On September 30, Sens. Barbara Boxer (D-CA) and John Kerry (D-MA) introduced their long-anticipated global warming bill, a counterpart to legislation passed by the House of Representatives last June. As the starting point for the Senate climate debate, the Clean Energy Jobs & American Power Act (S. 1733) would cap greenhouse gas emissions from approximately 7,500 power plants, industrial facilities and other covered sources at 20 percent below 2005 levels by 2020, and 83 percent below 2005 levels by 2050. The Senate bill proposes more aggressive reductions of greenhouse gas emissions than the House bill (20 percent by 2020 as opposed to 17 percent in the House bill), and would provide EPA with broader authority to regulate greenhouse gas emissions than is contemplated in the House bill.
Senate consideration of the Kerry-Boxer bill is unfolding against a continued credible threat from EPA to regulate greenhouse gases under the existing Clean Air Act if Congress does not enact more comprehensive legislation. After finalizing its greenhouse gas reporting rule, last week EPA took another significant step by announcing proposed greenhouse gas regulations that would apply to thousands of stationary sources, mostly power plants and industrial facilities (full text available here in PDF). This EPA rule, coupled with the heightened prospect of climate change litigation arising from a recent Second Circuit decision upholding common law nuisance actions against electric utilities, creates strong incentives for industry to seek a comprehensive solution from Congress.
The Kerry-Boxer bill remains subject to revision by various committees and lawmakers over the months ahead. We will provide updates as it moves through the Senate, beginning with this analysis of the bill’s impacts on New York. As one of the first states to cap global warming pollution through the 10-state Regional Greenhouse Gas Initiative (RGGI), New York has a large stake in federal climate policy.
Like the House bill, the Senate proposal would preempt state cap-and-trade climate programs, and would most likely also preempt regional cap-and-trade programs, including RGGI, for the first five years of its national emissions trading system. In a new provision, however, the Kerry-Boxer bill provides that if the federal program is delayed beyond its scheduled 2012 start date, preemption would not kick in until “at least 9 months from the first [national] auction” of greenhouse gas allowances.
New York City also has developed its own climate policies, including a plan to reduce transportation emissions by phasing in a more efficient, all-hybrid taxi fleet. The U.S. District Court for the Southern District of New York twice rejected those policies as preempted by federal law, but the Senate climate bill incorporates a proposal to effectively overturn those rulings and authorize the city’s plans suggested by New York Sen. Kirsten Gillibrand and Rep. Jerrold Nadler.
Finally, various sections of the Kerry-Boxer bill provide state and local governments with grants, free emissions allowances, and other incentives to promote water conservation, energy-efficient building retrofits, renewable energy and more. Many of these opportunities require advanced planning, so state and local officials can begin positioning themselves to take advantage of this developing climate policy today.
More on the bill, and the broader climate debate, to follow.
We gratefully acknowledge the valuable assistance of Jonathan Kalmuss-Katz, 2009 summer associate at SPR, in drafting this article.
