Waxman-Markey: Renewables, Transportation, and EPA and State Regulation

On Tuesday, March 31, House Energy and Commerce Committee Chairman Henry Waxman (D-CA) and Rep. Edward Markey (D-MA) released a “discussion draft” of the American Clean Energy and Security Act of 2009 – a climate change bill that will serve as the starting point for long-delayed congressional action on the world’s most pressing environmental program. CPRBlog asked several Center for Progressive Reform Member Scholars to examine different aspects of the 648-page Waxman-Markey bill. This entry, by Alice Kaswan, examines several issues in the bill, including the issue of co-pollutants (non-greenhouse gas, but nevertheless polluting, emissions), the need for state-federal partnership on transportation and land-use issues related to climate change, and the bill’s provision removing greenhouse gas emissions from EPA’s jurisdiction under the Clean Air Act but apparently allowing states to impose their own clean air requirements in some areas.

Representatives Waxman and Markey’s “discussion draft” of the American Clean Energy and Security Act of 2009 provides a robust starting point for much-needed federal climate change legislation.

Unlike traditional environmental laws, the bill addresses not only the end-of-the-stack – the emissions of greenhouse gases – but the energy sources and consumer consumption that lie behind them. Following in the footsteps of many states, it sets a federal goal for renewable energy production. (Sec. 101, p. 30) To varying degrees, the law also promotes energy efficiency in buildings, lighting, appliances, mobile sources, utilities, and industry. (Title II, p. 157)

The bill also recognizes that transportation infrastructure and land use planning impact emissions, and implicitly recognizes the federal-state partnership necessary to reduce the nation’s emissions. The Act requires states to develop goals for transportation-related emission reductions and requires states to work with regional transportation agencies to develop plans for achieving them. (Sec. 841 in Title II, p. 274) While the bill does not set any specific standards, it at least begins the process of stimulating state and local entities to consider the connections between land use and transportation emissions.

When it comes to facility emissions, the bill’s reliance on a cap-and-trade program is not surprising given support for that approach from the President and some members of industry. The Act may, however, go too far in preventing EPA from applying the Clean Air Act or otherwise developing regulatory standards to control greenhouse gases from major emitting facilities. (Title VIII, p. 484) While industry may resist traditional regulatory standards, it is not clear that Congress should remove the agency’s discretion to impose them in those situations where they offer a more effective and efficient mechanism for achieving low-cost reductions than the market. Under some circumstances, regulatory standards could also be more effective at achieving additional environmental goals: at reducing the co-pollutants that are inevitably emitted along with greenhouse gases.

The Act appears to partially preserve the states’ role in greenhouse gas regulation. The law removes greenhouse gases from EPA’s jurisdiction under the Clean Air Act (see sections 831-33, p. 490), but that should not prevent the states from adopting regulatory controls if they so choose. States are also permitted to impose their own requirements on their facilities’ use of federal allowances. (Sec. 334, p. 526) However, from 2012 until 2017, states are not permitted to set their own greenhouse gas emission caps, (Sec. 861, p. 527), a limitation that may be intended to preclude state cap-and-trade programs during that period. Nonetheless, the states’ ability to impose restrictions on the use of federal allowances in their states and to take other steps to control greenhouse gas emissions appears to be preserved under the bill.