Hour of Choosing Arrives: American Power Act Introduced

In a long-awaited proposal designed to secure existing domestic energy sources and develop new ones that begin to reverse the damaging effects of global climate change, New England Senators John Kerry and Joe Lieberman today introduced comprehensive clean energy and climate legislation.

The co-authors of the bill, one a Democrat from Massachusetts and the other an Independent from Connecticut, insisted that its vision is to change the direction of some of the nation’s toughest systemic problems — economic competitiveness, energy security, job loss, and environmental safety. Indeed, the 900-plus page bill’s expanse, encompassing development of the full menu of conventional and alternative energy sources, as well as international finance to help developing nations respond to climate change was widely commended by environmental and business organizations.

Support and Specific Concerns
But in nearly every statement issued today, by organizations as diverse as Oxfam America, the Natural Resources Defense Council, the League of Conservation Voters, and the U.S. Chamber of Commerce, executives expressed concern about specific provisions and vowed to work with Senators of both parties to fix them. Environmental organizations principally focused their critiques on provisions to expand offshore drilling, provide federal incentives to build new nuclear power plants, and support the coal and utility industries with grants to prove technology to capture and store carbon.

Environmental organizations also said they would work to improve or change provisions that would limit the reach of the Clean Air Act to reduce carbon emissions in new coal-fired utilities, and eliminate the ability of states to establish carbon-emission reduction programs. Oxfam said it was concerned that the international finance provisions of the proposal would not become effective until 2019, and did not include nearly enough federal investment to meet the commitment the Obama Administration made in Copenhagen in December to help establish a $100 billion-a-year global climate action fund to assist developing nations.

“If the proposal introduced today by Senators Kerry and Lieberman stays true to its goals,” said Michael Brune, the Sierra Club’s executive director, “it can serve as a foundation on which we can build an America free from oil dependence, with millions of new clean energy manufacturing, construction and service jobs here at home, less wasted energy, and less of the carbon pollution that is threatening our economy, our health and our climate. But this proposal will only serve as a solid foundation if the Senate both improves and completes it.”

According to Senator Kerry, who blogged about the bill’s contents on Grist and Huffington Post today, The American Power Act proposes to put a price on carbon emissions from roughly 7,500 power plants and other industrial facilities. The bill proposes to establish a market to trade emissions allowances in order to reduce carbon emissions 17 percent below 2005 levels by 2020, and 80 percent below 2005 levels by 2050.

Returns to Citizens
Moreover, a provision that borrows from a separate climate and energy measure proposed by Senators Maria Cantell and Susan Collins, provides proceeds of the sale of allowances as rebates to citizens. “None of it stays with or grows government,” said Kerry. “Those rebates rise over time until it all goes straight back to Americans.”

The American Power Act also takes into account the environmental and political consequences of the massive oil spill in the Gulf of Mexico. The bill’s co-authors inserted a new provision that gives states the authority to veto drilling less than 75 miles off their border, although it also gives states that decide to drill access to a percentage of the lucrative federal royalties generated by oil and gas production. The proposal introduces new regulatory safeguards that require oil developers to much more thoroughly assess the risks and consequences of drilling offshore, and to more accurately predict the potential of a spill.

A third provision that environmental organizations considered crucial is the bill’s influence on the Clean Air Act, which the Obama administration is applying for the first time since its passage in 1970 to limit carbon emissions. Unfortunately, the legislation limits the Environmental Protection Agencies’s ability to clean up new coal plants. Maintaining the ability to use the Clean Air Act to reduce global warming pollution is critical, especially if the federal program is found to be ineffective in future years. The bill does call on the EPA to continue setting tough emissions standards to reduce global warming pollution from cars and trucks and continues EPA’s ability to set some performance standards for old power plants to make sure they operate more cleanly.

Other provisions of the American Power Act, designed to both gain political allies in the Senate and encourage development of alternative sources of energy and fossil fuels, include:

• Providing incentives for farmers to base wind and other clean energy projects on their land.
• $2 billion in annual investment in carbon capture technology for coal-fired utilities.
• $7 billion in annual investment for public transit, clean car technology, and clean energy research.
• Federal incentives, including loan guarantees, to encourage the construction of 12 new nuclear power plants

White House and Graham Respond
The White House issued this statement today from President Obama: “The challenges we face — underscored by the immense tragedy in the Gulf of Mexico — are reason to redouble our efforts to reform our nation’s energy policies. For too long, Washington has kicked this challenge to the next generation. This time, the status quo is no longer acceptable to Americans. Now is the time for America to take control of our energy future and jumpstart American innovation in clean energy technology that will allow us to create jobs, compete, and win in the global economy.”

The introduction of the American Power Act, initially scheduled for April 26, was delayed until today due to the Republican Senator Lindsey Graham’s decision to withdraw as a member of the three-member Senate team that wrote the bill. Over the last two weeks, as Senators Kerry and Lieberman amended provisions, Senator Graham has consistently expressed his view that the proposal could not pass without his help.

Today Graham issued a statement that described his support for a comprehensive energy bill, but also warned that its Senate approval would be a struggle: “I want America to lead the world in the coming energy revolution, not follow. I look forward to working with my colleagues on both sides of the aisle to improve upon these concepts and find a pathway forward on energy independence, job creation, and a cleaner environment,” but ” the problems created by the historic oil spill in the Gulf, along with the uncertainty of immigration politics, have made it extremely difficult for transformational legislation in the area of energy and climate to garner bipartisan support at this time.”

Visit USCAN’s American Power Act page for more information and the climate community’s reactions. USCAN is following the developments and will be updating this article and posting others in the days ahead.

— Keith Schneider