Senate Democrats today unveiled the long-awaited 821-page discussion draft of the “Clean Energy Jobs and American Power Act,” a bill touted as “tough on corporate pollution”—but which will “improve the way the nation generates and uses energy,” without raising the “federal deficit by one single dime.”

The draft legislation (PDF), introduced by Sen. John Kerry (D-Mass.), chair of the Foreign Relations Committee, and Sen. Barbara Boxer (D-Calif.), chair of the Committee on Environment and Public Works, goes further than the Waxman-Markey bill passed recently in the House, setting a carbon pollution reduction target of 20% by 2020 and 80% by 2050 from 2005 levels. The House bill targets a 17% reduction by 2020 and over 80% by 2050 compared to 2005 levels.

The Boxer-Kerry bill proposes to accomplish this through a “Pollution Reduction and Investment system.” Specifically, it sets an annual tonnage limit of greenhouse gas emissions from specified activities and directs the Environmental Protection Agency (EPA) administrator to establish allowances equal to the tonnage limit for each year.

The system will apply only to the largest polluters in the country—around 7,500 facilities that account for nearly three-quarters of U.S carbon pollution. Small entities that emit less than 25,000 tons of carbon dioxide are not covered.

The bill also seeks to secure energy supplies as outlined for the following fuel sources:

Coal—It allocates $10 billion over 10 years to support research and development of new carbon capture and sequestration (CCS) technology. It also looks to reward “first-movers” who implement CCS on new or retrofitted plants—the higher the level of carbon capture, the greater the level of funding. Finally, it provides performance standards so that the industry has “definitive guidance” on advanced technology implementation.

Natural Gas—The bill will establish a new federal program to encourage investment in “low-carbon” generation like natural gas. It will also reward companies for reducing leaks from natural gas pipelines.

Nuclear—The bill builds on the American Clean Energy Leadership Act (the Senate’s wide-ranging energy bill released in June 2009) by increasing financing for loan guarantees and regulatory risk insurance. It also supports research for nuclear technology and waste management and training programs.

Renewables—Much like the American Clean Energy Leadership Act, the Boxer-Kerry bill would require utilities to obtain 3% of sold electricity from renewables or from energy efficiency improvements between 2011 and 2013. The Boxer-Kerry bill, however, includes significant new investments in cutting-edge research and development funding for renewable energy sources.

For more information, see a section-by-section summary of the Boxer-Kerry draft (PDF).

Source: Sen. John Kerry