US utilities form alliance to curb carbon dioxide emissions
Date: 24-May-01
Country: USA
Author: Patrick Connole
The plan runs counter to a decision made earlier this year by President George W. Bush rejecting caps on carbon dioxide emissions. The president said such caps were too costly and risky, given the nation's worsening energy supply crunch.
Carbon is considered the leading cause of man-made greenhouse gases, which are in turn blamed for global warming.
Included in the industry proposal are a national tonnage cap for emissions and a gradual reduction in carbon dioxide pollution, according to the industry source, who spoke on condition of anonymity.
Utilities would be allowed to go outside their own operations to gain credits for cutting pollution in other businesses, like buying clean-burning vehicles not related to running power plants.
The industry source said the proposal seeks to balance the need for certainty on pollution controls with a transition period for utilities to adapt to new emission controls.
WHITE HOUSE SUPPORT?
The Bush administration was "interested" in the plan's market-oriented design, he said.
"We're trying to work in a cooperative way with the Bush administration to solve the problem." said the source.
"We're looking for as much business certainty as we can achieve. There is now an unacceptable level of uncertainty (over the fate of carbon dioxide emission limits)."
The plan is to be completed next month, after which the group will seek support to move the proposal in Congress.
The eight firms, which work together on the four-pollutant plan as a coalition known as the Clean Energy Group, want to cap carbon, sulfur dioxide, nitrogen oxide and mercury emissions.
The utilities in the coalition are Conectiv , Consolidated Edison , Exelon Corp , Keyspan Corp , Northeast Utilities , PG&E National Energy Group , PSEG and Sempra Energy.
In addition to more certainty over how future power plant emissions will be regulated, the group wants to ease concerns on Wall Street.
Nervousness in the capital markets over the issue of emissions could slow financing for the hundreds of power plants expected to be built in United States in the coming decades.
NO KYOTO
The industry plan in no way mirrors the design of the Kyoto Protocol, the treaty shunned by Bush as an unworkable accord which would punish the U.S. economy if implemented.
Kyoto mandates cuts in major economic nations' carbon emissions by an average 5.2 percent below 1990 levels by 2010.
Bush removed the United States from the process to settle a final Kyoto agreement, and is expected to counter with a new proposal sometime this summer.
Christine Todd Whitman, administrator of the U.S. Environmental Protection Agency, said Wednesday that the administration would soon be ready to outline his alternative plans for combatting global warming.
Whitman made her remarks to reporters in Stockholm, where she was among those signing a U.N. treaty to outlaw 12 toxic chemicals.
The following are the general points of the plan, according to industry sources familiar with the proposal.
* Sulfur dioxide would be cut 50 percent by 2008.
* Mercury emissions would be cut 70 to 90 percent by 2012.
* Nitrogen oxides would be capped at just over 2 million tons in 2008, around half of current levels.
* Carbon emissions would stabilize at the levels recorded in the year 2000 by 2008, and reach 1990 emission levels by 2012, the proposal says. Flexible mechanisms would be in place to help achieve the reductions.
