White House: CO2 Proposal A Step Forward, Despite Revenue Cut
By Henry J. Pulizzi and Ian Talley, Of DOW JONES NEWSWIRES
WASHINGTON -(Dow Jones)- The White House called climate-change legislation
being crafted by Democrats in the U.S. House of Representatives "a big step
forward," even though the bill would generate far less revenue from the sale of
greenhouse gas emission credits than President Barack Obama has proposed.
In an effort to win the support of moderates, the measure emerging in the
House would give away all but 15% of the credits, which would give their holder
the right to emit greenhouse gases. While that would address the worries of
emission-intense industries and protect low-income households from energy price
rises, it would fall dramatically short of Obama's push for a 100% auction of
the credits.
White House spokesman Robert Gibbs was generally supportive of the House
measure, which he said the White House is reviewing, but conceded the fine print
may not be exactly what Obama has sought.
"Some of the details may not be perfect into what the president campaigned on,
" he said.
"I think we believe that the legislation, as the president said a few days
ago, represents a big step forward in dealing with dangerous greenhouse gases,"
he said.
Asked if the White House is disappointed that just 15% of the permits would be
auctioned, Gibbs said, "I think they're looking through that. I know that this
is the first step in this process."
He said that ultimately the bill will be viewed as a "substantive achievement"
if it meets Obama's goal of reducing greenhouse gas emissions by 83% by 2050.
The bill faces substantial political hurdles in the Senate and few believe it
will pass in that chamber this year. But if the House was able to pass the bill,
it could give the president leverage at a major international climate summit in
December, where leaders aim to sign agreement to cut emissions.
Obama's fiscal 2010 budget factors in $624 billion in revenue over 10 years
from the climate change law, based on a 100% auction of the credits. That figure
that would come down sharply with the permit giveaways.
The administration plans to use just over $504 billion of the climate-change
revenue to make permanent Obama's signature Making Work Pay tax credit. About $
120 billion - or $15 billion a year - would be used to fund investments in clean
energy research, development, adaptation and climate science, beginning in
fiscal 2012.
But using the administration's figures, if only 15% are auctioned that would
mean a total of around $93 billion for the Making work Pay program over the next
decade.
-By Henry J. Pulizzi and Ian Talley, Dow Jones Newswires; 202-862-9256;
henry.pulizzi@dowjones.com
(END) Dow Jones Newswires
05-15-091622ET
Copyright (c) 2009 Dow Jones & Company, Inc.
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