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Summary:

With Congress now waist deep in the climate and energy bill proposed by Chairman Henry Waxman and Subcommittee Chairman Ed Markey last month, running against the clock to push through a version by year’s end — if not by Memorial Day — we think it’s time […]

With Congress now waist deep in the climate and energy bill proposed by Chairman Henry Waxman and Subcommittee Chairman Ed Markey last month, running against the clock to push through a version by year’s end — if not by Memorial Day — we think it’s time to better acquaint ourselves with the plan that Speaker Nancy Pelosi has called a “strong starting point,” former Vice President Al Gore today called a “moral imperative” and that Illinois Representative John Shimkus recently called “the largest assault on democracy and freedom that I’ve ever experienced.” President Barack Obama, for the most part, has tried to stay out of the fray — although he did say “We’ll get it done. And I will sign it.”

But just how far did Markey and Waxman go with their draft? What’s really in there for cleantech? What compromises are in the works as the House Energy and Commerce Committee concludes a week of hearings with high-profile witnesses, like former Vice President Al Gore, Energy Chief Steven Chu, Dow Chemical VP of Energy Rich Wells and Google.org Director of Climate and Energy Initiatives Dan Reicher?

Keep in mind, this is a 648-page “discussion draft,” and few have read it all the way through (Oregon Rep. Greg Walden of Oregon asked witnesses at Thursday’s hearing if they had read the proposal in its entirety — most, including Secretary Chu and EPA Administrator Lisa Jackson, said no). Here are some of the critical sections for smart grid, clean vehicles and renewable energy technology, and what kind of static they’re creating on Capitol Hill. If you’ve been sorting through the bill, too, hit that comments button below and tell us where you think the discussion draft is on target — and where it’s flawed.

Cap and Trade: The Waxman-Markey draft proposes a mandate for companies that emit more than 25,000 tons of annual carbon emissions to buy tradeable allowances for every ton of carbon, with the number of allowances dropping each year — 3 percent below 2005 levels by 2012 and all the way to 83 percent below 2005 levels by 2050. According to Climatewire, House Democrats are now working behind the scenes to build a coalition with leaders of the Energy and Commerce Committee and about a dozen of the committee’s moderate and conservative Democrats are concerned that the proposal pushes too hard, too soon. More conservative members of the coalition want less ambitious emission targets, possibly as little as a 6 percent reduction by 2020 and 15 percent by 2025. According to the Washington Post, the Democrats’ talks suggest “coal-fired utilities are making progress in their efforts to get free access to 40 percent of emissions permits in a cap-and-trade system.”

Consumer and oil industry groups testifying in committee hearings are worried that runaway energy costs will result if the proposed targets and carbon prices go through. EPA Administrator Lisa Jackson countered “We do not claim to be able to do something for nothing. But EPA’s available economic modeling indicates that the investment Americans would make to implement the cap-and-trade program would be very modest compared to the benefits that science and plain common sense tell us a comprehensive energy and climate policy will deliver.” In a preliminary analysis released this week, the EPA said the bill would cost an average U.S. household a total of $98 to $140 a year, or less than 40 cents per day.

Smart Grid: Even Newt Gingrich, the former House Speaker who testified on a panel with former Vice President Al Gore today, likes the section promoting smart grid development and deployment — and this from a guy who said the bill would create bureaucracy and micromanagement that “are an invitation to corruption and an invitation to more politicians playing games. The idea that the Secretary of Energy is now going to be the czar of Jacuzzis is just absurd,” as MSNBC reports. Google.org’s Dan Reicher urged Congress to push the DOE to provide more funding for deploying smart meters.

Clean Transportation: Waxman and Markey propose that Congress authorize funding for grants or loan guarantees to cities, states and private companies for large-scale EV demonstration projects, including fast-charging infrastructure and battery exchange stations — a possible boon for Better Place. Additional funds are proposed to help automakers retool existing plants to build electric vehicles or buy U.S.-made vehicle batteries.

Low-Carbon Fuel Standard: After 2022, the bill phases in a low carbon fuel standard, similar to the one just approved in California, to cut the total carbon intensity of transportation fuels by five percent by 2023 and 10 percent by 2030. The plan to calculate direct and indirect emissions from cultivation or extraction all the way through to combustion of a fuel has drawn fire from the ethanol lobby in California.

Renewable Portfolio Standard: Waxman and Markey have proposed requiring electricity suppliers to generate 6 percent of their energy from clean sources by 2012, gradually increasing to 25 percent by 2025, but moderate and conservative Democrats involved in the coalition (mentioned above) support a 15 percent nationwide renewable electricity standard for the same date. In his testimony, Reicher called for more emphasis (and spending) on enhanced geothermal systems, calling the technology “the sleeping giant.”

Carbon Capture: Markey and Waxman want Congress to fund a demo program and incentives for large-scale deployment of carbon capture and storage technology. Gingrich came out in favor of carbon capture and sequestration (he actually called it “green coal,” an oxymoron if ever there was one) in his testimony on Friday, calling for more spending on the technology.

By Josie Garthwaite

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  1. [...] Vice President Al Gore testified before key members of Congress on the new clean energy and climate legislation and the urgent need for the U.S. to invest in creating millions of green jobs to strengthen the [...]

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  2. Ed Lynch-Bell Saturday, April 25, 2009

    “The plan to calculate direct and indirect emissions from cultivation or extraction all the way through to combustion of a fuel has drawn fire from the ethanol lobby in California.”

    Fantastic news although I need to dig deeper to work out what the LCA standard will include and exclude. (How exactly do you take credit for co-product use? Is carbon debt included or excluded?)

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  3. [...] & POLITICS FAQ: The Climate & Energy Bill Debate There are some of the critical sections for smart grid, clean vehicles and renewable energy [...]

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  4. I don’t believe anyone has looked at the footprint for the 6% renewable energy. If one looks at using 50/50% of the 6% total for wind and PV, it is quite large accounting for the inefficiencies. The magnitude is bigger than just stating that 6% should be renewable.

    I find the approach the politicians are using to this laughable. If we used political agendas to get to the moon we would still be trying to get there.

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  5. [...] the $4 billion expected in smart-grid stimulus funding; a House bill that, among other provisions, calls for utilities to set up demand-response plans; as well as a PJM [...]

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  6. [...] the $4 billion expected in smart-grid stimulus funding; a House bill that, among other provisions, calls for utilities to set up demand-response plans; as well as a PJM [...]

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  7. [...] how to implement a cap-and-trade system and national renewable portfolio standard as part of the current energy bill, a mixed bag is about as good as it gets for heavily polluting incumbent energy players. As the [...]

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  8. [...] how to implement a cap-and-trade system and national renewable portfolio standard as part of the current energy bill, a mixed bag is about as good as it gets for heavily polluting incumbent energy players. As the [...]

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  9. [...] called their initial proposal for a climate and energy bill last month. And the discussion has been heating up ever since, fueled in part by multimillion dollar lobbying efforts. The U.S. oil, gas and coal industry alone [...]

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  10. [...] Henry Waxman, who drafted the legislation with Rep. Ed Markey, wanted to push the bill through his committee by Memorial Day. Last night’s vote represents a victory for the two authors and [...]

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