House cap-and-trade bill may beat Senate energy measure to floor

A US House measure which would create a domestic cap-and-trade system to address global warming apparently will beat the Senate’s broader energy bill to the floor, but both face major opposition.

US House and Senate committees have approved major energy bills in recent weeks. The House measure which would create a domestic cap-and-trade system to address global warming apparently will beat the Senate’s broader bill to the floor, but both face major opposition.

US President Barack H. Obama urged Congress to pass HR 2454 in his June 23 press conference. “This legislation will spark a clean energy transformation that will reduce our dependence on foreign oil and confront the carbon pollution that threatens our planet,” he said.

The bill which the House Energy and Commerce Committee approved by 33 to 25 votes on May 20 falls short of what the Obama administration requested. Its cap-and-trade program would include allowances to help affected industries adjust initially instead of a more direct carbon credit auction.

But the measure, which was cosponsored by Henry A. Waxman (D-Calif.), the Energy and Commerce Committee’s chairman, and Edward J. Markey (D-Mass.), who chairs the committee’s Energy and Environment Subcommittee, still has White House support. It should reach the House floor by June 26, a spokesman for House Speaker Nancy Pelosi (D-Calif.) said on June 22.

“At a time of great fiscal challenges, this legislation is paid for by the polluters who currently emit the dangerous carbon emissions that contaminate the water we drink and pollute the air that we breathe. It also provides assistances to businesses and communities as they make the gradual transition to clean energy technologies,” Obama said.

‘National energy tax’

House Republicans continued to oppose the measure. “It is unfortunate, at a time when millions of Americans are struggling in today’s economy, that the president would continue to support a national energy tax that will ship millions of American jobs overseas and force Americans to pay energy costs that he has acknowledged will ‘skyrocket,’” Minority Leader John A. Boehner (R-Ohio) said following Obama’s press conference.

“The House GOP’s ‘all of the above’ energy plan will create more jobs, lower energy costs, and clean up our air and water,” Boehner maintained.

Several groups said that they oppose HR 2454 in its present form. American Solutions, a citizens’ action group which has former House Speaker Newt Gingrich as its general chairman, said on June 22 that it has launched a new national television commercial that calls attention to what it considers devastating economic costs under the bill. The American Petroleum Institute also said that it opposes HR 2454 “as it appears that time has run out to fix the proposal’s many flaws.”

Meanwhile, environmental organization Friends of the Earth said on June 23 that it is launching its own advertising campaign against the bill. “Corporate polluters include Shell [Oil Co.] and Duke Energy helped write this bill, and the result is that we’re left with legislation that fails to come anywhere close to solving this climate crisis,” said Brent Blackwelder, the group’s president. “Worse, the bill eliminates pre-existing [US Environmental Protection Agency] authority to address global warming. That means it’s actually a step backward.”

Waxman, Markey, and other supporters of the bill also have been talking with moderate House Democrats who have said that HR 2454 may be too ambitious in its approach to regulate commodity as well as carbon markets. The May 20 committee vote was almost completely along party lines. A June 17 vote on the broader Senate energy bill in the Energy and Natural Resources Committee was more bipartisan.

Offshore provision

That bill could run into serious opposition once it reaches the floor later this summer, however. “The offshore issue will be back in the news because the current bill has language which would have drilling in the Destin area 10 miles offshore Florida. At least one Florida senator is upset about this and could filibuster the bill,” US Sen. Maria E. Cantwell (D-Wash.) said on June 22.

A spokeswoman for Sen. Bill Nelson (D-Fla.) confirmed to OGJ on June 23 that Nelson is unhappy with that provision and is considering a filibuster.

Environmental organizations also have blasted the provision to open more acreage in the eastern Gulf of Mexico. Sierra Club Executive Director Carl Pope said following the committee’s approval of the bill on June 17 that committee chairman Jeff Bingaman (D-NM) had previously struck a reasonable balance on offshore drilling. “Regrettably, this approach was discarded in favor of an aggressive drilling plan that will put our coasts at risk, feed our addiction to oil, and do nothing to help build the clean energy economy, all the while benefiting Big Oil,” Pope said.

Oil and gas industry associations applauded the provision but remained generally silent about other portions of the Senate bill which could have substantially impacts on their members’ operations. There are strong indications that lobbyists are quietly working for changes in those elements of the legislation.

Cantwell and other participants in a June 22 forum on administration and congressional energy and reform initiatives sponsored by Shell and Newsweek said that the White House probably will concentrate more on health care and leave energy matters to Congress for the time being. But they also said that the president eventually will have to mobilize public support for energy reforms more strongly than he has.

“Just as he is framing health care on costs, he’s going to have to assure people that they’re not going to be gouged in the short term on their way to this green, glorious energy future,” observed Eleanor Clift, one of the magazine’s Washington-based contributing editors.

Contact Nick Snow atnicks@pennwell.com

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