to avoid a filibuster. This bill, expected in the spring, might have a renewed approach to the currently proposed US climate bills that are fundamentally centered around the liberal use of offsets, which has caused considerable debate.
There appears to be some consensus building around the fact that the cost of reducing the United State’s emissions in a meaningful way rises considerably without the use of an offset market.