6. Climate Change: McCain, Lieberman call for economy-wide GHG cap-and-trade scheme (E&E Daily, 08/06/2001)

Sens. Joseph Lieberman (D-Conn.) and John McCain (R-Ariz.) during speeches on the Senate floor Friday called for an economy-wide cap-and-trade scheme for greenhouse gas (GHG) emissions many scientists blame for rising global temperatures, though they have yet to introduce legislation mandating such a scheme.

The best chances for passage of legislation regulating GHG emissions lie in the Senate, where various committees with jurisdiction will begin hearings on portions of competing comprehensive energy bills when Congress reconvenes in September and there has been momentum for climate-related action. The energy package the House passed Wednesday, H.R. 4, would not regulate GHG emissions; in fact it is largely silent on climate-specific programs.

Lieberman and McCain's plan would expand upon S. 556, the so-called "multi-pollutant" bill introduced by Sen. Jim Jeffords (I-Vt.) to limit emissions of carbon dioxide and three other pollutants from power plants. That bill has yet to be marked up.

There has, however, been significant Senate action on the climate change front. Last week, the Senate Governmental Affairs Committee, which Lieberman chairs, passed S. 1008, requiring the Bush administration to establish a White House office dedicated to formulating, within one year, a national strategy to stabilize greenhouse gas emissions many scientists blame for rising global temperatures (see the 8/3 edition of Environment and Energy Daily).

That bill, however, seems like a fallback plan for Lieberman. Late last month the United States was the only country party to the 1992 United Nations Framework Convention on Climate Change (UNFCC) not to support an agreement reached in Bonn, Germany, paving the way for ratification of the Kyoto Protocol, a UNFCC side agreement that requires industrialized countries to cut GHG emissions an average 5 percent below 1990 levels by no later than 2012.

That agreement outlines an international GHG credit trading system, possibly leaving U.S. companies disadvantaged. McCain and Lieberman's plan would create a similar market, though it was unclear at press time whether they plan to make the U.S. market mesh with the international system.

"I believe this failure [to reach agreement on the Kyoto Protocol] abdicates the United States' position as a leader in environmental affairs and places U.S. industry at risk," Lieberman said on the floor. By creating a cap-and-trade system here, "we will unleash the power of that market to drive the United States back into its leadership position in the international effort to avoid the worst effects of one of the most serious environmental problems the world community has ever faced."

For McCain, already a leading Republican proponent of action to curb global warming, it was his strongest stance yet. "The agreement reached last week in Bonn, Germany on the Kyoto Protocol means that the rest of the world is moving forward to address this important problem," McCain said on the floor. "Given the fact that the United States produces approximately 25 percent of the total [global] greenhouse gas emissions, the current situation demands leadership from the United States.

"We should reward improvements in energy efficiency, encourage advances in energy technologies and improve land-use practices. Deploying the power of a marketplace to pursue the least-expensive answers is a unique and powerful American approach to the threat of climate change," McCain said.

McCain and Lieberman said they plan to meet with industry sector representatives to discuss possible legislation when Congress reconvenes. Their plan is sure to draw fire from conservative Republicans, several of whom introduced competing language to S. 1008 Wednesday.

Unlike S. 1008, the GOP bill, introduced by Sens. Chuck Hagel (R-Neb.), Frank Murkowski (R-Alaska) and Larry Craig (R-Idaho), places no deadline on a White House effort to develop a domestic climate change response strategy. It also seems to encourage President Bush to slam the door on mandatory GHG caps for industry by "improving and expanding" the voluntary CO2 emission reduction registry maintained by the Department of Energy. -- J.L. Laws

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