Transcript Analysis of Kerry-Boxer Clean Energy Jobs and American Power Act

Analysis of Kerry-Boxer
Clean Energy Jobs and American
Power Act
S. 1766
Gregory M. Adams
Los Angeles Sanitation Districts
October 22, 2009
Waxman-Markey vs. Kerry-Boxer
Structural Differences:
HR 2454 incorporates ~ 600 pages of energy bill changes while S. 1733 handled those
provisions in S. 1462 through Senator Jeff Bingaman’s Energy and Natural Resources
Committee
Kerry-Boxer (S. 1733)
Division A (Pollution Reduction, Transition and Adaptation) contains 3 Titles
Title I - Greenhouse Gas Reduction Programs
Title II - Research
Title III -Transition and Adaptation
Division B (Pollution Reduction and Investment) contains 2 Titles
Title I - Reducing Global Warming Pollution (adds Title VII to the CAA)
Title II - Program Allocations
Baseline Year in S. 1733 for emissions reductions is 2005 vs. 2002 for WaxmanMarkey hence considered more restrictive.
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Division A - Authorization for Pollution Reduction, Transition, and Adaptation
Title I - Greenhouse Gas Reduction Programs
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Subtitle D - Water Efficiency; Section 141 – WaterSense: This is basically a voluntary labeling
program for highest performance water-efficient products, processes or services; specifically
mentions the reduction of strain on water and wastewater infrastructure as a goal. [119]
Section 143 - State Residential Water Efficiency and Conservation Incentives Program:
Establishes a grant program where allocation-eligible entities (includes wastewater or sewerage
utility and municipal water authorities) establish financial incentive programs for their
residential consumers for the purchase of residential water-efficient products, processes,
buildings, landscapes or services. [129]
Title I, Subtitle F - Energy Efficiency and Renewable Energy: Section 161 (Renewable Energy)
definition includes biomass and landfill gas and municipal solid waste but not digester gas or
biosolids. The Administrator may provide grants, presumably to project developers, in states
with binding renewable portfolio standards, up to 50% of the total cost of a renewable energy
project. [168]
Section 162 - Advanced Biofuel: The Administrator must create a definition for “advanced
biofuel” that we should weigh in on but otherwise, this is a grant program to support research
and development of advanced biofuel projects. [171]
Section 163 - Energy Efficiency in Building Codes-Requires energy efficient residential and
commercial building codes by 1/1/2014 (very similar to Waxman-Markey). [173]
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Division A Title I - (Continued)
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Section 164 - Retrofit for Energy and Environmental Performance (REEP): The purpose of the
REEP program is to facilitate the retrofitting of existing buildings across the U.S. to achieve
maximum cost-effective energy efficiency improvements and significant improvements in water
use and other environmental attributes. Local governments can be used to carry out the grant
work providing up to 50% of the cost of retrofits, with funding awards increasing in proportion
to demonstrated efficiency attained. [175]
Subtitle H - Clean Energy and Natural Gas–Section 181 Clean Energy and Accelerated Emission
reduction Program [200]: The Administrator to establish a program to provide incentive
payments to promote dispatchable power generation projects whose emissions are below the
2007 U.S. utility average. Priority shall be given to projects to integrate intermittent renewable
power in to the bulk power system. [201]
Section 182 - Advanced Natural Gas Technologies: The term “natural gas” includes renewable
biogas. Grants are provided in this program for research and development of advanced
technologies that reduce greenhouse gas emissions from natural gas-fueled electricity
generation. [202]
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Division A - Title II - Research
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Subtitle B - Drinking Water Adaptation and Research; Section 211 [207] An extremely
comprehensive, funded research program largely for the water industry with some mention of
wastewater (6x), to the tune of $25MM per year for ten years. [217]
Subtitle C - Adapting to Climate Change; Section 366 Natural Resources Climate Change
Adaptation Strategy: Goal is to make natural resources more resilient; mention of ocean
acidification numerous times.
Subpart D - Additional Climate Change Adaptation Programs: Section 381-Water System
Mitigation and Adaptation Partnerships: This is essentially the very favorable Congresswoman
Lois Capps’ amendment carried over to the Senate. [360] This is a 50% grant-based program
directly through the Administrator, very broadly (flexibly) worded, and only short of a specific
% allocation. Allocation account in Division B [810] recognizes the details of the program.
Section 834 - Coastal and Great Lakes State Adaptation Program [375]. This program contains
potential funding for coastal dischargers.
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Division B – Pollution Reduction and Investment [380]
Title I – Reducing Global Warming Pollution
(Adds Title VII: Global Warming Pollution Reduction and Investment Program to the CAA. Many of
these sections are similar to Waxman-Markey.)
• Section 711: Designation of Greenhouse Gases: Includes CO2, CH4, N2O, SF6,
hydrofluorocarbons emitted as a byproduct at a stationary industrial source, perfluorocarbons
and nitrogen trifluoride. (Compounds can be added by petition similar to the Section 112 MACT
standards.) [401]
• Section 713: Greenhouse Gas Registry acknowledges The Climate Registry [413] but ignores the
federal Mandatory Reporting Rule. A reporting entity can be any entity who emits any amount of
GHGs if the Administrator determines that reporting by said entity will help achieve the purpose
of the title.
• Section 721: Emission Allowances. Allowances are not property rights so that the Administrator
can terminate or limit them with impunity. [431] (See the PEW Chart for the distribution of
allowances over the years.)
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Division B - Title I - (Continued)
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Section 722 - Prohibition of Excess Emissions - Allowances and credits held must exceed
emitted GHGs. Electricity sources and industrial stationary sources can exclude contribution
from renewable biomass or gas derived from renewable biomass. [442][445]. Section 722 (b)
(11) Fugitive Emissions: Fugitive emissions of key operative paragraphs are excluded from
consideration (may help POTWs). Many provisions on timing of program entry and use and
limits of domestic and international credits, very similar to Waxman-Markey. Special treatment
for algae-based fuels. [446][451]
Sections 723, 724, 725, and 726 dealing with penalties (double whammy), trading, banking and
borrowing and market buffer reserve account very similar to Waxman-Markey.
[459][461][462][465]
Section 727 - Permits: Contains some strange wording on Title V permits carried over from
Waxman-Markey: “ Recordation by the Administrator of transfers of emissions allowances shall
amend automatically all applicable proposed or approved permit applications, compliance plans,
and permits.” [477]
Section 733 - Eligible [Offset] Project Types: The initial list of projects, which can be modified,
contains favorable language for landfills, non-landfill methane collection, reduction in
greenhouse gas emissions from manure and “effluent” [493], several opportunities to partner
with the farming community and GHG emissions reductions from improvements and upgrades
to mobile and stationary equipment (including engines). Well-developed methodologies
(protocols) are a requisite. [490]
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Division B - Title I - (Continued)
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Section 734: Requirements for Offset Projects: Verifiable, additional, permanent, etc. [496]
Section 740 Early Offset Supply: For projects going back as far as 1/1/2001 but for emissions
reductions from those projects that occurred after 1/1/2009, for three years total only, after the
enactment of this title. (US Conference of Mayors issue??) [515]
Section 102 - Definitions [552] Entirely misplaced section similar to Waxman-Markey. See PEW
HR 2454 comment. Renewable biomass definition unfavorable to municipal solid waste but
great for algae. [567]
Subtitle B - Disposition of Allowances - Section 111 adds Section 771 - Allocation of Emission
Allowances: It appears that the focus of allowance distribution is generally to protect consumers
from energy price increases, to assist industry and workers in the transition to clean energy, and
to spur energy efficiency and the deployment of clean energy technology.
Section 772 - Electricity Consumers: Contains several operative definitions as Renewable
Energy Resource (renewable biomass, biogas derived exclusively from renewable biomass,
biofuels derived exclusively from renewable biomass) that must be examined to see how waste
treatment fares. [579][588]
Section 782: Early Action Recognition [684]: Allows for the re-couping of the monetary value of
the early reductions between 1/1/2006 and 1/1/2009. Also, an entity who receives allocations
under this subpart is not precluded from generating additional offset credits. [687]
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Division B - Title I - (Continued)
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Title VIII (CAA) Additional Greenhouse Gas Standards-Part A-Stationary Source Standards:
Section 811 - Standards of Performance: Appears to be a significant difference between
Waxman-Markey. Defines uncapped emissions as those to which Section 722 (Prohibition of
Excess Emissions) does not apply and directs the Administrator to delay until 1/1/2020 any
related NSPS standard for GHGs. Allows offset projects pursuant to Section 733 (Eligible
Project Types) to exist during this timeframe, presumably.
Section 122 - HFC Regulation: Establishes separate trading program (might be an issue for
POTWs or facilities with refrigeration systems.) [689]
Section 124 - States: Amends Section 116 of the CAA allowing states to regulate and limit
GHGs including requirements to surrender to the state or a political subdivision thereof emission
allowances or offset credits established or issued under the Act. [744]
Section 125 - State Programs: Adds Section 861 State Programs: Deals with federal pre-emption
of the cap and trade provisions for the first 5 years and is much clearer than Waxman-Markey
that a state can do everything else with its GHG program. [745]
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Division B - Title II
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Section 211 - State Programs for GHG Reduction and Climate Adaptation [799] A special State
Climate Change Response (SCCR) account can be used for many of the goals of Section 381 (d)
in Division A. There is no actual % allocation, however. [810]
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