Climate Legislation Remains Silent on Mechanisms to Protect Low-income Consumers

PUBLIC CITIZEN PRESS RELEASE

March 31, 2009 Contact: Tyson
Slocum (202) 454-5191
Rick
Claypool (202) 588-7742

Climate Legislation Good First Step; Opportunities to Strengthen
Environmental and Consumer Protections Will Come During Committee
Debate

Statement by Tyson Slocum, Director, Public CitizenÂ’s Energy Program

TodayÂ’s release of draft climate change legislation by House Energy
and Commerce Committee Chairman Rep. Henry Waxman (D-Calif.) is a good
first step toward reducing greenhouse gas emissions that cause climate
change. While the measure, “American Clean Energy and Security Act of
2009,” includes many positive, important objectives - such as making
it more expensive for polluters to emit carbon dioxide, requiring
electric utilities to generate 25 percent of their power from renewable
sources by 2025 and establishing strong energy efficiency standards -
important details not yet included in the bill may undermine its goals
of reducing greenhouse gas emissions by 20 percent of 2005 levels by
2020 and by 83 percent in 2050. The outcome depends on how these details
are resolved in the committee and on the floor of the House.

Namely, the bill does not yet address whether legal authorizations to
pollute (by obtaining credits once an emitter exceeds the capped
greenhouse gas allowance) will be given free to corporations or whether
they must be purchased. President Barack ObamaÂ’s budget got it right
when he proposed requiring all pollution allowances to be purchased
through an auction. It is crucial that windfall profits and a new right
to pollute are not part of climate legislation going forward.

In addition, the legislation features a $1 billion annual pot of money
for the coal industry that is not part of the federal budget (known as
“off-budget”) that would be unavailable to competing, superior
technologies such as wind and solar, or for efficiency investments.
Section 114 of the bill would allow electric utilities - but not
ratepayers - a vote to create a Carbon Storage Research Corporation, a
private organization designed to collect money from families through
electric rates. The money would finance carbon capture and storage
demonstration projects. Five percent of the money would be used for
administrative expenses. This stream of $1 billion per year would be
doled out by the Carbon Storage Research Corporation only to the coal
industry. No similar off-budget money is suggested to assist homeowners
interested in installing solar panels or making energy-efficient
improvements to their homes. Electricity ratepayers should not finance a
program that discriminates against technologies such as solar and energy
efficiency. On the bright side, the program doesnÂ’t finance
anti-consumer and anti-environmental approaches like nuclear power.

While Public Citizen has serious concerns with allowing markets -
chiefly Wall Street investment banks - to be in charge of setting the
price of pollution in carbon markets, the draft legislation may ensure
that such markets are transparent, since it requires the president to
form an interagency task force on how to best regulate carbon trading
markets. The task force would include representatives from the Commodity
Futures Trading Commission, an agency with experience regulating complex
futures markets.

The legislation also remains silent on which mechanisms will be
employed to protect middle- and low-income consumers from the impact of
higher energy prices caused by the cap and trade program. Shielding
vulnerable populations from price increases and giving homeowners access
to alternatives is crucial as families struggle to make ends meet during
this severe economic crisis.

It is encouraging that lawmakers are finally tackling the real problem
of climate change. Public Citizen looks forward to working with
lawmakers and the public to ensure that legislation works to empower
families - and not just large corporations - to play a leading role in
making our future greener and more sustainable.

###

Public Citizen is a national, nonprofit consumer advocacy organization
based in Washington, D.C.
For more information, please visit www.citizen.org.





Barbara Holzer
Broadcast & Marketing Manager
Public Citizen, 1600 20th St. NW
Washington, DC 20009
202-588-7716 [main: 1000]
bholzer@citizen.org