Waxman and Markey Release House Climate Bill: Some Details, But a Long Way From the Finish Line

I finally found time to review the 648-page “discussion draft” of the “American Clean Energy and Security Act of 2009” released by Representatives Waxman and Markey this week. It is fair to way that, though release of the draft may be an important way-station on the road to a climate change bill, there remains a lot of work to do. While the draft includes some important markers that are likely to set boundaries on what might be included in the final bill, it is at least as notable for what is omitted than for what is included. Here are some highlights of Title III of the bill, which addresses climate change: (We hope to post soon about the energy titles as well.)

  • No surprise here – the bill would create a cap and trade program requiring facilities with emissions of more than 25,000 tons per year of CO2 equivalents to have allowances in order to continue such emissions.
  • Allowances would be allocated so that emissions would decrease 20% from 2005 levels by 2020 and 83% from 2005 levels by 2050
  • The bill contains a framework for an auction system, but it does not specify what percentage of allowances will be auctioned or what will happen to the proceeds.
  • There are several measures designed to address concerns about multiple, conflicting, or inefficient regulatory programs:
    • The President is directed to “harmonize” “to the extent practicable” DOT fuel efficiency standards, EPA regulations, and California regulations regarding motor vehicle emissions
    • Other than regulations implementing the act, EPA is precluded from using existing authority to regulate greenhouse gases as hazardous air pollutants or under NSR rules (unless they have non-climate change related impacts) and precludes listing of greenhouse gases as criteria air pollutants based on their impact on climate change
    • State cap and trade programs would be preempted, at least from 2012 through 2017. It appears as though allowances already issued under RGGI will be folded into the federal program

Overall, this looks like a measured approach designed to win support from both sides. Environmentalists will be pleased by firm caps, including a 2020 cap more stringent than some have proposed. Regulated industries will be pleased by the attempts to harmonize standards on motor vehicles, preclude Clean Air Act regulation of greenhouse gases, and to preempt state or regional cap and trade programs.

If I had to guess, I’d say that this bill marks the death knell for regulation of greenhouse gases under existing Clean Air Act authority (assuming that a bill gets passed; if Congress fails to act, then EPA certainly will use existing authority); it is probably also the beginning of the end of state and regional programs.  On both of these issues, If Representatives Waxman and Markey are already staking out this position, then it seems difficult to imagine a final bill that doesn’t incorporate these elements of the draft bill.  As to the rest, time will tell.

One thought on “Waxman and Markey Release House Climate Bill: Some Details, But a Long Way From the Finish Line

  1. The House Climate Bill: More Details on Federal Cap and Trade

    As we mentioned yesterday, the discussion draft of the Waxman-Markey “American Clean Energy and Security Act of 2009” which was released on Tuesday is notable both for what it includes and the significant portions it leaves to be decided…

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