Kerry-Lieberman to cut greenhouse emissions

Bonner Cohen Author, Fixing America’s Crumbling Underground Infrastructure
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In a last-ditch effort to pass a global-warming bill before this year’s mid-term election drastically alters the political landscape in Congress, Sens. John Kerry (D-Mass.) and Joe Lieberman (I-Conn.) have introduced the “American Power Act.”

The 987-page document is really a draft containing many energy-rationing provisions that are expected to be revised many times behind closed doors in the weeks to come. It is the Senate version of the Waxman-Markey cap-and-trade bill, H.R. 2415, which narrowly passed the House last summer. Because the public has come to equate cap-and-trade with “energy taxes,” the Senate bill’s supporters scrupulously avoid the term “cap-and-trade” or “taxes” and refer instead to “linked fees.”

Under a convoluted and still poorly understood system to regulate greenhouse gases, the bill provides for “allowances” to be either given away or auctioned off in different phases over the next several years. As Kerry and Lieberman readily admit, the bill was drafted by representatives of the very companies that would be engaged in trading the allowances. Those expected to benefit from trading scheme many of them helped draft include BP, General Electric, Edison Electric Institute, Goldman Sachs, Duke Energy, Exelon, and Shell – just to name a few. The cost of the system will be borne by consumers who will see their energy bills soar.

What was originally supposed to be a measure to address the alleged threat of human-induced global warming, has degenerated into a desperate attempt to buy off enough big companies to give the bill a chance of passing the Senate. Kerry has candidly acknowledged that the American Power Act is not really and environmental bill.

With the Obama Environmental Protection Agency (EPA) moving forward with its plans to regulate greenhouse gases under the Clean Air Act, the bill’s backers hope that fear of the economic consequences of EPA’s action will convince reluctant senators to support their legislation. To sweeten the pot, the bill even places limits on EPA’s power to regulate carbon dioxide and other greenhouse gases. Getting something as controversial as the Kerry-Lieberman bill approved by the Senate will require 60 votes, and the chances of getting that many senators to vote yes are considered remote.

Meanwhile, EPA May 13 rolled out its so-called “tailoring” rule, detailing which stationary sources will be subject to permitting requirements once the agency begins to regulate greenhouse gas emissions from cars and trucks in January 2011. To soften the initial blow of its action, EPA will unilaterally raise the threshold from 250 tons of a pollutant to 75,000 tons. The Clean Air Act is clear that the threshold for regulation of 250 tons, and many observers believe the courts will strike down EPA’s tailoring rule.

A clear sign of just how nervous lawmakers are becoming is the “Resolution of Disapproval,” sponsored by Senator Lisa Murkowski (R-Alaska). Her resolution would effectively ban EPA from regulating greenhouse gases under the Clean Air Act. Only a simple majority of 51 votes is required to pass her resolution, and the vote, expected in the next few days, is thought to be too close to call.

Bonner R. Cohen, Ph. D., is a senior policy analyst with CFACT.