Energy, Climate Bill Stalled in the Senate

The bill's political future is even murkier after the oil spill in the Gulf of Mexico.

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It was supposed to have been a triumphant day for fans of clean energy. For weeks, people had been expecting Sens. John Kerry, Joe Lieberman, and Lindsey Graham to unveil a bipartisan climate bill last Monday. With Republican Graham's support, many hoped, one of the Democrats' priorities would finally have a path through the Senate. But at the last minute, Graham pulled out, angered, he said, by news that Senate Majority Leader Harry Reid was trying to push immigration reform through the Senate ahead of climate legislation. Suddenly, the press conferences were off, the public events canceled.

For all the hype that had been building around the bill in Washington, there's still very little known about its contents, and its political future seems to have grown even murkier in recent days as the giant oil spill down in the Gulf of Mexico has again raised questions about the environmental costs of offshore drilling. Few people have seen or read the bill, which is remarkable in a town known for its leaks. And many groups that would normally come out with endorsements—and often have early access to bills on the Hill—are keeping quiet for now, saying only that they, too, have yet to see the specifics. "We need to see the details to know what we think, because they matter a lot," says Franz Matzner, climate legislative director for the Natural Resources Defense Council.

Which is not to say that the whole effort is a total mystery. Broad outlines are known. The bill, for example, would set a limit on carbon emissions in the country, and that limit would grow tougher over time. And the three senators are believed to have ditched the idea of a cap-and-trade system covering the entire economy, in which polluters would have to buy permits for every ton of pollution they emit, in favor of rules for specific industries, including electric utilities and oil producers.

This is no small point. To many, cap-and-trade has become politically toxic, wrapped up in concerns that the federal government is overreaching and susceptible to attacks that it is a thinly-veiled tax on families. (Cap-and-trade, in fact, was angering town-hall protesters long before healthcare became a major issue.) To get a climate bill through the Senate in an election year, Kerry, Lieberman, and Graham felt that they would have to take a different approach.

That approach, however, has raised concerns on the left that the senatorial triumvirate has caved too much to industry interests—concerns that have grown even louder this week. The main worry is that for a Republican like Graham to be on board, there must be significant perks for domestic fossil fuel industries, including oil drillers. For environmentalists and politicians alarmed by BP's oil spill, the thought of doing anything more to spur offshore drilling is downright repulsive. Some are now even saying that any energy bill that comes up in the Senate should ban new offshore drilling.

What's clear is that, in the days after Graham's decision to withdraw his support, there has been intense pressure from climate bill advocates for the senators to resume their work—and for Reid to back away from talk about immigration reform. Behind the scenes, though, the work never actually stopped: Last week, Kerry and Lieberman sent the bill to the Environmental Protection Agency for analysis, a major step that says not only that the bill is more or less written but also that its authors are hoping to see it debated this summer.

Driving this urgency is the fact that if Congress doesn't act, the EPA will—soon. Earlier this month, the White House received the EPA's draft of its rule to regulate greenhouse gases from major industrial polluters like refineries and certain factories. Once the White House consents, the rule could take effect as early as next year.