Senate Climate Bill To Protect Trade-Exposed Industries

This past Saturday, 350.org [1] kicked off the largest, most diverse [2], international day of action [3] in the history of the environmental movement. They were drawing attention to the 350 parts per million concentration of CO2 many scientists are coming to believe is the safe maximum limit [4]. In spite of the fact that official US government economic modeling underestimates the costs of doing nothing [5] and underestimate the benefits of acting [6], the U.S. Senate is at least trying to keep up with the times.

The Chair's mark of the Senate global warming bill was released Friday [7], S. 1733, or the Clean Energy Jobs and American Power Act, a k a the Kerry-Boxer bill. A preliminary Environmental Protection Agency economic analysis [8] has also been released alongside it. Its impact is expected to be similar to the House version [6], H.R. 2454 [9], or the American Clean Energy and Security Act, a k a the Waxman-Markey bill.

Of particular interest, the Senate version [10] will provide emissions allowances to promote investment in the following sectors:

o Energy Intensive and Trade Exposed industries
o Small local distribution companies (including rural electric co-operatives)
o Transportation grants
o Agriculture and forestry
o Energy Efficiency and Renewable Energy
o Advanced energy research
o Credits for early action
o Energy efficiency and renewable energy worker training
o Nuclear worker training

It also includes money for states to boost all recycling-related programs, including manufacturing industries that use recycled inputs, and you can read a longer overview of the job protection provisions here [11].

On top of the research and development money in the stimulus package, whose effects President Obama highlighted last Friday [12] in an address at MIT, this bill can add to the preservation of our "industrial commons: [13] the valuable infrastructure of suppliers and skills [14] that underpins them."

Considering the no-holds-barred regional competition to attract new businesses [15], states like Michigan could use a little federal help to back up their efforts [16].

As such, the bill will hopefully meet with Sen. Sherrod Brown's approval [17]. The Ohio senator will be working with Senators Kerry and Boxer to make the final version that goes to the floor more friendly to manufacturing and to include a border-tariff accounting for the carbon intensity of imported goods.

On that last, Brown seems likely to get his wish. Section 765 of the draft version I've been looking at says, ‘‘It is the sense of the Senate that this Act will contain a trade title that will include a border measure that is consistent with our international obligations and designed to work in conjunction with provisions that allocate allowances to energy-intensive and trade-exposed industries.’’