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Kerry: Climate Bill Really a "Refund Bill" - "Nothing grows the size of government. Every penny goes back to creating jobs and protecting the American consumer."
May 5, 2010

Matt Dempsey matt_dempsey@epw.senate.gov

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E&E News

Kerry predicts broad industry support, offers allowance details

 (05/05/2010)

Darren Samuelsohn, E&E reporter

Link to Article

Sen. John Kerry is predicting widespread support from electric utilities, chemical companies and Big Oil as he enters his seventh month of closed-door negotiations on a comprehensive energy and climate bill that still hasn't made its way into public view.

Speaking at the Good Jobs Green Jobs conference today in Washington, D.C., Kerry said he expects to be joined by the CEOs of General Electric Co., DuPont, FPL Inc. and American Electric Power Co. Inc. when his climate legislation is ready for release.

"Every one of them are among the top emission polluters in the country," Kerry said. "But they all know this is good for America, and we have to do it. What they want is business certainty of knowing what the next 20, 30, 40 years are going to look like so they can plan accordingly."

The Massachusetts Democrat said additional backing would come from the nuclear power industry, religious groups and retired military officials. And he addressed the appearance of working with three of the country's biggest oil companies, including BP PLC, which is responsible for the Gulf Coast oil spill, on provisions dealing with how to regulate transportation fuels.

"Ironically, we've been working very closely with some of these oil companies in the last months," Kerry said, referring to BP, ConocoPhillips and Royal Dutch Shell PLC. "And I want to tell you they've acted in good faith and they've worked hard with us to try to find a way to get us to a solution that meets all of our needs. And I believe, when we roll out a bill, and we will very, very soon, we're going to have a unique coalition."

Kerry did not give a timeline beyond "very soon" for releasing the bill he has co-authored with Sens. Lindsey Graham (R-S.C.) and Joe Lieberman (I-Conn.). The trio had been planning to unveil the bill April 26 but indefinitely postponed the press conference after Graham complained that Democratic leaders had pushed the politically thorny issue of immigration onto the Senate agenda, making it impossible for him to also work on the climate legislation.

Kerry insisted today that the Senate trio continues to talk behind the scenes on their climate proposal, even amid Graham's protests over immigration. "He's standing by the work product, and he's standing by the bill, no matter what," Kerry said.

Yesterday, all three senators appeared together at a private rally hosted by the Environmental Defense Fund in the Senate's Kennedy Caucus Room -- the same place they had reserved for their press conference. Afterward, Kerry said he would consider ways to push ahead without Graham -- if it came to that.

"If immigration stays in a convoluted way, we'll consider what we have to do to push a bill," he said.

Kerry today also teased out partial details of how the climate bill deals with valuable emission allowances, namely by directing the bulk of the money back to the public and industry.

"Two-thirds of every dollar raised in the course of this effort goes straight back to the American consumer on their energy bill," Kerry said. "You'll actually look at your energy bill and it will say, 'Your bill would have been this, but now it's this, because you're getting a rebate.'"

Kerry said that "after a year or two, 100 percent goes back to the American consumer." And in the meantime, he said funding would be directed toward energy efficiency and research and development on new energy technologies.

Delays for some industries

Later, speaking to reporters, Kerry clarified his remarks to explain that the timeline for sending all of the allowance revenue back to consumers would take longer, though he did not give an exact schedule. He also explained that he did not expect 100 percent of the revenue to go back to consumers. Instead, it is about 96 percent. "And the reason it isn't 100, a small amount in the statute has to go to deficit reduction," he said.

Kerry also said energy-intensive manufacturers, such as glass, cement and chemical producers, can expect a six-year delay before they face the types of emission restrictions imposed on electric utilities. "So they can plan and capitalize, and when they come under, they get a rebate just like every average American in order to cushion the impact so that we keep a total minimal impact on every part of the economy," he said.

Previously, Kerry had floated a four-year delay for the manufacturers, but moderate Senate Democrats pushed for a much slower schedule. Sen. Carl Levin (D-Mich.), for example, had asked for a 10-year window before manufacturers face greenhouse gas restrictions.

Prospects for the overall Senate climate bill remain uncertain. Majority Leader Harry Reid (D-Nev.) yesterday said the oil spill in the Gulf of Mexico should "spur" debate on the issue, though he did not give an exact schedule for the legislation reaching the floor.

Reid and allies face a tough sell in cobbling together 60 votes. Liberal Democrats are critical of plans to fold in provisions that allow for more offshore drilling. Sen. Frank Lautenberg (D-N.J.) yesterday said he also would be dubious of Kerry's plans to roll out the climate bill on the same stage as BP. "Hell, we couldn't do that," Lautenberg said. "That'd be terrible. Standing with a pyromaniac watching the fire consume the place."

Opponents also question the underlying reasons for reducing greenhouse gas emissions. "I still think the cap-and-trade bill is dead this year because it would be a huge blow to our economy and because it's not based on settled science," Sen. Roger Wicker (R-Miss.) said yesterday.

Anticipating more attacks, Kerry today pushed back at his critics by saying the climate proposal he has written with Graham and Lieberman would not burden Americans' pocketbooks.

"I stake my reputation on it," Kerry said. "You can guarantee, even though the scare tactics will come, this bill is consumer friendly, citizen friendly. It is really a refund bill where almost any revenue that comes, nothing stays in the federal government. Nothing grows the size of government. Every penny goes back to creating jobs and protecting the American consumer."

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