RL33846 - Greenhouse Gas Reduction: Cap-and-Trade Bills in the 110th Congress
27-Jun-2008; Larry Parker, Brent D. Yacobucci, Johnathan L. Ramseur; 29 p.
Update: Previous releases:
January 31, 2008
April 24, 2007
March 29, 2007
Abstract: Multiple proposals to advance programs that reduce greenhouse gases have been introduced in the 110th Congress. S. 2191 was reported May 20, 2008, from the Senate Committee on Environment and Public Works. An amended version of S.2191, S. 3036, was considered by the Senate in June 2008, but a vote to invoke cloture failed. In general, these proposals would create market-based greenhouse gas reduction programs along the lines of the trading provisions of the current acid rain reduction program established by the 1990 Clean Air Act Amendments. This report presents a side-by-side comparison of the major provisions of those bills and includes a glossary of common terms (Appendix C).
Although the purpose of these bills is to reduce greenhouse gases (GHGs), the specifics of each differ greatly. Five bills (S. 280, S. 309, S. 485, H.R. 620, and H.R. 1590) cap greenhouse gas emissions from covered entities at 1990 levels in the year 2020. S. 317 places its first emissions cap at 2001 levels in 2015; S. 1766 targets reductions at 2006 levels in 2020; S. 2191 as reported would cap GHGs at about 19% below 2005 levels in 2020; H.R. 4226 would limit 2020 emissions to 85% of their 2006 levels; H.R. 6186 would reduce emissions to 20% below 2005 levels by 2020, and H.R. 6316 would reduce emission to 20% below 1990 levels by 2020. Ten bills (S. 280, S. 317, S. 485, S. 2191, S. 3036, H.R. 620, H.R. 1590, H.R. 4226, H.R. 6186, and H.R. 6316) would establish cap-and-trade systems to implement their emission caps. In contrast, S. 1766 provides for two compliance systems — a capand- trade program and an alternative safety valve payment — and allows the covered entities to choose one or employ a combination of both. Finally, S. 309 provides discretionary authority to the Environmental Protection Agency (EPA) to establish a cap-and-trade program to implement its emission cap.
The differences continue with respect to entities covered under the programs. Three bills (S. 309, S. 485, H.R. 1590) provide discretionary authority to EPA to determine covered entities by applying cost-effective criteria to reduction options. In contrast, S. 317’s emission cap is imposed solely on the electric generating sector. The other bills (S. 280, S. 1766, S. 2191, S. 3036, H.R. 620, H.R. 4226, H.R. 6186, and H.R. 6316) cover most economic sectors but not all (e.g., they exclude the agricultural sector). Thus, the overall reductions achieved by the bills depend partly on the breadth of entities covered.
Beyond the basics of these bills, each contains other important provisions. For example, S. 280 creates a new innovation infrastructure, while several — S. 1766, S. 2191, S. 3036, H.R. 4226, H.R. 6186, and H.R. 6316 — encourage foreign countries to undertake comparable control actions and specify potential consequences for inaction. Other provisions include mandatory greenhouse gas standards for vehicles (S. 309, S. 485, H.R. 1590), and a renewable portfolio standard for the electric generating sector (S. 309, S. 485, H.R. 1590). This comparison should be considered a guide to the basic provisions contained in each bill. It is not a substitute for careful examination of each bill’s language and provisions.