A Carbon Rule is Not a Carbon Law
EPA announced a proposed rule on Tuesday to create a national registry for greenhouse gas emissions reporting.
This step is crucial to any effort to enact a law pricing GHG emissions, be it a cap-and-trade system or a carbon tax. The rule would mandate annual reporting from suppliers of fossil fuels or industrial greenhouse gases, manufacturers of vehicles and engines, as well as any other facilities that emit 25,000 metric tons or more per year of GHG emissions.
Of course, this wasn’t news to us. We wrote about the rule and the 25,000 metric ton threshold last month.
While this step is important, far more difficult ones lie ahead. This week’s action simply required the Obama Administration to push a draft rule that had languished under its predecessor’s watch.
Now comes the hard part. The Administration must sell its larger vision for legislating carbon regulation in the halls of Congress and in the court of public opinion.
And the last week hasn’t been so encouraging.
Late last week Senator Jeff Bingaman, who chairs the Energy and Natural Resources Committee, called Obama’s vision of a 100 percent auction model (where a regulated party must purchase all allowances required to cover its GHG emissions, as opposed to initially receiving some allowances free under grandfathering provisions) “unlikely.”
This week, investor Warren Buffet, an Obama economic advisor, reiterated his concerns about embracing a cap-and-trade system at all. And finally, carbon tax advocates have not yet surrendered. Rep. John Larson (D-CT) is said to be close to introducing carbon tax legislation. The House Ways & Means Committee Chairman, Rep. Charles Rangel (D-NY) is also expected to push for a carbon tax.
Cap-and-trade proponents should savor the coming of the national GHG registry. It may be the best news they have for a while.
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