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Boxer-Kerry draft energy regulation bill promises higher energy prices, more regulation for all Americans

In advance of Senator Boxer and Kerry’s release of their energy regulation bill tomorrow, two advance drafts were released today. [Boxer-Kerry Draft 1 is available here. Boxer-Kerry Draft 2 is available here.] From these drafts it appears that the Boxer-Kerry bill will dramatically increase regulation, provide new entitlements to politically-connected groups, and give corporate rent-seekers a new source of Federal dollars. As a result of Boxer-Kerry, the American people will be forced to endure higher energy prices and onerous regulation.

Apparently, Senators Boxer and Kerry understand the difficulties they will face in passing a cap-and-trade bill this year. It seems that, in order to create leverage to secure more votes, the drafts do not completely spell out how the carbon dioxide allowances will be allocated. Instead the draft bills contain many placeholders. The following outlines the placeholders in the first bill leaked today:

SEC. 101. DISTRIBUTION OF ALLOWANCES FOR INVESTMENT IN CLEAN VEHICLES.

[PLACEHOLDER FOR AUTHORIZING LANGUAGE]

SEC. 124. DISTRIBUTION OF ALLOWANCES FOR COMMERCIAL DEPLOYMENT OF CARBON CAPTURE AND SEQUESTRATION.

[PLACEHOLDER FOR AUTHORIZING LANGUAGE]

SEC. 131. DISTRIBUTION OF ALLOWANCES TO STATES.

[PLACEHOLDER FOR AUTHORIZING LANGUAGE]

SEC. 201. ENERGY INNOVATION HUBS.

[PLACEHOLDER FOR AUTHORIZING LANGUAGE]

SEC. 202. ADVANCED ENERGY RESEARCH.

[PLACEHOLDER FOR AUTHORIZING LANGUAGE]

SEC. 454. ENERGY EFFICIENCY IN BUILDING CODES.

[PLACEHOLDER FOR TEXT PROVIDING ALLOCATION FOR PROGRAM UNDER SECTION 174]

SEC. 455. BUILDING RETROFIT PROGRAM.

[PLACEHOLDER FOR TEXT PROVIDING ALLOCATION FOR PROGRAM UNDER SECTION 175]

SEC. 456. FLOOD PREVENTION.

[PLACEHOLDER FOR TEXT PROVIDING ALLOCATION FOR PROGRAM UNDER SECTION 181]

SEC. 457. WILDFIRE.

PLACEHOLDER FOR TEXT PROVIDING ALLOCATION FOR PROGRAM UNDER SECTION 182]

SEC. 460. GREEN JOBS AND WORKER TRANSITION.

[PLACEHOLDER FOR TEXT PROVIDING ALLOCATION FOR PROGRAM UNDER SUBTITLE B OF TITLE III or for ENERGY EFFICIENCY AND RENEWABLE ENERGY WORKER TRAINING FUND UNDER SECTION 322]

SEC. 461. NATIONAL CLIMATE CHANGE ADAPTATION PROGRAM.

[PLACEHOLDER FOR TEXT PROVIDING ALLOCATION FOR PROGRAM UNDER SECTION 351]

SEC. 462. CLIMATE CHANGE HEALTH PROTECTION AND PROMOTION FUND.

[PLACEHOLDER FOR TEXT PROVIDING ALLOCATION FOR PROGRAM UNDER SECTION 367]

SEC. 463. CLIMATE CHANGE SAFEGUARDS FOR NATURAL RESOURCES CONSERVATION.

[PLACEHOLDER FOR TEXT PROVISING ALLOCATION FOR PROGRAM UNDER SUBPART C OF PART 1 OF SUBTITLE E OF TITLE III (section  371 et seq.)]

SEC. 464. NATURAL RESOURCES CLIMATE CHANGE ADAPTATION FUND.

PLACEHOLDER FOR TEXT PROVISING ALLOCATION FOR PROGRAM UNDER SECTION 380]

SEC. 465. INVESTMENT IN ENERGY EFFICIENCY AND RENEWABLE ENERGY.

PLACEHOLDER FOR TEXT PROVISING ALLOCATION FOR PROGRAMS UNDER SUBSECTIONS (a)(8), (b)(6), and (b)(7) of SECTION 782, and SECTION 788, of the Clean Air Act (as added by SECTION 411)]

Subtitle D—International Climate Change Program

Sec. 341.

TO BE SUPPLIED.

SEC. 2. FINDINGS.

TO BE SUPPLIED

SEC. 142. NUCLEAR WASTE RESEARCH AND DEVELOPMENT.

TO BE SUPPLIED

SEC. 173. ADVANCED BIOFUELS.

TO BE SUPPLIED

SEC. 181. FLOOD PREVENTION.

TO BE SUPPLIED

SEC. 790. ENERGY REFUND PROGRAM.

TO BE SUPPLIED

Subtitle D—International Climate Change Program

SEC. 341.

TO BE SUPPLIED.

SEC. 788. CLIMATE CHANGE CONSUMER REBATES.

TO BE SUPPLIED

After the first draft bill was leaked, and appeared in a story in Greenwire, an updated draft was leaked. This second draft did not contain as many placeholders as the first, instead it gives the EPA Administrator discretion to allocate many of the allowances. This still gives Senators Boxer and Kerry bargaining power to allocate allowances to politically preferred groups.

But it also raises an important question—if Congress needs to act to limit the damage of EPA regulating carbon dioxide under the Clean Air Act, how is the second Boxer-Kerry draft an improvement over EPA regulation? This is especially important because the Boxer-Kerry draft does not limit EPA authority to regulate greenhouse gases using the Clean Air Act.[1]


[1] Waxman-Markey’s attempt to limit EPA’s ability to regulate greenhouse gases is ineffectual. The limitation only prohibits EPA from regulating greenhouse gases based on the impact on “global climate change.” (Sec. 831-835) That language does not prohibit EPA from regulating carbon dioxide based on non-global climate change concerns such as ocean acidification. This is especially telling because there are a number of sections in Waxman-Markey where climate change and ocean acidification are coupled (see e.g. Sec. 471).
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