U.S. Senate may scrap Cap and Trade in exchange for Cap and Dividend

I may have spoke too soon the other day. It seems that a few Republicans in the Senate are not only on board with Cap and Trade but could be willing to support a Cap and Dividend model as the centerpiece of the climate change legislation that the House of Representatives passed last year. I've been a fan of Cap and Dividend since I read about the concept in a few publications and blogs.

The key difference between Cap and Dividend and Cap and Trade is that the revenues that are raised through the auctioning of permits, which would allow businesses to emit a certain level of greenhouse gases, would be paid out in the form of dividends to American citizens, whereas in a Cap and Trade system the revenues go to the Federal Government, where they are supposed to be used to fund renewable energy projects. The problem, as we have seen with many of these types of government programs, is that legislators seems to always find away to use the money for something other than its intended purpose (in Allegheny County you have Dan Onorato trying to use tax revenues intended for public transit or air quality improvements to build roads).

When it comes to Cap and Trade or Carbon Taxes, many Americans have a legitimate concern (and for once, Republicans have a valid argument against Democratic legislation) that utilities would pass on any increased costs in the form of a new tax or fee on their utility bills. The utilities are almost guaranteed to pass these costs on to us, which is why a Cap and Dividend is the way to go. The dividends that are paid out to citizens would in essence offset any taxes or rate hikes on our utility bills. A bonus of the Cap and Dividend is that it acts as an incentive to consumers to reduce their electricity consumption, since a lower utility bill would mean they would have more of the dividend to keep for themselves.

This past December Senators Maria Cantwell (D-WA) and Susan Collins (R-ME) unveiled the CLEAR (Carbon Limits and Energy for America’s Renewal) Act. Which, at only 39 pages, is much simpler and clear cut than the Waxman-Markley climate bill that was passed last summer.

CLEAR is a “100-75-25-0” policy:

• 100% of the permits to bring fossil carbon into the U.S. economy will be auctioned from day one – there are no permit giveaways.
• 75% of the auction revenue is returned directly to the public as equal per person dividends.
• 25% of the auction revenue is devoted to investments in energy efficiency, clean energy, adaptation to climate change, and assistance for sectors hurt by the transition from the fossil-fueled economy.
• Zero offsets are allowed: polluters cannot avoid curbing use of fossil fuels by paying someone else to ostensibly clean up after them.

What's not to like about that?

For more on the CLEAR act, check out Senator Cantwell's website.

For more on Cap and Dividend read Scientific American's Cap and Dividend, not Trade: Making Polluters Pay

Supreme Court Ruling is a Huge Blow to Climate Change Legislation

Big business just got a huge shot in the arm yesterday thanks to a Supreme Court of the United States ruling that removes restrictions for federal campaign financing by corporations, unions, and other special interest groups (See "A Shocking Win for the Fat Cats"). The argument made by the majority boils down to the need to give corporations the same freedom of speech that you and I have under the Constitution of the United States. I blogged over at Thoughts on Government about how wrong this reasoning is, but here at Green is Good I wanted to touch upon how corporations can now directly spend their money to work to defeat any legislation that threatens their bottom line.

Health care firms were already spending an average of $1.4 million a day, yes, a single day, to defeat health care legislation. Now that the SCOTUS has made a ruling that will remove the restrictions that force corporations to use PACs for federal campaign contributions, one could argue that any legislator who supports a bill that hurts corporate profits will now be under fire from those same corporations and industry groups. Besides health care, the climate change legislation comes to mind as the most critical legislation that is now under threat of being derailed thanks to this ruling. The utility industry groups have already been sending out letters to their customers, telling them that climate change legislation would lead to higher rates or a tax on the utility customer. The SCOTUS ruling will open up a floodgate of more mailings, more commercials, and much more money being spent to defeat any legislators who support cap and trade or cap and dividend legislation.

This ruling will make it more likely that any Democratic Senator or Congressman in a red state or district will think twice about supporting a bill that puts them squarely in the bulls eye of corporate America. Our legislators, those who do not have a spine anyways, will not vote for something that is unpopular, even though it is, in their mind and heart, the right thing to do. My friends, we are becoming a plutocracy - a nation where our laws and policies are no longer written for your average citizen, but for the citizen (think T Boone, Bloomberg, Soros, etc) and the corporations that have the deep pockets to buy any politician who supports their agenda. If you haven't already, please watch the great documentary The Corporation for more on how treating corporations as if they were citizens poses a serious threat to our democratic republic.

Tuesday Bullets

From Climate Progress: "Europe made a major commitment under the Kyoto protocol that U.S. conservatives have been telling us for years they would never achieve. It now seems clear they will meet their commitment under the terms of the protocol. It will become increasingly difficult for those who don’t want a U.S. cap-and-trade system to point to the European Trading System ETS) as an obvious failure."

Waxman-Markey is going to get changed. Again and again and again.

India wants US $upport from Copenhagen on climate change.

Software as a service company helps businesses reduce greenhouse emissions — and be more energy efficient. Customers include Coca-cola and (surprise, surprise) the city of Palo-Alto.

Volvo presses the gas on its plans for a plug-in hybrid.

VA’s GOP Gubernatorial candidate talks about energy, fails: "On energy, our opponents will say NO to offshore drilling, NO to clean coal, NO to nuclear, and NO to the new jobs and investment that come with it. When it comes to promoting energy independence: They’ll just say NO, we’ll just say YES!" Not quite, "Yes we can..."

First quarter funding for renewable energy in Asia fell 70% due to credit crunch, recession, drop in oil prices.

Don’t call it a comeback — wood is getting back into the energy mix.

China invests $14.6 billion to double wind power capacity by 2010.

Saturday Bullets

• The politics of the American Clean Energy and Security Act from Grist: “In the exact center, according to recent work by two economists, are nine lawmakers. And if the Waxman-Markey climate bill receives a full House vote, any one of them could provide the 218th “yes”—the decisive vote that passes the bill.”
  
  
• Can’t afford a hybrid? Paint your roof white, from Climate Progress.
  
  
• How global warming makes storms more dangerous, parts one and two. (Also from Climate Progress).
  
  
• Bai Kin-moon addresses the World Business Summit on Climate Change via Grist
  
  
• Oil keeps going up and up from Environmental Capital.
  
  
• The challenges of building wind turbines in China... sound a lot like the challenges of doing business in China.
  
  
• Robert Stavins from the Energy Collective, writing about how political giveaways in Waxman-Markey might affect the effectiveness of cap and trade: Despite all the hand-wringing in the press and the blogosphere about a political “give-away” of allowances for the cap-and-trade system in the Waxman-Markey bill voted out of committee last week, the politics of cap-and-trade systems are truly quite wonderful, which is why these systems have been used, and used successfully.