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Statements on Introduced Biils and Joint Resolutions

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STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS -- (Senate - May 26, 2005)

BREAK IN TRANSCRIPTS

By Mr. MCCAIN (for himself and Mr. LIEBERMAN):

S. 1151. A bill to provide for a program to accelerate the reduction of greenhouse gas emissions in the United States by establishing a market-driven system of greenhouse gas tradeable allowances, to limit greenhouse gas emissions in the United States and reduce dependence upon foreign oil, to support the deployment of new climate change-related technologies, and ensure benefits to consumers; to the Committee on Environment and Public Works.

Mr. MCCAIN. Mr. President, I am pleased to join with Senator LIEBERMAN today in introducing an amended version of the Climate Stewardship Act, which we introduced in February.

The legislation we submit today incorporates the provisions of S. 342, the Climate Stewardship Act of 2005, in its entirety, along with a new comprehensive title regarding the development and deployment of climate change reduction technologies. This new title, when combined with the ``cap and trade'' provisions of the previously introduced bill, will promote the commercialization of technologies that can significantly reduce greenhouse gas emissions, mitigate the impacts of climate change, and increase the Nation's energy independence. And, it will help to keep America at the cutting edge of innovation where the jobs and trade opportunities of the new economy are to be found.

In fact, the ``cap and trade'' provisions and the new technology title are complementary parts of a comprehensive program that will allow us to usher in an new energy era, an era of responsible and innovative energy production and use that will yield enormous environmental, economic, and diplomatic benefits. The ``cap and trade'' portion provides the economic driver for existing and new technologies capable of supplying reliable and clean energy and making the best use of America's available energy resources. Because of the multiple benefits promised by this comprehensive program, we expect that the new bill will attract additional support for the vital purposes of the Climate Stewardship Act. We simply need the political will to match the public's concern about climate change, the economic interests of business and consumers, and American technological ingenuity and expertise.

Our comprehensive bill sets forth a sound course toward a productive, secure, and clean energy future. Its provisions are based on the important efforts undertaken by academia, Government, and business over the past decade to determine the best ways and means towards This energy future. Most of these studies have shared two common findings. First, significant reductions in greenhouse gases--well beyond the modest goals of our bill--are feasible over the next 10 to 20 years using technologies available today. Second, the most important technological deployment opportunities to reduce emissions over the next two decades lie with energy efficient technologies and renewable energy sources, including solar, wind, and biofuels. For example, in the electric power sector, which accounts for one-third of U.S. emissions, major pollution reductions can be achieved by improving the efficiency of existing fossil fuel plants, adding new reactors designs for nuclear power, expanding use of renewable power sources, and significantly reducing electricity demand with the use of energy-saving technologies currently available to residential and commercial consumers. These clean technologies need to be promoted and that is what spurs our action today.

Before describing the details of this legislation, I think it is important to talk about what has occurred since the Senate vote on this issue in October 2003. For example, the scientific evidence of human-induced climate change has grown even more abundant. But just since February of this year, when I highlighted the results of the Arctic Climate Impact Assessment, even more startling evidence about the Arctic region has been revealed. In a recent Congressional briefing, Dr. Robert Corell, chair of Arctic Climate Impact Assessment, presented recent data indicating that climate change in the Arctic is occurring more rapidly than previously thought. Annual average arctic temperatures have increased at

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twice the rate of global temperatures over the past several decades, with some regions increasing by five to ten times the global average.

The latest observations show Alaska's 2004 June-July-August mean temperature to be nearly 5 degrees Fahrenheit, 2.8 degrees Celsius, above the 1971-2000 historic mean, and permafrost temperature increasing enough to cause it to start melting. Dr. Corell said the Greenland ice sheet is melting more rapidly than thought even 5 years ago, and that the climate models indicate that warming over Greenland is likely to be up to three times the global average, with warming projected to be in the range of 5 to 11 degrees Fahrenheit, 3 to 6 degrees Celsius, which will most certainly lead to sea-level rise. These are remarkable new scientific findings.

It isn't surprising that just this past Tuesday, indigenous leaders from Arctic regions called on the European Union to do more to fight global warming and to consider giving aid to their peoples, saying their way of life is at risk. Global warming is said to be causing the arrival in the far north of mosquitoes bearing infectious diseases. And in Scandinavia, more frequent rains in the winter are causing sheets of ice to develop on top of snow, causing animals to die of hunger because they cannot reach the grass underneath.

We are not asking for sympathy, said Larisa Abrutina of the Russian Association of Indigenous Peoples of the North. We are asking each country in the world to examine if it is truly doing its part to slow climate change.

The efforts taking place globally to address climate change have gained even greater prominence. For example, British Prime Minister Tony Blair has made climate change one of his top two issues during his Presidency of the G8. Mr. Blair's commitment to addressing climate change should be commended. He has chosen to take action and not to hide behind the uncertainties that the science community will soon resolve. The Prime Minister made it clear in a January speech at World Economic Forum in Davos as to his intentions when he said:

..... if America wants the rest of the world to be a part of the agenda it has set, it must be a part of their agenda too.

The top two issues that Prime Minister Blair has chosen to deal with are climate change and poverty in Africa. It is interesting to note that a recent article in the New York Times highlighted the connection between the two issues. The article highlights that a 50-year-long drying trend is likely to continue and appears to be tightly linked to substantial warming of the Indian Ocean. According to Dr. James Hurrell, a scientist at the National Center for Atmospheric Research:

. . . the Indian Oceans shows very clear and dramatic warming into the future, which means more and more drought for southern Africa. It is consistent with what we would expect from an increase in greenhouse gases.

It appears that Mr. Blair's two priorities are quickly becoming one enormous challenge.

In its September 2004 issue, The National Geographic devotes 74 pages laying out in great detail the necessity of tackling our planet's problem of global warming. In an introductory piece, Editor-in-Chief Bill Allen described just how important he thinks this particular series of articles is:

Why would I publish articles that make people angry enough to stop subscribing? That's easy. These three stories cover subjects that are too important to ignore. From Antarctica to Alaska to Bangladesh, a global warming trend is altering habitats, with devastating ecological and economic effects..... This isn't science fiction or a Hollywood movie. We're not going to show you waves swamping the Statue of Liberty. But we are going to take you all over the world to show you the hard truth as scientists see it. I can live with some canceled memberships. I'd have a harder time looking at myself in the mirror if I didn't bring you the biggest story in geography today.

The articles highlight many interesting facts. Dr. Lonnie Thompson of Ohio State University collects ice cores from glaciers around the world, including the famed snows of Kilimanjaro, which could vanish in 15 years. According to Dr. Thompson, ``What glaciers are telling us, is that it is now warmer than it has been in the past 2,000 years over vast areas of the planet.'' Many of the ice cores he has in his freezer may soon contain the only remains of the glaciers from which they came from.

Highlighted quotes from the articles include: Things that normally happen in geologic time are happening during the span of a human lifetime. The future breakdown of the thermohaline circulation remains a disturbing possibility. More than a hundred million people worldwide live within 3 feet of mean sea level. At some point, as temperatures continue to rise, species will have no room to run. The natural cycles of interdependent creatures may fall out of sync. We will have a better idea of the actual changes in 30 years. But it is going to be a very different world.

Global warming demands urgent action on all fronts, and we have an obligation to promote the technologies that can help us meet the challenge. Our aim has never been simply to introduce climate stewardship legislation. Rather our purpose is to have legislation enacted to

begin to address the urgent global warming crisis that is upon us. This effort cannot be about political expediency. It must be about practical realities and addressing the most pressing issue facing not only our nation, but the world. We believe that our legislation offers practical and effective solutions and we urge each members careful consideration and support.

I will include for the Record a more detailed description of the various components of the new technology title. However, I do want to describe some of the key provisions designed to enhance innovation and commercialization in key areas. These include zero and low greenhouse gas emitting power generation, such as nuclear, coal gasification, solar and other renewables, geological carbon sequestration, and biofuels:

The bill directs the Secretary of Commerce, through the former Technology Administration, which would be renamed the Innovation Administration, to develop and implement new policies that foster technological innovation to address global warming. These new directives include: developing and implementing strategic plans to promote technological innovation; identifying and removing barriers to the research, development, and commercialization of key technologies; prioritizing and maximizing key federal R&D programs to aid innovation; (establishing public/private partnerships to meet vital innovation goals; and promoting national infrastructure and educational initiatives that support innovation objectives.

It also authorizes the Secretary of Energy to establish public/private partnerships to promote the commercialization of climate change technologies by working with industry to advance the design and demonstration of zero and low emission technologies in the transportation and electric generation sectors. Specifically, the Secretary would be authorized to partner with industry to share the cost, 50/50, of ``first-of-a-kind'' designs for advanced coal, nuclear energy, solar and biofuels. Moreover, each time that a utility builds a plant based on the ``first-of-a-kind engineering'' design authorized by this bill, a ``royalty'' type payment will be paid by the utility to reimburse the original amount provided by the Government.

After the detail design phase is complete, the Secretary would be able to provide loans or loan guarantees, Up to 80 percent, for the construction of these new designs including three nuclear plant designs certified by the NRC that would produce zero greenhouse gas emissions; three advanced coal gasification plants with carbon capture and storage that make use of our abundant coal resources while storing carbon emissions underground; three large scale solar energy plants to begin to tap the enormous potential of this completely clean energy source; and three large scale facilities to produce the clean, efficient, and plentiful biofuel of

the future--cellulosic ethanol.

The loan program will be administered by a Climate Technology Financing Board, whose membership will include the Secretary of Energy, a representative from the Climate Change Credit Corporation, as would be created in the bill, and others with pertinent expertise. Once each plant is operational, the private partner will be obligated to pay back these loans from the government, as is the case with any construction loan.

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I think it is important to be very clear about this ambitious, but necessary, technology title. We intend that much, if not all, of the costs of the demonstration initiatives, along with the loan program, will be financed by the early sale of emission allowances through the Climate Change Credit Corporation under the cap and trade program, so that industry and the market will foot much of the bill, not the taxpayers. And, as I already mentioned, the bill requires that any Federal money used to build plants will be repaid by the utility when the plant becomes operational.

Finally, the bill contains a mechanism requiring utilities to pay reimbursement ``royalties'' as they build plants based on zero and low emission designs created with Federal assistance. These funding provisions are more fair and certain than requiring taxpayers to cover the entire costs of these programs and depending upon future appropriations. But there will be some costs involved. That is why it is important to weigh these expenditures against the staggering cost of inaction on global warming. I think we will find more than a justified cost-benefit outcome.

In addition to promoting new or underutilized technologies, the bill also includes a provision to aid in the deployment of available and efficient energy technologies. This would be accomplished through a ``reverse auction'' provision, which would establish a cost effective and proven mechanism for Federal procurement and incentives. Providers' ``bids'' would be evaluated by the Secretary on their ability to reduce, eliminate, or sequester greenhouse gas emissions.

The ``reverse auction'' program would be funded initially by the taxpayers but eventually would be funded by the proceeds from the annual auction of tradeable allowances conducted by the Climate Change Credit Corporation under the cap and trade program.

I want to clarify that this bill doesn't propose to dictate to industry what is economically prudent for their particular operations. Rather, it provides a basis for the selection and implementation of their own market-based solutions, using a flexible emissions trading system model that has successfully reduced acid rain pollution under the Clean Air Act at a fraction of anticipated costs--less than 10 percent of the costs that some had predicted when the legislation was enacted. That successful model can and must be used to address this urgent and growing global warming crisis.

The ``cap and trade'' approach to emission management is a method endorsed by Congress and free-market proponents for over 15 years after it was first applied to sulfur dioxide pollution. Applying the same model to carbon dioxide and other greenhouse gases is a matter of good policy and simple, common sense. It is an approach endorsed by industry leaders such as Jeffrey Immelt, CEO of General Electric, one of the largest companies in the U.S.

Moreover, using the proven market principles that underlie cap and trade will harness American ingenuity and innovation and do more to spur the innovation and commercialization of advanced environmental technologies than any system of previous energy-bill style subsidies that Congress can devise.

Three decades of assorted energy bills prove that while subsidies to promote alternative energy technologies may sometimes help, alone they are not transformational. In the 1970s, Americans were waiting in line for limited supplies of high priced gasoline. We created a Department of Energy to help us find a better way. Yet today, 30 years later, we remain wedded to fossil fuels, economically beholden to the Middle East and we continue to alter the makeup of the upper atmosphere with the ever-increasing volume of greenhouse gas emissions. Our dividend is continued energy dependence and global warming that places our nation and the globe at enormous environmental and economic risk. Not a very good deal.

Cap and trade is the transformational mechanism for reducing carbon dioxide emissions, protecting the global environment, diversifying the Nation's energy mix, advancing our economy, and spurring the development and deployment of new and improved technologies that can do the job. It is indispensable to the task before us.

The Climate Stewardship and Innovation Act does not prescribe the exact formula by which allowances will be allocated under a cap and trade system. This should be determined administratively through a process developed with great care to achieve the principles and purposes of the Act. This includes assuring that high emitting utilities have ample incentives to clean up and can make emission reductions economically and that low emitting utilities are treated justly and recognized for their efficiency. Getting this balance right will not be easy, but it can and must be done.

The fact remains that, if enacted, the bill's emission cap will not go into effect for another 5 years. In the interim there is much that the country can and should do to promote the most environmentally and economically promising technologies. This includes removing unnecessary barriers to commercialization of new technologies so that new plants, products, and processes can move more efficiently from design and development, to demonstration and, ultimately, to the marketplace. Again, without cap and trade, these efforts will pale, but the new technology title we propose will work hand in glove with the emission cap and trade system to meet our objectives.

As I mentioned, the new title contains a host of measures to promote the commercialization of zero and low-emission electric generation technologies, including nuclear, clean coal, solar and other renewable energies, and biofuels.

I want to take some time to address the bill's nuclear provisions. Although these provisions are only part of the comprehensive technology package, I am sure they will be the focus of much attention.

I know that some of our friends in the environmental community maintain strong objections to nuclear energy, even though it supplies nearly 20 percent of the electricity generated in the U.S. and much higher proportions in places such as France, Belgium, Sweden and Switzerland--countries that aren't exactly known for their environmental disregard. But the fact is, nuclear is clean, producing zero emissions, while the burning of fossil fuels to generate electricity produces approximately 33 percent of the greenhouse gases accumulating in the atmosphere, and is a major contributor to air pollution affecting our communities

The idea that nuclear power should play no role in our energy mix is an unsustainable position, particularly given the urgency and magnitude of the threat posed by global warming which most regard as the greatest environmental threat to the planet.

The International Energy Agency estimates that the world's energy consumption is expected to rise over 65 percent within the next 15 years. If the demand for electricity is met using traditional coal-fired power plants, not only will we fail to reduce carbon emissions as necessary, the level of carbon in the atmosphere will skyrocket, intensifying the greenhouse effect and the global warming it produces.

As nuclear plants are decommissioned, the percentage of U.S. electricity produced by this zero emission technology will actually decline. Therefore, at a minimum, we must make efforts to maintain nuclear energy's level of contribution, so that this capacity is not replaced with higher emitting alternatives. I, for one, believe it can and should play an even greater role, not because I have some inordinate love affair with splitting the atom, but for the very simple reason that we must support sustainable, zero-emission alternatives such as nuclear if we are serious about addressing the problem of global warming.

I would like to submit for the record a piece written by Nicholas Kristof of the New York Times. Mr. Kristof made the following observation: ``It's increasingly clear that the biggest environmental threat we face is actually global warming and that leads to a corollary: nuclear energy is green.'' He goes on to quote James Lovelock, a British scientist who created the Gaia principle that holds the earth is a self-regulating organism. He quoted Mr. Lovelock as follows:

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I am a Green, and I entreat my friends in the movement to drop their wrongheaded objection to nuclear energy. Every year that we continue burning carbon makes it worse for our descendents. Only one immediately available source does not cause global warming, and that is nuclear energy.

I have always been and will remain a committed supporter of solar and renewable energy. Renewables hold great promise, and, indeed, the technology title contains equally strong incentives in their favor. But today solar and renewables account for only about 3 percent our energy mix. We have a long way to go, and that is one of the objectives of this legislation--to help promote these energy technologies.

I want to stress nothing in this title alters, in any way, the responsibilities and authorities of the Nuclear Regulatory Commission. Safety and security will remain, as they should, paramount in the citing, design, construction and operation of nuclear power plants. And the winnowing effect of the free market, as it should, will still determine which technologies succeed or fail in the market place. But the idea that a zero-emission technology such as nuclear has little or no place in our energy mix is just as antiquated, out-of-step and counter-productive as our continued dependence on fossil fuels. Should it prevail, our climate stewardship and clean air goals will be virtually impossible to meet.

The environmental benefit of nuclear energy is exactly why during his tenure, my friend, Morris Udall, one of the greatest environmental champions the United States has ever known, sponsored legislation in the House, as I did in the Senate, to develop a standardized nuclear reactor that would maximize safety, security, and efficiency. The Department of Energy has done much of the work called for by that legislation. Now it is time for the logical next steps. The new title of this legislation promotes these steps by authorizing Federal partnership to develop first of a kind engineering for the latest reactor designs, and then to construct three demonstration plants. Once the demonstration has been made, free-market competition will take it from there. And the bill provides similar partnership mechanisms for the other clean technologies, so we are in no way favoring one technology over another.

No doubt, some people will object to the idea of the Federal Government playing any role in helping demonstrate and commercialize new and beneficial nuclear designs. I have spent 20 years in this body fighting for the responsible use of taxpayer dollars and against porkbarrel spending and corporate welfare. I will continue to do so.

The fact remains that fossil fuels have been subsidized for many decades at levels that can scarcely be calculated. The enormous economic costs of damage caused by air pollution and greenhouse gas emissions to the environment and human health are not factored into the price of power produced by fossil-fueled technologies. Yet it is a cost that we all bear, too often in terms of ill-health and diminished quality of life. That is simply a matter of fact.

It is also inescapable that the ability to ``externalize'' these costs places clean competitors at a great disadvantage. Based on that fact, and in light of the enormous environmental and economic risk posed by global warming, I believe that providing zero and low emission technologies such as nuclear a boost into the market place where they can compete, and either sink or swim, is responsible public policy, and a matter of simple public necessity, particularly, as we enact a cap on carbon emissions.

The Navy has operated nuclear powered submarine for more than 50 years and has an impressive

safety and performance record. The Naval Reactors program has demonstrated that nuclear power can be done safely. One of the underpinning of its safety record is the approach used in its reactor designs, which is to learn and build upon previous designs. Unfortunately for the commercial nuclear industry, they have not had the opportunity to use such an approach since the industry has not been able to build a reactor in over the past 25 years. This lapse in construction has led us to where we are today with the industry's aging infrastructure. As we have learned from other industries, this in itself represents a great risk to public safety.

I want to close my comments on the nuclear provisions with two thoughts. A recent article in Technology Review seems particularly pertinent to those with reservations about nuclear power. It stated:

The best way for doubters to control a new technology is to embrace it, lest it remain in the hands of the enthusiasts.

This is particularly sage advice because, frankly, the facts make it inescapably clear--those who are serious about the problem of global warming are serious about finding a solution. And the rule of nuclear energy which has no emissions has to be given due consideration.

Mr. President, don't simply take my word regarding the magnitude of the global warming problem. Consider the National Academy of Sciences which reported in 2001 that:

Greenhouse gases are accumulating in the Earth's atmosphere as a result of human activities, causing surface air temperatures and subsurface ocean temperatures to rise. Temperatures are, in fact, rising. The changes observed over the last several decades are likely mostly due to human activities. .....

Also consider the warning on NASA's website which states:

With the possible exception of another world war, a giant asteroid, or an incurable plague, global warming may be the single largest threat to our planet.

Consider the words of the EPA that

Rising global temperatures are expected to raise sea level, and change precipitation and other local climate conditions. Changing regional climate could alter forest, crop yields and water supplies. .....

And, let's consider the views of President Bush's Science Advisor, Dr. John Marburger who says that,

Global warming exists, an we have to do something about it, and what we have to do about it is reduce carbon dioxide.

Again, the chief science advisor to the President of the United States says that global warming exists, and what we have to do about it is to reduce carbon dioxide.

The road ahead on climate change is a difficult and challenging one. However, with the appropriate investments in technology and the innovation process, we can and will

prevail. Innovation and technology have helped us face many of our national challenges in the past, and can be equally important in this latest global challenge.

Advocates of the status quo seem to suggest that we do nothing, or next to nothing, about global warming because we don't know how bad the problem might become, and many of the worst effects of climate change are expected to occur in the future. This attitude reflects a selfish, live-for-today attitude unworthy of a great nation, and thankfully, not one practiced by preceding generations of Americans who devoted themselves to securing a bright and prosperous tomorrow for future generations, not just their own.

When looking back at Earth from space, the astronauts of Apollo 11 could see features such as the Great Wall of China and forest fires dotting the globe. They were moved by how small, solitary and fragile the earth looked from space. Our small, solitary and fragile planet is the only one we have and the United States of America is privileged to lead in all areas bearing on the advance of mankind. And lead again, we must, Mr. President. It is our privilege and sacred obligation as Americans.

I ask unanimous consent an editorial from the New York Times be printed in the RECORD.

There being no objection, the material was ordered to be printed in the RECORD, as follows:

http://thomas.loc.gov/

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