From the press
release:
Rep. Edward J. Markey (D-Mass.) introduced a revolutionary new global
warming bill today that would reduce global warming pollution
according to scientific targets, reinvest any revenue back to American
workers and technology, and would re-establish America as a leader in
solving the globe’s greatest challenge, climate change.
At a speech at the Center for American Progress this morning, Rep.
Markey, who is Chairman of the House Select Committee on Energy
Independence and Global Warming, and a senior member of the Energy and
Commerce and Natural Resources Committees, laid out his science- and
consumer-based vision for climate legislation.
“I am here today because the chorus for change is deafening. The time
for action is now,” said Rep. Markey in his prepared remarks. “We must
cap pollution, we must invest in consumers, jobs and the technology of
tomorrow, and America must lead the world in solving our greatest
challenges, and we must start now.”
The bill is called the Investing in Climate Action and Protection Act,
or iCAP for short, the small “i” a tip of the cap to the technological
potential of clean energy. The bill also proffers a new paradigm in
global warming legislation: the Cap-and-Invest system. The bill caps
pollution at 85 percent below 2005 levels by 2050. It then uses an
auction system that sets a price on carbon, and allows companies to
compete for reductions, or buy or trade credits within the system.
The “Investing in Climate Action and Protection Act” (iCAP Act) amends
the Clean Air Act to establish an economy-wide cap-auction-and-trade
system that adheres to five core principles:
1. Reduce U.S. global warming pollution by 85 percent by 2050, the
necessary U.S.
The iCAP Act’s cap-auction-and-trade program will cover 87 percent of
U.S. greenhouse gas emissions and will reduce covered emissions to 2005
levels by 2012, to 20 percent below 2005 levels by 2020, and to 85
percent below 2005 levels by 2050.
The following “covered entities” will be regulated under the cap: (1)
power plants and large industrial facilities; (2) entities that produce
or import petroleum- or coal-based liquid or gaseous fuels; (3) entities
that produce or import hydrofluorocarbons, perfluorocarbons, sulfur
hexafluoride, or nitrogen trifluoride; (4) natural gas local
distribution companies; and (5) geological carbon sequestration sites.
The iCAP Act will achieve 7 percent additional coverage (a total of 94
percent coverage) through (1) mandatory performance standards for coal
mines, landfills, wastewater treatment operations, and large animal
feeding operations; and (2) voluntary financial incentives to farmers
and forest managers to reduce greenhouse gas emissions and increase
carbon storage. The iCAP Act also sets mandatory performance standards
for new coal-fired power plants, requiring them to capture and sequester
85 percent of their CO2 emissions within a set
timeframe.
2. Auction pollution allowances, instead of giving them free-of-charge
to polluters, to avoid windfall profits for polluters, ensure fairness
and effectiveness, and reduce social costs.
The iCAP Act begins by auctioning 94 percent of allowances in 2012 and
transitions to a 100 percent auction in 2020. The 6 percent of
allowances not initially auctioned are distributed as transitional
assistance to U.S. industries that are energy-intensive and exposed to
international trade competition (e.g., iron and steel, aluminum, cement,
glass, and paper). The iCAP Act permits any person to buy, sell, or
transfer allowances or to “bank” them for future use. Covered entities
also may borrow allowances from the allowance budget for future years,
but these “loans” must be repaid within five years with interest.
Covered entities can meet up to 15 percent of their annual obligations
with EPA-approved domestic offset credits and
up to an additional 15 percent with
EPA-approved international emission allowances
or offset credits. Domestic and international offset credits are subject
to rigorous standards to ensure reductions in emissions or increases in
sequestration are real, verifiable, additional, permanent, and
enforceable. The Federal Energy Regulatory Commission will oversee the
carbon market to prevent fraud and market manipulation.
compensate for any increase in energy costs as a result of climate
legislation.
The iCAP Act returns over half of auction proceeds to low- and
middle-income households through rebates and tax credits. This will
compensate all increased energy costs due to climate legislation for all
households earning under $70,000 (66 percent of U.S. households), and
will provide benefits to all households earning up to $110,000 (over 80
percent of U.S. households).
climate policy, spur the development of advanced low-carbon
technologies, grow the U.S.
The iCAP Act uses the remaining auction proceeds to fund:
- clean energy technology research, development, demonstration and
deployment;
- efficiency policies to reduce the costs and consumer impacts of
climate policy;
- incentives to U.S. farmers and foresters to reduce greenhouse gas
emissions and increase carbon storage in agricultural soils and
forests;
- green jobs training and assistance for workers to transition into the
new jobs of a low-carbon economy;
- reduction of deforestation and deployment of clean technologies in
developing countries;
- programs to increase resilience to climate change impacts in the
United States and in developing countries; and
- climate change education.
India, to take comparable action to reduce global warming pollution to
protect the competitiveness of U.S. industry.
Under the iCAP Act, developing countries that take comparable action to
reduce global warming pollution will have access to funding from the
International Clean Technology Fund and will be allowed to sell “offset
credits” into the U.S. market. Developing countries that carry out
programs to reduce emissions from deforestation will be eligible for
assistance from an International Forest Protection Fund. If a country
fails to take comparable action by 2020, importers of energy-intensive
primary goods (e.g., iron and steel, aluminum, cement, glass, and paper)
from that country will have to purchase special reserve allowances to
account for pollution generated in the production of such goods. Until
2020, U.S. manufacturers of competing primary goods will be given free
allowances to prevent loss of jobs or “leakage” of emissions due to
international competition.
