Proposed Bills on: GHG Emission Limits

S. 1059:   Zero-Emissions Building Act of 2007. The Act amends the Energy Conservation and Production Act by inserting language that requires and specifies reductions in GHG emissions in Federal buildings. Sponsor: Sen. Hillary Rodham Clinton (D-NY) (1 Cosponsors)

 

S. 1168:   Clean Air/Climate Change Act of 2007. This bill amends the Clean Air Act to establish a regulatory program for pollutants and greenhouse gas (GHG) emissions from the electric generating sector. Among other provisions, it requires each electric generating unit constructed or modified after January 1, 2105, to meet a performance standard of 1,100 pounds of CO₂/mWh or less. The bill also sets declining annual tonnage limits for carbon dioxide (CO₂), sulfur dioxide, and nitrogen oxide emissions from units within the 48 contiguous States, and requires the Administrator of the EPA to establish CO₂ and nitrogen oxide allowance trading programs for generating units. In addition, the bill authorizes the Administrator to award offset allowances for certain offset projects, and provides guidelines for awarding such offsets. Sponsor: Sen. Lamar Alexander (R-TN) (1 Cosponsors)

 

S. 1177:   Clean Air Planning Act of 2007. Among other provisions, this bill promulgates declining annual national pollutant tonnage limitations for emissions of carbon dioxide, sulfur dioxide, nitrogen oxides, mercury, and emissions from the electric generating sector. It also establishes allowance trading programs for these pollutants. In addition, it establishes a Climate Action Trust Fund, to be funded by revenues from auctions of allowances from the separate trading programs, and to be used for clean and low-carbon energy technology research and development, adaptation assistance for workers and communities negatively affected by climate change and greenhouse gas regulation, and wildlife and habitat conservation and adaptation. Sponsor: Sen. Thomas Carper (D-DE) (7 Cosponsors)

 

S. 1201:   Clean Power Act of 2007. Among other provisions, this bill would amend the Clean Air Act to reduce emissions from electric power plants, by requiring caps on greenhouse gas (GHG) emissions if the President has not signed legislation affecting at least 85% of GHG emissions and on an economy-wide basis by December 31, 2012. The bill also directs the Administrator to establish an emissions allowance permitting and trading system. In addition it imposes a low-carbon generation requirement on certain fossil fuel-burning power plants. Sponsor: Sen. Bernard Sanders (I-VT) (3 Cosponsors)

 

S. 1227:   Clean Coal Act of 2007 ( Cosponsors)

 

S. 1227:   Clean Coal Act of 2007. Among other provisions, this bill would require that each coal-fired electric generating unit that commences construction on or after April 26, 2007 shall meet a performance standard of not more than 285 pounds of carbon dioxide emitted pre megawatt-hour. Carbon dioxide that a facility geologically sequesters would not be counted as emitted. Sponsor: Sen. John Kerry (D-MA) ( Cosponsors)

 

S. 1766:   Low Carbon Economy Act of 2007. This bill is intended to reduce greenhouse gas (GHG) emissions from the production and use of energy. It would establish a cap-and-trade system for GHG emissions, beginning in 2012. The bill’s goal is to reduce United States GHG emissions to 2006 levels by 2020 and to 1990 levels by 2030. Facilities subject to the cap are petroleum refineries, natural gas processing plants and liquefied natural gas (LNG) facilities, importers of liquid fossil fuels, importers and manufacturers of non-carbon dioxide GHGs, large coal-consuming facilities, and manufacturers of adipic or nitric acid, aluminum smelters. The bill establishes a technology accelerator payment (TAP), which regulated entities can pay in lieu of submitting an emission allowance; the initial price of the TAP is $12/metric ton of carbon dioxide (CO₂)equivalent in 2012, increasing at a rate of 5% above the rate of inflation per year. Funds received under the TAP mechanism will be used to fund technology development and deployment. Emission allowances will be allocated to industry sectors: 12% to coal mines; 7% to petroleum refineries; 4% to natural gas processing facilities; 54% to electricity generating facilities; 4% to nonfuel regulated activities; and 19% to carbon-intensive manufacturing facilities. 9% of allowances will be allocated to states, and allowances will also be allocated for agricultural projects and for early reductions according to rules yet to be established. The bill creates bonus allowances for carbon capture and sequestration, starting at an allowance-to-ton of sequestered CO₂ of 3.5/1 in 2012, and declining to .5/1 in 2039. The bill specifies that 24% of all allowances to be auctioned at the start of the program, increasing to 53% by 2030. Auction proceeds will be used to fund the Energy Technology Deployment Fund, for research, development, and deployment of low-carbon technologies, as well as international technology deployment. Auction funds will also be deposited in a Climate Adaptation Fund to mitigate the effects of climate change; and the Energy Assistance Fund, to be used to ease the financial impact of higher energy costs. Sponsor: Sen. Jeff Bingaman (D-NM) (6 Cosponsors)

 

S. 1874:   Containing and Managing Climate Change Costs Efficiently Act. This bill would establish a Carbon Market Efficiency Board, supervised by the Department of Treasury, to promote the achievement of the environmental objectives of the United States, including any national mandatory greenhouse gas (GHG) emissions cap and reduction targets.

The bill gives the Board the power to, in the first two years of GHG allowance trading program, increase the amount of allowance that covered entities may borrow, but only in the event that the average daily closing price of an emissions allowance exceeds the upper range predicted by the Congressional Budget Office prior to the start of the program. In subsequent years, the Board will have the power to: (1) temporarily increase the amount that covered entities can borrow, lengthen the payback period of loans, and/or lower the interest rate on loans; and, in the event of more extreme economic circumstances, (2) to temporarily expand the total number of allowances in the economy, provided that subsequent years’ caps are tightened sufficiently to ensure that cumulative emissions reductions over the long term remain unchanged. The Board is only to use these powers as needed to avoid significant harm to the economy.

This bill is intended to serve as a cost containment amendment for any GHG cap-and-trade bill brought to the full Senate.

Sponsor: Sen. Mary Landrieu (D-LA) (3 Cosponsors)

 

S. 2155:   International Clean Energy Technologies Deployment and Global Energy Markets Investment Act of 2007. This bill would amend the Energy Policy Act of 1992 to direct the Secretary of Energy, in coordination with the Secretary of State and the Administrator of the United States Agency for International Development (USAID) to provide assistance for activities in developing countries that include, among others, promoting clean energy and energy efficiency measures; identifying opportunities to reduce, avoid, or sequester greenhouse gases; and monitor progress in implementing greenhouse gas reduction strategies. The bill also requires, not later than 2 years after enactment, the establishment of a pilot program to provide financial assistance for demonstration projects for clean energy and other technologies which will reduce greenhouse gas emissions (compared to technologyies wich would be otherwise deployed), and requires that such projects be constructed in a developing country to produce energy which will be consumed in that country, or which will improve the efficiency of energy use in a developing country. In addition, the bill requires that if a developing country receiving assistance represents the predominant share of energy use among developing countries, then that country shall be required to report on various indicators of progress, including increased use of lower greenhouse gas-emitting fossil fuel-burning technologies. The bill also requires the President to establish a Task Force on International Clean energy Technologies Cooperation. Sponsor: Sen. Robert C. Byrd (D-WV) ( Cosponsors)

 

S. 2191:  

NOTE:  For a full range of Pew Center resources for Lieberman-Warner, including in depth analysis, a longer summary,  a complete timeline, and links to relevant external documents and media, please click here

The Lieberman-Warner Climate Security Act (L-W CSA). This bill would establish a cap-and-trade program within the United States requiring a 70% reduction in greenhouse gas (GHG) emissions from covered sources, which represent over 80% of total U.S. emissions. The bill as amended also includes complementary policies, such as a low carbon fuel standard and provisions aimed at enhancing energy efficiency. Taken together, the bill’s sponsors believe these provisions will reduce overall U.S. GHG emissions roughly 63% by 2050.

The L-W CSA divides the six GHGs into two categories: Group I (carbon dioxide, methane, nitrous oxide, sulfur hexafluoride, and perfluorocarbons) and Group II (hydrofluorcarbons). For all GHGs, the bill uses the common unit of measurement CO₂ equivalent (CO₂e)—the quantity of GHGs that the U.S. EPA has determined makes the same contribution to global warming as one metric ton of CO₂. The L-W CSA would create two separate caps, one covering facilities that produce HFCs and the other covering facilities that:

·  Use more that 5,000 tons of coal annually;

·  Process, produce, or import natural gas;

·  Produce or import petroleum or coal-based fuel that when combusted will emit a Group I GHG;

· Produce for sale or distribution or import more than 10,000 CO₂e of chemicals that are group I GHGs, assuming no capture or permanent sequestration

· Emit as a by-product of HCFC production more than 10,000 CO₂e of HFCs

Overall, the two caps combined are expected to cover over 80% of total U.S. GHG emissions, although some process related emissions are not covered.

The cap on facilities producing HFCs would start in 2010 at 300 million metric tons of carbon dioxide equivalent (MMTCO₂e) and decline to 90 MMTCO₂e by 2037, remaining at that level through 2050. Emissions from all other covered facilities would be capped at 5775 MMTCO₂e in 2012, with this cap decreasing annually to 1732 MMTCO₂e in 2050. The two caps combined would result in roughly a 19% reduction from 2005 levels in 2020 and a 70% reduction from 2005 levels by 2050.

Beginning in 2012 and continuing through 2030, the L-W CSA would provide transition assistance in the form of free allowances to electric power generators (19%), manufacturers (10%), fuel producers or importers (2%), HFC producers and importers (2%), and rural electric cooperatives (1%). In addition, 5% of the total emission allowance account will be allocated to early actors from 2012-2017 and 4% for carbon, capture and sequestration activities from 2012-2030. Approximately 30.5% of the total allowance account will be set aside from 2012-2050 for other entities, including states, load-serving entities, farms and forests, coal mines, and others. Starting in 2012, 26.5% of allowances would be auctioned (including 5% for an early auction to be held shortly after enactment), with the proceeds going to energy technology deployment, low-and middle-income energy consumers, adaptation efforts in the U.S., and programs to support energy independence and national security. Over time, the auction will grow so that by 2031, 69.5% of the allowances would be auctioned and the revenue used for these purposes.

The L-W CSA allows covered facilities to satisfy up to 15% of their compliance obligation with specific domestic offsets. An additional 15% can be covered using international emission allowances. Unlimited banking is allowed and owners and operators of covered facilities can borrow up to 15% of their annual compliance obligation from future years. The L-W CSA also creates a Carbon Market Efficiency Board to monitor the carbon trading market and implement specific cost relief measures, including increased borrowing and use of offsets.

The L-W CSA includes a review of the commitments of other major-emitting nations to reduce their GHG emissions. Eight years after enactment the President is authorized to require importers of GHG emission-intensive products from countries that have not taken action comparable to the U.S. to submit credits equal to those required of domestic manufactures.

Sponsor: Sen. Joseph I. Lieberman (I-CT) (9 Cosponsors)

11/1/07: Reported by the Senate Committee on Environment and Public Works Subcommittee on Private Sector and Consumer Solutions to Global Warming by 4-3; 12/5/08: Reported by the Senate Committee on Environment and Public Works by 11-8.

 

 

S. 280:   Climate Stewardship and Innovation Act of 2007. The Act establishes a market-driven system of tradable greenhouse gas (GHG) allowances, administered by the Environmental Protection Agency, to begin in 2012. The Act would divide the economy into sectors—electricity, transportation, industry, and commercial—each subject to separate, sector-wide emissions cap, while allowing inter-sector trading. Allowances would be equal to a maximum of 6.13 million metric tons of CO2e after 2011, reducing to 5.239 million metric tons after 2019, 4.1 million after 2029, and 2.096 after 2049; the quantities of these allowances could be reduced, depending on the GHG emissions of the rest of the economy and emitters not subject to the cap. The bill would also establish a national GHG database and registry, as well as a Climate Change Credit Corporation, a non-profit corporation with a board appointed by the President of the United States. This corporation would be allocated a portion of tradable allowances, and be able to buy and sell other allowances, and is directed to use the proceeds from its trading activities to reduce costs borne by consumers as a result of the GHG reduction requirements of the Act. The Act also contains provisions to encourage the innovation and deployment of advanced, climate-friendly technologies; it also directs the Secretary of Commerce to conduct research on the impact of climate change on low-income populations around the world, and the costs of mitigating those impacts. Sponsor: Sen. Joseph I. Lieberman (I-CT) (9 Cosponsors)

 

S. 3036:  

The Lieberman-Warner Climate Security Act of 2008
 

NOTE:  For a full range of Pew Center resources for this bill, including in depth analysis, a longer summary,  a complete timeline, and links to relevant external documents and media, please click here


·         The Act, if enacted into law, would establish a market-based cap-and-trade program for greenhouse gas (GHG) emissions in the United States, and establish other measures to reduce GHG emissions.

·         This is the first cap-and-trade legislation to proceed to the Senate floor through regular order—that is, through the committee process. A previous version of this bill, then titled S.2191, was passed 11-8 by the Senate Environment and Public Works (EPW) Committee in December 2007. The version that will debated on the Senate floor has been extensively revised from the version passed by the EPW committee.

·         An estimated 87% of U.S. GHG emissions would be subject to the bill’s cap-and-trade program. Those required to submit emissions allowances under the program include: coal-fired power plants and other entities that use more than 5,000 metric tons of coal, natural gas processors and importers, petroleum processors and refiners, manufacturers and importers of more than 10,000 metric tons of GHGs (as measured in CO2 equivalents), and any entity that emits more than 10,000 metric tons (CO2e) of HFCs as a byproduct of the manufacture of hydrochlorofluorocarbons (HCFCs).  The bill establishes a separate cap-and-trade system for HFCs produced or imported (including those in products and equipment).

·         The cap-and-trade program would reduce GHG emissions from covered sectors by 4% below 2005 levels by 2012; 19% below 2005 levels by 2020; and 71% below 2005 levels by 2050.

·         The bill would allocate 75.5% of all allowances for free in 2012— including 18% to power plants, 11% to manufacturers, 2% to petroleum refiners, and 0.75% to natural gas processors (transitioning to zero in 2031); 12.75% to electricity and natural gas local distribution companies for the benefit of energy consumers, and 15% to states, etc. The proportion of allowances auctioned would increase from 24.5% in 2012 to 58.75% by 2032.

·         The bill would establish numerous measures to contain the cost of the cap-and-trade program, including allowing the use of domestic and international offsets, and the banking and borrowing of allowances; establishing a Carbon Market Efficiency Board empowered with certain cost-relief powers; and establishing a “cost-containment auction” of a fixed quantity of allowances each year that will initially be offered only to those with compliance obligations and within a certain price range. The bill also establishes a working group that will create regulations designed to protect the market from fraud and manipulation.

·         The bill would provide funds to compensate low-income energy consumers and assist in worker transition.

·         The bill would provide funding and incentives for development and deployment of geological carbon capture and sequestration (CCS) technology, with a goal of constructing 5-10 commercial coal-burning electricity facilities using CCS.

·         The bill would also provide funds for:  renewable energy; increasing the energy efficiency of buildings, appliances, manufacturing; research into low-carbon electricity generation and advanced energy projects; increasing the use and manufacture of hybrid and advanced vehicles; and increasing the production of cellulosic biofuels. It also includes a low-carbon fuel standard.

·         The bill would provide funds for the states for mass transit projects, and wildlife conservation and adaptation projects, among others.

·         The bill has a number of international provisions, including a measure that would require importers of certain commodities from countries that do not have GHG control programs to submit special allowances, as well as funds for assisting vulnerable communities abroad, promoting international technology development, and conserving forests and wildlife in other countries.

 

Sponsor: Sen. Barbara Boxer (D-CA) ( Cosponsors) 6/2/08: Cloture on the motion to proceed to the bill invoked by the Senate by 74-14; 6/6/08: the Senate failed to invoke cloture to close debate on the bill by 48-36.

 

S. 309:   Global Warming Pollution Reduction Act. The Act, through an amendment to the Clean Air Act, requires the United states to reduce its greenhouse gas (GHG) emissions to 80% of 1990 levels by the year 2050, in the following stages: 1/3 of 80% of 1990 levels by 2030; 2/3 of 80% of 1990 levels by 2040; and fully 80% of 1990 levels by 2050. The Act gives the Administrator of the Environmental Protection Agency the discretion to propose GHG reductions, and provides a menu of policy options, including market-based measures—such as emissions trading—among others, to achieve those reductions. The bill also requires the Administrator to mandate that, not later than January 1, 2010, each fleet of highway vehicles over 10,000 pounds sold by a manufacturer in the United States must, beginning in model year 2020, meet the following GHG tailpipe emissions standards: not more than 850 carbon dioxide equivalent (CO₂e) grams per mile (gpm) for highway vehicles with a gross vehicle weight (GVW) rating between 10,001 and 26,000 pounds; and not more than 1,050 CO₂e gpm for such vehicles with a GVW rating of more than 26,000 pounds. The bill gives the Administrator the discretion to increase the stringency of these administrators after model year 2020. Among other provisions, the bill also contains GHG emission standards for electric generation units and energy efficiency and promotes research into carbon capture and sequestration. Sponsor: Sen. Bernard Sanders (I-VT) (11 Cosponsors)

 

S. 317:   Electric Utility Cap and Trade Act of 2007. The Act creates a greenhouse gas (GHG) cap-and-trade system for electric generating facilities of 25 megawatt capacity or larger. Beginning in 2011, the Act would limit total GHG emissions by these facilities to their total emissions in 2006; to 2001 levels in 2015; in each year from 2016 to 2019, by an additional 1% reduction based on the emissions reduction of the previous year; and in each year from 2020 onwards, by an additional 1.5% reduction based on the emissions reduction of the previous year. Emissions credits would be distributed through a mix of auction and allocation, with proceeds from auctions going into a Climate Action Trust Fund. Monies from the Trust Fund would be used to fund research and development for climate-friendly technologies, and adaptation assistance for workers and communities, among other purposes. Sponsor: Sen. Dianne Feinstein (D-CA) (1 Cosponsors)

 

S. 485:   Global Warming Reduction Act of 2007. The Act would “establish an economy-wide global warming pollution emission cap-and-trade program,” among other provisions. The bill declares that it shall be a goal of the United States to work with other greenhouse gas (GHG)-emitting countries to limit average global concentrations of GHGs at 450 parts per million, and to reduce emissions to 65% of year 2000 levels by 2050. The bill requires the United States to reduce emissions to 1990 levels by 2020; by at least an additional 2.5 percent below each preceding year between 2021 and 2030; and by at least an additional 3.5 percent each preceding year between 2031 and 2050. The bill directs the Administrator of the Environmental Protection Agency to design the cap-and-trade system, and gives the Administrator discretion over the scope of the system, including which sectors would be subject to the cap. The bill also directs the President, in conjunction with the Administrator and other Federal agencies, to submit to Congress a plan for how the tradable allowances should be distributed. In addition, the bill directs the Administrator to establish GHG emissions standards for passenger vehicles which will meet or exceed the standards adopted by the California Air Resources Board in September 2004. The bill also contains provisions concerning research and development, energy efficiency standards, the renewable portfolio standard, and carbon capture and sequestration, among others. Sponsor: Sen. John F. Kerry (D-MA) (2 Cosponsors)

 

S.6:   National Energy and Environmental Security Act. This non-binding resolution expresses the sense of Congress that Congress should enact, and the President should sign, legislation to enhance the security of the United States by reducing the dependence of the United States on foreign and unsustainable energy sources and the risks of global warming by--(1) requiring reductions in emissions of greenhouse gases; (2) diversifying and expanding the use of secure, efficient, and environmentally-friendly energy supplies and technologies; (3) reducing the burdens on consumers of rising energy prices; (4) eliminating tax giveaways to large energy companies; and (5) preventing energy price gouging, profiteering, and market manipulation. Sponsor: Sen. Harry Reid (D-NV) (13 Cosponsors)

 

H. Con. Res. 96:   Concurrent Resolution expressing the sense of the Congress that there should be enacted a mandatory national program to slow, stop and reverse emissions of greenhouse gases. (21 Cosponsors)

 

H. Con. Res. 96:   Concurrent Resolution expressing the sense of the Congress that there should be enacted a mandatory national program to slow, stop and reverse emissions of greenhouse gases Sponsor: Rep. Norman Dicks (21 Cosponsors)

 

H. Res. 735:   A resolution congratulating Vice President Al Gore and the Intergovernmental Panel on Climate Change on receiving the 2007 Nobel Peace Prize and recognizing their important work to increase awareness about and evidence of the dangers of global warming. Among other provisions, the resolution also encourages Congress and the President to enact important climate change legislation to substantially reduce the contributions of the United States to global greenhouse emissions. Sponsor: Rep. Michael Honda (D-CA) (42 Cosponsors)

 

H. Res. 739:  

A resolution honoring Albert Arnold Gore Jr. and the Intergovernmental Panel on Climate Change, winners of the 2007 Nobel Peace Prize. The preamble language cites Vice President Gore's studies with climate scientist Roger Revelle, and recognizes that the IPCC "develops the scientific consensus necessary for humankind to address the challenges set forth by this crisis." Among other provisions, the resolution also declares that the United States House of Representatives affairs that human-induced climate change is "an urgent problem that must be confronted by all people of the world; and the United States House of Representatives accepts as its own challenge and calls upon citizens of the United States to find ways to reduce the emission of greenhouse gases that contribute to changing of Earth's climate, the peace, security and prosperity of this Nation and world demanding it."

Sponsor: Rep. Jim Cooper (D-TN) ( Cosponsors)

 

H.R. 2447:   Energy and Environment Block Grant Act of 2007. This bill directs the Secretary of Energy to establish a block grant program for local governments and the states to support energy efficiency and greenhouse gas (GHG) emission reduction strategies. (23 Cosponsors)

 

H.R. 2635:   Carbon-Neutral Government Act of 2007. This title, among other provisions, directs each federal agency to annually inventory and report its GHG emissions. Not later than 18 months after enactment, the EPA must promulgate annual GHG reduction targets for the total emissions of all agencies taken as a whole, for each fiscal year from 2010 through 2050. The title also sets GHG emissions standards for federal vehicle fleets, based on the California Code of Regulations. In addition, the bill requires the Secretary of Energy to establish new efficiency standards for federal buildings, so that by 2030 they have achieved a 100% reduction in fossil-fuel generated energy consumption compared to consumption in 2003. Sponsor: Rep. Henry Waxman (D-CA) (14 Cosponsors)

 

H.R. 2643:   Department of the Interior, Environment, and Related Agencies Appropriations Act, 2008. Among other provisions, the bill declares that “it is the sense of the Congress that there should be enacted a comprehensive and effective national program of mandatory, market-based limits and incentives on emissions of greenhouse gases.” The bill appropriates $266 million for basic research on climate change to the Department of the Interior (through the USGS), the EPA, and the U.S. Forest Service. It also appropriates $50 million to establish a commission on climate change adaptation and mitigation. In addition, the bill appropriates $2 million to develop regulations to reduce GHG emissions, pursuant to the Supreme Court’s ruling in Massachusetts v. EPA. Sponsor: Rep. Norman Dicks (D-WA) ( Cosponsors)

 

H.R. 3989:  

Healthy Air and Clean Water Act. This bill would amend the Clean Air Act to establish a reduction program for mercury emissions from coal-fired power plants, and a trading system for carbon dioxide (CO₂) emissions from such plants. It would cap CO₂ emissions from coal-fired power plants (including cogeneration facilities) that have a nameplate generation capacity of more than 25 megawatts. The bill would cap CO₂ in 2015 at 2005 emissions levels for covered plants; at 75% of 2005 emissions in 2020; at 50% of 2005 emissions in 2030; at 35% of 2005 emissions in 2040; and at 20% of 2005 emissions in 2050. The bill would require the Administrator of the EPA to develop regulations for the trading system, though it would mandate that all emissions allowances be auctioned, with proceeds to be deposited into a special fund administered by the Department of Energy and the EPA to fund research and development of renewable energy projects.

 

The bill would also directs the Administrator of the EPA to promulgate regulations to reduce, by 2010, aggregate sulfur dioxide emissions from power plants by 75% from the levels allowed by the Clean Air Act; and aggregate nitrogen oxide emissions from power plants by 75% from 1997 levels. The bill would give the Administrator discretion over the means to achieve these reductions, and states that the Administrator may use market-based mechanisms, such as emissions trading.

 

In addition, the bill would require the Administrator to, not later than the end of 2010, submit to Congress a report identifying objectives for environmental indicators that are sufficient to protect and restore sensitive ecosystems including those of the Adirondack Mountains, mid-Appalachian Mountains, Catskill Mountains, Rocky Mountains, and Southern Blue Ridge Mountains and water bodies of the Great Lakes, Lake Champlain, Long Island Sound, the Chesapeake Bay. Sponsor: Rep. John McHugh (R-NY) (4 Cosponsors)

 

H.R. 6186:  

Investing in Climate Action and Protection (iCAP) Act. This bill would amend the Clean Air Act to establish a cap-and-trade system for greenhouse gas (GHG) emissions, and for other purposes.

 The bill would regulate carbon dioxide (CO₂), methane (CH₄), nitrous oxide (N₂O), sulfur hexaflouride (SF₆), hydrofluorocarbons (HFCs), and perfluorocarbons (PFCs). The bill would also regulate nitrogen trifluoride (NF₃), which is a GHG not covered by the Kyoto Protocol, and, in addition, would regulate any other anthropogenic gas the Administrator of the EPA determines to have a global warming potential equal to or greater than carbon dioxide. According to the bill’s authors, the legislation would cover 94% of U.S. GHG emissions—87% through cap-and-trade.

 The cap-and-trade program would reduce covered emissions to 2005 levels by 2012, to 20% below 2005 levels by 2020, and to 85% below 2005 levels by 2050.The cap-and-trade program would cover emissions from: fossil fuel-fired power plants that emit more than 10,000 carbon dioxide equivalents (CO₂e) a year; industrial facilities that emit more than 10,000 CO₂e a year; producers or importers of petroleum or coal-based fuels, the combustion of which will produce more than 10,000 CO₂e a year; natural gas local distribution companies (LDCs) who deliver natural gas that will produce more than 10,000 CO₂e  a year when combusted; producers or importers of more than 10,000 CO₂e a year of HFCs, PFCs, SF₆, or NF₃, or any other fluorinated gas that is designated by the Administrator as a GHG; and “commercial-scale” geological carbon sequestration sites to cover any leakage.

In addition to the cap-and-trade program, the act will cover an additional 7% of U.S. GHG emissions through financial incentives to farmers and forest managers to reduce GHG emissions and increase storage as well as performance standards for coal mines, landfills, wastewater treatment operations, and large animal feeding operations that emit more than 10,000 CO₂e a year. The bill would direct the Administrator to publish and subject to regular review a list of such sources not later than 90 days after enactment, and establish the relevant performance standards not later than 2 years after that.

The bill would also set mandatory performance standards for coal-fired power plants with a generating capacity of 25 megawatts or more, and which derive more than 50% of annual fuel input from coal or petroleum coke. Plants which commence construction on or after January 1, 2009, would be required to capture and sequester 85% of their CO2 emissions. Plants which commence operation before January 1, 2020, would have to be in compliance with the performance standard by either January 1, 2016, or four years after they commence operation, whichever is later.  

The bill would auction 94% of all allowances in 2012, transitioning to a 100% auction in 2020.

Allowance auctions would begin in 2010. The bill would establish a number of funds in the U.S. Treasury, and deposit in them the following percentages of revenues from allowance auctions from 2010-2019. Dollar amounts listed in the following table are the bill’s author’s estimates. 

 

Fund	2010-2019		2020-2050		2012-2050
	% of allowance value	Est. annual funding ($ billions)	% of allowance value	Est. annual funding ($ billions)	Est. cumulative funding ($ billions)
General Fund of the Treasury	51	110	48	110	4,290
Climate Trust Rebate Fund	7.5		7
Low-Carbon Technology Fund	12.5	24	12.5	25	963
National Energy Efficiency Fund	12.5	24	12.5	25	963
Agriculture and Forestry Carbon Fund	4.5	8	5	10	378
Climate Change Worker Transition Fund	1.5	3	2	4	147
National Climate Change Adaptation Fund	2	7	2.5	9	332
Natural Resource Conservation Fund	1.5		2
International Forest Protection Fund	1.5	3	2	4	147
International Clean Technology Fund	3.5	7	4	8	301
International Climate Change Adaptation Fund	2	4	2.5	5	185

 

 

Funds from the General Fund of the Treasury and the Climate Trust Rebate Fund would be used for refundable tax credits and rebates to compensate consumers for higher energy prices resulting from the bill. Cash rebates would be directed at low-income households and will be distributed through the Electronic Benefits Transfer system used for food stamps. All households earning under $110,000 would be eligible for some benefit, with benefit levels phasing out gradually for households earning $70,000 to $110,000.

In addition to auctions, 6% of allowances would be allocated to energy-intensive, trade-exposed industries each year from 2012-2019.

Entities would be able to fully bank allowances. Entities would also be able to borrow allowances from future years, and would be required to pay back borrowed allowances within 5 years, at an interest rate of 10% per year.

Entities would be able to meet up to 15% of their compliance obligation with EPA-approved domestic offsets, and an additional 15% of their compliance obligation with EPA-approved international emission allowances or offsets. Eligible domestic offset projects would be limited to: agricultural projects that reduce GHGs resulting from enteric fermentation or manure management in soils, or that increase biological sequestration of carbon through afforestation or reforestation; projects which reduce fugitive GHGs from petroleum and natural gas systems in the US; and projects that reduce GHG emissions from coal mines (agricultural and coal mine projects are only eligible if they are not subject to the performance standards discussed above). The bill would direct the Administrator to promulgate regulations for eligible international offset projects; forestry or land use projects, and projects involving the destruction of HFCs, would not be eligible.

The bill would establish an Office of Carbon Market Oversight (OCMO) within the Federal Energy Regulatory Commission. The OCMO would have the authority to oversee the carbon market to prevent fraud and market manipulation. 

The bill would establish a system of international reserve allowances to begin in 2020. If the President determines that a given country has not taken “comparable” action to reduce its GHG emissions, the President would be authorized to require importers of energy-intensive, trade-exposed primary goods from those countries to purchase and submit special international reserve allowances. These allowances would not be able to be used for compliance in the regular cap-and-trade system, and proceeds from the sale of these allowances would be used to supplement the International Clean Technology Fund established by the bill.

The bill contains a provision that would permit California to regulate GHG emissions from the tailpipes of automobiles, as well as other states which have adopted the same standards.

The bill would also amend the Clean Air Act to establish a low-carbon fuel standard. The Administrator would be directed to no later than 2010, establish a methodology for determining the lifecycle GHG emissions per unit energy of all transportation fuels for which such a determination does not already exist. The EPA would establish a fuel emission baseline, and would require transportation fuel providers to reduce, on an annual average basis, the average lifecycle GHG emissions of those fuels, resulting in a reduction of at least 10% from the baseline by 2028.  The performance standard used to determine the baseline would be revised in 2033 and every 5 years thereafter. The EPA would set up a market for credits, through which producers who achieve greater lifecycle emission reductions than the baseline would be able to earn credits to trade or sell to other producers, or bank for future use.

In addition, the bill would require the EPA to develop comprehensive regulatory standards for the underground injection of CO₂, and would requires the DOE to develop model building efficiency codes that states would be required to adopt and enforce in order to become eligible for funding from the National Energy Efficiency Fund that would be established by the bill.  

Sponsor: Rep. Edward J. Markey (D-MA) ( Cosponsors)

 

H.R. 620:   Climate Stewardship Act. The Act establishes a market-driven system of tradable greenhouse gas (GHG) allowances, administered by the Environmental Protection Agency, to begin in 2012. Allowances would be equal to 6.13 million metric tons of CO2e after 2011, reducing to 5.239 million metric tons after 2019, 4.1 million after 2029, and 2.096 after 2049. The bill would also establish a national greenhouse gas database and registry, as well as a Climate Change Credit Corporation, a non-profit corporation with a board appointed by the President of the United States. This corporation would be allocated a portion of tradable allowances, and be able to buy and sell other allowances, and is directed to use the proceeds from its trading activities to reduce costs borne by consumers as a result of the GHG reduction requirements of the Act. Sponsor: Rep. John Olver (D-MA) (17 Cosponsors)

 

H.R. 823:   A bill to authorize Federal agencies and legislative branch offices to purchase greenhouse gas offsets and renewable energy credits. Sponsor: Rep. Peter Welch (D-VT) (14 Cosponsors)