House Passes Climate Change and Energy Bill by Slim Margin

The U.S. House of Representatives passed by a narrow vote of 219–212 a mammoth climate change and energy bill on Friday that, among other things, seeks to establish a carbon emissions reduction goal, a cap-and-trade program, and a federal renewable energy standard. The bill now heads to the Senate.

The bill—which has grown to some 1,500 pages following markups in various House committees—had been a top priority for the Obama administration. The vote—one of the narrowest in recent history—was a partisan one, with only eight Republicans voting with Democrats for the bill.

The Senate, where opposition is tougher, will now write a version of the climate change bill. It is uncertain when it will be debated on the floor. Although 60 filibuster-proof votes are needed, only 45 senators mostly Democrats, can be counted as certain or probable supporters of the bill, The New York Times reports. Some 23 Democrats could vote either way, and there is very little Republican support.

Among its key aspects, the bill would require electric utilities to generate 15% of their electricity from renewable sources such as wind or solar power and show a 5% gain in energy efficiency by 2020. Governors could lower the 15% target to 12% with 8% efficiency gains if they determine the national goals are unattainable for their states. The legislation also seeks to reduce carbon emissions from major U.S. sources by 17% by 2020 and over 80% by 2050 compared to 2005 levels.

At the core of the bill is a contentious cap-and-trade program. About 85% of government-issued pollution permits to industry would be given out for free, while around 15% would be sold. Local electric distribution companies would get 30% of all permits for free, but they would have to protect consumers from price hikes. About 15% of free permits would be given to cement, steel, glass, and other big energy-using industries; 9% to local natural gas distribution companies; 3% to companies making electric and advanced technology vehicles; and 2% to oil refiners.

In 2026, many of the free permits would begin converting to purchased permits. Fewer and fewer permits would also be available to companies over the next several decades. Companies could then sell some of their permits to others struggling to meet environmental requirements.
The bill would also allow companies to offset up to 2 billion tons of their emissions annually by paying for “green” projects—such as preserving tropical rainforests—in the U.S. and abroad.

The U.S. Environmental Protection Agency estimates that the bill in its current form would cost American households between $80 and $111 per year, which equals 22 cents to 30 cents per day. A separate analysis from the nonpartisan Congressional Budget Office projected an annual cost of $175 for U.S. households by 2020, but it has said that low-income households could enjoy a $40-a-year benefit from rebates and other aid. Republicans, meanwhile, have claimed $3,100 or more per household per year in higher prices for energy and other goods.

Sources: House Energy and Commerce Committee, The New York Times, EPA, Congressional Budget Office, POWERnews

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