Browner, Kerry stay upbeat on US cap and trade in 2010

President Obama remains committed to passing comprehensive energy and climate legislation in 2010 despite calls from Senate moderates to wait until after the midterm elections, a top White House aide said today.
"We want to do it this year," Carol Browner, the president's climate and energy adviser, told reporters following her appearance at a panel discussion hosted by The New Republic.
On Capitol Hill yesterday, several Senate Democrats -- including Finance Chairman Max Baucus of Montana, Commerce Chairman Jay Rockefeller of West Virginia and Carl Levin of Michigan -- questioned whether there is any momentum left for a sweeping bill that puts a price on carbon dioxide emissions. Levin said he expected that a pared-back energy bill had a better chance of passage. And Rockefeller said the White House would not mind more time, too, in order to better educate the public on the complex issue. But Browner denied Rockefeller's account of the legislative dynamics. And she explained that the climate debate has a better chance at picking up bipartisan Senate support in 2010 thanks to calls from many industries for greater regulatory certainty (Source: E&E News).

"I've been involved in passage of a lot of environmental legislation over the last 20 years, and I've never seen as much business support," Browner said. "I think that really distinguishes this from some of the other debates going on on the Hill right now."

Gearing up for a nationally televised summit on health care Thursday, Obama yesterday rolled out a legislative blueprint that marks the first time he has gone into any great degree of detail on one of his signature domestic items. On climate, Browner said she did not expect the White House to follow the same path.

"At this point in time we're not going to put forward legislative proposals, because we think the work that's going on on the Hill is moving at a nice speed, and we're going to continue to work with those folks," she said.

Browner and Interior Secretary Ken Salazar met yesterday with the Senate trio that has taken the lead on that effort: Sens. John Kerry (D-Mass.), Lindsey Graham (R-S.C.) and Joe Lieberman (I-Conn.) -- the latest in a series of administration-led strategy sessions aimed at finding the sweet spot on a bill capable of winning 60 votes and then meeting in conference with the House-passed bill.

Speaking this morning at the same event, Kerry said he does not believe the comments of his moderate colleagues who think the climate legislation won't make it into law this year.

"I am excited," he said. "I know that's completely counter to conventional wisdom."

The Massachusetts Democrat said he expects to build support over the coming weeks with the help of former President Clinton, who has expressed an interest in speaking to the Senate Democratic Caucus on the climate issue much the same way he came to the Capitol for a closed-door session on health care. Kerry also said he recently heard from Majority Leader Harry Reid (D-Nev.).

"He affirmed he wants a bill and he wants a bill soon," Kerry said. "And we're going to try to meet that standard."

Prospects of the climate bill making it across the finish line have been something of a parlor game in Washington, given double-digit unemployment figures and a packed agenda that includes Obama's health care plan.

Karen Harbert, president and CEO of the U.S. Chamber of Commerce's Institute for 21st Century Energy, warned that plans to pass a broader climate bill may be complicated by the low level of public understanding on the nuances of the issue. "We can't forget there are other people outside the Beltway," she said.

But Dirk Forrister, president of the NatSource consulting firm and former head of the Clinton-era White House Climate Change Task Force, said Obama should not hesitate this year just because of the election-year politics. "I don't think it gets any easier the next year or the year after that," he said. "In fact, we dig ourselves into an even deeper hole, and it's even harder."

Sticking point: carbon pricing
Kerry insisted he did not want to release any piecemeal details on the bill that has been coming together over the last several months.

But he still teased out many of the dynamics in the negotiations.

For example, reporters asked him what is the biggest hurdle that the trio is facing. His response: determining what method to use for setting the cap on greenhouse gases. "What's the mechanism for pricing carbon is the real key here," Kerry said. "That's what we're trying to figure out is how we do that in the most effective way."

Kerry said the trio still has not made any decisions when it comes to sorting out whether to go with a cap-and-trade approach, a cap-and-dividend system, a more direct carbon tax or an approach that meshes the somewhat competing ideas together. "Every mechanism that's out there is on the table," he said.

The Senate trio does plan to address industry concerns about the costs of the legislation through a "price collar" that mirrors legislation he co-authored with Sen. Barbara Boxer (D-Calif.). That approach sets up a reserve fund of allocations aimed at controlling volatile prices without destroying the environmental integrity of the overall legislation.

"I don't see any reason why we'd lose that in the mix as we're going forward right now," Kerry said. "I think it's a good idea. And since I'm writing the bill, I think there's a good chance it will end up in the bill."

Kerry also said the legislation would address concerns that a climate bill opens the door for carbon traders to manipulate the multitrillion-dollar market. "Whatever we do in terms of any kind of market out there, whatever shape the pricing takes, there'll be very strict accountability, very strict transparency and no opportunity for games to be played in ways that have been in the past," he said.

Turning to energy issues, Kerry said he expected the bill will make a statement on the nation's plans to continue using oil and gas. "We're going to be drilling for some years to come," he said. "That's going to be reflected in our legislation."

But he also said he expects new coal-fired power plants will see a requirement to capture and sequester their greenhouse gases. "We should not build one new pulverized coal plant that cannot burn clean," he said. "That should be the standard."

Kerry also pushed back against calls for just moving on an energy bill, saying that approach does not deal adequately with the global warming concerns and forgoes economic stimulus. "Energy-only is an escape," Kerry said. "It's a cop out. It's an unwillingness to deal with the reality that we have to achieve."