January 2012

Next week, the Senate Environment and Public Works Committee will hold three hearings on S. 1733, the Clean Energy Jobs and American Power Act,” also known as Kerry-Boxer after its co-sponsors Senators John Kerry (D-MA) and Barbara Boxer (D-CA). Kerry-Boxer is the Senate companion bill to H.R. 2454, the American Clean Energy and Security Act (ACESA), also known as Waxman-Markey after its co-sponsors Reps. Henry Waxman (D-CA) and Ed Markey (D-MA).

Part A of Title VII of Kerry-Boxer sets forth the emission reduction targets and timetables of the bill’s proposed greenhouse gas emissions cap-and-trade program. It is nearly identical to the corresponding section of the Waxman-Markey bill, the main substantive difference being a tougher emissions reduction target for the year 2020. Waxman-Markey requires a 17% reduction below 2005 levels by 2020; Kerry-Boxer, a 20% reduction. 

It would be a mistake, though, to suppose that those numbers reflect the full extent of the regulatory burdens Title VII Part A could impose on the U.S. economy. Identical language in both bills could (1) unleash a torrent of lawsuits against tens of thousands of relatively small emitters of carbon dioxide (CO2), and (2) put pressure on future presidents and congresses to adopt substantially tougher emission reduction targets. 

Section 701 Findings: Setup for CO2 Tort Litigation

Under the Kerry-Boxer and Waxman-Markey bill, business entities would be subject to the cap-and-trade program only if they emit at least 25,000 metric tons per year of carbon dioxide-equivalent (CO2-e) greenhouse gas (GHG) emissions. So on superficial inspection, if you are small manufacturer or just about any type of non-industrial facility, you will have no emission reduction obligations. That perception helps the bills’ proponents divide-and-conquer the business community.

In reality, the Findings in Kerry-Boxer and Waxman-Markey are the setup for litigation demanding additional emission reductions beyond those specified in the bills’ cap-and-trade programs. This is particularly worrisome because state attorneys general and environmental groups are already suing energy companies under tort law for emitting CO2.

The Findings say that “each increment of emission … causes or contributes … to the acceleration and extent of global warming and its adverse effects,” and “accordingly, controlling emissions in small as well as large quantities is essential” to reduce “threats” and “injuries,” including disease, death, property damage, bad weather, business losses; harm to forest, plants, wildlife, water resources, and air quality; and – as if that list weren’t inclusive enough — “other harm.”
 
Worse, the Findings go on to equate risk of harm with actual harm: “the fact that some of the adverse and potentially catastrophic effects of global warming are at risk of occurring and not a certainty does not negate the harm persons suffer from actions that increase the likelihood, extent, and severity of future impacts.” Get that? All plaintiffs will need is some remote, speculative possibility of catastrophic impacts — and of course that’s what the global warming scare is all about — and voila, harm has been done, injuries cry out for redress.
 
If the language in the Findings becomes the law of the land, there will be no stopping the flood of common law nuisance suits. Any increment of emissions, no matter how small, will be deemed to cause or contribute to global warming and its harmful effects. And even if no harm can be proved, the risk of harm will count as actual injury.

Bottom line: Although EPA, initially, may only regulate entities emitting at least 25,000 tons of CO2-e per year, the Findings implicitly authorize litigation targeting vast numbers of small entities.

Section 705 Review and Program Recommendations: Setup for Moving Goal Posts
 
There’s a lot of mischief in this section, too. To begin with, Sec. 705 requires the EPA Administrator, every four years, to address “existing scientific information and reports, considering, to the greatest extent possible, the most recent assessment report of the Intergovernmental Panel on Climate Change, reports by the United States Global Change Research Program … ” This provision will turn EPA into an even more uncritical rubber stamp for the IPCC and USGCRP than it already is. More than ever, IPCC and USGCRP will write their reports to influence U.S. policy (i.e. they will be even more politicized) and their influence will increase. Cheer if you like agenda-driven science!
 
Sec. 705 also requires EPA to report on annual emissions and annual per-capita emissions by country. Not a word, though, about tracking emission intensity (greenhouse gas emissions per dollar of output) by country. In other words, the metrics have been selected to paint the United States in the worst possible light.
 
Also, as you’d expect, the Administrator is required to assess the impacts of climate change on everything under the Sun — populations, health, livelihoods, tribal culture, weather, fresh water, ecosystems, agriculture, etc. — but there is no requirement to assess the impacts of climate policy on anything. This despite a requirement that the Administrator use a “risk management framework.”
 
Similarly, the Administrator is supposed to assess the potential non-linear, abrupt, or essentially irreversible changes in the climate system but he is under no corresponding obligation to assess factors that might stabilize the climate and counteract the forcing effects of greenhouse gases.
 
Now here’s where it gets serious. The Administrator is also required to assess what terrible things won’t be prevented by limiting CO2 equivalent emissions to 450 ppm or global warming to 2°C (3.6°F) beyond pre-industrial temperatures. This sets up the Administrator to advocate 350 as the new 450. It specifically requires the Administrator to identify “alternative thresholds or targets that may more effectively limit the risks” of climate change.
 
Similarly, the Administrator must assess whether the Kerry-Boxer bill, taking into account international actions and commitments, is sufficient to limit GHG concentrations to 450 ppm and global warming to 2°C above pre-industrial temperatures, or whether ”other temperature or greenhouse gas thresholds identified” by the Administrator would be more protective.
 
So the U.S. Climate Action Partnership gang are naive if they think the Kerry-Boxer and Waxman-Markey emission reduction targets, once enacted, will be set in stone. These bills are just the framework for more aggressive emission reduction requirements to come. Regulatory certainty is an illusion.
 
Perhaps because some people just don’t trust EPA — imagine that! — Kerry-Boxer requires the National Academy of Science (NAS) to undertake a similar four-year review of climate science and policy. If the NAS concludes that the United States will not meet the Kerry-Boxer targets, or that 450 ppm and 2°C are not sufficiently protective, the President “shall” submit a plan to Congress identifying the domestic and international actions that will achieve the additional reductions. This language implicitly makes the president a handmaid of the National Academy. Once Jim Hansen and his NAS buddies decide that 350 is the new 450, the president “shall” submit a plan explaining how we get there.

Much of the debate on Kerry-Boxer and Waxman-Markey has centered on the bills’ emission reduction targets. Meeting those targets could destroy millions of jobs. The not-so-hidden fangs lurking in Sections 701 and 705 pose additional significant threats to the economy — and provide additional reasons to oppose such legislation.