House Passes Bill to Address Threat of Climate Change

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“This legislation will break our dependence on foreign oil, make our nation a leader in clean energy jobs and cut global warming pollution,” said Representative Henry A. Waxman, Democrat of California, a co-sponsor of the bill, adding that Friday’s vote was a “decisive and historic action” that would position the United States as a leader in energy efficiency and technology.

The bill’s provisions forcing reductions in the use of fossil fuel while increasing production of alternative energy sources would produce millions of new jobs, Mr. Waxman said.

But the legislation, a patchwork of compromises, falls far short of what many European governments and environmentalists have said is needed to avert the worst impacts of global warming. And it has pitted liberal Democrats from both coasts against more conservative Democrats from areas dependent on coal for electricity and heavy manufacturing for jobs.

Friday’s vote illustrated that rift: The bill passed by a seven-vote margin, with 44 Democrats voting against it.

As difficult as passage in the House proved, it is just the beginning of the energy and climate debate in Congress, since the issue now moves to the Senate, where political divisions and regional differences are even starker.

At the heart of the legislation is a cap-and-trade system that sets an overall limit on emissions of heat-trapping gases like carbon dioxide while allowing utilities, manufacturers and other emitters to trade pollution permits, or allowances, among themselves. The cap grows increasingly tighter over the years, pushing up the price of emissions and presumably driving industry to find cleaner ways of producing energy.

While some environmental groups supported the legislation, others — Greenpeace, for example — vigorously opposed it. Business groups were also split. Republican leaders called the bill a national energy tax and predicted that those who voted for the measure would pay a heavy price at the polls next year.

“No matter how you doctor it or tailor it,” said Representative Joe Pitts, Republican of Pennsylvania, “it is a tax.”

Only eight Republicans voted for the bill, which runs to more than 1,300 pages.

Apart from its domestic implications, the bill is a show of resolve that American officials can point to when negotiating the new global climate change treaty, after years of American objections to binding limits on carbon dioxide emissions.

The German chancellor, Angela Merkel, who was in Washington Friday to meet President Obama, strongly endorsed the bill even though it fell short of European goals for reducing the emissions of heat-trapping gases.

Ms. Merkel, a longtime advocate of strong action to cut carbon dioxide emissions, has been pushing the United States to take a leading role in advance of the global climate negotiations set for December in Copenhagen.

After meeting with Mr. Obama, she said she had seen a “sea change” in the United States on climate policy that she could not have imagined a year ago when President George W. Bush was in office.

“This really points to the fact that the United States is very serious on climate,” Ms. Merkel said.

The compromises in the bill were necessary to attract the support of Democrats from different regions and ideologies. In the months of horse-trading leading to Friday’s vote, the bill’s targets for emissions were weakened, its mandate for renewable electricity was scaled back, and incentives for various industries from automobiles to natural gas were sweetened.

The final bill intends to reduce overall heat-trapping gases in the United States by 17 percent of 2005 levels by 2020, and 83 percent by midcentury.

When the program is scheduled to begin in 2012, the estimated price of a permit to emit a ton of carbon dioxide will be about $13. That is projected to rise steadily as emission limits come down, but the bill contains a measure to prevent costs from rising too quickly in any one year.

The bill grants a majority of the permits free in the early years of the program, to keep costs low. The Congressional Budget Office estimated that the average American household would pay an additional $175 a year in energy costs by 2020 as a result of the provision, while the poorest households would end up with $40 in rebates.

Several House members expressed concern about the new market to be created in carbon allowances, saying it posed the same risks as markets in other kinds of derivatives. Regulation of such markets would be divided among the Commodity Futures Trading Commission, the Treasury Department and the Federal Energy Regulatory Commission. The bill also sets a national standard of 20 percent for the production of renewable electricity by 2020, although a third of that could be met with efficiency measures rather than renewable energy sources like solar, wind and geothermal.

It also devotes billions of dollars to new energy projects and subsidies for low-carbon agricultural practices, clean-coal research and electric vehicle development.