Senators Joseph Lieberman, I-Conn., and John Kerry, D-Mass., are set to debut their comprehensive energy bill Wednesday afternoon after months of negotiations and false starts. The bill plans to cut carbon pollution by 17 percent by 2020 and by over 80 percent in 2050.
A draft summary obtained by Fox News outlines the senators’ plans to regulate the three largest carbon emitting sectors of the economy: power plants, heavy industry, and transportation.
The three sectors will have to purchase carbon credits for their emissions. The income from those credits will go back to consumers in the form of energy bill discounts and rebates. The funds that do not go to consumers go toward reducing the deficit.
While imposing a tax on carbon, the bill does throw several concessions to the business community to garner support. The bill’s sponsors pitch the sweeping overhaul measure’s large scope as a positive for business, noting that instead of “a patchwork of conflicting state and federal regulations, it lays out one clear set of rules for reducing greenhouse gas emissions.” Those states that already have a cap-and-trade system in place will be compensated for the termination of their programs.
There is a “hard price collar” that sets the cost of the carbon credits that businesses will have to buy to offset pollution. That should help ease the fears of utility companies and heavy industry, who worried that such a sweeping bill would cause their operating costs to skyrocket.
The oil industry, still reeling from the ongoing spill in the Gulf of Mexico, will have more areas open for exploration in the Outer Continental Shelf.
However, the law allows states to enact laws prohibiting drilling within 75 miles of its coastline. And in a more damaging section, states that may be “directly impacted” by an oil spill can prevent oil leases in other areas from occurring.
The coal and nuclear power industries fare a bit better under the proposal.
Nuclear energy gets a boost though tax credits to build more power plants and $54 billion in loan guarantees to spur the domestic production of nuclear reactor parts.
Coal companies receive incentives of $2 billion to research and develop carbon capture technologies.
Manufacturers are exempt from the bill's provisions until 2016, giving them time to comply with the new rules.
Farmers are exempt from the carbon costs, which is similar to the energy bill passed by the House last summer.
The bill’s summary is quick to hit on an oft-pilloried Democratic villain declaring, “This is not a plan that enriches Wall Street speculators,” and a common complaint from previous legislative efforts like health care and financial regulatory reform insisting that “this is certainly not a plan to grow the government.”