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Sen. Harry Reid Unveils Moderated Energy Legislation
On July 27, Senate Democrats released their long-awaited energy legislation, with an eye on achieving some legislative progress before their August recess. To secure bipartisan support for the bill, Senate Majority Leader Harry Reid (D-NV) has assembled a scaled back version of various proposals. As a result, a carbon pricing regime is not included in the new legislation. Still, advocates of carbon pricing (including White House Press Secretary Robert Gibbs) have this week pointed to the possibility of including a provision during a House-Senate conference either before or after the November midterm elections. In an article, the New York Times
analyzed this possibility.
The bill would remove the current $75 million liability cap on economic damages from an oil spill, and make the change retroactive to apply to the Deepwater Horizon spill. It includes a title to incentivize the production of electric and natural gas vehicles; the so-called HomeStar bill, which would create a federal program to provide incentives to make homes more energy efficient; and a still undefined increase to the per-barrel oil tax that contributes to the Oil Spill Liability Trust Fund.
As of this posting, the bill has not yet been formally filed.
Draft Summary of Senate Democrats' Energy Bill
New York Times Article on Including Carbon Pricing in Conference
Sen. Bingaman's Renewable Energy Standard Bill Not Included
Despite widespread reports leading up to the announcement of the Senate Democrats legislation, it appears that Sen. Jeff Bingaman's (D-NM) American Clean Energy Leadership Act of 2009 (S.1462), that cleared the Senate Energy and Natural Resources Committee last year, would not be included. While many renewable energy companies had initially called for a higher renewable energy standard than Sen. Bingaman's bill, the elimination of it due to political pressure and time constraints, has led many to call for its insertion into the Democratic package, according to the Washington Independent.
The Bingaman bill would create a national renewable energy standard, or a provision that would require that 15 percent of energy be produced by renewable sources by 2021. Sources would include "wind, solar, ocean, geothermal, biomass, landfill gas, incremental hydropower, hydrokinetic, new hydropower at existing dams with no generation," according to a summary of the bill.
Washington Independent Article
Summary of Sen. Bingaman's Legislation
Alaskan Senator Signal Doubts About New Legislation
On July 29, Sen. Mark Begich (D-AL) told the Associated Press he would consider supporting a Republican energy reform bill if the Democratic legislation is lacking, signaling legislative difficulties ahead for Majority Harry Reid. Sen. Begich said his main concern was that the Democrats' proposal was not comprehensive enough, and cited the removal of the $75 million cap on economic liability from an oil spill as one of his key concerns.
The Republican alternative is the Practical Energy and Climate Plan Act of 2010 (S. 3464), sponsored by Sens. Richard Lugar (R-IN), Lindsey Graham (R-SC) and Lisa Murkowski (R-AK). The bill would not place a cap on emissions, but would boost efficiency for cars, light trucks and new buildings, and reduce oil imports by raising vehicle fuel economy standards and supporting domestic oil production.
Associated Press Article
Practical Energy and Climate Plan Act of 2010
New Report Finds Past Decade Hottest on Record
On July 28, the National Oceanic and Atmospheric Administration (NOAA) issued a report that found the past decade was the hottest on record, and part of a pattern of global warming dating back 50 years.
The report drew on data from more than 300 climate scientists in 48 countries.
NOAA Report
Regional Group Releases Draft Proposal for Cap-and-Trade
On July 27, a group of seven states and four Canadian provinces called the Western Climate Initiative released a draft outline for a cap-and-trade program that would begin operating in 2012. The group includes Arizona, British Columbia, California, Manitoba, Montana, New Mexico, Ontario, Oregon, Quebec, Utah, and Washington.
A smaller subgroup of the Western Climate Initiative (California, New Mexico, Ontario, Quebec and British Columbia) have committed to move first to limit carbon dioxide emissions based on the shared outline.
Western Climate Initiative Cap-and-Trade Outline
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China Proposes Carbon Trading Scheme
According to a July 26 report from Risk.net, the Chinese government plans to move forward with a carbon trading scheme “to be implemented from 2011 to 2015.” The report noted that plans to cut carbon emissions are now “too expensive” for the country to meet previously defined targets and should be funded through an emissions trading scheme.
Preliminary reports from the Chinese state media suggest a trading scheme could create a program that may either set an absolute cap on carbon dioxide emissions in a certain area or industry, or offer the option of converting the country’s carbon intensity target into carbon-related allowances for trading schemes.
Risk.net article
UN Lays Out Post-Kyoto Options
On July 20, the United Nations Framework Convention on Climate Change (UNFCCC) released a paper that outlines options if there is no agreement on a successor to the Kyoto Protocol, which is set to expire in 2012. The paper suggests it may be possible to extend emission caps for two years after they expire in 2012, as there does not appear to be a global consensus for resolving climate issues.
The paper also notes that clean development mechanisms (CDMs) would suffer without either an extension of the Kyoto Treaty or an entirely new agreement. The paper states, “under this interpretation, no new CDM project activities could be validated or registered, emission reductions or removals that occurred after the first commitment period could not be verified, and corresponding CERs could not be issued.”
UNFCCC Paper
EU Nations Set Carbon-Auction Rules
On Wednesday, July 14, the European Union member states agreed on rules for auctioning carbon permits after 2012. The draft regulation provides for a "simple, single-round, sealed-bid, uniform-price" auction format that is easily accessible for ETS operators and other eligible bidders. It also provides for a predictable auction calendar with annual volumes being determined automatically on the basis of a straightforward rule in the regulation.
More specifically, the agreement states: “From the start of the third trading period in 2013 auctioning will progressively replace free allocation as the main method for allocating allowances to all EU ETS sectors except aviation. In 2013, at least half of the total volume of allowances is expected to be auctioned.”
The vote on the auctioning regulation sets up a three-month “scrutiny period” in the European Council and the European Parliament, after which the measure could be adopted by the Commission.
EP Press release
Europe Outpaces US in Race for Foothold in China
On Tuesday, July 27, Euractiv.com reported that European companies continue to have a stronger presence in the Chinese renewable energy market, largely due to the pace at which China plans to incorporate green energy production. Because of the rapid pace of modernization, China chooses to purchases licenses from European companies that have patented the technology. It was also reported that the US is falling behind on supercritical (SC) and ultra-supercritical (USC) technologies in the clean coal segment of green energy.
Despite the strong European presence, both European and US companies are concerned with intellectual property rights and technology transfers from the Chinese government to state-owned companies. Typically, China uses SC and USC technologies, but then appropriates the technology, causing companies to become reluctant participants in the large and growing market.
Euractiv report
| The Weeks Ahead |
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Monday, August 9 - Tuesday, August 10
The New York Academy of Sciences
7 World Trade Center, 250 Greenwich Street, 40th floor, New York, NY
The 5th Annual New Energy Symposium
Tuesday, September 14 - Wednesday, September 15
9:00 AM
GreenPower Conferences
Washington Marriott, 1221 22nd Street NW, Washington, DC
Solar Policy and Economics Forum USA
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