Date: 18-Mar-10
Country: US
Author: Richard Cowan
 

Smoke rises from chimneys at the Sugar Cane Growers cooperative in Belle Glade, Florida January 6, 2010.
Photo: Carlos Barria

The Senate is close to wrapping up talks ahead of introducing a compromise climate change bill, a top Democratic lawmaker said on Wednesday, but details still have to be nailed down.

"We're planning to button up our efforts somewhere I hope next week," Senator John Kerry told reporters after meeting with a coalition that represents automakers, forestry and paper firms, Big Oil, steel, mining, electricity and others.

Kerry is working with Republican Lindsey Graham and independent Joseph Lieberman on a bill to require U.S. industry to cut emissions of carbon dioxide and other greenhouse gases associated with global warming.

Indicating there was still work to be done, Kerry said, "We're trying to build support as we develop (bill) language."

Bruce Josten, an executive vice president at the U.S. Chamber of Commerce, left Wednesday's meeting with the three senators and told reporters: "They're being very constructive; they're trying to figure out how to make this work for the American economy."

The measure will not take the exact approach of legislation approved by the House of Representatives last June, and by the Senate Environment and Public Works Committee last November. This would set an economy-wide "cap and trade" direction to reducing carbon pollution.

Kerry said that while "a lot of language is there" to craft legislation, "we don't have a full outline" yet of a bill.

CHAMBER OPPOSES EPA REGULATION

The climate bill has been stalled in the Senate and supporters have missed several informal deadlines for producing and passing a bill.

Under cap and trade, companies would have limits on the amount of carbon pollution Washington would let them emit. Those limits would become stricter over the next 40 years, when supporters want an 80 percent reduction from 2005 levels. Also, required pollution permits could be sold on a regulated market.

More near-term, President Barack Obama has embraced pollution reductions in the range of 17 percent by 2020.

The Chamber of Commerce, which says it represents more than 3 million U.S. businesses of all sizes, is staunchly opposed to U.S. Environmental Protection Agency regulation of carbon dioxide.

The EPA is ready to issue final regulations as early as March 31 for automobile carbon emissions. That would clear the way for expanding regulations to smokestack emissions, although the agency prefers Congress tackles that problem.

Instead of an economy-wide cap and trade, sources have said the three senators are aiming for cap and trade just for power companies, which contribute about 40 percent of carbon emissions.

Josten said the senators are "talking about allowances for that sector that are built around pollution-reduction targets and prohibiting price spikes."

As for a possible transportation/oil industry tax on carbon, Josten would only note that the senators have publicly said "they are working on a linked-fee concept for the transportation sector."

Under such a program, a tax, such as on gasoline sales, could be linked to a market price of carbon. But sources have said there also are discussions of a tax at the oil refinery level.

Once a bill is put together, the Congressional Budget Office will analyze the potential costs to the federal government and the economy. EPA also is expected to conduct a six-to-eight week analysis of the bill before it could be debated on the Senate floor, possibly in June.

(Editing by Xavier Briand)