Saturday, May 8, 2010

Just in from Washington

Senate climate change bill possible by June
Washington--With a promise from Senate Majority Leader Harry Reid to allow energy and climate change legislation to be brought to the floor in the coming months, Sens. John Kerry (D-Mass.), Lindsey Graham (R-S.C.) and Joe Lieberman (I-Conn.) are intensifying their efforts to build a consensus among fellow lawmakers, as well as the industries that would be affected by the greenhouse gas emissions caps and other proposals the trio is making. Among those with a seat at the discussion table are farmers and ranchers.

“We appreciate the outreach and the opportunity to again lay out our concerns,” said Rick Krause, American Farm Bureau Federation climate change specialist. “It’s a dialogue we plan on keeping up.” However, Krause cautioned, regardless of the provisions benefiting agriculture that may be included in the Kerry-Graham-Lieberman climate change bill, fees on motor fuels and emissions caps on the utility and manufacturing sectors—all of which are being considered —will put a squeeze on farmers and ranchers by driving up fuel, fertilizer and energy costs.

In addition, Kerry, Graham and Lieberman are proposing making carbon a commodity, one that could be more profitable than crops or livestock. “Legislation that puts a price on carbon so it can be bought and sold will likely compel some landowners to turn their crop fields and grazing lands into forests,” Krause explained. To broaden support for their bill, the senators are considering tempering the climate change provisions with provisions dedicated to boosting renewable fuels and promoting nuclear power and offshore oil and gas drilling.

However, a number of their colleagues from coastal states such as Florida, New Jersey and Maryland have already raised a red flag signaling they would not support a bill that would open their coastal waters to drilling.

For Senators Maria Cantwell (D-Wash.) and Susan Collins (R-Maine), it’s Kerry, Graham and Lieberman’s carbon trading approach that’s a problem. The pair is offering an alternative they call “cap-and-dividend.” Under their bill, carbon emissions allowances would be auctioned off to fossil fuel industries with most of the revenue going back to consumers to help defray higher energy costs.

Cantwell and Collins said their proposal is as likely to pass the Senate as the Kerry-Graham-Lieberman bill, which Kerry said will be released after Congress returns from its two-week recess the week of April 12. Lieberman said the bill will likely be considered in June, after the Senate debates financial regulatory reform. “There are obviously still many unknowns, including exactly what the bill will look like and what it will cost farmers, ranchers and all Americans,” Krause said.

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