Future of Climate Change Legislation in the U.S. Senate

Senator Barbara Boxer (D-CA) and Senator John Kerry (D-MA) are planning to introduce climate change legislation this year or early next year. The Senate bill will be debated first in the Environment and Public Works Committee, chaired by Senator Boxer and is expected to be similar to legislation written by Representatives Henry Waxman (D-CA) and Ed Markey (D-MA), which passed the U.S. House of Representatives in June.

Under the Boxer/Kerry bill, electric utilities that use coal and natural gas will have to buy "allowances" to comply with the nation-wide cap on greenhouse gas emissions. The number of allowances they must purchase varies over time. The cost of purchasing these allowances will be passed on to consumers. The Center opposes auctioning allowances favoring free allocation of all but 2% of the allowances.

Senator Jeff Bingaman (D-NM), chair of the Energy and Natural Resources Committee, has begun hearings on the economic implications of climate change legislation. As many as six Senate committees may have a hand in drafting a climate change bill before the bill makes its way to the Senate floor. In particular, the bill will need to address difficult regional concerns in order to pass the Senate. These concerns include maintaining affordable electricity rates and protecting jobs.