Congress Leaves with a Bang on Climate

August 1 marked the last day Congress was in session before its month-long August recess. In just the five-day work period of its last week, the House introduced two big climate-related bills and the Senate and House held four hearings on climate change.

On July 29 and 30, with the Environmental Protection Agency (EPA) holding hearings across the country on its recently-released Clean Power Plan (see EESI's article), the House held its own hearings examining the proposed plan, which would reduce the carbon dioxide (CO2) emissions from currently operating power plants by 30 percent below 2005 levels by 2030. Over the same two-day span, the Senate convened two briefings examining the threats and economic costs of climate change.

On July 30, the House Committee on Science, Space and Technology, chaired by Rep. Lamar Smith (R-TX), held a full hearing entitled, “EPA’s Carbon Plan: Failure by Design.” The witnesses at this hearing included Jeffrey Holmstead , partner at Bracewell & Guliani LLP; Charles McConnell, Executive Director of the Energy & Environment Initiative; David Cash, commissioner of the Massachusetts Department of Environmental Protection; and Gregory Sopkin, partner at Wilkinson, Barker, Knauer LLP. A large focus of this hearing was whether or not the Clean Power Plan has legal standing under the Clean Air Act; the hearing also examined the rule’s potential negative economic impacts. David Cash argued the rule will not necessarily have high costs, citing the Regional Greenhouse Gas Initiative (RGGI) as an example of how regulating carbon dioxide can result in more benefits than costs to ratepayers.

On the morning of July 29, the House Energy and Commerce subcommittee on Energy and Power, chaired by Ed Whitfield (R-KY), held a hearing on the Federal Energy Regulatory Commission’s (FERC) view of the Clean Power Plan, entitled, “FERC Perspectives: Questions Concerning EPA’s Proposed Clean Power Plan and other Grid Reliability Challenges.” The witnesses included Acting Chairman Cheryl A. LaFleur and Commissioners Philip D. Moeller, John R. Norris, Tony Clark, and Norman C. Bay. FERC jurisdiction includes the nation’s electric grid, electricity markets, generation dispatch, and the integration of intermittently generated electricity, among other things. With its wide-ranging remit, FERC will be involved in overseeing many of the changes under the Clean Power Plan. All the witnesses agreed that climate change is happening and steps need to be taken to mitigate its effects, but some on the panel also noted that the Clean Power Plan presents challenges that should be addressed.

On July 29, the Senate Budget Committee held a hearing entitled, “The Costs of Inaction: The Economic and Budgetary Consequences of Climate Change.” The hearing examined the economic and social cost of inaction on climate change mitigation. Chairwoman Patty Murray (D-WA) commented, “It’s becoming clearer and clearer that if you care about the deficit, you need to care about climate change . . . We’ve got a responsibility to leave a stronger country for our children and grandchildren, and that means addressing climate change to help the environment, help the economy and help the federal budget.” During the question period, all five witnesses agreed that climate change is happening. The witnesses included: Mindy Lubber, president of Ceres; Alfredo Gomez, Director of Natural Resources and Environment at the Government Accountability Office (GAO); Sherri Goodman of the CNA Military Advisory Board and former Deputy Undersecretary of Defense; W. David Montgomery, Senior VP of NERA Economic Consulting; and Dr. Bjorn Lomborg, adjunct professor at the Copenhagen Business School. On July 29, the White House released a report that also examined the economic cost of inaction on climate change (see Climate Change News August 4). In the report, the White House Council of Economic Advisers found that delaying action on climate change could result in $150 billion in losses per year to the U.S. economy.

Later that same day, the Senate Environment and Public Works (EPW) subcommittee on Clean Air and Nuclear Safety, chaired by Senator Sheldon Whitehouse (D-RI), held a hearing on the topic of “Examining the Threats Posed by Climate Change,” where members heard from a variety of witnesses on the threats climate change brings to economies and societies. The witnesses included Carl G. Hedde, Head of Risk Accumulation at Munich Reinsurance America, Inc.; Kristin Jacobs, Commissioner of Broward County, Florida, and part of the White House’s Climate Task Force; Bill Mook, President of Mook Sea Farm; Dr. Bjorn Lomborg, Adjunct Professor at the Copenhagen Business School; and Raymond J. Keating, Chief Economic of the Small Business & Entrepreneurship Council. Some members of the subcommittee questioned witnesses regarding whether climate change should be addressed at all, stating that economic impacts are too costly and the scientific models too uncertain. Carl Hedde commented, “One area where we [Munich Reinsurance America] do see an upward trend is in regard to losses from weather catastrophes, which, over time, have increased in both frequency and severity,” showing that there is also an economic cost associated to inaction on climate change.

Rep. Chris Van Hollen (D-MD) introduced the Healthy Climate and Family Security Act of 2014 (H.R. 5271), a cap-and-dividend approach for carbon emissions reduction, on July 30. Rep. Van Hollen explained, “by capping carbon emissions, selling permits, and returning the resulting revenue to everyone equally, this ‘cap and dividend’ approach achieves the greenhouse gas reductions climate scientists tell us we need to prevent the dangerous consequences of climate change while boosting the purchasing power of American consumers.” The bill’s goal is to lower carbon emissions by 80 percent below 2005 levels before 2050. The bill would create auctions to sell off permits for the emission of carbon dioxide, gradually raising the price of carbon intensive products and creating incentives for people to use more clean energy and energy efficiency technologies. One hundred percent of the proceeds from selling permits would be returned as a dividend to every American with a social security number, adult or child.

On July 31, following the hearings, Rep. Matt Cartwright (D-PA) introduced the Preparedness and Risk management for Extreme weather Patterns Assuring Resilience (PREPARE) Act (H.R. 5314), which addresses the need for government to become more resilient in the face of increasing extreme weather. The PREPARE Act would create structures within the government to help prepare for and respond to extreme weather events, which have resulted in $130 billion in damages and over 400 lives lost in just the last two years (see EESI's article).

The surge of Congressional activity in late July reflects the need to further understand and address the implications of rising temperatures and increasing extreme weather events on the U.S. economy. According to Jim Stock, one of the lead authors of the White House report, “If we do nothing this year, we save money this year . . . But the trouble is, by doing nothing this year, it costs us more in the future.”

 

Authors: Jenifer Collins & Laura Small