Thursday, April 23, 2009

Administration Stops Short of Endorsing Climate Bill


WASHINGTON — Obama administration officials said Wednesday that an ambitious energy and climate-change proposal sponsored by House Democrats could help create jobs and reduce greenhouse gas emissions, but they stopped short of endorsing it.

Steven Chu, the secretary of energy, and Lisa P. Jackson, the administrator of the Environmental Protection Agency, told a House committee considering the measure that they believed it could help accomplish President Obama’s goals of moderating climate change, spurring clean-energy technology and reducing dependence on foreign oil.

Yet both said they were still studying the details of the 648-page draft, unveiled late last month by two Democratic lawmakers, Representatives Henry A. Waxman of California and Edward J. Markey of Massachusetts. In fact, Dr. Chu and Ms. Jackson said that they had not read the entire draft and that the administration had not given its blessings to the bill. They said they would work closely with Congress to help fashion acceptable legislation.

The House measure, the most far-reaching piece of energy and environmental legislation to come before Congress in years, would require large changes in the way the United States generates electricity, manufactures products, heats and lights its homes and offices, and moves people and goods.

One central provision would establish a cap-and-trade program to limit greenhouse gas emissions. Mr. Obama has repeatedly pushed the idea of a cap-and-trade plan as part of any eventual measure — he did so again Wednesday at an Earth Day observance in Iowa — but he and his senior aides have left the details to Congress.

Mr. Waxman, chairman of the House Energy and Commerce Committee, where Dr. Chu and Ms. Jackson testified Wednesday along with Transportation Secretary Ray LaHood, has begun a month of intensive work on the legislation with the announced goal of moving it through the committee by late May. The panel will hear from 67 witnesses this week and will begin subcommittee work next week.

Mr. Waxman faces vocal skepticism from most Republicans on his committee, several of whom complained at Wednesday’s hearing that the bill would drastically raise energy costs and lead to large job losses. They also said Mr. Waxman was moving too quickly on a measure with such profound consequences.

Representative Fred Upton, Republican of Michigan, called the legislation a “cap and tax” proposal that would “kick working families when they’re down.”

But Mr. Waxman and other Democrats cited an E.P.A. study issued on Tuesday that said the bill would have a negligible effect on the American economy and consumers’ pocketbooks.

Ms. Jackson said the Waxman-Markey measure would impose “modest costs compared to the benefits.”

While the committee will be exposed to hour upon hour of such argument from lawmakers, government officials, industry executives, academics and environmental advocates over the next days and weeks, the real action on the bill is going on behind the scenes.

Under any sort of cap-and-trade scheme, government sets an overall limit on emissions while allowing companies to trade permits, known as allowances, to pollute. But the House draft does not address two central issues. First, it does not say how many of the allowances the government will give away, if any, and how many it will auction. Democrats from states dependent on coal and manufacturing are asking that a sizable portion of the allowances be granted free, to mitigate the costs of the carbon cap.

Second, the legislation does not say what will be done with the proceeds of any auction of permits, estimated in Mr. Obama’s budget proposal to be worth at least $65 billion a year.

Negotiations are under way to resolve those questions, and the answers will determine how many Democrats ultimately support the bill and whether any Republicans do.

Those financial issues will also be crucial to winning support in the Senate, where on Wednesday two unlikely bedfellows announced legislation requiring the E.P.A. to conduct a study on the environmental effects of so-called black carbon, the soot that lands on Arctic ice and other reflective surfaces and contributes to global warming.

Senators John Kerry, Democrat of Massachusetts, and James M. Inhofe, Republican of Oklahoma, who are usually about as far apart on environmental issues as it is possible to be, are among the sponsors of the bill. They called black carbon a “dangerous pollutant” emitted by old, dirty diesel engines and the burning of wood, peat and dung. They said it was thought to be the second-largest cause of global climate change, after carbon dioxide.

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