Co-Opting “Cap and Dividend”

  • Senator Maria Cantwell says something has to be done to push the country toward alternative sources of energy – and away dependence on polluting fossil fuels. (Photo courtesy of the NREL, Warren Gretz)

A new climate change bill will be introduced next week. It’s expected to be very complicated because of so many competing interests. Critics say it won’t pass. Julie Grant reports another much shorter and simpler bill in the Senate is getting some overdue attention:

Transcript

A new climate change bill will be introduced next week. It’s expected to be very complicated because of so many competing interests. Critics say it won’t pass. Julie Grant reports another much shorter and simpler bill in the Senate is getting some overdue attention.

Carbon emissions come from smokestacks, tailpipes and all kinds of manufacturing processes. It’s considered the biggest culprit in the greenhouse gas pollution contributing to climate change.

We’ve heard a lot about a possible cap and trade program to reduce carbon emissions. The House of Representatives passed a cap and trade bill last summer, but it hasn’t gone far in the Senate. Senators John Kerry, a Democrat, Joseph Lieberman, an independent, and Lindsey Graham, a Republican have been working on a bill for months.

But a simple bill called The CLEAR Act introduced last December has been is gaining interest. Senator Maria Cantwell is a Democrat from Washington State. She co-sponsored the bill with Republican Susan Collins of Maine.

Cantwell says something has to be done to push the country toward alternative sources of energy – and away dependence on polluting fossil fuels. That’s why they’re pushing the bill, called cap and dividend:

“We’re saying we think it’s very important to have a simple approach that the American people can understand. a 41-page bill is a lot about getting people to understand how this can work and helping us make a transition.”

Like cap and trade, the CLEAR Act would limit carbon emissions—it would put a cap on them. But it’s different from the complicated cap-and-trade plan that would target those who use energy and allow for many kinds of loopholes.

The Cantwell and Collins cap and dividend plan would concentrate on those who produce energy from fossil fuels. It would cap carbon at the tanker bringing in imported oil, the mine extracting coal, the oil and gas at the well head.

It would charge those energy producers for permits. Each year the number of permits would be reduced, so theoretically, the amount of carbon pollution would be gradually reduced.

Twenty-five percent of the money from the permits would go toward a clean energy fund. The other 75-percent would be paid at a flat rate to each person in the nation to offset higher energy prices.

So, fossil fuel energy would be more expensive, but families would get money to offset the higher costs.

Cantwell says no matter what we do, even if we do nothing, energy costs are going to rise. She says people want to know what to expect in their energy bills.

“What they want to know is how do you make that transition with the least impact to people and that’s what the Clear act is about; it’s about making a stable transition, and helping consumers along the way not get gouged by high energy prices.”

Many economists and environmentalists like the cap and dividend idea.

Senators Kerry, Lieberman and Graham have said they’ll fold some elements of cap and dividend into their massive proposal.

Darren Samuelsohn is the Energy and Environment Reporter for GreenWire. He says the three Senators are taking a comprehensive look at carbon pollution in relation to the entire U.S. energy policy.

“They’ve been meeting as a group of three behind closed doors working to try and satisfy the needs for a price on carbon emissions, across multiple sectors of the economy–power plants, heavy manufacturing and transportation.”

And they’re using bits and pieces of the Cantwell-Collins proposal.

Senators Cantwell and Collins say they don’t want their bill

cannibalized by that large scale bill.

One reason Cantwell is concerned is that the Kerry, Lieberman Graham bill allows trading permits. She says trading hasn’t worked in the European system. And she’s concerned it will make the price of carbon vulnerable to speculators who could drive the prices up artificially.

Instead, she wants carbon prices decided at monthly federal auctions.

Cantwell says the time is right for a simple, predictable bill like the CLEAR Act.

“You don’t have to ahve a 2-thousand page bill and figure out how many allowances you have to give away in the back room to make somebody believe in this. This is a concept the American people can understand and one they can support.”

On Monday, the Kerry-Lieberman-Graham bill is expected to be introduced. The vote will be very close, so they can’t afford to ignore what Senators Cantwell and Collins want.

For The Environment Report, I’m Julie Grant.

Related Links