Senate offers some hope for legislation to combat climate change

Wednesday, February 10, 2010

CLIMATE CHANGE legislation, according to conventional wisdom, is all but dead for the year. It fell victim to Senate gridlock, yawning gaps between lawmakers over how and even whether to tackle the issue and President Obama's decision last year to place it third on his list of priorities, after the stimulus and health care. The president himself seemed to admit at least temporary defeat last week; at a town hall meeting in New Hampshire, Mr. Obama cited speculations that the Senate might pass only a modest energy bill. Such a bill inevitably would contain expensive subsidies and research programs, but it would not place a price on carbon.

Putting a price on the burning of oil, gas and coal is the most efficient way to limit American greenhouse emissions, but Mr. Obama -- though he supports the idea -- didn't even mention carbon pricing when he discussed energy with reporters on Tuesday.

A version of such a scaled-down energy bill passed the Senate Energy Committee last year, and it contains some worthwhile provisions, such as updating building codes and the electricity grid. It is also incomplete, lacking both much in the way of revenue to pay for its programs and any economy-wide emissions limit. The House-passed Waxman-Markey climate bill, by contrast, contains a cap-and-trade provision aiming to provide for both, but that bill is marred by giving away far too many valuable pollution permits to politically favored groups, a scheme of which many senators are rightly skeptical.

Is there no alternative between simple do-nothingism and House complexity? In fact, there is. An alternative proposal increasingly capturing interest on Capitol Hill is the CLEAR Act, sponsored by Sens. Maria Cantwell (D-Wash.) and Susan Collins (R-Maine). The bill would cap the amount of carbon the United States produces and sell pollution permits to those who produce or import dirty fuels. Suppliers would pass these costs to customers, , which would discourage carbon-guzzling. It would also raise costs, of course, but the government would rebate 75 percent of the revenue from the permit auctions back to the populace.

Ms. Cantwell and Ms. Collins estimate that 80 percent of Americans would break even or come out ahead, even as consumption patterns shifted toward greener goods and greater energy efficiency. Congress would use the rest of the money to pay for some of the things in that energy bill, things that merely raising the price of carbon might not accomplish -- investing in transmission infrastructure, for example, or basic research and development. There is a risk that lawmakers will waste some of this cash, but it's a defensible one.

Meanwhile, The Post's Juliet Eilperin reports that Sen. Lisa Murkowski (R-Alaska) might propose a simple tax on carbon, with all proceeds returned to taxpayers, perhaps via a cut in payroll taxes. Though it might be tougher to pass, such an approach is also very appealing for similar reasons. At the same time, Sen. Lindsey O. Graham (R-S.C.), who is trying with Sen. John F. Kerry (D-Mass.) and Joseph I. Lieberman (I-Conn.) to assemble a bipartisan bill, has been discussing the Cantwell-Collins proposal with his colleagues, reportedly to some favorable reaction. In other words, there is a chance that the failure of the House's bill in the Senate and the search for a Plan B will yet produce better legislation.

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