Waxman-Markey

Will the House Climate Bill Protect U.S. Competitiveness?

Yes, according to a recent government report examining the impacts of the House-passed climate bill.

An important concern in any climate legislation is the negative impact it might have on domestic energy-intensive producers that compete in global markets.  Climate policy can raise the production costs of U.S. manufacturers relative to their unregulated foreign competitors, and as a result production and emissions could shift overseas.  Responding to a request by five Democratic senators, the Obama administration recently released an interagency report on the competitiveness impacts of the climate bill that passed the House in June.  It finds that most U.S. energy-intensive, trade-exposed industries (EITEs) will experience only small increases in their production costs.  As a result, emissions "leakage" to countries that do not adopt climate policies will be minimal. 

How the Senate Divides up the Climate/Energy Issue

In the House, the committee chaired by Rep. Henry Waxman (D-CA), the House Energy and Commerce Committee, has jurisdiction over most matters touched on by the climate/energy bill.  In the Senate, jurisdiction over the bill is divided between six major committees.  This makes things complicated, since Congress does most of its work in its committees.

The House committee’s membership made it an excellent crucible for producing a balanced comprehensive climate and energy bill.  Even with most committee Republicans not involved in the drafting, there was a large enough majority of Democrats (36 out of 59) to pass the American Clean Energy and Security Act on Democratic votes alone.  Moreover, committee Democrats were roughly divided between those eager to pass a bill and those more cautious, out of consideration for the bill’s possible impacts on the manufacturing or energy sectors in their districts.  This meant Rep. Waxman had to balance the bill’s economic and environmental objectives just to get it out of committee.

This is not as true with the Senate Environment and Public Works Committee (EPW), the committee largely in charge of writing the GHG cap-and-trade provisions of the bill.  The committee is not quite as regionally diverse as the House Energy and Commerce Committee.  This morning we heard that EPW Chairman Boxer plans to start holding hearings on the Kerry-Boxer bill around mid-November, presumably moving shortly thereafter to a “mark up” (the arcane term for when a committee formally amends and decides whether to pass a bill).  EPW passed a cap-and-trade bill in 2007 and is expected to do so again this year.  Even after it does so, however, it will take a few more twists and turns for the bill to win the support of 60 Senators. 

One option for doing this would be to have all six relevant committees tackle the aspects of the climate issue within their jurisdiction.  Eighty-one of the Senate’s 100 members sit on at least one of these six committees.  A robust committee process could therefore engage a much larger group of Senators than the 19 EPW members.  The Senate Energy and Natural Resources Committee (ENR) did in fact earlier this year pass a major bipartisan energy bill with provisions corresponding with many of the energy measures of the House bill.  The ENR Committee is going to continue exploring the climate issue next Wednesday with a hearing on energy and economic effects of climate change legislation.  Aside from ENR’s bill, however, it is not clear at this point whether all relevant Senate committees will be sitting formally to address the climate aspects of the bill.

Another option would be for key Senators, those especially focused on the bill’s implications for manufacturing, agriculture and energy supply, to rise up outside the committee process and engage in the specifics of the bill.  In fact, several ad hoc groups of moderate Democrats have crafted statements on the factors that would need to be addressed in a climate bill, the use of trade measures, the amount of allowance value needed to prevent carbon leakage, and the treatment of coal, setting a good precedent for their engagement.

Regardless of process by which the Senate at large is engaged, observers expect Senate Majority Leader Reid ultimately to be the one to forge the various inputs into a 60-vote bill – no doubt with major input from the President.  I will write more on this in a later post.

Manik Roy is Vice President, Federal Government Outreach

Climate Change Legislation: On to the Senate

Regardless of how enthusiastic one is about the Waxman-Markey climate and energy bill passed by the House of Representatives in June, passing the bill in six months through a body that had never before wrestled with climate action was a major accomplishment.  (For the record, the Pew Center was enthusiastic about the achievement, while seeing some room for improvement in the bill itself.)  This week, Senators Barbara Boxer and John Kerry introduced their climate bill.  It takes nothing from the House’s accomplishment to recognize that passing a bill through the Senate will be a steeper climb. 

First, there’s the math.  House passage requires a simple majority, which Waxman-Markey just managed, at 219 – 212.  Passage through the Senate will essentially require a supermajority of 60 votes, because of the filibuster.  (If you aren’t familiar with the filibuster, you don’t really need to be.  Just trust me, it takes 60.)

Second, the rules of the House give the Speaker a great deal more control over the chamber’s agenda than the Senate gives its leader.  Speaker Nancy Pelosi very adroitly defined the process by which her chamber hammered out a workable balance of competing objectives.  Senate Majority Leader Harry Reid will be herding cats.

We can get climate change legislation through the Senate, but it’s going to be a completely different animal.  I’ll explore the hows and whys in future posts.

The American Clean Energy and Security Act (Waxman-Markey Bill) Discussion Draft

The discussion draft of the American Clean Energy and Security Act (ACES Act), released on March 31, 2009 by Representatives Waxman (D-CA) and Markey (D-MA) includes four distinct titles: I) clean energy, II) energy efficiency, III) reducing global warming pollution, and IV) transitioning to a clean energy economy. Title I contains provisions related to a federal renewable electricity standard, carbon capture and storage technology, performance standards for new coal?fueled power plants, a low carbon fuel standard, and smart grid advancement. Title II includes provisions related to building, lighting, and appliance energy efficiency programs, as well as efficiency standards for mobile sources and other transportation programs. Title IV includes proposals designed to preserve domestic competitiveness and support workers, provide assistance to consumers, and support domestic and international adaptation initiatives while transitioning to a clean energy economy. The following is a brief overview of the proposed greenhouse gas (GHG) cap-and-trade program contained in Title III.

Waxman-Markey Discussion Draft Materials

EPA Preliminary Analysisof Discussion Draft

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