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American Power Act Essay

1474 words - 6 pages

  Summary of the American Power Act (Kerry‐Lieberman)  On May 12, 2010, Senator Kerry (D‐MA) and Senator Lieberman (I‐CT) released their draft legislation,  the American Power Act (APA). This bill contains a comprehensive, sector‐based approach to enhancing  energy security, spurring the development and deployment of clean energy technologies, and reducing  greenhouse gas emissions. The bill contains the following seven titles: domestic clean energy  development, global warming pollution reduction, consumer protection, job protection and growth,  international climate change activities, community protection from global warming impacts, and  budgetary effects.     Domestic Energy Production  ...view middle of the document...

 The  bill also uses allowance value to provide financial incentives for widespread commercial deployment of  CCS.     Scope of Coverage      The bill covers emissions from the approximately 7,500 major stationary sources that emit greater than  25,000 tons per year of greenhouse gas emissions.  It covers producers of generators of electricity,  petroleum fuels, distributors of natural gas, producers of certain fluorinated gases (F‐gases), and other  specified sources. Greenhouse gases that are limited under the bill include carbon dioxide, methane,  nitrous oxide, sulfur hexafluoride, perfluorocarbons, nitrogen fluoride, and hydrofluorocarbons emitted  as a byproduct.     Targets    The bill establishes goals for economy‐wide emission reductions from 2005 levels: 4.75 percent by 2013,  17 percent by 2020, 42 percent by 2030, and 83 percent by 2050. Specific reduction requirements take  effect in 2013 for electricity generators and transportation fuels, while local natural gas distributors and 

May 2010 

industrial sources of emissions are covered beginning in 2016. Emissions from transportation‐related  fuels are covered under the overall cap, but they are treated separately with allowances set aside and  directly purchased by refined product providers from the government at the most recent auction  allowance price.  A section of the bill also calls for “fast mitigation” actions including setting a separate  cap on hydrofluorocarbons (with an 85 percent phase down required by 2033), studying and possibly  reducing emissions of black carbon, providing grants from USDA to conduct pilot projects of soil  sequestration (biochar), and supporting the Methane to Markets international program.     Distribution of Allowances    The bill establishes a number of mechanisms to address cost impacts to consumers and businesses and  to support clean energy technologies. Beginning in 2013 and annually through 2029, emission  allowances are directed to compensate for increases in energy bills. This allowance value is provided to  all consumers (residential, commercial, and industrial) through local distribution companies for  electricity and natural gas, and through states for home heating oil.      In addition, the bill establishes a refundable tax credit, the Working Families Relief Program, for low‐ income families and an Energy Refund Program for qualified households under the Social Security Act.  Beginning in 2026, the bill also establishes a Universal Trust Refund with some of the value from  auctions used for deficit reduction (25 percent) and the remainder directly refunded to the public.    Allowance value for the transportation sector is used to support the Highway Trust Fund, a Clean Vehicle  Technology Fund, transportation improvement programs similar to those implemented under the  American Recovery and Reinvestment Act, and state and metropolitan efforts to reduce GHG emissions ...

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