Cap and Trade

China officially passes the United States as the world’s largest energy consumer, according to the International Energy Agency, although the US is still the world’s leader in energy consumed per capita by a considerable margin.  However, that per capita gap is expected to decrease as the Chinese economy becomes wealthier and consumers purchase more energy intensive products.

A Congressional Budget Office analysis reported that the climate change bill, the American Power Act, being sponsored by Sens. Kerry and Lieberman, would reduce the federal deficit by approximately $19 billion over the next ten years.  This squares with the EPA analysis which reported that the bill would have a modest impact on families.  However, it still seems unlikely that such a bill will pass this year.

Though I predict climate change legislation will not pass in 2010, it will come to pass, most likely beginning with a utility sector cap.  Thus, it is essential to advance the development and deployment of carbon capture and storage (CCS) in order to curb coal-fired power plant emissions.    

Shy of 60 votes in the Senate, a still shaky economy, and November elections all lead to the forecast that climate change legislation, featuring a cap and trade element, is unlikely to happen in 2010.

Climate Progress recently compared the two competing bills on climate change—the Waxman-Markey bill which passed the House in June of 2009, and the Kerry-Lieberman draft bill introduced today in the Senate, along with President Obama’s campaign promises.

Carbon markets are an essential component of cap-and-trade programs that aim to reduce greenhouse gas emissions using a market-based approach.  Even if the U.S. does not commit to a cap-and-trade program, voluntary markets and regional markets will continue to expand.

NOW, BE IT THEREFORE RESOLVED, that CSG strongly urges Congress and the Administration to act in close partnership with state governments as they establish a market-based approach to help the U.S. achieve GHG-reduction targets, while maintaining the competitiveness of U.S. manufacturing and industry in respect to foreign competition;

BE IT FURTHER RESOLVED, that CSG urges Congress to adopt policies that involve all sectors of the economy and all sources of GHG.

 

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