Statement by Eileen Claussen, President, Pew Center on Global Climate Change
Upon Senators Bingaman and Specter's announcement of the Low Carbon Economy Act of 2007
July 11, 2007
A sound climate policy will protect the environment by reducing greenhouse gas (GHG) emissions in a way that protects the U.S. economy. Sen. Bingaman has long been one of the leaders in the Senate's debate over how best to meet these objectives, and the Bingaman-Specter Low Carbon Economy Act of 2007, introduced today, is an important contribution to Congress' debate on this topic.
The Pew Center is encouraged to see that the bill is more protective of the environment than the most recent recommendations of the National Commission on Energy Policy from which the legislative proposal evolved, especially in establishing a tighter emissions cap (as long as the safety valve is not triggered) and in providing strong incentives for the deployment of climate-friendly technologies, most particularly geologic carbon storage.
We remain concerned, however, about the low “safety valve” or price cap contained in the bill. The allowance price is capped at $12 per ton of CO2 in 2012, rising to around $23 (in 2012 dollars) in 2025. Intervening in the market through a low price cap could both render the emission levels established in the bill meaningless and undermine investment in the next generation of climate-friendly technologies. We will be studying the proposal further to determine more specifically the effects of the price cap on both overall emission levels and investment in new technologies.
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