The report does not include any proposed regulations for reducing carbon emissions, but the indication is that the Barack Obama administration would prefer a legislative solution, such as a cap and trade market, rather than regulation. It is a view shared by big and small industry, says Timothy Juliani of the Virginia-based Pew Center on Global Climate Change, but the EPA seems headed in another direction.
"The EPA is more in favour of command and control, especially when it comes to the Clean Air Act," Juliani says. "Really, nobody wants that as the solution. Companies would much rather see a cap-and-trade system put in place by Congress than letting the EPA go regulation by regulation. It would be death by a thousand stabs. That has put pressure on Congress and pressure on the business community."
The legislative process has begun, with the House Energy and Commerce Committee passing a climate bill last month called the American Clean Energy and Security Act. It proposes a system based on allowances to emit greenhouse gases designed to see emissions from electric utilities, oil firms, and large industrial sources cut by 17% below 2005 levels in 2020 and 83% below 2005 levels in 2050. It also proposes a combined renewable energy and efficiency target of 20% by 2020, with 15% coming from renewables. If a state cannot meet the requirement, its governor may cut the renewable target to 12% and boost the energy efficiency goal to 8%.