Trade groups respond to draft climate bill

Washington-Sens. Barbara Boxer (D-Calif.) and John Kerry (D-Mass.) on Sept. 30 released an 821-page draft version of the Clean Energy Jobs and America Power Act, a bill that addresses climate change by establishing a mandate to cut by 2020 the nation’s greenhouse gas emissions by 20 percent from 2005 levels. The bill offers specifics on several key issues, such as incentives for natural gas and nuclear power, as well as offset projects in which farmers and other landowners may earn money for conducting environmentally-friendly projects and practices. The bill’s sponsors also decided to drop references to greenhouse gas trading provisions as “cap and trade” and are referring to them instead as a “Pollution Reduction and Investment” program. The language change didn’t work on the Agricultural Retailers Association, which issued a statement saying the bill “could result in increased costs for the agriculture industry.” ARA said the draft climate change bill does not include information on how emissions allowances will be distributed under the legislation. “ARA is concerned that a cap and trade regime will result in a significant input cost for American agricultural suppliers, farmers and ultimately an increase in food price for consumers,” the organization said. To deal with economic uncertainties, ARA claims the draft climate change plan would establish an allowance reserve that permits EPA to sell credits into the carbon market by auction if credit prices rise faster than expected. ARA noted that the proposed bill would place the carbon markets under a single regulator, the Commodity Futures Trading Commission, and empowers the CFTC to prevent manipulation and eliminate excessive speculation in the markets that adds to price volatility. Just one day after publication of the draft bill, the Economic Policy Institute released a study concluding that industries employing 4.1 million workers are at risk unless climate change legislation addresses the issue of international competitiveness. “If climate legislation increases energy costs in the United States and our foreign competitors do not have similar cost increases, we lose competitiveness and jobs,” said the Industrial Energy Consumers of America on Oct. 1.