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Democrat Representatives led by Henry A. Waxman appear to have reached a compromise on the American Clean Energy and Security Act, which promises to introduce binding emission targets ahead of the UN’s Copenhagen meeting in December.

However, the compromise deal waters down the original targets in the bill. The target of a 20% cut in emissions on 2005 levels by 2020 has been reduced to 17% and the requirement on energy suppliers to generate 25% power from renewable sources has been reduced to 15% by 2020.

Under the new deal, energy utilities will also have to demonstrate annual electricity savings of 5% from energy efficiency measures.

“This combined renewable energy and energy efficiency standard will drive the deployment of clean energy from solar, wind, geothermal, and biomass resources and promote cost-effective investments in energy efficiency,” said Waxman.

The cap-and-trade aspect of the legislation has also been watered down to mitigate the impact on industry and energy prices. Under the revised bill, 35% of pollution permits would be given to energy companies for free, until phasing out begins in 2026. By 2030, energy suppliers would have to buy their pollution permits.

Meanwhile, heavy industry will receive 15% of pollution permits for free until 2025 and the auto sector 3% between 2012 and 2017, after which it will receive 1% until 2025.

“We have reached an important milestone as we build consensus on comprehensive clean energy legislation,” commented Representative Edward J. Markey, who has been central in the revision of the bill.

The WWF has given the bill a cautious welcome, saying that it takes the US the first step towards combating climate change.

“We understand legislation as ambitious as this requires compromise,” said WWF president and CEO Carter S. Roberts in a statement.

“But we remain seriously concerned that the current draft does not go far enough in securing America’s clean energy future and falls short of what is needed to achieve a global agreement to manage climate change.”

If the Energy and Commerce Committee pass the bill, as now expected, it will move onto other House of Representatives panels before coming before the full House later this summer.

While Waxman is still confident that the bill will be passed before the UN’s Copenhagen meeting in December, the US will still be falling short of EU targets of a 20% reduction in emissions by 2020. The comprise bill could undermine the EU’s pledge to increase its target to a 30% reduction by 2020 if the US agreed to similar measures.

“Unless strengthened, this bill could undermine America’s ability to secure an effective international agreement during climate negotiations in Copenhagen this fall,” said Roberts.

For further information:
waxman.house.gov/
energycommerce.house.gov/
www.house.gov/