Global Warming In the News

Darren Samuelsohn, E&E Daily senior reporter

Two pro-industry plans are emerging as the Senate gears up for a June floor debate on a major piece of global warming legislation, but there are few takers thus far.

Sen. George Voinovich (R-Ohio) has taken the lead on one broad-based climate plan focused first on tax breaks for industry to help it make investments in new and existing low-carbon energy technologies, including nuclear power and carbon capture and storage at coal-fired power plants.

Voinovich's "Incentives-Based Alternative Climate Policy Act" also calls on a future Congress to enact a mandatory cap-and-trade program if the White House determines after three consecutive years that the tax breaks aren't working. According to a draft version obtained Friday by E&E Daily, the Voinovich bill would seek to reduce greenhouse gas emissions to 2006 levels by 2020 and to 1990 levels by 2030.

A second approach comes from a coalition of the nation's biggest coal companies, including Peabody Energy, Arch, Foundation, Rio Tinto, Consol Energy, and the industry's leading trade group, the National Mining Association. It too has a heavy mix of technology funding and incentives for underground carbon storage, including liability protection and authorization of the FutureGen power plant that the Bush administration scrapped earlier this year for several smaller scale projects.

Spelled out in a series of 14 individual amendments, the coal companies' plan also suggests several other significant substitutions to the Senate bill from Sens. Joe Lieberman (I-Conn.) and John Warner (R-Va.) due on the floor starting June 2.

The coal companies pull generously from a separate climate bill drafted last summer by Sens. Jeff Bingaman (D-N.M.) and Arlen Specter (R-Pa.). They suggest the Bingaman-Specter method for distributing billions of dollars worth of emission credits to industry via a mix of auctioning and free allowances to industry. The coal industry also calls for use of a "safety valve" that puts an absolute ceiling on the price of a emission allowance.

Both the Voinovich and coal industry proposals include almost identical language calling for the elimination of state and regional laws for global warming -- an approach sure to spark opposition from California and the Northeast. And they both would overturn the Supreme Court's year-old decision in Massachusetts v. EPA that gives the federal government the green light to start regulating for global warming.

The two industry-friendly alternatives come as the Senate sponsors of Lieberman-Warner look to shore up their own support before this spring's scheduled floor debate. The bill's lead authors have been meeting with potential swing-vote Democrats and Republicans on several hot-button issues relevant to the debate, including cost containment, international competition and nuclear power.

"We're just trying to see where people are, and how they feel with the different provisions and if there's something they feel we didn't do right and something we did do right," Senate Environment and Public Works Chairwoman Barbara Boxer (D-Calif.) said last week.

Boxer has pledged to pull the Lieberman-Warner bill from the floor if opponents have success in making any major changes to the legislation that weaken it. Several industry sources say they doubt there will even be a significant floor debate on climate this year because moderate and conservative Senate Democrats do not want to take votes on the issue at a time when gas and energy prices continue to increase.

Trouble finding cosponsors?

Voinovich opposed the Lieberman-Warner bill when it emerged last December from Boxer's committee. He has since been on the lookout for Democratic cosponsors, but sources on and off Capitol Hill say Voinovich has not won over any converts yet to his proposal.

"The senator has been talking and working with those willing to come to the table on developing a strategy that will actually help the environment and not kill our economy," Voinovich spokeswoman Garrette Silverman said in an e-mail Friday. "No legislative text has been finalized and the timetable for an alternative bill is fluid at this point," she added.

Voinovich, a former Ohio governor, got help in crafting his proposal from industry lobbyists in the Washington office of Bracewell & Giuliani. The law firm includes President Bush's first-term U.S. EPA air pollution chief, Jeff Holmstead, and Scott Segal, director of the Electric Reliability Coordinating Council.

Segal said his coalition, which includes Southern Co., Progress, Ameren, CSX, Luminant, Salt River Project and Duke Energy Corp., has not endorsed any specific piece of climate legislation. But he nonetheless insisted that the Voinovich proposal better heeds industry concerns compared with the Lieberman-Warner plan.

"The principal cap-and-trade bills have the same flaw: too much near-term fuel switching resulting in extraordinary costs," Segal said. "The way out of that trap is to develop and deploy adequate technology to meet our goals. It seems to me that the Voinovich legislation is the only proposal that takes that challenge seriously."

Not everyone agrees with that assessment.

Tony Kriendler, a spokesman at Environmental Defense, said the Voinovich alternative does not come close to meeting the challenge of reducing heat-trapping greenhouse gas emissions. "This is a do-nothing bill," he said. "And because it does nothing, it's by far the most expensive proposal on the table."

As for the coal company proposal, industry officials said they do not yet have any cosponsors for their amendments. But they have been sharing ideas for several months with more than a dozen Senate Democratic and GOP offices, including Bingaman, Specter, Voinovich and Sen. Byron Dorgan (D-N.D.).

"Given concerns about Massachusetts v. EPA, the activity occuring at the state and local level, our industry is as motivated as any industry to move reasonable climate legislation forward in the days that remain in this Congress," Kraig Naasz, president of the National Mining Association, said in an interview.

Neither the Voinovich nor the coal company proposal comes with direct support from the Bush administration, though both include themes likely to line up with the "principles" that the president spelled out earlier this month in his Rose Garden speech on global warming.

"We understand a number of players are working on a variety of ideas," said Kristen Hellmer, a spokeswoman at the White House Council on Environmental Quality. "We will evaluate all of those against the president's principles when formal legislation has advanced."