FCNL Opposes American Clean Energy and Security Act

Jun 26, 2009

June 26, 2009

Dear Representative:

We at the Friends Committee on National Legislation (Quakers) have worked with many of you over the last months to strengthen the American Clean Energy and Security Act to ensure that U.S. greenhouse gas emissions will be cut quickly, deeply, and effectively. Unfortunately, the current bill has been so weakened by offsets, allowances to polluters, and other concessions that it may not even begin to reduce U.S. greenhouse gas emissions from fossil fuels for well over a decade.

As a result, the Friends Committee on National Legislation urges you to vote against the American Clean Energy and Security Act (ACES) unless it is substantially improved.

We make this recommendation with great regret. Chairmen Henry Waxman and Ed Markey have worked hard to negotiate a strong bill, but have been unable to assemble the coalition needed to pass effective climate change legislation. Yet we believe the House would be making a mistake by passing flawed legislation now that

• Does not guarantee real reductions in greenhouse gas emissions,


• Strips EPA of authority,


• Locks in payoffs to polluters, and


• Creates vested interests that would make substantive reforms in the future extremely difficult.

The following elements of ACES need improvement:

Emissions Reductions and Offsets

The cap and additional mandatory measures in ACES would reduce greenhouse gas emissions by 1 to 4 percent of 1990 levels by 2020 - well short of the levels recommended by scientists to avoid 2 degrees Fahrenheit of additional warming (minimum of 25 percent below 1990 levels by 2020 for developed nations). Furthermore, due to offset and banking provisions, even those cuts are unlikely to be achieved. The legislation provides a pathway for U.S. greenhouse gas emissions from fossil fuels to increase through 2029.

We do not believe the international community, which must be our partners in reducing global emissions, will accept nominal or no reductions in U.S. fossil fuel emissions for over a decade. In addition, delaying the transition to clean technologies will make the inevitable transition more abrupt and costly.

Environmental Protection Agency Stripped of Authority

The EPA would no longer be able to regulate greenhouse gases on the basis of their effect on climate change. With this regulatory backstop disabled, the United States will have one less tool at its disposal and will be dependent on the success of ACES which, as written, will not achieve the domestic reductions required of developed nations to avoid climate catastrophe.

Allowances Given to Polluters

ACES gives a significant amount of free permits to the coal and oil industry. The coal industry could receive approximately $150 billion over the lifetime of the bill for the deployment of carbon capture and sequestration (CCS) technology – funds that should be invested instead in renewable energy technologies. In addition, the bill allows utilities to tax ratepayers to fund CCS deployment. The revenue from this tax would be managed by a non-governmental entity made up of utilities. ACES also gives approximately $24 billion to oil refiners, a figure that does not include the most recent carve-out refiners.

Problematic New Markets

ACES creates a vast new carbon derivatives market. Commissioner Bart Chilton of the Commodity Futures Trading Commission recently estimated that in five years the carbon market could be worth $2 trillion, consisting of 180 million contracts -- about the equivalent of the sweet crude oil and natural gas markets combined. This massive trading program would create the world’s largest commodity and derivatives market. Despite the warnings from last year’s financial crisis, the bill relies on regulatory structures similar to those that have failed in the past.


With deep disappointment and regret, we ask you to defeat this flawed bill.


Sincerely,

Devin Helfrich
Legislative Advocate
Friends Committee on National Legislation