CLIMATE:

Details trickle out on Waxman-Markey proposal

Two senior House Democrats will unveil a 600-page draft global warming and energy bill today that they hope will prompt an intense round of internal negotiations, culminating with passage out of the Energy and Commerce Committee before June, according to several lawmakers and off-the-Hill sources briefed on the measure.

The bill from Chairman Henry Waxman (D-Calif.) and Energy and Environment Subcommittee Chairman Ed Markey (D-Mass.) includes four separate titles aimed at overhauling U.S. climate and energy policy, starting with a cap-and-trade program that sets mandatory limits on greenhouse gas emissions over the next four decades.

Waxman and Markey have also included a nationwide standard for renewable electricity production, as well as a federal low carbon fuel standard modeled after California law.

The two lawmakers offered a broad outline of their proposal to Democratic committee members during a closed-door meeting yesterday. Committee staff also previewed the legislation to members of the U.S. Climate Action Partnership coalition and environmental groups, with a public release expected this morning.

Several Democratic lawmakers briefed on the package praised the two new chairman for putting together a discussion draft that they predicted was on track for passage.

"Everything's converging," said Rep. Charles Gonzalez (D-Texas). "You're going to see a product. I believe we're going to get something out."

"I think there might be some angst, but they'll get there," added Rep. Bart Stupak (D-Mich.).

Waxman and Markey also unveiled a preliminary schedule for moving the legislation, starting with hearings on the bill during the week of April 20 as lawmakers return from a two-week spring recess. A subcommittee markup is penciled in for the week of April 27, with a full committee markup to follow during the week of May 11.

And looking out several months ahead, House Science and Technology Chairman Bart Gordon (D-Tenn.) said Democratic leaders envision conferencing a final House energy and climate bill with a Senate-passed measure later this fall. But Gordon later added that Democrats have considerable wiggle room built into that plan. "If you were to model it out, that's the model," he said. "But things don't always happen the way you'd like for it."

Emissions targets prompt quick debate

On cap and trade, the Waxman-Markey draft seeks to curb emissions on a slightly more aggressive scale than the limits proposed by President Obama.

The Democrats' proposal calls for a 20 percent cut from 2005 levels by 2020, compared with Obama's budget released in February that suggested a 14 percent cut in 2020.

Both the Waxman-Markey draft and Obama's plan do line up on a midcentury target curbing emissions by 83 percent. But the House lawmakers offer more specifics than the new administration when it comes to the cap-and-trade program's start in 2012. The Democrats call for a 3 percent emissions cut from 2005 levels. They also include a 42 percent reduction in 2030.

"I think the goals are realistic," said Rep. Jay Inslee (D-Wash.) "It's based on science, rather than fear."

But Rep. Rick Boucher (D-Va.) countered that the 2020 limits may be too aggressive for industry given technological constraints. "I think it's challenging," Boucher said, adding that he planned to glean suggestions in the coming weeks from the United Mine Workers of America and the electric utility industry.

"I'm going to be proposing a series of changes to the draft and the early implementation schedule may be one of those," Boucher said.

The Waxman-Markey draft makes only one decision on the contentious debate over how to distribute hundreds of billions of dollars worth of emission credits.

Inslee said the Democratic committee leaders have incorporated his proposal with Rep. Mike Doyle (D-Pa.) that would set aside about 15 percent of the cap-and-trade program's allowances for industries considered most vulnerable to international competition, including iron and steel, aluminum, cement, glass, ceramics, chemicals and paper.

Waxman and Markey do not go into any further detail on allowances and auctions, instead leaving the issue open for negotiations with their fellow Democrats and any interested Republicans over the coming weeks. "It's a statement that we want to find consensus, rather than running this thing through," Inslee said.

Renewable electricity, energy efficiency standards make the cut

The bill includes a nationwide renewable electricity standard, which requires utilities to supply escalating amounts of power from sources such as wind, solar and geothermal.

Lawmakers and lobbyists say the standard is expected to reach 25 percent in 2025, and a fifth of this can be met with efficiency measures. Markey had earlier floated a standard of 25 percent by 2025 that did not include this efficiency carve-out.

Nonetheless this plan, if indeed in the bill, would be more aggressive than a measure passed by the House in the last Congress, which set a 15 percent standard by 2020 while allowing roughly a fourth to be met with efficiency measures. It did not advance in the Senate.

"It is a good solid piece," Inslee said. "It recognizes the advances we have made in technology most recently, the concentrated solar power contacts that are coming on. There are some good things happening out there."

A nationwide renewable power standard has been a longstanding Democratic goal but nonetheless faces continued hurdles in the Senate, where many Republicans are opposed and some conservative Democrats have misgivings.

Senate Energy and Natural Resources Chairman Jeff Bingaman (D-N.M.) this year has floated a plan that requires power providers to obtain 16 percent of their supply from renewables by 2019, and 20 percent in 2021 and for almost two decades thereafter. The plan allows a fourth of the target to be met with energy efficiency measures.

Sources tracking the House committee draft said they also expect it to include a separate measure called an energy efficiency resource standard, another Markey policy goal. Last month he introduced H.R. 889, which requires electric and natural gas utilities to take various steps to reduce demand.

H.R. 889 would require escalating savings by power providers, reaching 15 percent in 2020, while the level for gas distributors reaches 10 percent in 2020. Two sources tracking the committee draft slated for release today say it contains an efficiency standard that mirrors these levels.

Low-carbon fuel standard -- eventually

On the transportation fuels side, Rep. Gene Green (D-Texas), a member of the Energy and Commerce Committee, said the bill is expected to include a low-carbon fuel standard. This would require a reduction in the greenhouse gas emissions from the nation's fuel mix.

Green and other sources said the standard would not begin, however, until after the end of the renewable fuels standard that was expanded in a major 2007 energy bill.

The standard, which requires escalating use of renewable fuels such as ethanol and cellulosic fuels, hits 36 billion gallons annually in 2022. It requires biofuels, to varying degrees, to have lower lifecycle greenhouse gas emissions than conventional fuels like gasoline.

Green, from a Houston-area district with a number of refineries, said he had been concerned about overlapping mandates with the biofuels standard and a low-carbon fuels standard. He warned against policies that would end up "running production offshore."

"That gives me a lot of comfort level from where I was coming from," Green said of the apparent decision to have the low-carbon fuels standard begin after the current renewable fuels standard has reached its limit. However, Green noted he has not yet seen bill language.

Overall, Green praised the process so far but cautioned that much remains to be done. "I have talked to Chairman Waxman for months now and Chairman Markey, and we talk about it in good faith. We want to sit down and see what we can do and as I bring up a problem we will work on it," he said. "That is legislating. We will see how we get there, but I feel more comfortable now, but I want to see what the language is."