Cap-And-Trade appears to be dead in the US Senate or maybe not. It all depends on whether you side with Senator Graham or whether you prefer to be on the side of Senator Kerry. The following article appeared in the NYT.
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Advocates of Climate Bill Scale Down Their Goals
Their preferred approach, a cap-and-trade system to curb emissions of climate-changing gases, already faced a difficult road in a bruised and divided Senate. Its prospects grew dimmer after the special election in Massachusetts last week was won by Scott Brown, a Republican who repudiated the federal cap-and-trade proposal in his campaign.
Republicans, industry executives and some Democrats have already written cap and trade’s obituary, at least for this year. And even some of the system’s most ardent supporters now say they must scale back their ambitions and focus on job-creating energy projects and energy efficiency measures if they are to have any hope of dealing with climate change in this Congress.
“Realistically, the cap-and-trade bills in the House and the Senate are going nowhere,” said Senator Lindsey Graham, Republican of South Carolina, who is trying to fashion a bipartisan package of climate and energy measures. “They’re not business-friendly enough, and they don’t lead to meaningful energy independence.”
Mr. Graham said the public was demanding that any energy legislation from Washington focus on creating jobs, whether by drilling for offshore oil or building wind turbines.
“What is dead is some massive cap-and-trade system that regulates carbon in a fashion that drives up energy costs,” he said.
Mr. Graham’s opinion matters because he has been the only Republican willing to work with Democratic senators on some form of climate change legislation. He said that the price of attracting Republican and business support was to use the legislation to provide incentives for building nuclear power plants, stepped-up domestic oil and gas exploration and subsidies for reducing carbon dioxide emissions from coal.
White House officials continue to insist on a broad approach to climate and energy, including a cap-and-trade system for carbon emissions that encompasses the entire economy. They are also pressing forward with Environmental Protection Agency regulation of emissions of heat-trapping gases over the virtually unanimous opposition of Republicans in the House and Senate.
“There continues to be very strong support among a range of legislators for comprehensive climate legislation that includes cap and trade,” Gary Guzy, the deputy director of the White House Council on Environmental Quality, said at a conference last week.
Another White House official, who insisted on anonymity to avoid overshadowing the State of the Union address, said President Obama would restate his commitment to a bill that addresses global warming along with measures to increase energy efficiency and clean-energy technology.
The official said the White House would support legislation that provided incentives for oil and gas drilling and for construction of nuclear plants, as well as provisions that helped industries that use a lot of energy and were vulnerable to foreign competitors.
But the president will also insist that any legislation also contain some form of cap on emissions of heat-trapping gases to make good on his pledge to reduce global warming pollution by 17 percent over 2005 levels by 2020.
“At the end of the day, any and all ideas are on the table because the clock is ticking,” the official said.
Senator John Kerry, the Massachusetts Democrat who is working with Mr. Graham and Senator Joseph I. Lieberman, independent of Connecticut, to try to knit together a global warming and energy measure, said this week that the political climate in Washington was already harsh and had worsened with the special election in his home state. Mr. Kerry said he had held talks with the White House, business leaders and fellow senators in hopes of finding an approach to climate and energy issues that can win enough votes for passage.
“I can’t tell you whether it will happen this year or not,” Mr. Kerry said. “But it’s going to happen. It is inevitable that the United States will deal with climate and energy. The sooner you do it, the cheaper it is.”
Some leaders in the energy industry were almost gleeful in pronouncing cap and trade dead for the year. They see an opportunity to win support from Congress for their businesses and to delay indefinitely the costs of reducing pollution from heat-trapping gases.
“Reality is hitting, and the reality is the American people are interested in jobs, not extreme legislation,” said Larry Nichols, chief executive of Devon Energy and chairman of the American Petroleum Institute. “Because of the shift in raw political power, there now has to be compromise.”
A bill that has the support of Senator Harry Reid, the Democratic leader, and some senior Congressional Republicans, would offer tax incentives to bus and truck fleets to switch to natural gas, a fuel that emits less carbon dioxide than diesel. Some energy industry leaders are also looking for additional money for so-called clean-coal research and energy efficiency measures for buildings.
Two senators, Maria Cantwell of Washington, a Democrat, and Susan Collins of Maine, a Republican, have proposed a system known as “cap and dividend” under which power plants, steel mills, refineries and other major carbon emitters would have to pay for permits to pollute, with all of the money being rebated to consumers to cover the higher costs of energy and manufactured goods.
Another option, but one largely opposed by most businesses, is regulation by the E.P.A. Mr. Obama has repeatedly said that he would much prefer a market-based cap-and-trade system to top-down mandates from the E.P.A.
The partisan gridlock that hobbled health care overhaul could be repeated if the administration and Democratic leaders try to ram through a sweeping measure to rein in carbon emissions and remake the nation’s energy economy, said Paul Bledsoe of the National Commission on Energy Policy, a bipartisan advisory group.
“If cap and trade becomes a political anathema,” Mr. Bledsoe said, “the consequences are very broad. If it is seen as divisive or politically suicidal, it could be discredited as the vehicle for dealing with climate change for the foreseeable future.”
