Climate

Reid: “I think if we do it right, the energy bill, the climate bill can be very, very job productive” — plans floor debate on bipartisan bill “sometime in the spring”

Senate Majority Leader Harry Reid (D-Nev.) today confirmed that floor debate on a sweeping energy and global warming bill that will be sold to the American public in part as an economic stimulus measure will be held early next year.

“We’re going to try to do that sometime in the spring,” Reid told reporters when asked about the window for moving a climate bill onto the Senate floor.

So E&E News PM (subs. req’d) reports.   Ideally the debate would start by the end of February, so the Senate vote could be finished by early spring, as I recently wrote.   The bipartisan team of Senators crafting a bill with the White House plan on a blueprint by Copenhagen:

Kerry and Sens. Lindsey Graham (R-S.C.) and Joe Lieberman (I-Conn.) are taking the lead in writing the climate and energy bill with a goal of releasing a blueprint before U.N. global warming negotiations start Dec. 7 in Copenhagen.

The good news is that Reid sees this bill as part of the economic stimulus and jobs package the administration is putting together, which should increase the motivation to pass it:

“I think if we do it right, the energy bill, the climate bill can be very, very job productive,” Reid said.

Environment and Public Works Chairwoman Barbara Boxer (D-Calif.) met with Reid and four other Democratic committee leaders yesterday to map out the legislative agenda for the rest of this year and early 2010….

“This is a jobs bill,” Kerry said. “This is without question a jobs bill. I’d say this is the biggest jobs bill staring us in the face, without any question, and we’ll prove that as we go down the road in the next days. So if you want to do a jobs bill, this is the bill to do. And I’d argue that with the president very, very forcefully.”

The bill certainly can drive early investment in clean energy through pollution reduction incentives, tax breaks, efficiency standards — and even through the carbon caps, as Nobelist Paul Krugman explained back in May:

Right now, the biggest problem facing our economy is plunging business investment. Businesses see no reason to invest, since they’re awash in excess capacity, thanks to the housing bust and weak consumer demand.

But suppose that Congress were to mandate gradually tightening emission limits, starting two or three years from now. This would have no immediate effect on prices. It would, however, create major incentives for new investment “” investment in low-emission power plants, in energy-efficient factories and more.

To put it another way, a commitment to greenhouse gas reduction would, in the short-to-medium run, have the same economic effects as a major technological innovation: It would give businesses a reason to invest in new equipment and facilities even in the face of excess capacity. And given the current state of the economy, that’s just what the doctor ordered.

This short-run economic boost isn’t the main reason to move on climate-change policy. The important thing is that the planet is in danger, and the longer we wait the worse it gets. But it is an extra reason to move quickly.

So can we afford to save the planet? Yes, we can. And now would be a very good time to get started.

Precisely.

The bill should be written so that the cap-and-trade doesn’t start until 2013, well after the recession is over, but ideally with funding to accelerate clean technology into the marketplace frontloaded to start immediately, funding that can be deficit-neutral because it is offset by allowances that will be auctioned later.

Note:  I am proposing the cap start one year later than the current bills.  That’s because the bill is going to become law later than people thought, giving less time to set up all the rules for 2012 trading, and because of the recession, which has knocked CO2 levels down sharply (see “EIA stunner: By year’s end, we’ll be 8.5% below 2005 levels of CO2 “” halfway to climate bill’s 2020 target“).  That means 2012 was probably going to have an over-allocation of allowances anyway.  Putting the start of the cap off one year therefore won’t actually reduce the amount of emissions reductions the bill achieves — quite the reverse, it’ll probably reduce the early surplus of allowances distributed.

6 Responses to Reid: “I think if we do it right, the energy bill, the climate bill can be very, very job productive” — plans floor debate on bipartisan bill “sometime in the spring”

  1. Ben Lieberman says:

    This is promising, but what will it take to get coal state Senators on board? It seems inevitable that a bill will include nuclear power, but what combination of “carbon capture” and indemnification will prove necessary to get to 60?

  2. BobSmith says:

    This is a joke. There was H.R. 2454 that eventually got through the house, then who knows what happened to it in the senate. Then what seems like at least 6 mos. later Kerry and Boxer come up with a bill, then suddenly no one likes that one, and now – when we are suppose to be setting an example and leading the world in alternative energy, a Chinese company is making the windmills for a Texas site, and no one expects a bill to “hit the senate floor” until early next year? What [insert expletive here]!

  3. Wes Rolley says:

    The comment that really got to me was Reid saying it was a “sweeping energy and global warming bill that will be sold to the American public…” Sold? Someone should tell the honored Senator from the great mining state of Nevada, that as long as he is not listening, we are not buying. He might start off by “selling” this to the Democratic Senators.

    I saw an alert today about 14 Democratic Senators shilling for the coal industry. I expected to see Byrd and Rockefeller’s names when I read it. Instead I find Al Franken. It was all about handing out free pollution permits to coal burning rural coop utilities. There is something of a point here, but not much. Is this not just another example of what economists call moral hazard? The more we let anyone figure out that if they yell loud enough their Senator will ride to their rescue, they will continue to do and never take the steps necessary for sustainability. There must be consequences for continuing business as usual.

  4. As a college senior finishing up my degree in economics and environmental studies I feel as though I’m an ambassador for my generation. I really liked the quotes from krugman. I know it is up to people like me to cut through the propaganda out there that claims no benefits and only costs of environmental legislation. Its good to be reminded of how to defend government action and the benefits it can bring to the environment. He needs to be in government!

  5. John Hirsch says:

    I am increasingly frustrated with the optimism that is associated with the present contents of likely US legislation. It is right to be pleased that something may actually be done, but not so much when you compare the contents with what most exprts are saying is really necessary to prevent DISASTROUS climate change. If even half of what is proposed in Paul Gilding’s -“one degree war” piece is necessary, then present plans for US legislation (and by definition, all that the rest of the world will commit to) will be woefully inadequate.
    I guess I fall in the camp that favours shocking people into understanding the dire circumstance we are in.

  6. Peter Wood says:

    While I know that the Administration and Senators such as Kerry, Boxer and Reid are working hard on this, I am starting to get very worried. Assuming that there is a “COP 15.5” meeting happening in mid 2010, if the bill does not pass before the meeting it could be an absolute disaster. While people did an excellent job putting the Waxman-Markey Bill together so quickly, time is running very short.

    There is an elephant in the room here, and that is how to ratify any legally binding implementing agreements that come from COP 15.5 or COP 15. Good Senators who are serious about climate change need to start thinking seriously about how they will approach this issue. There are several possible outcomes from Copenhagen: the talks collapse; there is some sort of non-binding political agreement; there is implementing agreement on the legal framework for countries to make emission reductions (not likely, but desirable). If the latter happens, the US will need to get serious about implementing that.

    If a draft Kerry-Graham-Lieberman Bill gets released before Copenhagen, then that would be very useful. I hope that happens.

    I don’t like the idea of waiting until 2013 for the cap to commence. Globally we need countries to start carbon pricing regimes as soon as possible – once that happens and people realise that introducing a carbon price won’t cause the sky to fall in, it will be possible to tighten the caps into the future. Also, it seems like 2013 is a long time to wait for the US Economy to emerge from recession. Is the economy really in such bad shape? If so, I would like to see the modelling. If not, the Administration should argue to the American people (and Senate) why the economy will be growing by 2012, and how a green stimulus bill will ensure that is the case.