Cap and Trade takes a Beating in Senate Committee

The special Senate Committee on Cap and Trade will be wrapping up their meetings today (Oct 29, 2009) to prepare the Kerry-Boxer bill for markup. After a volley of heated comments from Democrats and Republicans concerning the bill, Senators on the committee listened to presentations from expert witnesses from across the country. The testimonies were both for and against climate change legislation, and witnesses were available to members of the Senate committee for cross examination.

One of the first focuses of the meetings was a price collar that was worked into the current draft of the senate bill from the contributions from the office of Senator Arlen Specter. These collars are designed to deliver subsidies to generators if energy costs increase in the first few years of the program. Senator Lamar Alexander was quick to point out that the amount of collar funds would taper to zero in about 5 years, before the price of carbon is expected to begin a steady linear uptick.

Senator Boxer countered his statement by saying that his calculations certainly don't account for the adaptation of the carbon market, and that the projected cost of carbon cannot truly be known, much as the ease of SO2 emission cuts surprised industry.

Senator Alexander took more time to point out which states in the House had representatives vote for the climate bill, which was the Pacific coast, the Northeast, and Michigan. Representatives from Mountain, Southern, and Midwest states all voted against this, which Senator Alexander says is because Cap and Trade will redistribute $345 million to Pacific and Northeast states each year. The senator ran over his allotted time again by stating that cap-and-trade in the EU has resulted in energy shortages, $8 gas, a 20% higher residential energy bills, and a "green bubble" in Spain and Germany that will collapse as soon as the government weens off subsidies. Alexander called for a boycott of the bill's markup.


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