EEI, oil companies to back climate bill, Kerry says
Washington, 23 April (Argus) — The Edison Electric Institute (EEI) and three major oil companies will back energy and climate legislation to be released next week, said Sen. John Kerry (D-Massachusetts), one of the authors of the bill, during a conference call yesterday with members of a business coalition.
Kerry also discussed some new details of the bill he will release April 26 with Sens. Lindsey Graham (R-South Carolina) and Joe Lieberman (I-Connecticut), including that it will provide $10bn to support clean coal technology and additional funding for carbon capture and sequestration.
Kerry said on the call that it is time for coal to prove it can be clean and let the market decide, according to Damon Moglen, global warming campaign director for Greenpeace USA, who participated in the call organized by We Can Lead, a coalition of 150 businesses pushing for federal climate legislation.
Kerry did not name the oil companies, but BP, ConocoPhillips and Shell have been among the most active in the industry in pushing for legislation. Until February, all three were members of the US Climate Action Partnership (USCAP), whose proposals served as the basis for much of the House-passed Waxman-Markey climate bill. BP and ConocoPhillips left the coalition to focus on winning changes to provisions affecting their industry. All three companies declined to comment on the legislation until its release.
Shell believes that comprehensive energy and climate legislation is essential to meeting our growing demand for energy and that a national framework will help keep down the cost of doing business and provide the regulatory certainty that companies need when making investment decisions. We are hopeful that any forthcoming legislation will resolve those concerns while reducing emissions, Shell spokesman Bill Tanner said.
EEI also said it would not comment until it sees the legislation and has an opportunity to discuss it with its membership. Kerry's office did not respond to requests for comment.
Backing from EEI, the association of investor-owned electric companies, and any of the major oil companies would go a long way toward improving the chances of getting the Kerry-Graham-Lieberman bill through the Senate this summer. While EEI and USCAP played key roles in shaping the Waxman-Markey bill, coal-fired generators and refiners have been pushing for significant changes in the Senate.
Kerry also told the call that the bill's cap-and-trade program for utilities would begin in 2013, with energy-intensive industries brought in four years later. It will also include a hard price collar for allowances to prevent significant market volatility — another concern raised by EEI — and support construction of 12 new nuclear plants. Kerry also said the bill would return two-thirds of any auction revenue to consumers. Refiners will be excluded from the cap-and-trade program but would be required to purchase allowances at a fixed price and retire them. Kerry also said there would be significant offsets from the agriculture sector in the bill, but he did not say what limit if any would be placed on their use.
The bill will pre-empt existing state and Environmental Protection Agency programs to regulate greenhouse gas emissions, including the Regional Greenhouse Gas Initiative, as long as industry complies with the legislation. And it will incorporate legislation passed last year by the Senate Energy and Natural Resources Committee that included setting a renewable electricity standard of 15pc by 2021 and opening more of the eastern Gulf of Mexico to oil and gas development.
While many of these provisions could win industry support, some environmental groups such as Greenpeace have already signaled they will oppose the bill. It's clear that polluter lobbyists have succeeded in hijacking this climate policy initiative and undermined the ambitious action necessary, Greenpeace Executive Director Phil Radford said in a statement.
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