ANALYSIS - State Carbon Plans May Stall US Climate Bill
Date: 05-Dec-07
Country: US
Author: Timothy Gardner
"The biggest issue is how do we incorporate all these state regimes into a federal program," said Peter Fusaro, a carbon market expert and founder of energy advisors Global Change Associates in New York.
Nine US Midwest states became last month the country's latest region to pledge to fight global warming. They agreed to form a plan to cut greenhouse emissions by up to 80 percent by 2050. Ten states in the East are set to regulate by 2009 carbon dioxide, the main greenhouse gas, at power plants. And the Western Climate Initiative, a group of five states, plans to cut emissions 15 percent by 2020.
The rise of the states has come amid growing excitement about the prospects of national climate legislation, particularly as delegates from about 190 countries are meeting in Bali, Indonesia until Dec. 14 to hunt for a new global deal to fight global warming. This week, a full US Senate committee is expected to hold a vote on a leading climate bill, sponsored by Joe Lieberman, a Connecticut Independent, and John Warner, a Virginia Republican.
But now, much may have to be ironed out between federal and state governments before any national plan becomes law, experts said.
"State preemption is one area that's getting very, very tricky," Jonathan Black, a staff assistant for Sen. Jeff Bingaman, said at a utility conference in New York on Tuesday. He said the states could be one factor preventing the quick passage of a climate bill. Black's boss, a New Mexico Democrat, has introduced climate legislation that is in some ways more moderate than the leading bill.
Years ago, former New York Gov. George Pataki and other governors forming the climate pacts had hoped state greenhouse laws would push big emitters like utilities and oil companies to lobby the US Congress to quickly pass a federal plan. With a national carbon regime, companies would not have to face the expenses and difficulties of complying with the patchwork of different laws in every region in which they operated, the thought went.
Indeed, major oil companies, the Big Three car makers, and utilities, have come together under a group called US Climate Action Partnership to pressure Congress -- but not as quickly as hoped.
STATES GET ENTRENCHED
Even if the Senate approves the leading climate bill, the legislation could face a difficult time becoming law. The House of Representatives has moved more slowly on carbon legislation, and President George Bush opposes mandatory regulation of climate-changing gases.
With the recent Midwest agreement, nearly half of Americans will live in areas covered by agreements designed to combat global warming, according to Washington-based World Resources Institute.
"As time goes on... and as these states get further and further entrenched," said Black, "these members are going to face a lot of pressure back home to not support something that doesn't necessarily look like what they are doing, or at the least oppose things that would weaken what they would do."
A key difference between many of the states and the federal legislation is how to kick start an emissions market through distribution of tradable credits representing greenhouse gas emissions reductions to polluters.
Many of the states hope to auction 100 percent of the allocations, while federal legislation aims to auction roughly only a quarter of them.
"At this point, federal legislation looks as though it is lagging behind more progressive efforts in a number of the states," said Frank O'Donnell, president of Washington-based Clean Air Watch.
O'Donnell and Fusaro said the rise of the states is one factor that could help delay passage of a federal plan well into the administration of the next US president.
(Editing by Marguerita Choy)
