Washington Preps for Global Warming Debate in 2009

October 10, 2008

Days Until Presidential Election: 25

TABLE OF CONTENTS

Carbon Regulation: Washington preps for global warming debate in 2009
Legislation Summary
Calendar

For a side-by-side comparison of major energy bills, click here.
For a side-by-side comparison of market regulation measures, click here.

Carbon Regulation
Elections

• Amid the ongoing financial crisis, Washington is preparing for the expected global warming debate in 2009.
• Sens. Barack Obama (D-IL) and John McCain (R-AZ) have both made campaign pledges to address global warming.
  • While Sens. Obama and McCain differ on some key details, both represent a contrast from the Bush Administration’s stance on climate change. President Bush has threatened to veto any legislation that includes mandatory emissions caps.
  • Senate Environment and Public Works Committee Chairwoman Barbara Boxer (D-CA) said she will remind the incoming administration of the global warming promises made on the campaign trail, regardless of what other issues may rise to the top of the agenda.
    • Sen. Boxer said, “Whoever is the president, I’m going to be in touch with them before they’re sworn in and say, ‘The first 100 days, send us your principles that you’d like to see in a bill.’”
  • Sen. Obama and House Speaker Nancy Pelosi (D-CA) have discussed cap-and-trade measures for the next Congress.
• On Tuesday leaders of the House Energy Committee released a draft of their global warming measure. The proposal was authored by House Energy Chairman John Dingell (D-MI) and member Rick Boucher (D-VA). The measure contains some key differences with the legislation that failed in the Senate last June.
  • The draft bill would require a 6% reduction in greenhouse gas emissions by 2020, and an 80% reduction by 2050.
    • The Senate measure would have required a 19% reduction by 2020, and a 71% by 2050.
    • Reps. Dingell and Boucher said the lower target for 2020 would allow time for the development of clean energy technology such as carbon capture.
  • The measure would cap greenhouse gas emissions and establish a market-based program for industry to trade emissions credits.
  • The draft bill would preempt certain state-level emissions caps, preventing states from creating their own emissions reduction programs. A related provision in the proposal would preempt state motor vehicle emissions standards.
• Despite increased inter-branch cooperation, enacting a measure into law still won’t be easy.
  • Several issues remain unresolved from June’s Senate floor debate over carbon regulation. These include allocation of trillions of dollars in emission credits over the next half-century, and how to approach countries such as China and India that do not regulate their own emissions.

CATALYST:
Congress passes greenhouse gas legislation in 2009

IMPACT:
American Electric Power (AEP)
Edison International (EIX)
Evergreen Energy (EEE)
General Motors (GM)
Ormat Technologies (ORA)
Xcel Energy (XEL)

HANDICAP:
80%

Directional Bias: Green is upward, Red is downward, Black is neutral.
Click here for an explanation of Directional Bias.

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