Bingaman Proposal Reflects Growing Support for Mandatory Climate Change Policy

FOR IMMEDIATE RELEASE

Contact:

Tony Kreindler, Environmental Defense, 202-572-3378 or 202-210-5791

(Washington – July 10, 2007) Senator Jeff Bingaman tomorrow is expected to introduce the 9th significant climate change bill in the Senate this session, reflecting continued growth in bipartisan support for mandatory limits on global warming pollution.

But despite improvements from previous drafts, Senator Bingaman’s bill still contains a fatal flaw that would seriously undermine climate protections.

“The safety valve is a dangerous kill switch that could turn off the whole program,” said Steve Cochran, national climate campaign director at Environmental Defense. “There are much better ways of managing costs than giving up on the environmental goal altogether.”

The safety valve in Senator Bingaman’s bill would put a price ceiling of $12 per ton of carbon dioxide under an emissions cap and trade system. If emissions allowances traded by companies reached the price ceiling, companies could buy unlimited cut-rate emissions allowances from the government – effectively jettisoning the bill’s mandatory emissions limits.

The safety valve included in Senator Bingaman’s bill:

• Undermines the fundamental goal of an emissions cap. Fixing the climate problem means capping and reducing carbon emissions. Previous government analysis of similar legislation has shown that the operation of a safety valve prevents climate bills from achieving their own emissions reduction targets. 

• Limits investment in new low-carbon technologies. Putting a ceiling on the price of emissions allowances puts a ceiling on the amount of private-sector capital that could flow to the development of the clean energy technologies needed to make deep reductions in U.S carbon emissions.

• Is bad for farmers and Rural America. A cap and trade system will create a major new market for emissions allowances, and anyone who can make emissions reductions can profit. If companies can buy allowances from the government at a below-market price, they have no incentive to buy allowances from farmers who could generate more than $8 billion worth of reductions through no-till farming, methane capture and other practices.

Senator Bingaman’s bill will be referred to the Environment and Public Works Committee, where subcommittee Chair Joe Lieberman and Ranking Member John Warner are preparing comprehensive climate legislation. The two senators recently announced that they expect to bring legislation to a markup in their subcommittee before the August congressional recess.