Chairwoman Boxer, I want to thank you for holding this hearing. As the former Chairman of the Subcommittee on Clean Air, Climate Change, and Nuclear Safety, I have had a keen interest in this issue and look forward to the debate I know the Committee and Senate will have on this very important matter.
Simply mentioning this issue can spark a heated discussion about the future of our planet and actions that should or should not be taken. The wide disparity of views is showcased on the Environment and Public Works Committee where members call climate change both the "greatest hoax" and our "greatest problem."
While some may push for no action, several of my colleagues have put forth proposals to impose significant restrictions on the emissions of greenhouse gases. Unfortunately, these proposals would be devastating to our country because they ignore our economic and energy needs. These proposals would have a significantly negative impact on our nation's economy, cause extensive job loss, and raise electricity and natural gas prices.
Higher costs of natural gas would be overwhelming to our country. Over the past six years, natural gas prices have increased over 300 percent. We have the highest natural gas prices in the world, impacting families who depend on it to heat their homes and businesses that use it to make their products. Due in large part to these increased prices, the U.S. has lost more than 3.1 million manufacturing jobs since 2000 and my State of Ohio has lost nearly 200,000.
Jack Gerard with the American Chemistry Council testified before my Subcommittee on February 9, 2006:
"In a few short years, the US chemical industry has lost more than $50 billion in business to overseas operations and more than 100,000 good-paying jobs in our industry have disappeared. Put another way, the chemical industry went from posting the highest trade surplus in the nation's history in the late 1990s to becoming a net importer by 2002."
Concerns about natural gas prices led the Senate to take two major actions last year to address this problem. First, we made available an additional $1 billion for the Low Income Housing Energy Assistance Program – or LIHEAP. Since 1999, funding for this program to provide assistance to low-income households to help with their heating or cooling costs has increased by about 70 percent.
Second, Congress passed the Gulf of Mexico Energy Security bill to open more than 8.3 million acres on the Outer Continental Shelf for oil and gas leasing. Passage of this bill has the potential to develop an estimated 5.8 trillion cubic feet of natural gas — enough to heat and cool all five million Ohio homes for over 15 years.
If these climate change proposals were passed, we would eliminate any progress associated with these two actions. EIA predicts that coal use would decline sharply and more natural gas would be used to generate electricity. This would further increase the demand for natural gas and use up any additional resources that we expect to extract from the Gulf of Mexico. As EIA predicts, the bill would drive up the price of natural gas even further. The impact would be astronomical costs to the poor, the elderly, and the middle class in this country – and of course, there would be an even greater need for increased LIHEAP funding.
This is the problem with our nation's tail wagging the dog environmental policy. For far too long, we have failed to consider the impact our environmental policies have on our energy and economic needs. Part of the reason is that we have many groups that have only one concern –the environment. As the father of the Ohio EPA with a strong record on clean air and a lifelong proponent of Great Lakes restoration, I am an environmentalist that must balance many different needs.
The United States is in the midst of an energy crisis. It is time for a 'Second Declaration of Independence' – independence from foreign sources of energy – and for our nation to take real action toward stemming our exorbitantly high oil and natural gas prices. Instead of considering them separately, we must harmonize our energy, environment, and economic needs. This is an absolute must as we consider any additional actions to address climate change.
Advocates of climate change proposals attack the U.S. for not doing anything – but this is simply not true. I am going to address two very important questions today: (1) what are we doing; and (2) how are we doing?
In 2002, President Bush established a national goal to reduce greenhouse gas intensity (emissions per unit of GDP) of the U.S. economy by 18 percent by 2012. To meet this goal, the United States is spending more than any other nation and has created many different programs. The federal government has devoted nearly $29 billion since 2001 to climate science, technology, international assistance, and incentive programs, and the President's Fiscal Year 2007 budget calls for $6.5 billion for climate-related activities. The Administration has also implemented more than 60 federal programs, and I will summarize several of them:
· Climate Leaders is an EPA partnership encouraging individual companies to develop long-term, comprehensive climate change strategies. Over 100 corporations are participating in the program.
· Climate VISION is a Department of Energy public-partnership program involving fourteen major industrial sectors and the membership of the Business Roundtable, who have committed to work with four cabinet agencies to reduce greenhouse gas emissions in the next decade.
· The Climate Change Technology Program is a multi-agency program that increases the development and use of key technologies aimed at reducing GHG emissions. The FY2007 budget included almost $3 billion for the program.
· The Climate Change Science Program is a multi-agency program led by the Department of Commerce, and the FY2007 budget included $1.715 billion.
· The SmartWay Transportation Partnership is a voluntary partnership between various freight industry sectors and EPA designed to increase energy efficiency and reduce greenhouse gases and air pollution.
· For the first time, the Department of Agriculture is providing targeted incentives through its conservation programs to increase carbon sequestration in soils and trees and to reduce methane and nitrous oxide emissions from crop and animal agricultural systems.
While these are examples of domestic programs, there are numerous international actions as well. In fact, the United States has established 15 climate partnerships since 2001 with countries and regional organizations that together account for almost 80 percent of global greenhouse gas emissions.
· The Asia-Pacific Partnership for Clean Development and Climate involves six nations –Australia, China, India, Japan, South Korea, and the United States. It is designed to promote the development and deployment of cleaner energy technologies to meet pollution reduction, energy security, and climate change concerns. This Partnership is unprecedented given that these developed and developing nations collectively represent about half of the world's manmade carbon dioxide emissions.
· The Methane to Markets Partnership focuses on advancing cost-effective, near-term methane recovery and use as a clean energy source from coal beds, natural gas facilities, landfills, and agricultural waste management systems. This Partnership, which involves 18 countries, is very significant because methane is a greenhouse gas that is more than 20 times more potent than carbon dioxide.
· The United States worked with the United Kingdom and other G-8 partners to launch the 2005 Gleneagles Plan of Action, which contains over fifty actions to address climate change, development, energy security, energy access, and air pollution. Additionally, President Bush and European Union leaders will enter into a High Level Dialogue on Climate Change, Clean Energy and Sustainable Development this fall.
· The United States launched the International Partnership for the Hydrogen Economy as a vehicle to organize, co-ordinate, and leverage multinational hydrogen research programs that advance the transition to a global hydrogen economy.
In addition to all of these domestic and international actions, Congress also acted comprehensively to address climate change with enactment of the Energy Policy Act of 2005.
· The energy bill provides for about $5 billion in tax credits and incentives over 5 years that will help to unleash substantial new capital investment in cleaner, more efficient technologies.
· Research and development funding is provided for long-term zero or low emitting
greenhouse gas technologies, including fuel cells, hydrogen fuels, and coal gasification.
· It includes extensive provisions to increase energy efficiency and conservation.
I also worked to include three bills that Environment and Public Works Committee Chairman Jim Inhofe and I authored to provide for the safe and secure growth of nuclear power. These initiatives combined with the loan guarantee and production tax credit provisions in the energy bill have provided a foundation for the industry to pursue new nuclear power plants. The Nuclear Regulatory Commission currently expects to receive license applications for more than 30 new nuclear reactors in the next two to three years. Due to the energy bill, our country is experiencing a nuclear renaissance – which means we will hopefully be utilizing more on this emissions-free power, and relying less on foreign source of energy.
Even though these provisions all address climate change, I joined Senators Chuck Hagel and Mark Pryor to successfully include an amendment by a vote of 66 to 29 to promote greenhouse gas reducing technologies domestically and abroad. This amendment authorized the very important Asia-Pacific Partnership that I mentioned earlier. Last year, we led a letter that a total of 21 senators signed in support of the President's request of $52 million for this important initiative.
Clearly, we are doing a lot – but how are we doing? Are all of these programs and funds having an impact? The answer is a resounding yes, which I will show through two main points.
First, the United States has engaged developing countries such as China and India. In 2005, I visited China where it became clear that they must be involved in any effort due to the large number of coal plants that they are building.
According to a June 11, 2006 New York Times article entitled "Pollution from Chinese Coal Casts a Global Shadow":
"The increase in global-warming gases from China's coal use will probably exceed that for all industrialized countries combined over the next 25 years, surpassing by five times the reduction in such emissions that the Kyoto Protocol seeks...Already, China uses more coal than the United States, the European Union, and Japan combined...Every week to 10 days, another coal-fired power plant opens somewhere in China that is big enough to serve all the households in Dallas or San Diego...To make matters worse, India is right behind China in stepping up its construction of coal-fired power plants – and has a population expected to outstrip China's by 2030."
According to EIA's International Energy Outlook 2006, Organization of Economic Cooperation and Development (OECD) countries accounted for 53 percent of world carbon dioxide emissions in 2003 with non-OECD countries, which include China and India, making up the remaining 47 percent. By 2030, non-OECD countries will account for 60 percent of world carbon dioxide emissions. These countries will also account for 77 percent of the projected increase in global emissions from 2002 to 2030.
My staff attended the 11TH Conference of the Parties to the United Nations Framework Convention on Climate Change in Montreal at the end of 2005. The primary focus of the two week meeting was post-2012, since the Kyoto Protocol's commitment period ends at that time. My staff met with the representatives from the Group of 77, which is made up of the developing nations. They strongly stated that all countries including the U.S. should commit to the Kyoto Protocol and then another round of reductions before they would even begin any discussions about mandatory reductions for themselves.
Through the Asia-Pacific Partnership, the United States has been able to finally bring China and India to the table on this important issue. Without their involvement, any efforts by countries to reduce greenhouse gases will be completely offset by emissions increases in developing countries.
Now to my second point, the United States is meeting its intensity goal and is doing as well or better than other nations.
To meet our greenhouse gas intensity reduction target of 18 percent by 2012, there needs to be an average annual rate of improvement of about 1.96 percent. EIA preliminarily estimates that carbon dioxide emissions intensity improved in the U.S. by 3.3 percent in 2005. This means that we are on target to meet our goal and may even exceed it.
The overall progress of the United States compares favorably with other countries – even those that have signed the Kyoto Protocol. Based on data reported to the UN Framework Convention on Climate Change, from 2000 to 2004, the major developed economies of the world are at about the same place as the U.S. in terms of actual greenhouse gas emissions. Emissions are increasing in some countries and decreasing in others – but no country is decreasing its emissions massively. In fact, the U.S. has seen its actual emissions increase at a rate of 1.3 percent compared to 2.1 percent for the European Union.
In summary, I think the United States is unfairly criticized on this issue of climate change. In reality, we are doing more than any other country in terms of our overall effort. Since 2001, our nation has taken action to address climate change by spending almost $30 billion, implementing more than 60 federal programs, establishing 15 international partnerships, and enacting an Energy Bill.
The great news is that this effort is working. We have brought developing countries to the table and are doing as well or better than other nations that have committed to very costly mandatory programs.
Before acting on any climate change legislation, we must consider all that the United States is doing and carefully balance our energy, economic, and environmental needs.
Chairwoman Boxer, I want to thank you for holding this hearing, and I look forward to working with you and other members of this Committee to find the right balance.