Washington (Platts)--28May2008

US Representative Edward Markey, Democrat-Massachusetts, unveiled a
carbon cap-and-trade bill Wednesday, in advance of next week's Senate
consideration of global warming legislation.

Markey's fellow US House of Representatives Democrats, Energy and
Commerce Committee Chairman John Dingell of Michigan and Energy and Air
Quality Subcommittee Chairman Rick Boucher of Virginia are working on their
own measure, which is expected to be the House vehicle for global warming
legislation.

Markey, who chairs the House Select Committee on Energy Independence and
Global Warming, said his bill was intended to be a "lessons learned" report
after 16 months of exploring the issue of climate change.

"It is intended to be another important part of the debate," said Markey,
sidestepping questions about whether his bill was a pre-emptive strike against
the Dingell-Boucher measure, which will likely be much more industry-friendly.

He acknowledged, however, that his ideas would compete with those of
other House members and ultimately those of the Senate before a final bill is
sent to the president.

Markey's bill, which he plans to formally introduce when Congress returns
from recess next week, calls for US greenhouse gas emissions to be reduced to
85% below 2005 levels by 2050.

Markey said that the measure would cover 94% of the US economy, and 87%
of GHG emissions. It would auction 100% of emissions credits by 2020 -- a
strategy Boucher has said would be unnecessarily costly, and invest the
revenues in tax cuts for consumers of moderate means and green technologies.

Industries that are deemed to be particularly vulnerable to international
competition, like steel production, would receive a small number of free
credits until 2020 to give them time to adjust to the regime.

The so-called Investing in Climate Action and Protection Act would
require new coal-fired power plants to employ carbon capture and sequestration
technologies to reduce their emissions by 85% within a timeframe defined by
the Environmental Protection Agency.

It would also create a low-carbon fuel standard, grant California a
waiver to establish a vehicle GHG emissions standard, and provide retraining
for workers in GHG-intensive industries.

--Jean Chemnick, jean_chemnick@platts.com