Climate Bill Barely Passes House

The House passed, 219-212, the American Clean Energy and Security Act of 2009, with virtually no Republican support. The Act could for the first time bring widespread government restrictions on greenhouse gases, CNN reports.

The central part of the legislation limits the amount of carbon dioxide that companies like electric utilities, gasoline refiners, chemical firms and other large users of energy can put into the atmosphere. There were previously no restrictions on carbon dioxide emissions. Under a cap-and-trade plan, the government would require companies emitting large amounts of greenhouse gases, to obtain a permit for each ton they emit each year.

The number of permits issued each year is then lowered, forcing companies to reduce their emissions. Companies that still need more permits, can either pay to install cleaner equipment, fund carbon-offset projects like tree farms, or buy these permits on a secondary market from other companies that have cleaned up their operations and now have extra permits to sell.

Meeting those targets is expected to cost the average household $175 a year by 2020, according to a recent analysts by the Congressional Budget Office. Opponents say it will cost far more and supporters saying consumers will actually save money by reducing their energy use. As for consumers, they will mainly see this cost increase in the form of higher electric bills and gas prices.

Opposition to the bill stemmed largely from the costs. Some Democrats from coal producing or big manufacturing states voted against the measure, afraid of what higher energy prices may mean for their constituents.

The bill now heads to the Senate, which isn’t expected to take up the matter until the fall. There’s considerably more opposition to the plan in the Senate. But the Obama administration will likely keep pressure on Congress. This is currently being done by a thinly veiled threat to use the EPA to regulate greenhouse gases, a process most observers say would be even costlier than a cap-and-trade plan, the article said.