House Committee to Approve Climate Change Bill

The House Energy and Commerce Committee tonight is expected to pass a bill to reduce U.S. greenhouse gas emissions by 83 percent from 2005 levels by 2050through a nationwide cap and trade program and a nationwide renewable energy standard.  The vote follows four days of debate and partisan votes on amendments.  Republicans on the panel opposed to the bill had readied as many as 450 amendments.  Last Friday, Energy and Commerce Committee Chairman Henry Waxman (D-Calf.) released a 932-page revised bill that offers concessions to Democrats on the panel who expressed concerns over the cost of the bill to energy-intensive industries and consumers.  As a result, the bill gives away 85 percent of the emission allowances for free, leaving just 15 percent of the allowances available for auction.  President Obama has called for 100 percent auction of the allowances, although he supports the House bill.  The electric utility industry wins most of the free allowances with 35 percent, while the pulp,paper, cement and steel industries were able to secure 15 percent of the free allowances.  Even though the oil and gas industry represents about 30percent of U.S. emissions, the bill does little to address high fuel costs under the bill-refiners would only get 2 percent of the allowances for free starting in 2014 and ending in 2016.  Chairman Waxman will likely achieve his goal of approving a cap and trade bill prior to Memorial Day, but hurdles remain for House passage of the measure.  The bill has been referred to eight other committees whose leadership and members may conduct additional hearings and amend the bill further.  The Senate has yet to propose similar legislation. AGC will continue to monitor developments closely.