Statement from Environmental Defense Fund on House Carbon Capture Legislation

Contact:
Tony Kreindler, EDF, 202-572-3378 or 202-210-5791 (cell)
  
(Washington, DC - July 10, 2008) The House Subcommittee on Energy and Air Quality today held a hearing on H.R. 6258, a bill intended to spur the development and deployment of carbon capture and storage (CCS) technologies to reduce global warming pollution from coal-fired power plants.
 
EDF recognizes that coal will continue to be an important part of the U.S. energy supply for the foreseeable future, and that CCS technologies are needed to help electric utilities meet energy demands while protecting the climate. EDF believes the most effective way for Congress to promote the rapid commercialization and deployment of CCS technology is to create a market for it by enacting a national cap and trade program.
 
“The single best thing Congress can do for CCS is enact a national cap on greenhouse gas emissions. Funding for CCS development will only do so much – we need the cap to pull the technology into the marketplace,” said Scott Anderson, energy policy specialist at EDF.
 
EDF looks forward to working with Chairman Boucher on practical CCS incentives as part of national cap and trade legislation. As Congress considers proposals to advance CCS technologies, it should adhere to the following principles: 
  •  Be comprehensive.  In addition to providing incentives to drive CCS technology development, Congress can and should create the demand necessary to pull the technology into the marketplace by enacting comprehensive climate legislation.  Any new incentives to advance CCS technology should complement, not substitute for, comprehensive action. 
  •  Ensure that public monies are spent with public oversight and accountability.  H.R. 6258 would establish a Carbon Storage Research Corporation to raise $1 billion a year from the public to award grants to fund CCS technology projects.  The Corporation would be governed exclusively by representatives from the utility and fossil fuel industries, without any representatives from the public or environmental interests.  Neither the Congress nor federal or state electricity regulators would oversee the board or its decisions.  Congress should ensure that the public is adequately represented in any federal program to promote CCS technology and that it is ultimately accountable to the public.
  • Incentives to promote CCS technology should follow strong and effective standards.  The bill attempts to accelerate the commercial availability of CCS technology, but offers little guidance on how grants should be awarded to maximize the likelihood of that outcome.  The bill also lacks standards to ensure that grants go to those technologies with the greatest promise of delivering deep emissions cuts from the utility sector.  Strong standards can guide grant-making and increase the likelihood of success.
  •  Maximize the use of existing federal programs to promote CCS technology.  Congress has already established CCS research and deployment programs at the Department of Energy, which have already identified and tapped into expertise on the subject at the national labs, industry and universities.  It is unclear whether the efforts under H.R. 6258 would be redundant or complimentary to existing efforts or how all CCS technology programs should be coordinated.  Any additional incentives to advance CCS technology that Congress wishes to pursue should take full advantage of all these programs have to offer. 
  • Don’t forget other essential issues associated with CCS.  The commercial availability of CCS technology depends on more than technology development.  It also requires that standards and rules be put in place to protect potentially vulnerable water supplies, to help site CO2 pipelines, and to establish liability should projects fail.  Advances on all these fronts will be necessary if we are to accelerate the deployment of CCS technology. 
  • Consider the rights of state and local governments.  The Carbon Storage Research Corporation created by this legislation is allowed to levy fees on local electric utilities, and would require local and state regulatory commissions to allow utilities to fully recover those costs from ratepayers. Congress should exercise great caution in deciding whether and to what degree to preempt the rate-setting authority of state and local regulators, who are better situated to determine how costs should be shared between utilities and ratepayers.
 
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One of the world’s leading international nonprofit organizations, Environmental Defense Fund (edf.org) creates transformational solutions to the most serious environmental problems. To do so, EDF links science, economics, law, and innovative private-sector partnerships. With more than 3 million members and offices in the United States, China, Mexico, Indonesia and the European Union, EDF’s scientists, economists, attorneys and policy experts are working in 28 countries to turn our solutions into action. Connect with us on Twitter @EnvDefenseFund