I’ll admit that I never had much hope for the Waxman-Markey Cap & Trade climate bill, but now it’s just a bad, bad joke.
During the final days of the drafting of a 946-page climate bill, Rep. Gene Green (D-Tex.) won support for an amendment that deleted a single word and inserted two others. The words could be worth millions of dollars to U.S. oil refiners.
The Green amendment deleted the word “sources” and inserted “emission points.” In the arcane world of climate legislation, that tiny bit of editing might one day give petroleum refiners valuable rights to emit carbon dioxide when it otherwise might not have been allowed. Refiners could get the extra allowances in return for cutting carbon emissions by 50 percent at a single point of a vast refinery complex instead of slashing emissions by 50 percent for the entire facility.
That’s like a building inspector giving a safety permit for a new hospital because there’s a smoke detector at the front door, while the rest of the building has loose electrical wires, faulty construction, and a cracked foundation. Only this is much, much more dangerous.
And that’s just one of the many compromises (read, foolish allowances) that have been added to the bill in its journey through the House of Representatives.
Point Carbon, a market analysis firm, estimates that the current House draft earmarks $254 billion in allowances — one sixth of the estimated total value of allowances from 2012 through 2030 — and gives them to industries most sensitive to carbon pricing, including coal-based electric power generators, energy-intensive manufacturers vulnerable to foreign competition, oil refineries and the automobile industry.
And the bill hasn’t even made its way to the Senate yet, where it’s likely to get watered down much more.
From what I can tell, the environmental and climate groups have gone through a painful process of disillusionment, with the exception of big fish like Environmental Defense, which had a major role to play–working with industry groups–in crafting the bill.
Supporters of the bill say its key component is an iron-clad cap on the nation’s emissions that drops over time. They said it doesn’t matter how allowances are distributed.
“The environmental goals depend on having a strong cap and a time horizon to encourage innovation,” said Nathanial Keohane, an economist at the Environmental Defense Fund. “That’s what we see in the bill.”
A time horizon, huh? After 2030? That’s brilliant, especially when climate scientists like NASA’s Dr. James Hansen, tell us that we need to get down to 350 parts per million of carbon dioxide in the atmosphere to avoid the risk of disastrous threshold events like the shut down of the gulf stream. We’re at 388 ppm and rising, and evidence is mounting that the effects of global climate change are happening much more quickly and severely than even the worst of predictions. So, yeah, it makes a lot of sense to give away permits.