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Clean Energy and Green Jobs

H.R. 2454, the American Clean Energy and Security Act (ACES) is a comprehensive bill addressing our dependence on foreign oil, combating climate change and providing 21st century clean energy jobs. I serve on the Energy and Commerce Committee and have been an active participant in the development of ACES. I appreciate hearing from you concerning this important issue.

The legislation produced in the Energy and Commerce Committee was based on past years’ experience and building on the 2005 Energy Policy Act and 2007 Energy Independence and Security Act. ACES was not a bill brought before Congress at the last minute. During the week of May 18, the Committee held an unprecedented four-day markup to alter, change, consider and amend the ACES bill. We spent more than 40 hours in Committee, considered 94 amendments to the bill, and finally approved the measure out of the Committee on May 21, 2009. I then spent the next month working with my colleagues in Congress to improve the bill before its consideration on the House floor on June 26, 2009. I voted in support of the final bill, which now awaits action in the U.S. Senate.

For the past 15 years, I have served on the Energy and Commerce Subcommittee on the Environment and Subcommittee on Oversight and Investigations where I heard, questioned and examined experts, witnesses, scientists and skeptics on global warming. Some individuals will point to a cold day, a cool summer or fewer hurricanes as “proof” that global warming is not occurring! While I respect these differing opinions, the whole body of evidence and an overwhelming majority of experts and scientists agree that carbon dioxide and greenhouse gases pollute the air we breathe and endanger our planet.

I believe it is in our national security interest to address global warming, reduce our dependence on foreign oil and revitalize our economy with new clean energy jobs. More than 70 percent of our daily oil consumption is imported from other countries. Some of those countries have used their oil to disrupt our economy, support our adversaries and sponsor terrorism. It is imperative that the United States develop alternatives to our reliance on oil.

As ACES developed, my priorities were to protect existing Northern Michigan jobs, create new jobs through developing alternative energy technologies and make sure that unreasonable costs are not passed on to consumers.

There are a number of myths circulating about the cost of this bill that are simply untrue. Overhauling our nation’s energy policy will not be free, but significant steps have been taken in ACES to protect our most vulnerable industries and citizens. The increased energy costs some consumers will see in the short term are far outweighed by the benefit the legislation will bring to our overall economy. According to the non-partisan Congressional Budget Office (CBO), the average net cost for a family of four 10 years from now will be $175. This includes potential costs of electricity, heating, fuel and other associated costs. The Environmental Protection Agency (EPA) estimates that average household net costs would be $80 to $110 per year, less than $10 per month.

There are other related economic benefits to you and our country, for which it is difficult to attain a precise dollar figure. These include:

I worked on ACES to create jobs in Northern Michigan and throughout the state. The Michigan timber industry will benefit from expanded use of woody biomass for energy production and carbon sequestration projects. Our automotive industry will receive incentives to develop energy efficient electric vehicles. I worked to make sure the bill brings job growth to our industrial and manufacturing sectors, while protecting consumers and benefiting our environment.

One change I worked to include is defining “renewable biomass” to incorporate timber resources that were off limits in the original draft legislation. We have a large forest industry that will play a vital role in lowering greenhouse gas emissions, while benefiting the economy of Northern Michigan. I fought to include a broader definition of woody biomass that now includes all timber from federal timber sales as an eligible fuel source for renewable energy projects. Fuel stock eligibility should be based on proper sustainable and healthy forest practices; not excluded for arbitrary reasons. Our timber industry, paper mills, biofuel power plants, lumber and farming industries all will benefit from this new definition.

I was successful in including our iron ore industry as an energy and trade intensive industry. Iron ore mines in Northern Michigan operated by Cliffs Natural Resources will receive carbon allowances so Cliffs Natural Resources can produce quality, low-cost iron ore to compete with foreign imports from Brazil, China and other countries. Along with the increased incentives for auto and domestic manufacturing for clean energy technologies, the iron ore and steel industry will see an economic benefit from this legislation and spur development of the proposed iron ore nugget plant.

ACES establishes a carbon dioxide cap-and-trade system, but originally left out how to properly regulate and oversee a new carbon credit financial market. The financial impact of cap-and-trade on utilities, businesses and households will depend on whether allocations are properly distributed and verified by the EPA, and if excessive speculation on Wall Street is controlled in the carbon financial markets. I was successful in adding a version of my Prevent Unfair Manipulation of Prices (PUMP) Act to ACES. This section of the bill will grant the Commodity Futures Trading Commission (CFTC) broad authority to regulate carbon and energy markets to prevent excessive prices based on speculation, fear and greed.

America can responsibly reduce harmful emissions of carbon dioxide and other greenhouse gases that cause global warming and grow our economy. Congress has previously provided tax credits and other incentives to promote the development and use of clean coal technology, wind, solar, geothermal, ethanol, and other biofuels. In addition, Congress has also worked to promote energy efficient businesses and homes. The increased use of cleaner burning fuels and improved efficiency will help energy users reduce their greenhouse gas emissions.

My goal of creating an energy policy that helps end our dependence on Middle Eastern oil can be accomplished in ACES. The bill also provides important economic protection to ensure Michigan’s most vulnerable industries, such as iron ore mining, steel, concrete, timber and paper production, are not placed at a competitive disadvantage to their foreign counterparts. It also ensures consumers are protected from unreasonable energy price increases.

ACES is endorsed by a number of organizations with economic interests throughout Northern Michigan including Dow Chemical; Rio Tinto, the parent company of Kennecott Minerals; American Transmission Company, the provider of electric transmission in the Upper Peninsula; United Steelworkers; United Auto Workers; AFL-CIO Building and Construction Trades Department; and the National Farmers Union.

ACES is now pending the Senate where it faces an uncertain future. If passed by the Senate, the legislation would then be subject to a conference committee to work out differences between the two versions. If these differences between the House and Senate are worked out, I would then have to review the conference committee legislation thoroughly before determining whether to support it.

Because climate change and energy policy are global problems, Congress and the Administration must engage the international community to promote greenhouse gas reduction in all countries. Europe has had laws reducing its energy use and greenhouse gas emissions for some time. I am pleased our committee and the House of Representatives has produced a legislative initiative to finally address global climate change, energy independence and create clean energy jobs.