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Following a month of continuous negotiations in which I engaged with Energy and Commerce Chairman Henry Waxman (D-Calif.) and Subcommittee on Energy and Environment Chairman Ed Markey (D-Mass.), an agreement has now been reached on the principles for greenhouse gas control legislation that protects the national economy and cushions the consumers of fossil-fueled electricity from significant electricity rate increases. Our agreement is at the core of the legislation that has been approved by the Energy and Commerce Committee and will be debated on the House floor this summer.
While some Members of the House will oppose the legislation, I think it is essential that it be approved. It is inevitable that federal controls on greenhouse gases will be adopted. The Supreme Court ended the debate on whether there would be controls when it effectively mandated three years ago that the Environmental Protection Agency regulate greenhouse gas emissions unless the Congress regulates them first. Just about all interested parties, from industrial emitters to electric utilities to the environmental community, would prefer that Congress adopt the regulations rather than the EPA.
Accordingly, I have been working with Chairmen Waxman and Markey to advance the goals that I think are important to be achieved in control legislation. These goals are preventing the national economic disruption, which would occur if the control program forces emitters to stop using coal and switch to fuels that are in short supply, and keeping electricity rates affordable in regions where most of the electricity is fossil-fuel-fired. The compromise we have now achieved is a major step toward meeting these goals.
Our agreement will provide to electric utilities 90 percent of the emissions allowances they will need without charge. The provision of free allowances will help to keep electricity rates affordable. Our agreement provides 2 billion tons annually of offsets that will enable electric utilities to invest in agriculture and forestry, including tropical rain forest preservation, as a means of meeting their emissions reduction requirements under the law. Therefore, by using offsets, electric utilities can continue using coal while at the same time reducing greenhouse gas emissions.
Under our agreement, separate legislation I have introduced to accelerate the flow of federal funding for the latest generation of carbon capture and storage technologies will be enacted into law. Under that measure, $1 billion annually will be devoted to the development of these technologies for a 10-year period, and estimates are that with this funding they will be available and reliable in 2020. This technology development is essential to achieving our long-term goals for greenhouse gas controls, including a reduction from 2005 levels of 83 percent by 2050, while at the same time protecting the economy and keeping electricity rates affordable.
While the changes we negotiated were necessary and have greatly improved the legislation from its draft form, I continue to have concerns regarding some provisions of the bill. As the process moves forward, I will be seeking additional changes to address the remaining concerns.
One improvement will be a change in the level of greenhouse gas reductions that will be required by 2020. Chairman Waxmans initial proposal was a 20 percent reduction based on 2005 levels by 2020. Our agreement for purposes of committee consideration sets the level at 17 percent. I continue to believe that a 14 percent reduction would be more economically achievable.
I also remain concerned about the short length of the phaseout of the electricity sector allowances after 2025, with a full transition to auction occurring over a mere five years.
Despite these reservations, and my intention to seek additional modifications, I believe that the time to pass a cap-and-trade program of greenhouse gas controls has arrived. The bill approved by the committee is a well-balanced foundation for those controls.
Rep. Rick Boucher (D-Va.) is a member of the House Energy and Commerce Committee.