Statements on Introduced Bills and Joint Resolutions

Floor Speech

STATEMENT ON INTRODUCED BILLS AND JOINT RESOLUTIONS -- (Senate - December 11, 2009)

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Ms. COLLINS. Mr. President, I am pleased to join my colleague from Washington State, Senator Cantwell, in introducing what I believe to be landmark legislation, the Carbon Limits and Energy for America's Renewal, or CLEAR Act. Let me commend the Senator for her leadership on this important issue.

One of the most appealing parts of this bill is it takes a fresh look at the issues facing our country in the area of developing alternative energy, promoting energy independence, and addressing climate change and the need for more green jobs in the economy. Indeed, this bill addresses the most significant energy and environmental challenges we face. It would help to reduce our dependence on foreign oil, promote alternative energy and energy conservation, and advance the goal of energy independence for our Nation.

The cost of gas and oil imposes a great burden on many Americans, particularly those living in large rural States such as the State of Maine. High gasoline prices have a disproportionate impact on Mainers who often have no choice but to travel long distances to their jobs, grocery stores, and doctors offices. This lessens the amount of money they have to spend on other necessities.

In addition, 80 percent of Mainers heat their homes with home heating oil. That is one of the highest percentages in the Nation. The State of Maine is one of the States most dependent on foreign oil of any State in the Nation. Our Nation must work together on comprehensive long-term actions that will stabilize gas and oil prices, help to prevent energy shortages, avoid those spikes when we are held hostage to foreign oil, and achieve national energy independence. This effort will require a stronger commitment to renewable energy sources such as wind energy, as well as energy efficiency and conservation.

The development and implementation of these new approaches to environmental stewardship and energy independence will also provide a powerful stimulus to our economy and the creation of green jobs. Like my colleague, I want the United States to lead the way on green technology, not lose our edge to China, for example.

In addition to advancing these goals, the CLEAR Act is the fairest climate change approach from the perspective of consumers. It would rebate 75 percent of the proceeds generated by the cap on carbon emissions directly to citizens. That is a tremendous advantage of this bill over alternative approaches such as the cap-and-trade bill.

I also share the concerns of my colleague from Washington State about the abuses we have seen in energy and agricultural markets, when speculators are allowed to participate in the market. That is why in our bill, which imposes an upstream cap on carbon, only the producers are allowed to participate in the trading. That is a far better approach that will guard against market manipulation and excessive speculation.

In the United States alone, emissions of the primary greenhouse gas carbon dioxide have risen more than 20 percent since 1990. Clearly climate change is a daunting environmental challenge, but we must develop solutions that do not impose a heavy burden on our economy, particularly during these difficult economic times. That is why I am pleased to join as the lead cosponsor of the CLEAR Act. Climate change legislation must protect consumers and industries that could be hit with higher energy prices. We must recognize that many of our citizens are struggling to afford their monthly energy bills now and cannot afford dramatically higher prices. We also must produce legislation that would provide predictability in the price of carbon emissions so that businesses can plan, invest, and create good jobs. Climate change legislation should encourage the adoption of energy efficiency measures and the further development of renewable energy.

I am very excited about the possibilities for the State of Maine because of its immense potential to develop offshore wind energy. Estimates are that the development of 5 gigawatts of offshore wind in Maine would be enough to power more than 1 million homes for a year. It could attract $20 billion of investment to the State of Maine and create more than 15,000 green energy jobs, jobs that are desperately needed in our State. The CLEAR Act would help to achieve all of those goals.

I could not support the bill that was passed to deal with climate change by the House of Representatives. Let me read a couple of the descriptions of that bill. The New York Times described it as ``fat with compromises, carve-outs, concessions, and out-and-out gifts.'' The Washington Post in an editorial described it as having pollution credits and revenue that were ``divvied up to the advantage of politically favored polluters.''

I do not believe this bill, which is a 2,000-page monstrosity, can garner the necessary 60 votes to proceed in the Senate. The CLEAR Act, by contrast, would help to move a stalled debate forward by offering a fairer, a more efficient, and a straightforward approach.

You have only to look at our bill. It is 39 pages long compared to 2,000 pages of the House-passed bill.

My full statement goes into detail on how the bill would work. I hope my colleagues will look closely at it. But let me talk about one part. That is in the CLEAR Act, 75 percent of the carbon auction revenues would be returned to consumers as tax free rebates. They wouldn't be lost to speculation or to $ 1/2 billion of fees every year to investment firms on Wall Street. No, 75 percent of those revenues would be returned on a per capita basis to consumers. That means that 80 percent of Americans would incur no net new cost under the CLEAR Act. The average Mainer would stand to actually gain $102 per year from the CLEAR Act. I can tell you, Mainers would welcome that. It would help them winterize their homes, meet their energy bills, invest in energy conservation and efficiency, or have a little more money to get by.

By contrast, under the House-passed cap-and-trade bill, the average citizen in this country would experience a net cost increase of $175 per year. That is a big difference and a big advantage of the Cantwell-Collins approach.

What about the other 25 percent of the auction revenues? What we would propose is that those would go to a trust fund to fund energy efficiency programs and renewable energy research and development, to provide incentives for forestry and agriculture practices that sequester carbon, to encourage practices that reduce other greenhouse gases, to help energy-efficient, energy-intensive manufacturers, and to assist low-income consumers. That fund would be called the Clean Energy Reinvestment Trust, the CERT fund. It would be subject to the annual appropriations process so that Congress could adapt assistance for climate-related activities on an annual basis rather than being locked into a complicated allocation scheme that may well favor special interests.

I am excited about this bill. It offers us a way forward to a green economy. It will help create jobs. It will alleviate the burden on consumers, particularly in New England, where the Presiding Officer and I live, as well as the Northwest. It makes sense. It is a commonsense approach. I hope my colleagues will consider joining the Senator from Washington and me on this important legislation.

Again, I commend Senator Cantwell's leadership. She has done a great deal of work to come up with this approach, and I am excited to be joining her in this effort.

To reiterate, today I am pleased to join my colleague from Washington, Senator Cantwell, in introducing landmark legislation, the Carbon Limits and Energy for America's Renewal, or CLEAR, Act.

This bill addresses the most significant energy and environmental challenges facing our country. It would help reduce our dependence on foreign oil, promote alternative energy and energy conservation, and advance the goal of energy independence for our Nation.

The costs of gas and oil impose a great burden on many Americans, particularly those living in large, rural States like Maine. High gasoline prices have a disproportionate impact on Mainers who often have to travel long distances to their jobs, doctors' offices, and grocery stores, which lessens the amount of money they have available to spend on other necessities. Also, 80 percent of Mainers heat their homes with home heating oil, one of the highest percentages in the Nation. Our Nation must work together on comprehensive, long-term actions that will stabilize gas and oil prices, help to prevent energy shortages, and achieve national energy independence. This effort will require a stronger commitment to renewable energy sources, such as wind energy, and energy efficiency and conservation.

The development and implementation of these new approaches to environmental stewardship and energy independence will also provide a powerful stimulus for our economy and the creation of ``green'' jobs.

In addition to advancing the goal of energy independence and creating green jobs, the CLEAR Act is the fairest climate change approach for consumers. It would rebate 75 percent of the proceeds generated by the cap on carbon directly to citizens.

According to recent reports from the Intergovernmental Panel on Climate Change, increases in greenhouse gas emissions have already increased global temperatures, and likely contributed to more extreme weather events such as droughts and floods. These emissions will continue to change the climate, causing warming in most regions of the world, and likely causing more droughts, floods, and many other problems.

In the United States alone, emissions of the primary greenhouse gas, carbon dioxide, have risen more than 20 percent since 1990. Climate change is the most daunting environmental challenge we face, and we must develop reasonable solutions to reduce our carbon emissions.

I have personally observed the dramatic effects of climate change and had the opportunity to be briefed by the preeminent experts, including University of Maine professor and National Academy of Sciences member George Denton. In 2006, on a trip to Antarctica and New Zealand, for example, I saw sites in New Zealand that had been buried by massive glaciers at the beginning of the 20th century, but are now ice free. Fifty percent of the glaciers in New Zealand have melted since 1860--an event unprecedented in the last 5,000 years. It was remarkable to stand in a place where some 140 years ago, I would have been covered in tens or hundreds of feet of ice, and then to look far up the mountainside and see how distant the edge of the ice is today.

The melting is even more dramatic in the Northern Hemisphere. In the last 30 years, the Arctic has lost sea ice cover over an area ten times as large as the State of Maine, and at this rate will be ice free by 2050. In 2005 in Barrow, AK, I witnessed a melting permafrost that is causing telephone poles, planted years ago, to lean over for the first time ever.

I also learned about the potential impact of sea level rise during my trips to these regions. If the west Antarctica ice sheet were to collapse, for example, sea level would rise 15 feet, flooding many coastal cities. In its 2007 report, the IPCC found that even with just gradual melting of ice sheets, the average predicted sea level rise by 2100 will be 1.6 feet, but could be as high as 1 meter, or almost 3 feet. In Maine a 1 meter rise in sea level would cause the loss of 20,000 acres of land, include 100 acres of downtown Portland, including Commercial Street. Already in the past 94 years, a 7-inch rise in sea level has been documented in Portland.

The solutions to these problems must not impose a heavy burden on our economy, particularly during these difficult economic times. That is why I am pleased to be the lead cosponsor of the CLEAR Act.

While we must take meaningful action to respond to climate change, it must be a balanced approach. Climate change legislation must protect consumers and industries that could be hit with higher energy prices. We must recognize that many of our citizens are struggling just to pay their monthly energy bills and cannot afford dramatically higher prices. Such legislation also must provide predictability so that businesses can plan, invest, and create jobs.

Climate change legislation should encourage adoption of energy efficiency measures and the further development of renewable energy, which could spur our economy and job creation. For example, Maine has immense potential to develop offshore wind energy. Estimates are that development of 5 gigawatts of offshore wind in Maine--enough to power more than 1 million homes for a year--could attract $20 billion of investment to the State and create more than 15,000 green energy jobs that would be sustained over 30 years.

The CLEAR Act achieves all of these goals, whereas the bill passed by the House of Representatives earlier this year has been characterized by the Boston Globe as ``providing cushions for industry;'' ``fat with compromises, carve-outs, concessions and out-and-out gifts,'' a New York Times article by John Broder, June 30, 2009; and having pollution credits and revenue that were ``divvied up to the advantage of politically favored polluters,'' from the Washington Post editorial, June 26, 2009. This House bill could not garner the necessary 60 votes in the Senate. The CLEAR Act will help to move a stalled debate forward by offering a more efficient, straightforward approach.

Let me discuss how our bill would work. The CLEAR Act places an upstream cap on carbon entering the economy. The upstream cap on carbon would capture 96 percent of all carbon dioxide emissions, 93 percent of total annual U.S. greenhouse gas emissions by weight, and 82 percent of total annual U.S. greenhouse gas emissions by global warming potential.

The initial annual carbon budget under the cap would be set based on the amount of fossil carbon likely to be consumed by the U.S. economy in 2012, the year in which the CLEAR Act regulations would begin, based on projections by the Energy Information Administration. For the first 2 years, the cap would stay at the 2012 level to give companies time to adapt to the system. Starting in 2015, the carbon budget would be reduced annually along a schedule designed to achieve nearly an 80 percent reduction in 2005 level emissions by 2050.

The cap will recognize voluntary regional efforts like the Regional Greenhouse Gas Initiative, RGGI. RGGI is a cooperative effort by 10 northeast and mid-Atlantic States to limit greenhouse gas emissions. These 10 States have capped CO2 emissions from the power sector and will require a 10-percent reduction in these emissions by 2018.

Coal companies, oil and gas producers, and oil and gas importers would have to buy permits or ``allowances'' for the carbon in their products. They would buy the permits in a monthly auction in which those companies would be the only ones allowed to participate. One hundred percent of the allowances would be auctioned; no free allowances are provided to special interests. Thus, the CLEAR Act does not provide special favors like the House bill.

Unlike the House bill, in the CLEAR Act, only the companies directly regulated by the legislation would participate in the auction. This avoids the huge potential for market manipulation and speculation to drive up carbon prices that exists in the House bill. Financial experts estimate that under the House bill, carbon permit trading could create a $3 trillion commodity market by 2020. Do we really want to have energy consumers subsidizing Wall Street traders?

In the CLEAR Act, 75 percent of the carbon auction revenues would be returned to consumers as tax-free rebates. Nationwide, this means 80 percent of Americans would incur no net costs under the CLEAR Act. The average Mainer would stand to gain $102 per year from the CLEAR Act. By contrast, under the House-passed cap and trade bill, the average citizen would experience a net cost increase of $175 per year.

The other 25 percent of the auction revenues generated under CLEAR would go into a trust fund to fund energy efficiency programs and renewable energy research and development, to provide incentives for forestry and agriculture practices that sequester carbon, to encourage practices that reduce other greenhouse gases, to help energy-intensive manufacturers, and to assist low-income consumers. The fund, called the Clean Energy Reinvestment Trust, CERT Fund, would be subject to the annual appropriations process. This would allow Congress to adapt assistance for climate-related activities on an annual basis, rather than being locked into a complicated allocation scheme that favors special interests.

I applaud the leadership of my colleague from Washington for developing this straightforward, effective and fair climate bill. I urge all my colleagues to consider joining us on this important legislation.

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