SENATE CLIMATE BILL ANALYZED

Senate Global Warming Bill Is Seeking to Cushion the Impact on Industry
John M. Broder, October 24, 2009 (NY Times)

"The Senate bill aimed at reducing global warming pollution will initially grant billions of dollars of free emissions permits to utilities and industry but will require the bulk of the money be returned to consumers and taxpayers, according to newly released details.

"The bill will also provide a cushion to energy-intensive manufacturing companies to ease the transition to a lower-carbon economy and to help them compete internationally, although the subsidies will disappear over time. The measure also sets a floor and ceiling on the price of permits to emit carbon dioxide and other greenhouse gases."

Excellent summary analysis (click to enlarge)

"…[T]he Environmental Protection Agency estimates that overall cost of the [Senate bill] at roughly $100 a year per household, similar to that of a House climate change and energy bill passed in June…The Senate measure, sponsored by Senators John Kerry of Massachusetts and Barbara Boxer of California, both Democrats, aims to [cut greenhouse gas emissions 20% below 2005 levels by 2020, 42% by 2030 and 83% by 2050] under a cap-and-trade system that sets a nationwide limit on emissions but allows polluters to buy and sell permits to meet it…

"Senators Kerry and Boxer introduced their bill in late September with a number of missing provisions…[A] more detailed 923-page draft [of S. 1733]…spells out the formula for distributing pollution allowances and other provisions…[and] includes new financing for research on capturing and storing carbon dioxide emissions from power plants, more money for low-carbon transportation projects, additional assistance for rural communities and more favorable treatment for agriculture and forestry…The bill is before the Senate Environment and Public Works Committee, which Mrs. Boxer leads. The panel has scheduled three days of hearings [and then will begin markup]…"

click to enlarge

"The E.P.A. analysis of the Kerry-Boxer bill found that its costs and impact were roughly equivalent to those of the House bill…[Both] would reduce overall American emissions by nearly the same amount over the next 40 years. The costs to consumers are also similar, the agency found…Neither bill would add to the federal deficit and both measures could actually produce some revenue from the sale of emissions permits, the agency found…

"...The E.P.A. did not try to quantify the benefits to individuals or society of reducing greenhouse gas pollution…Other studies have found higher costs, although all such estimates are based on assumptions about how businesses and consumers would behave as energy costs rise and how quickly new technology would appear to replace increasingly costly fossil fuels…Senate Republicans dismissed the E.P.A. analysis as incomplete and have threatened to boycott committee action until a more thorough analysis is done…"

Bonus extended summary analysis worth clicking to enlarge