Kerry: Three Big Oil Companies Likely to Back Climate Bill (Strips EPA's authority to regulate CO2)

Kerry: Three Big Oil Companies Likely to Back Climate Bill
— By Kate Sheppard| Thu Apr. 22, 2010 4:43 PM PDT

When Sens. John Kerry, Lindsey Graham and Joe Lieberman release their climate bill on Monday, they expect to have the backing of three of the five major oil companies, Mother Jones has learned. In a conference call with a coalition of progressive business leaders on Thursday evening, Kerry said he believes those companies will "actively participate in supporting this bill." He hopes the other big oil companies will at least hold their fire on the bill, and added that he believes the American Petroleum Institute (API), the oil industry's major trade group, will call off its ad campaign attacking the legislation.

Kerry also said that the Edison Electric Institute—the main trade group representing utilities—will support their measure. "We are bringing to the table a significant group of players who were never there for the Waxman-Markey bill," Kerry said. (Whilie Edison supported Waxman-Markey, it was opposed by several big oil companies and API).

In the teleconference, organized by the We Can Lead coalition, Kerry outlined specific details from the bill that have not previously been publicly available. Here's a rundown:

*The bill would remove the Environmental Protection Agency's authority to regulate carbon dioxide under the Clean Air Act, and the states' authority to set tougher emissions standards than the federal government.
*There will be no fee—or "gas tax"—on transportation fuels. Instead, oil companies would also be required to obtain pollution permits but will not trade them on the market like other polluters. How this would work is not yet clear.
*Agriculture would be entirely exempt from the cap on carbon emissions.
*Manufacturers would not be included under a cap on greenhouse gases until 2016.
*The bill would provide government-backed loan guarantees for the construction of 12 new nuclear power plants.
*It will contain at least $10 billion to develop technologies to capture and store emissions from coal-fired power plants.
*There will be new financial incentives for natural gas.
*The bill would place an upper and lower limit on the price of pollution permits, known as a hard price collar. Businesses like this idea because it ensures a stable price on carbon. Environmental advocates don't like the idea because if the ceiling is set too low, industry will have no financial incentive to move to cleaner forms of energy.
*The energy bill passed by the Energy and Natural Resources Committee last year will be adopted in full. This measure has sparked concerns among environmentalists for its handouts to nuclear and fossil fuel interests.

Some elements of the legislation remain in flux, Kerry said. The senators still haven't figured out how to deal with the contentious question of offshore drilling. He added that they are still trying to secure the support of the Chamber of Commerce, another prime foe of the House measure, but remain hopeful that the powerful business lobby might endorse the bill.

http://motherjones.com/blue-marble/2010/04/kerry-says-climate-bill-has-industry-backing

NEXT WEEK, Senators John Kerry, Lindsey Graham, and Joe Lieberman will release their much-anticipated proposal for comprehensive climate and energy legislation — the best remaining shot at forging a bipartisan consensus on this issue in 2010. Their proposal has many strengths — and as an environmental economist who has worked on this issue for two decades, I hope it succeeds.

<snip>
Government officials from California, New England, New York, and other Northeastern states are vociferously lobbying in Washington to retain their existing state and regional systems for reducing greenhouse gas emissions, even after a new federal system comes into force. That would be a mistake — and a potentially expensive one for residents of those states, who could wind up subsidizing the rest of the country. The Senate should do as the House did in its climate legislation: preempt state and regional climate policies. There’s no risk involved; if federal legislation is not enacted, preemption will not take effect.
<snip>
But for the core of climate policy — which is carbon pricing — the simplest, cleanest, and best way to avoid unnecessary costs and unnecessary actions is for existing state systems to become part of the federal system. California’s leaders and those in the Northeast may take great pride in their state and regional cap-and-trade systems.

But if they accomplish their frequently-stated goal — helping to bring about the enactment of a meaningful national climate policy — they will better serve their states and the country by declaring victory and getting out of the way.

SENATOR KERRY: Well, of course there ought to be. I mean, there--look, there are all kinds of provisions on mine safety, but mining is still dangerous and everybody knows that. I don't know--I mean, there's a report--there's an analysis going on right now about precisely, you know, what took place and how. The bottom line is there have been accidents in--in mines, tragically, over many years, and we've lost too many miners, but that's not going to end the industry, nor should it. What we have to do is make it safer. We have to make sure it is safer, but we also need to make sure that the coal we burn is clean, and--and that's what this bill focuses on. There's plenty of other--it's not even in our jurisdiction to be doing the safety component of this, but he cleanliness of it is within this bill's prerogatives, and that's what we need to focus on right now.

MS. CUMMINGS: And have you thought--felt like the explosion has given new ammunition to environmentalists who are still not sold on which clean coal technology can really come clean--

SENATOR KERRY: I do not think so. I do not think that that's specifically going to have an impact on it, I really don't. I think that's a question that stands on its own merits, and whether--I mean, there are many new technologies being explored that a lot of people aren't aware of which could be game-changers for coal. And what we want to do in this bill is accelerate the research and the development of those technologies. I'll give you an example: There's one company out in California that currently takes the gas emissions out of the pipe before it even goes into the air and it turns those emissions into a calcium carbonate substance that's the equivalent of concrete or cement and it can be used in buildings or in roads; that's a game-changer. If that could happen on commercial scale, that's a big deal for coal, and it means that you don't even have to build those pipes that go hide it in the ground. You can use it in a non-geologic, sequestered fashion.

So, I think technology and research, exploration in our laboratories, colleges, universities, and so forth, that's one of the exciting things that will come with this legislation. And I'm convinced, personally--it's in the American DNA that we explore and create and find new ways of doing things, and I'm absolutely convinced we are going to find new ways of providing energy for America, new ways of propelling our automobiles and trucks and our buses and so forth. We're going to find new ways of fueling the engines of our airplanes and so forth. A lot of different things are going to happen because we price carbon in this legislation; that's the key.

Read more: http://www.politico.com/news/stories/0410/35970_Page2.html#ixzz0m2YS29jq

In addition to this part of the interview, Kerry addresses the alternative to legislation, regulation. He argues that legislation is better for the coal industry, because it has the ability to spend the money on researching efficient ways to make coal cleaner.

I can see how the talk on this issue looks to you and your co-workers. Coal, oil, nuclear and gas industries all can sound like they are the enemy. However, without them our society as it is, can't exist. For me, it would be a cold winter in NJ, without heat! But, there is a need to do it cleaner - and as you point out, there are some promising ideas for capturing and storing the emissions.

Now, I don't expect you to become a liberal - anymore than I think you could make me a NJ Conservative, but this issue should not be partisan. It should be based on using science and technology as best we can to create a cleaner environment, while providing the energy we need. With any change this big, we also need the legislators to work to include in their bills provisions to help any regions that become the "losers". As you say, before they eliminate coal, if years from now they do, they need to find industries to move into the affected area. That is what legislation has the power to do, but regulation (via the EPA) can't. (Here's a link to an article that contains a letter from manufacturing state's Senators suggesting provisions they wanted - http://views.washingtonpost.com/climate-change/post-carbon/2010/04/nine_democrats_outline_manufacturing_demands.html

Thank you for coming here to bring the discussion - at least on coal - back to the real people who are affected by things that are abstract to me and others. (I think the last time I saw a piece of coal it was likely 50 years ago when I, as a kid, watched coal being put down a coal chute at my Grandmother's house.)