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Blog: Yet Another Climate Bill

4:22 PM MDT | May 13, 2010 | By VINCENT VALK

Just when you thought U.S. cap-and-trade was dead…and dead again…Senators Kerry and Lieberman have introduced the long-awaited American Power Act, which would establish a cap-and-trade program in the U.S. So, is cap-and-trade back in business? And what makes this bill more different from the others, anyway?

U.S. opinion leaders have lately made something of a sport out of predicting ways in which major legislation will fail in the Senate. There's good reason for that – it was difficult to imagine how any climate bill could get the magical 60 votes before the Deepwater Horizon blew up in the Gulf of Mexico. Now it may be impossible, but, as Grist points out, perhaps not as impossible as you'd think. For one, the bill does have some likely Republican supporters (including Senator Graham, who, though he's taken his name off the bill, has not given any indication that he won't vote for it). For another, its possible that the Gulf oil spill will galvanize support for an improved energy policy. Of course, that policy may wind up being one that does not include significant support for offshore drilling, like the American Power Act does, but just having this out there substantially increases the odds of some kind of energy bill with some kind of carbon cap making it through Congress before the all-important midterms.

So, what's the difference here? For starters, the bill doesn't regulate industrial greenhouse gas emissions until 2016. That compares with a 2012 start date for economy-wide emissions under the previous bills, Waxman-Markey and Kerry-Boxer (they're both presumed dead, and rightly so). The bill also hones in on big emitters – power plants, manufacturing facilities, and the like – and includes a provision akin to "cap-and-dividend," which would distribute a good chunk of the program's revenues back to consumers to offset higher energy costs. It's also filled with goodies for industry and business, from increased offshore drilling to expansion of the clean energy manufacturing tax credit. Indeed, it's so filled with goodies that some environmental groups are opposed to it.

I'm not one for the prediction game – I prefer to leave that to the experts – but I'll say this: if this bill fails, many will proclaim this the end of cap-and-trade. And then, next year, even if Republicans run Congress, someone will come out with some kind of new climate bill with cap-and-trade. That's just how the process works.

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