House fast-tracks major changes on energy and climate

Washington and Boston

Congressional Democrats have launched a bid to shift the United States into greener energy technologies, while protecting US consumers and jobs during a difficult transition.

The draft plan, released Tuesday by the House Energy and Commerce Committee, moves one of President Obama�s key campaign pledges onto a fast track on Capitol Hill. It also opens a debate over how America powers its economy � one that crosses party and regional lines � at a time of deep economic stress.

�This legislation will create millions of clean-energy jobs, put America on the path to energy independence, and cut global warming pollution,� said Rep. Henry Waxman (D) of California in a statement.

The bill�s main elements

The bill has three main elements: developing clean energy sources, dramatically boosting energy efficiency, and capping and reducing greenhouse-gas emissions. The bill also aims to protect US consumers and industry during the transition to a clean energy economy.

Development of wind energy, solar energy, geothermal energy, smart-grid efforts, and new transmission lines would be accelerated, and there would be a new standard for utilities to meet regarding use of renewable sources for generating electricity. Utilities in all states would be required to gradually increase the proportion of renewables to 25 percent by 2025. The measure would also set a low-carbon standard for transportation fuels and push to reduce coal emissions by developing technologies to capture and sequester carbon.

As expected, the bill unveiled Tuesday is getting mixed reviews. Critics, including many Republicans, charge that the plan will kill jobs and add thousands of dollars to the average family�s utility bill.

�Tuesday�s cap-and-trade bill marks a triumph of fear over good sense and science, and it couldn�t come at a worse time, because it proposes to save the planet by sacrificing the economy,� said Rep. Joe Barton of Texas, the top Republican on the energy panel.

Citing a recent University of Massachusetts study, he added that new jobs associated with boosting domestic oil and gas supplies, which would be hard hit by the proposed bill, pay twice as much as jobs associated with green investment. �It�s not hard to guess which line of work most people would choose, especially if they didn�t have the foresight to be born into money,� he said.

Energy-efficiency advocates, on the other hand, are generally enthused. The bill contains a number of reforms that strengthen the US Energy Department�s authority to set energy standards for energy guzzlers that currently don�t have any standards, such as hot tubs, says Andrew Delaski, executive director of the Appliance Standards Awareness Project, which is sponsored by several environmental groups.

�This is a pragmatic bill that tries to balance a historic opportunity to unleash clean energy to rebuild our economy and stop the climate crisis, with the diversity of views on the Energy & Commerce Committee,� says Emily Figdor, director of the Federal Global Warming Program at Environment America, a coalition of environmental groups.

The draft bill includes strong clean-energy standards that reflect the latest climate science, Ms. Figdor notes. �But on the flip side, we�re disappointed that the bill includes sky-high levels of carbon offsets, which provide less-certain reductions in emissions, and lavish subsidies, including for ratepayers, for still-unproven carbon capture and storage technology.�

Business backing

The bill draws heavily on recommendations by the US Climate Action Partnership (USCAP), a coalition of business groups favoring climate legislation. As a result, it may be more likely to attract moderate lawmakers.

The draft legislation is �a strong starting point for enacting legislation to reduce greenhouse-gas emissions,� according to a statement from USCAP, which includes Alcoa, ConocoPhilips, Duke Energy, and General Motors, among other corporations.

�A number of compromises and proposals were already hammered out,� says David Doniger, policy director of the Natural Resources Defense Council (NRDC). �It�s not a bill crafted just by environmentalists, but with all the interests in mind.�

The cost of the bill hasn�t been assessed yet by the Energy Information Administration or the Environmental Protection Agency.

The cost of cap-and-trade

�It would be reasonable to anticipate that, overall, the climate portion would cost, at most, 1 percent of GDP [gross domestic product],� says Robert Stavins, an environmental economist and director of Harvard�s environmental economics program. �That�s a big number, but I don�t see it pushing us into another recession.�

�Still,� he adds, �it will be difficult to deal with during an economic downturn.�