New Climate Bill Introduced in U.S. Senate
This post was written by Ariel Nieland.
After much anticipation, Senators Joe Lieberman (I-Conn.) and John Kerry (D-Mass.) finally unveiled their comprehensive energy and climate bill, known as the American Power Act, in a press conference yesterday afternoon. The bill's release was delayed by several weeks after prior co-sponsor Senator Lindsey Graham (R-SC) withdrew his support following a dispute over unrelated immigration reform legislation. Below are some of the bill's key features:
- Aims to reduce greenhouse gas emissions by 17% from 2005 levels by 2020 and 83% by 2050, targeting heavy industry, power plants and transportation infrastructure.
- Removes disincentives for natural gas generation at merchant plants in order to level the power sector playing field, and plans to help guide state regulators by requiring public disclosure of chemicals used in natural gas production.
- Places a cap on carbon emissions for producers of more than 25,000 tons of carbon pollution annually, which includes approximately 7,500 U.S. companies. Producers with a mandatory cap may trade carbon credits in the primary market, while the secondary market will be open to all participants. Carbon credits would start at $12 per ton.
- Provides financial incentives for a variety of energy producers, including regulatory risk insurance and loan guarantees for a dozen new nuclear plants; $2 billion a year for coal technologies that can capture and store greenhouse gas emissions, such as carbon capture and storage; and $7 billion a year for improvements to transportation infrastructure and efficiency.
- Encourages offshore oil drilling while providing states with veto power over drilling in neighboring states along with the ability to opt out of any drilling within 75 miles of the state's own shoreline. States that oppose drilling could pass laws blocking the activity, while states that choose to drill may retain 37% of federal royalties raised.
- Preempts any state-operated cap-and-trade programs already in existence, and compensates states for any revenue lost as a result.
