Congress enters new phase of global climate change deliberations

Nick Snow
Washington Editor

WASHINGTON, DC, Apr. 8 -- US House Energy and Commerce Committee Chairman John D. Dingell (D-Mich.) recognizes some familiar complaints and proposals as Congress discusses energy and environmental issues in 2008. He also expects the coming battles to be the toughest yet.

"It probably will be the most complex and difficult discussion in my time in Congress. The Energy Information Administration's role in analyzing potential impacts of various proposals will be critical," the veteran federal legislator told attendees Apr. 8 at EIA's Annual Energy Outlook conference.

"This is one of the most crucial periods for energy policy in the history of this nation," said Dingell, who was a major force behind EIA's creation 30 years ago. "We now confront the same issues we have over the years. We seem to enacting the same kind of legislation in response to the same problems: limited supplies, rising prices, and citizen complaints."

The major difference is that voters and lawmakers are incorporating global climate change issues in energy discussions, he said. "We ended 2007 with an energy bill we all can be proud of, with tougher automotive fuel efficiency standards and expanded biofuels incentives," he said.

"EIA did not endear itself to Congress when it reported that the benefits won't be fully realized because the programs probably won't be fully funded, but that's why we put it in business: to offer unbiased assessments of our actions, even when it isn't what we'd like to hear," Dingell said.

The next phase
Congress now is in a new phase of its global climate change deliberations as it considers whether to enact a carbon cap-and-trade program, Dingell said. The Senate has the bill cosponsored by Joseph I. Lieberman (I-Conn.) and John W. Warner (R-Va.) while Dingell's committee is discussing whether elements of the successful sulfur dioxide program from the 1980s can be used in the more difficult carbon dioxide situation.

"We are moving forward, but not as quickly as we'd like. But we are determined to get it right," he said of his committee's efforts. One question is whether a carbon cap-and-trade program would use State Implementation Plans, New Source Review, or an entirely new approach, Dingell said.

"We're looking at carbon capture and storage, new technologies, and other components to continue using coal in an environmentally proper way, since the United States is, in fact, the 'Saudi Arabia of coal.' Any plan also must include judicious use of our domestic natural gas resources. It is my hope that we can adopt legislation to address all these problems before the end of this year," he said.

Robert M. Simon, Senate Energy and Natural Resources Committee's staff director, said he does not expect Congress to pass a comprehensive climate change bill in 2008. "Our chances of having one by the end of this session aren't good, so the question becomes what smaller steps can be taken," he said.

Simon said Congress has passed three major laws (namely, the Energy Policy Act of 2005, the America Competes Act of 2007, and the Energy Independence and Security Act) that started to address global climate change.

'Robust oversight'
"The whole process of moving an important policy forward is remembering what you've done and continuing to make progress," Simon said. "Part of this is a robust oversight program to make sure these laws' provisions are implemented and the results are what Congress intended."

John Shanahan, who until recently served as senior minority counsel on the Senate Environment and Public Works Committee, and two current congressional Republican staff members each said that US carbon emissions reduction programs won't have a meaningful impact unless other countries participate.

"Last year, [the US Environmental Protection Agency] found that without China taking aggressive action, emissions would continue to go up even if the United States adopted aggressive standards," Shanahan said. "If, by our actions, we let China off the hook, we will have economically retrenched without environmentally benefits," he warned.

Frank Macchiarola, the Senate Energy and Natural Resources Committee's minority staff director, said while China and India represented only 13% of the world's total energy consumption in 1990, the most conservative estimates put their share around 30% by 2030. "Such statistics show that energy and environmental issues must be addressed globally. Literally dozens of climate change bills have been introduced but none of them require reductions by our global competitors," he said, adding that he expects congressional enthusiasm for global climate change initiatives to be dampened by growing economic concerns.

David J. McCarthy, minority chief counsel for energy and environment on the House Energy and Commerce Committee, generally agreed. "Most members of Congress are hearing from their constituents about the impact of higher gasoline prices. It's not just disgruntled Soccer Moms, but small businesses such as the florist who canceled deliveries one day last week because the price of flowers did not equal the cost of gasoline," he said.

Gas collection points
Shanahan said the Lieberman-Warner bill is headed for the Senate floor without substantive hearings before the Environment and Public Works Committee on questions such as natural gas carbon cap-and-trade payment collection points which could create unexpected problems. Republicans who proposed 108 amendments were told that questions such as nuclear power's role would be addressed during floor debate, he said. "Then the message became that the bill can't be changed and will be recalled if it is watered down," Shanahan said.

Pete V. Domenici (R-NM), the Senate Energy and Natural Resources Committee's ranking minority member, said the US should reduce carbon dioxide emissions but added that impacts will be minimal without international cooperation. "Some of America's foremost economists are questioning the value of a cap-and-trade system. As we approach floor debate on the Lieberman-Warner bill, I hope common sense prevails," he said in separate remarks on Apr. 4.

"We have to consider complex issues in a sober manner, but we can't stand still," said Simon. "Absent an effective program to address global warming, we're stuck. We're not building new coal-fired power plants, nuclear isn't being serious considered and we're continuing our de facto reliance on natural gas to generate electricity. Even if we do nothing, energy prices will continue to go up."

Macchiarola said any climate change strategy will need to tap private markets. Simon responded that investors are waiting for Congress to set the ground rules. "When you get a bunch of investment bankers in a room, their first question is when Congress will put a price on carbon," he said.

Former US Rep. Philip R. Sharp (D-Ind.), the current president of Resources for the Future, who moderated the panel discussion with the four congressional staff members, recalled that Congress debated plans to reduce sulfur dioxide emissions for years in the 1980s but did not act until George H.W. Bush became president and initiated a specific plan. The same could be true of a carbon cap-and-trade program and George W. Bush's successor, Sharp suggested.

The congressional staffers observed that there can be a major difference between what a candidate says during the campaign and what he or she actually does upon election. McCarthy added that of the 4,000 interviews that the two major parties' presidential candidates have given, only four dealt with global climate change. "Health care and the economy are bigger issues now," he said.

Contact Nick Snow at nicks@pennwell.com.

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