Wednesday, April 01, 2009

Climate Bill is All About the Coal Hard Cash

Yesterday, Congress began the debate that will determine our nation's energy future. Congressmen Henry Waxman (D-CA) and Ed Markey (D-MA) introduced a mammoth 648-page bill designed to fundamentally change the way we make and use energy in this country. The "American Clean Energy and Security Act" may look complicated, but it's really all about the cold hard cash. Or should I say, the coal hard cash.

The bill will establish a limited supply of permits allowing the release of greenhouse gas emissions by major polluters as part of an emissions reduction plan known as cap-and-trade. Those emissions permits are collectively worth tens or even hundreds of billions of dollars annually. That's a lot of cash. And yet the bill is remarkably silent about where all that money will go.

Silent that is, except for on one front: coal.

With billions of dollars up for grabs, the coal industry went straight for a big stack of cash. With the help of allies in Congress, the coal sector has already snagged at least a billion dollars each year in new subsidies to support the development of technologies the industry promises will reduce emissions at coal-burning power plants.

That sweet deal for the coal industry is the only spending the bill specifies so far. And coal companies are likely to snag even more cash as the debate unfolds and deals are cut.

So where is the money for truly clean energy sources? There isn't any. Yet.

This is only a discussion draft, I've repeatedly been reminded, and how to allocate the billions of dollars in value created by the emissions permits is still very much up for discussion (aka vigorous debate).

But the draft we see before us very much reflects the vision of the environmental groups leading the so-called U.S. Climate Action Partnership, including Environmental Defense and NRDC. And with these leading green groups setting the agenda, here's what's so telling: with billions of dollars sitting on the table, these well-known green groups leading the climate charge simply left it there -- or worse yet, looked the other way while the coal industry grabbed their pile of cash.

Why didn't these greens insist that the revenues raised from climate regulations are actually invested in technologies that reduce global warming pollution? Why didn't they fight to make sure that money directly supports the construction of wind turbines in the American Heartland, makes affordable solar panels a reality for every homeowner, and secures our energy independence by driving plug-in hybrid cars off assembly lines in Michigan and Kentucky? With all the rhetoric about green jobs flying around, why did no one else demand that Markey and Waxman reinvest carbon revenues to accelerate the emergence of the clean energy economy, acting as a true engine of job creation?

EDF and NRDC and the rest of the US CAP greens didn't fight for any of this, because for them, it simply isn't really about the money. It's about carbon prices, regulations, and standards.

Rather than fighting for the kind of transformative public investments that built the railroads and the interstate highways, brought water and electricity to rural America, made microchips cheap and invented the Internet, biotechnology, and today's wind and solar power technologies, these leading green groups have their sites on a laundry list of regulations, from renewable electricity standards to low-carbon fuel standards, building codes to appliance standards. And they make backroom deals with industry to preserve an increasingly compromised cap and trade scheme.

Congressman Ed Markey, the man who will shepherd this bill through his House energy subcommittee, says he understands the transformative power of public investments. When he introduced his vision of an ideal climate bill last year, Markey declared that the time had come to "invest in the American economy and in American workers, and launch an energy technology renaissance that will rival the information technology revolution of the past decade." Markey's "iCAP" bill promised to use the money from carbon pollution permits to "invest tens of billions" each year to develop and deploy "the cutting-edge low-carbon energy technologies that will power America's future."

The discussion draft we see today clearly reflects a different vision of climate policy, one dictated largely by the US CAP greens who have already struck devil's bargain with the cadre of big industry players that make up the "United States Climate Action Partnership". While they pay lip service to investments in the green economy and clean technology, when push comes to shove and the deals are cut, the green groups in USCAP will fight to protect their treasured suite of regulations, leaving the cold hard cash on the table.

So if leading green groups setting the climate agenda today won't fight to ensure that money is invested to make a clean energy economy a reality, who will?

Will other mainstream green groups or the rest of the climate movement? Will the youth activists who recently gathered 12,000 strong in Washington D.C. demanding clean energy and green jobs? Or will progressive groups like MoveOn rally their millions of grassroots supporters to the fight? And what about Al Gore's Repower America campaign, which is now running ads that read, "Government investment can change history?"

If these self-declared champions of the new energy economy don't prioritize the fight over the cold hard cash, coal companies and other representatives of the industries of the past will be the only ones at the table, and an historic opportunity to make critical investments in the clean energy technologies and industries of the future will slip through our fingers.



Jesse Jenkins is the director of energy and climate policy at the Breakthrough Institute and the founder and chief editor of WattHead - Energy News and Commentary

2 comments:

Anonymous said...

A. Everybody already knows about bailouts already.

B. The leading green groups are just another lobby group. Check out for instance Lessig on Wash corruption.

C. The green vc are also in it for the money, don't be hypocritical.

D. Please, if you are going to diss backroom deals, admit to being a nihilist.

E. Be realistic, Romm gave this a B+

F. What about taxing financial trading to raise money? There's gold in them pots. -ids

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