Issue Date: July 6, 2009
Climate Legislation Moves To Senate
With House passage of a 1,200-page climate-change and energy bill (H.R. 2454) in late June, the Senate now takes up the measure. There, it faces perilous prospects including being sidelined in favor of other legislation such as health care reform.
California Democrat Sen. Barbara Boxer's Environment & Public Works Committee has primary authority for the bill, and she is expected to begin hearings early in July. Senate Majority Leader Harry M. Reid (D-Nev.) has set a deadline of Sept. 18 to have a bill ready to take to the full Senate.
At the core of the bill, which narrowly passed the House by a 219-212 vote, is a "cap and trade" system that would reduce carbon dioxide emissions each year. The bill cuts CO2 emissions by 17% of 2005 levels by 2020 and by 83% of 2005 levels by 2050. Electric utilities and covered companies must cut their emissions to meet the declining cap or may purchase pollution "allowances" from companies whose emissions are below their cap (C&EN, June 15, page 22).
In the first years, however, utilities, companies, and electricity ratepayers will be spared much pain because some 85% of the CO2 pollution allowances that they would have had to buy will be given away free under the bill.
The hard-fought House bill represents a major compromise. The legislation would give away too many allowances to polluters, some opponents say, whereas others believe industry needs more free allowances. Supporters, meanwhile, view the bill as an important step by the U.S. to cut greenhouse gas emissions. Industry is divided. DuPont and nearly all companies that are members of the lobbying group U.S. Climate Action Partnership support the bill, but the National Association of Manufacturers and the Chamber of Commerce oppose it.
President Barack Obama predicts the Senate will pass a bill, but one that's different from the House version. He foresees tough House-Senate conference committee negotiations that will be needed to complete the legislative process.
In addition to cap-and-trade provisions, the bill has other parts of key concern to the chemical industry. For instance, the bill's definition of greenhouse gases includes sulfur hexafluoride, all perfluorocarbons, nitrogen trifluoride, and hydrofluorocarbons (HFCs).
The House bill would significantly curb the use of HFCs, which have hundreds to thousands of times the ability of CO2 to trap heat. Starting in 2012, it would phase down the use of 20 HFCs, many of which are used as alternatives to ozone-depleting refrigerants. And the bill would direct EPA to study fluorinated gases other than HFCs and recommend whether their production or their emissions should be regulated.
In addition, the bill takes aim at what is thought to be the second-largest contributor to human-induced global warming—black carbon, a type of particulate pollution. A product of incomplete combustion of biomass and fossil fuels, black carbon absorbs the sun's energy and heats the atmosphere. Through deposition, it causes ice or snow to melt faster.
Within two years after its enactment, H.R. 2454 would require EPA to issue a regulation under the Clean Air Act to control emissions of black carbon or explain why such a rule is unnecessary.
Meanwhile, the President singled out one bill provision of particular concern. Beginning in 2020, importers of energy-intensive products—including chemicals—made in countries without greenhouse gas emission regulations must purchase allowances before their goods can cross into the U.S. Obama sees this requirement as a tariff. "We're going to have to do a careful analysis to determine whether the prospects of tariffs are necessary, given all the other stuff that was done and had been negotiated on behalf of energy-intensive industries," he says.
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