On September 4, Sen. Kit Bond (R-MO) sent a letter to his colleagues criticizing climate change legislation recently released by Sens. Joe Lieberman (I-CT) and John Warner (R-VA) - both members of the Environment and Public Works Committee (EPW). In the letter, Bond also calls for a federal pre-emption of state and regional carbon cap programs. (See 9-5-07 NEPPA e-Weekly for a summary of the Lieberman-Warner climate proposal.)
Bond cited the following as reasons that the bill would adversely affect the U.S. economy:
- It would give away approximately 70 percent of the pollution credits for free to power companies, but not allow the transportation sector to receive any of the allowances;
- It "requires significant harm to the economy before triggering cost containment and management measures;"
- The proposal would hurt low-income consumers because it sets aside allowances to meet 100% of the needs of rural electric-cooperatives, while providing little energy-cost impact assistance to low-income people in urban or suburban areas. The bill also provides help to middle-income consumers for energy efficiency programs, while giving little to low-income consumers; and
- The Carbon Market Efficiency Board included in the bill, which would be in charge of oversight of cost-containment measures and would be modeled after the U.S. Federal Reserve Board, would be immune to the hardship the bill would inflict on workers, consumers, families or individuals.
Sen. Bond is a senior member of the Senate EPW Committee and a strong supporter of coal. This letter provides a sample of the arguments that will be made by opponents of the Lieberman/Warner bill.
Lieberman's spokesman said that Bond's letter does not account for the fact that studies by the U.S. Environmental Protection Agency (EPA) and Energy Information Administration (EIA) found that a similar climate change proposal introduced by Sens. John McCain (R-AZ) and Lieberman found only minimal costs to the economy.