Structure of Clean Energy Act Takes Shape in Congress

First, the energy-intensive, trade-exposed industries will be allocated 15 percent of all carbon dioxide emission allowances in 2014, the committee agreed. Emissions of this greenhouse gas are widely acknowledged to be driving global warming.

Next, the automobile industry will receive three percent of CO2 emission allowances from 2012 through 2017, and after that will receive one percent of allowances through 2025.

And an agreement on a Combined Efficiency and Renewable Electricity Standard provides for a combined 20 percent standard by 2020.

Under the first deal, energy-intensive industries that compete in global markets will be provided incentives to improve their energy efficiency based on the amount of domestic production, as well as assistance to address the costs of transitioning to a clean energy economy.

This is good for jobs, good for investment, and good for the environment," said Congressman Henry Waxman of California, who chairs the committee. "We are establishing strong protections to ensure America's industrial capacity can thrive without being disadvantaged by overseas competition."

To provide adequate transition time, the industries will receive allowances to emit some carbon dioxide through 2025, at which time the President will determine whether they are still needed.

"We've worked hard to develop legislation that will dramatically reduce CO2 emissions while preserving energy-intensive U.S. manufacturing jobs and protecting consumers from substantially higher electric bills - and I believe that the agreement we've reached will do just that," said co-author of the agreement Congressman Mike Doyle of Pennsylvania.

Co-author Congressman Jay Inslee of Washington said, "This agreement will allow energy-intensive American industries like Alcoa, Weyerhaeuser, and Nucor Steel in Washington state to fairly compete and protect jobs while reducing our national emissions."

The automobile industry will be provided incentives to make electric and advanced technology vehicles. The bill will help fund research, development, implementation and deployment of new, low-carbon technologies and upgrades for the manufacturing facilities that will produce the next generation of greener vehicles.

The Ford River Rouge factory in Dearborn, Michigan (Photo by Emily Benson)

"We seen remarkable innovations from the automakers as consumers have shown interest in more fuel efficient vehicles, said committee Chairman Emeritus John Dingell, who represents the automotive manufacturing state of Michigan. "The agreement on allowance values will spur more innovations and new, green job creation here at home."

"It is critically important that the American automobile industry be a strong driver of jobs as we move to build a more energy independent American economy," said Waxman. "These provisions assist our automobile manufacturers in a time of need by encouraging them to deliver the next generation of fuel efficient cars, trucks, and buses, which will create jobs for skilled workers and greater choice for consumers."

Under the agreement on a Combined Efficiency and Renewable Electricity Standard, by 2020, utilities would be required to obtain 15 percent of their electricity from renewable energy sources and demonstrate annual electricity savings of five percent from energy efficiency measures.

If the governor of a state determines that utilities in the state cannot meet the 15 percent renewable requirement, the governor may reduce the renewable requirement to 12 percent and increase the efficiency requirement to eight percent.

This clean energy standard can be met without increasing electricity prices, says Congressman Ed Markey of Massachusetts, chairman of the Subcommittee on Energy and Environment, who introduced the original standard this Congress.

Markey cites a recent Department of Energy analysis of a similar provision showing that the 20 percent standard will have no impact on the price of electricity through 2020 and will save consumers up to $2 billion through 2030.

"This updated standard proves that every region of the country can meet an aggressive clean energy standard, save money, and grow the job-creating energy industries of the future," he said.

Environmentalists are pleased that the legislation is moving forward. Dan Lashof, director of the Climate Center for the Natural Resources Defense Council, said, "The emerging consensus in the House Energy and Commerce Committee lays the critical foundation for Congress to enact legislation this year that will spur clean energy investments and cut carbon pollution that causes global warming."

"For too many years, progress to spur economic growth through investments in energy efficiency and clean energy sources, like the wind and sun, was held hostage," said Lashof. "Now, just four months into the new administration and Congress, businesses, labor, and environmental advocates are working together to unleash American innovation and make a clear break from the past."

Jerome Ringo, president of the Apollo Alliance, said, "The energy and climate bill under debate in Congress is an opportunity for the country to unite and transition from our faltering fossil fuels-based economy to a vibrant economy that runs on clean energy."

Copyright Environment News Service (ENS) 2009. All rights reserved.