Trucost Blog / 13 May 2010

US climate bill to set slow path to low-carbon economy

The proposed American Power Act is in danger of leaving international climate change policies uncertain and fragmented.

The bill for an American Power Act is full of compromise. Earlier plans for a cap-and-trade program – a tool designed to achieve emission reductions at the lowest economy-wide cost – have been watered down and industrial sources will not be covered by the “national pollution reduction plan” until 2016. To protect US manufacturers from carbon leakage, a controversial border tax will apply to imports from countries that have not taken action to limit emissions to a comparable amount, unless there is a global agreement to address climate change.

Unbridled support for new nuclear power stations is not matched by equivalent measures to promote renewable energy. A Renewable Portfolio Standard requiring a share of electricity to be produced from renewable sources is missing.

However, the Bill would amend the Clean Air Act to establish performance standards for new coal-fired power plants permitted from 2009 onwards. And it’s a start. Hopefully the Senate will pass it before the UN climate talks in November/December. Otherwise, international climate change policies are likely to remain uncertain and fragmented.

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