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Prospects Dim for Climate Change Legislation

The prospects for passing comprehensive climate change legislation this year appeared to dim last Tuesday after Senate Majority Leader Harry Reid (R-NV) suggested in comments that some of the work before Congress may be put on hold until 2010.

"We are going to have a busy, busy time the rest of the year," Reid told reporters. "And, of course, nothing terminates at the end of this year. We still have next year to complete things if we need to."

A spokesman in Reid's office told NGI last week that no decisions have been finalized about when certain legislation is scheduled to be brought to the floor. Besides the cap-and-trade (CAT) legislation, Congress has several other big ticket items on its plate this fall, including health insurance and financial regulatory reforms.

However, Reid was not the only Democrat to suggest last week that climate change legislation may be delayed.

"I think it's increasingly difficult to have a climate change bill done before the end of the year," said Sen. Byron Dorgan (D-ND), who chairs the Democratic Policy Committee. Dorgan said efforts to pass a comprehensive energy and CAT bill could damage the entire package. "I do think there's a potential of losing both if they're combined."

The new chair of the Senate Agriculture Committee, Blanche Lincoln (D-AR), appeared to side with Dorgan.

"Adding climate change legislation to the reforms...in the Senate Energy Committee's proposal is going to be a challenge, in my view," Lincoln said in a speech to the National Cattlemen's Beef Association. "I am opposed to the House-passed cap and trade legislation, which in my view picks winners and losers and places a disproportionate share of the economic burden on families and businesses in Arkansas. It is a deeply flawed bill, and I will not support similar legislation in the Senate."

Sens. Barbara Boxer (D-CA) and John Kerry (D-MA) were scheduled to release a draft CAT bill earlier this month, but they delayed the bill to continue negotiations with other legislators. The House passed climate change legislation in June (see NGI, June 29). Kerry told reporters that he and Boxer plan to send draft legislation to their Senate colleagues by Sept. 30.

"We have a mental deadline," Kerry told reporters. "We are aiming for this month."

At the center of the CAT legislation is allocation language, which is to be marked up by the Senate Finance Committee, chaired by Max Baucus (D-MT). Baucus said he was waiting for Reid's approval before moving ahead; the senator last Wednesday introduced health insurance reform legislation.

"It's health care now," Baucus told reporters. "Climate change really depends on [Reid's] schedule."

Reid's "tentative step back" regarding the planned Senate debate on CAT and greenhouse gas (GHG) emissions legislation increases "the likelihood that climate legislation will remain a back-burner issue until significant progress on health care reform is achieved," wrote energy analyst K. Whitney Stanco of Concept Capital's Washington Research Group. "In addition, it elevates the possibility that financial regulatory reform may be the next 'big issue' Democratic leaders aim to tackle."

According to Stanco, Reid was asked about separating energy provisions from the CAT legislation, "to which he replied, 'We've focused on what the House has done, and that is, do it all in one package. But...that's a bridge that's still a long ways away.'" If CAT supporters "fail to garner the 60 votes needed to break a filibuster on a bill in the Senate, we still view the likeliest scenario is that energy provisions (such as a national renewable electricity standard, energy efficiency provisions, a clean energy bank and possibly limited federal siting authority for transmission) would be separated from climate legislation and enacted," Stanco wrote.

"We view Sens. Lincoln and Dorgan as particularly important because we believe they are key vote targets for cap and trade supporters," said Stanco. "Assuming the legislators in the Massachusetts state house change the law and temporarily replace the late Sen. Edward Kennedy (D-MA), the Democrats would still only have 60 senators -- meaning the loss of even one Democratic vote would need to be replaced by a Republican yes vote to prevent a filibuster."

Besides Lincoln and Dorgan, five other Democratic senators are considered by Stanco to be the "most critical" swing votes: Indiana's Evan Bayh, Robert Byrd of West Virginia, Kent Conrad of North Dakota, Louisiana's Mary Landrieu and Nebraska's Ben Nelson.

Even though some key senators have backed away from the CAT debate, the Environmental Protection Agency (EPA) and the Department of Transportation are moving ahead. Tuesday the two agencies issued a proposed joint rulemaking on fuel economy standards and GHG emissions for light-duty trucks.

"This move was expected and is another step in EPA's path toward regulating GHG emissions under the Clean Air Act," said Stanco. "Indeed, the proposed vehicle GHG emission standards announced...are contingent on EPA finalizing its proposed endangerment finding" (see NGI, Sept. 7).

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