House Energy and Commerce Committee Continue Negotiations on Climate Change, Prepare for Week-long Fight

May 15, 2009
Democratic proponents of a bill that would create a cap and trade system to control greenhouse gas emissions are continuing negotiations within their own party in advance of a week-long markup of the legislation in the House Energy and Commerce Committee next week.  Committee Chairman Henry Waxman (D-Calif.) earlier this week conceded to many of his Democrat colleagues' demands, including an agreement to give away credits to a variety of industries that would be most affected by a cap and trade scheme.  Waxman has committed to give away 35 percent of the emission allowance credits through 2025 for free to local electricity distribution companies and 15 percent of the credits for free to energy intensive industries, such as steel, aluminum, chemical and glass.  Under the original bill, these industries would have been required to purchase emission allowance credits, the cost of which could have been passed down to consumers in the form of higher prices.  President Obama has called for 100 percent auctioning of allowance credits.  Waxman has also made concessions on the bill's renewable energy standard, which requires utilities to provide escalating amounts of power from wind, solar and biomass by reducing the standard from 25 percent - an Obama campaign pledge - to 20 percent by 2025.  The new agreement would also lower the overall greenhouse gas emission reduction target from 20 percent to 17 percent below 2005 levels by 2020, higher than the 14 percent cut the president has proposed. The bill would still require an 80 percent reduction below 2005 levels by 2050.  Energy and Commerce Committee ranking member Joe Barton (R-Texas) is promising a fight once the markup begins on Monday, and he will likely have the support of the 22 other Republican members of the Committee.  Barton said Republicans are preparing to offer hundreds of amendments and to use other tools to slow down the markup. Moreover, despite his concessions so far, Waxman still has to convince about a dozen or so of Democrat "fence-sitters" to go along with his plan.  Waxman has made Committee passage of his bill before Memorial Day a priority.  The Senate has yet to introduce comprehensive climate change legislation.  For more information, contact Karen Lapsevic at (202) 547-4733 or
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