Washington, DC - Congressman John D. Dingell (D-MI15) made the following opening statement this morning at the Committee on Energy & Commerce Subcommittee on Energy & Environment hearing titled “The Role of Offsets in Climate Legislation”:

“Mr. Chairman, thank you for holding this important hearing.  You are to be commended for building a strong record and for making a strong case for swift and well-thought out action on climate change.  It is crucial that we find a way to reduce greenhouse gas emissions to avoid dangerous harm to the planet.  It is just as crucial that we do so in a way that protects our economy. 

“I have heard from industry that allowing some use of offsets is the best way to control the cost of a climate change program. 

The EPA’s analysis of Lieberman-Warner bears this out.  It projected that the use of offsets could decrease allowance prices by up to seven-fold if offsets were allowed.

“Last year when Rick Boucher and I put forward a draft comprehensive cap-and-trade bill, we included in the draft an offset program that would allow offsets to be used for up to 5% of each entity’s compliance at the start of the program, increasing to up to 35% after 2025. 

“Other groups, including USCAP - a coalition of industry and environmental groups - have called for a greater use of offsets, particularly in the early part of the cap-and-trade program, to keep allowance prices at levels necessary to avoid economic harm.  I welcome and encourage this debate, because when Mr. Boucher and I introduced our draft, this is exactly the kind of feedback that we wanted.

“It is also essential that the use of offsets maintains the integrity of the emissions reductions.

“That is why our discussion draft would require that offsets be vigorously verified for quality and regularly assessed to ensure that they are quantifiable, permanent and enforceable.  And I will note that in the prepared testimony today by our witness from the GAO, John Stephenson, the Director of Natural Resources and Environment, the GAO encourages Congress to establish: 1) clear rules for offset compliance, 2) procedures to account and compensate for uncertainty, 3) a standardized registry for tracking the creation and ownership of offsets and 4) procedures for amending offset rules as new information becomes available.  The Dingell-Boucher draft achieved all of these recommendations and I encourage the Members of this Committee to explore the carbon offset program we put forward when considering cap-and-trade legislation in this Congress.

“I look forward to hearing from our witnesses today as we explore this important issue in much more depth.”

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