EPA, Senate Move to Cut Greenhouse Gases

"This is our time. Global warming is our challenge," said Barbara Boxer (D-Calif.), who co-wrote the Senate measure with John F. Kerry (D-Mass.).
"This is our time. Global warming is our challenge," said Barbara Boxer (D-Calif.), who co-wrote the Senate measure with John F. Kerry (D-Mass.). (By Melina Mara -- The Washington Post)
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By Juliet Eilperin
Washington Post Staff Writer
Thursday, October 1, 2009

The Obama administration said Wednesday that it is moving ahead to curb carbon emissions by issuing a proposed rule that would require the nation's biggest greenhouse-gas emitters to install advanced pollution-control technology to operate any facility they plan to construct or significantly modify.

The action by the Environmental Protection Agency came as Senate Democrats introduced a climate bill that would g nationwide limit greenhouse gases. The two efforts could influence the outcome of U.N.-sponsored talks in Copenhagen in December, where more than 180 nations will attempt to forge a new international climate pact.

"This is our time," said Sen. Barbara Boxer (D-Calif.), chairman of the Environment and Public Works Committee, who held a rally on the East Front of the Capitol before a huge American flag and a group of veterans, clean-energy entrepreneurs, and state and local lawmakers. "Global warming is our challenge."

Both the Senate bill, sponsored by Boxer and Senate Foreign Relations Chairman John F. Kerry (D-Mass.), and the new EPA proposal target about 7,500 coal-fired plants, oil refineries and other facilities that emit at least 25,000 tons of carbon dioxide each year and create more than 70 percent of the nation's greenhouse-gas emissions. While the administration has said it prefers that Congress take the lead on climate change, it remains unclear whether it can pass a bill this year.

The EPA's move is significant, because under the Clean Air Act, any facility emitting more than 250 tons per year of a regulated pollutant must meet federal requirements. The agency is seeking to modify that requirement to target the biggest emitters of greenhouse gases.

"By using the power and authority of the Clean Air act, we can begin reducing emissions from the nation's largest greenhouse gas emitting facilities without placing an undue burden on the businesses that make up the vast majority of our economy," EPA Administrator Lisa P. Jackson said in a statement.

But former EPA air administrator Jeff Holmstead described the proposal as "a valiant effort by the EPA to fit a square peg into a round hole" and said it will probably face legal challenges. The rule is subject to public comment for 60 days; the EPA did not say when it would become final.

The Senate bill would cut the nation's greenhouse-gas emissions 20 percent from 2005 levels by 2020 and create what Boxer described as "a soft collar" that aims to curb price volatility in the carbon allowance trading market. If allowance prices reached $28, it would trigger the release of reserve allowances to keep prices in check. For the first five years, the price trigger would rise 5 percent above the rate of inflation; after 2018, it would rise 7 percent.

The measure also calls for the Commodity Futures Trading Commission to set regulations overseeing the carbon trading market, though it does not specify what those rules would look like. It establishes an emission allowance rebate program targeted at some trade-sensitive and carbon-intensive American industries, but it excludes the oil industry. And the bill does not spell out how those rebates would be distributed, just as it leaves open the question of how the federal government would allocate carbon allowances to ease the transition to a low-carbon economy.

Jason S. Grumet, president of the Bipartisan Policy Center, said the Kerry-Boxer bill represents progress because it seeks to contain the cost of carbon allowances businesses will have to buy and sell to comply with any federal limit on greenhouse-gas emissions.

"It addresses one of the most significant concerns the business community and conservative members of Congress have had for the past 10 years, which is having some upper limit on the potential program's cost," Grumet said. "Whether policy progress will be reflected in political momentum in this very difficult political environment remains an open question."

Because several panels have jurisdiction over the bill, Kerry said that the Environment and Public Works Committee and the Finance Committee could have competing proposals on carbon allowances, but that they could reconcile them. "I'm convinced we're going to pull this together," he said.

A lobbyist for the oil refining industry, who spoke on the condition of anonymity because he represents clients that would be affected by the legislation, questioned why the measure leaves such questions unresolved: "I know they've been talking to people. There's no evidence those talks have led to any progress for three months."

Gene Karpinski, president of the League of Conservation Voters, said the fact that the measure does not spell out details such as which industries might receive free allowances "signals that a lot of important conversations will have to occur to get the support we need." But he added: "It's obviously a hugely important step forward signaling that it's time to move forward in the Senate."

Several key Democrats such as Senate Agriculture Chairman Blanche Lincoln (Ark.) and Sen. Debbie Stabenow (Mich.) said they need to review the Kerry-Boxer bill before taking a position on it. Lincoln told reporters that she intends to help shape the parts of the bill affecting agriculture and that she doubts the chamber can complete work on it by the end of the year. "It's going to be tough, real tough," she said.

Republicans delivered an even harsher assessment. Sen. John Thune (S.D.) said the measure is "much worse" than the House-passed climate bill. "It's more expensive, it's more restrictive, it's more aggressive," he said.

And Sen. John McCain (R-Ariz.), who sponsored the first climate bill to make it to the Senate floor for a vote, said the new bill does not do enough to promote nuclear power and is open to special-interest manipulation. "The bill has no specific allocations, which made the House bill such a debacle," he said.

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