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United States

United States: Climate bill - Senate to revisit clean energy bill

This month lawmakers in Congress are expected to revisit comprehensive energy legislation that could help put wind on a stronger footing in the US.

But negotiations and politicking on a massive healthcare reform bill has taken up most of the capacity in Congress over past months and threatens to distract, postpone or even perhaps sink action on the bill. The House of Representatives passed one version of the bill, called the American Clean Energy and Security Act (ACES), earlier in the summer, followed by an approval in the Senate Energy and Natural Resources Committee.

The Senate now has to finalise its own version of the bill, and vote on it. Assuming the vote is carried, which is by no means certain, the bill must still then go to a conference committee where the differences between the House and Senate can be ironed out.

Tight vote

The bill squeezed through the House on a vote of 219 to 212, with no votes from the US opposition, centre-right party, the Republicans. The Democratic-led bill, which is backed by President Barack Obama, is more than 1200 pages long and includes a vast range of provisions, only some of which will affect the wind sector.

Many renewables proponents are worried that the legislative change currently on the table will do little to benefit wind. The most direct provision for wind is establishing a national renewable electricity standard that requires utilities to purchase or produce a minimum percentage of their electricity from renewable energy sources. It calls for 6% of electricity to come from renewables by 2012 and 20% by 2020.

But wind experts say provisions that allow energy efficiency measures to count in place of renewables towards the total put the thresholds at between 3 and 6% of actual total US electricity generation.

This is "essentially equal to or below the status quo," said GE vice chair and energy infrastructure president and CEO John Krenicki, while testifying before the Senate Environment and Public Works Committee. "Massive new investments in manufacturing will not be made in the US today based (purely) on the hope of a strong carbon price signal 10 years from now," he added.

American's first cap-and-trade

The House bill also contains what could be America's first carbon cap-and-trade program, which creates a market-based structure for regulating greenhouse gas carbon dioxide in much the same way nitrogen dioxide and sulphur dioxide were regulated in the US decades ago. By many standards, the cap-and-trade program is also modest but both the program and the renewables standard face an uphill battle this month in the Senate where moderate and fiscally conservative so-called "Blue Dog" Democrats say the measures would impose undue cost increases on consumers and businesses.

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