Summary
The U.S. House of Representatives narrowly passed the American Clean Energy and Security Act of 2009 (“ACES”) on June 26, 2009. The discussion below contains the key points in the Bill now headed to the Senate for debate and action.
Analysis
Below are the key points of the American Clean Energy and Security Act of 2009 (“ACES”):
*Requires a reduction in greenhouse gases (GHG) by 17% from 2005’s level by 2020 and by 83% by 2050 from power plants, the electricity sector, factories, and refineries.
*Agriculture emissions are exempt from the cap.
*GHG emissions reductions would be achieved through a cap and trade program through the use of emissions credits.
*The emissions credits initially would primarily be allocated to the affected industries, with the remaining auctioned. The allocated-auction ratio would slide down over the years, with more being auctioned.
*Allowing emissions reductions to be met through “offsets”, such as planting trees both domestically and internationally.
*Effectively bans coal plants from being permitted after 2020 without partial GHG reduction technology. It allows coal plants with the tighter performance standard to be permitted after 2020.
*A requirement that electric utilities produce a minimum of 12% of their power from renewable resources such as wind and solar energy by 2020. It also requires 8% in savings through energy savings. Noticeably not included as an energy source to meet this standard is nuclear power—a non-emitter of GHG.
*New buildings will need to be 30% more energy efficient by 2012 and 50% more efficient by 2016.
*Programs for credits and rebates to lower-income households to help offset the higher energy costs resulting from the program.
