U.S. Representatives Lloyd Doggett (D-Texas), Chris Van Hollen (D-MD) and Earl Blumenauer (D-OR) today introduced the Climate MATTERS Act (Climate Market Auction Trust and Trade Emissions Reduction System) to institute a cap-and-trade system designed to reduce greenhouse gas pollution. This is the first such bill to receive primary referral to the Ways and Means Committee, which is scheduling a hearing on it within a month.
The bill’s 2050 target is 80% below 1990 levels, and auctions 85% permits from the start, moving to 100% by 2020. Funds from the auction are directed primarily to consumers and workers, including a fund for healthcare.
The following environmental organizations released a joint statement heralding the legislation for its “strong, science-based targets” and “best practices of cap-and-trade policy”: Alaska Wilderness League, Defenders of Wildlife, Earthjustice, Environmental Defense Fund, Environment America, Greenpeace, League of Conservation Voters, National Audubon Society, Physicians for Social Responsibility, Sierra Club, Union of Concerned Scientists, The Wilderness Society.
Bill summary provided by the authors:
The Climate MATTERS Act (Climate Market, Auction, Trust & Trade Emissions Reduction System)
The Climate MATTERS Act develops an innovative plan for the auction, revenue and trade aspects of a cap and trade system.
Strikes a Balance: The Climate MATTERS Act is environmentally strong, but realistic about its goals and methods to accomplish them.
Domestic Auction
- The Climate MATTERS Act emissions cap will reduce emissions 80% below 1990 levels by 2050.
- Beginning by auctioning 85% of all emissions allowances, this bill quickly moves to a 100% auction in 2020.
- While excluding agriculture, forestry and small businesses from the emissions cap, this bill also provides incentives for these sectors to reduce their emissions.
Green Investment Plan for Auction Revenue
- As the comprehensive auction system raises significant new revenue, this bill recognizes that this revenue is an important aspect of a comprehensive response to global warming. The Climate MATTERS Act devotes this revenue to addressing the social, economic and environmental aspects of adapting to a clean energy economy and offsetting the inevitable impacts of climate change.
Consumer and Worker Assistance
- Consumer Assistance: Provides substantial assistance to American families in meeting their household needs and making energy efficient improvements.
- Part of the revenue is used to create the “Healthy Families Fund.” The reserve fund acknowledges that climate change and lack of access to affordable healthcare are two of the largest problems America confronts. This fund will assist households with the costs of obtaining and maintaining healthcare coverage as we transition to a new clean energy future.
- Affected Worker Assistance: Provides funding for adjustment assistance, employment services, income-maintenance, and needs-related payments for workers to ease the transition to a low carbon economy. Funds will also assist communities in attracting new employers, provide local government services.
- Worker Training: Supplements funding for green worker training, and provides funding for the advancement of environmental education to create an environmentally-literate workforce.
Environmental Protections
- Provides funding to conserve natural resources, mitigate impacts and help wildlife and ecosystems survive global warming. Provides funding to help the developing countries begin to adapt to a changing climate.
- Provides funding to achieve real, verifiable, additional, permanent, and enforceable reductions in greenhouse gas emissions from the agriculture and forestry sectors, as well as promoting forest restoration and deforestation reduction efforts internationally.
Transition to a Clean Energy Economy
- Technological Development: Provides funding for the advancement of basic renewable energy technologies.
- Energy Efficiency: Provides funding for energy efficiency and conservation, advancement in mass transit and provides funding to load serving entities to implement energy efficiency programs for their customers. In addition, the bill provides funding for heating and weatherization assistance programs.
- Early Action: Provides funding to operators of emitting facilities in recognition of early action to reduce greenhouse gases.
- International Technology and Adaptation: Provides funding to qualified developing countries to accelerate low carbon technologies and assist the most vulnerable developing countries cope with climate change impacts.
International Cooperation
- The Climate MATTERS Act also provides strong encouragement to other countries such as China and India to participate through a combination of carrots and sticks in a manner designed to be WTO compliant.
- The bill provides incentives to encourage early implementation of cap and trade agreements by allowing flexibility in setting emissions levels in a limited number of initial agreements.
- Carbon-intensive goods from countries lacking such emissions caps cannot enter the U.S. market without allowances purchased to cover their carbon footprint.
- In addition, the Climate MATTERS Act acknowledges the substantial benefits of tropical deforestation reductions by providing negotiators the ability to reward countries that significantly reduce deforestation, even if they are unable to implement a comprehensive emissions cap.
Tax Offset
The Climate MATTERS Act devotes a portion of the auction proceeds to ensure the bill does not add to our national debt.