Legislation taking a comprehensive approach to reduce greenhouse gases, thought to be dead a month ago, has come back to life in the form of a bi-partisan proposal being hammered out by senators John Kerry (D-MA), Lindsey Graham (R-SC) and Joe Lieberman (I-CT).
Though details are sketchy – Lieberman is saying a draft of the bill will be ready by March 26 – here is what’s known at the moment:
Under the Kerry-Graham-Lieberman proposal, carbon polluters would be divided into three sectors – utilities, transportation and manufacturing. Utilities would come under a cap for carbon-dioxide emissions, with CO2 permits being allotted through an as-yet-to-be-named system. Transportation, which affects mainly oil producers, would have a carbon tax applied to fuel. Manufacturers would have restrictions on CO2 emissions at some future date with details to come.
The New York Times reported on a meeting between the White House and Senate leaders aimed at getting a climate bill passed this year. Smart money would probably bet the White House to back the KGL proposal, with an all-out push coming after Congress’ Easter recess when health care reform has been resolved.
While I give these three senators credit for continuing to press for a legislative solution on climate change, the devil is always in the details. The new bill is likely to include provisions aimed at garnering GOP support – offshore oil drilling, support for nuclear power and “clean coal” technology. Environmental groups – particularly those who supported the ill-fated cap-and-trade bill last year – will have to decide how much they are willing to hold their noses should they decide to back the current proposal.
Citizens Climate Lobby’s position on coal and oil is pretty simple: leaving it in the ground is the best and only proven way to sequester the carbon they produce. Nuclear is on the table, but only if we can resolve the safety and storage issues that still plague this technology.
The other devil sure to emerge in the details to follow is allowing polluters to purchase carbon offsets. Offsets sound fine in theory: Pay a nation somewhere in the world to save a portion of their rainforest, and you’re allowed to spew the CO2 that those trees would soak up. The only problem is that loggers will move on to the next rainforest and chop down the same number of trees they planned on harvesting. There is no net reduction in CO2. Offsets merely allow polluters to bust the cap on CO2.
The biggest problem with KGL is that it will fail – just as cap and trade failed – to remove uncertainty in the price of carbon. Unless utilities, businesses and consumers know for sure that coal, oil or gas will become more expensive than clean energy, they will be reluctant to make the long-term investments needed to transition us to carbon-free power.
The best way to ensure predictability in future energy costs is with a steadily-increasing, direct fee on carbon at the source – the mine, well or port of entry. If the revenue from the carbon fee is returned to all households, Americans will not have to absorb the economic hit from rising energy costs. We refer to this as the carbon fee and dividend approach. In fact, most families would receive more from the dividend than they would pay for increased energy costs.
In his new book, “Storms of My Grandchildren,” leading climate scientist Dr. James Hansen calculates that when the price of CO2 reaches $115 a ton, a family of four could expect to receive $6,000 from the carbon “dividend.” If politicians in Washington can’t sell that to the American people, they should reconsider their vocation.
To see Hansen commenting on the fee and dividend, go here. Scroll down to the “Energy Policy” heading and play the interview segment there. To hear more from Dr. Hansen, listen to Citizen Climate Lobby’s February conference call.
Last year, when it appeared that cap and trade was the only train leaving the station on climate legislation, many groups hopped on board with ticket in hand, despite the onerous shortcomings of the bill. While the KGL bill looks like the best chance for climate legislation at the moment, it is not the most effective solution. And unless we go with the best solution, we’ll soon find out just how little tolerance the Earth’s climate has for compromise.
Steve Valk is director of communications for Citizens Climate Lobby.