Climate Stewardship and Economic Security Act of 2007 - Requires the Administrator of the Environmental Protection Agency (EPA) to establish a National Greenhouse Gas Database consisting of: (1) an inventory of greenhouse gas (GHG) emissions by covered entities (specified entities that own or control a source of GHG emissions in the electric power, industrial, and commercial sectors of the U.S. economy that emit more than 10,000 metric tons of GHGs per year); and (2) a registry of GHG emission reductions and increased sequestration, applicable to all entities.
Establishes a program for the market-driven reduction of GHGs by covered entities through the use of tradeable emissions allowances. Requires the Administrator to establish a declining cap on allowances to reduce GHG emissions over time. Requires covered entities, beginning in 2012, to submit to the Administrator one allowance for every metric ton of GHGs emitted. Authorizes the President to establish a program to require importers to pay the value of GHGs emitted during the production of goods or services imported into the United States from specified foreign nations.
Allows allowances to be sold, exchanged, purchased, retired, borrowed, offset, or otherwise used as authorized by this Act. Imposes civil penalties on covered entities that fail to submit allowances. Requires: (1) the Administrator to establish a program to assist developing counties and covered entities in reducing GHGs; and (2) the Secretary of Agriculture to establish an outreach initiative on opportunities for agricultural producers to earn revenue.
Establishes: (1) the Carbon Market Efficiency Board to analyze information on the GHG emission tradeable allowance market and to carry out cost relief measures if such market poses a significant harm to the US economy; and (2) the Climate Change Credit Corporation (CCCC) to receive, manage, buy, and sell allowances.
Directs the Administrator to make allocations of allowances to covered sectors and entities and to the CCCC, providing initial allocations for early action and accelerated participation.
Requires the CCCC to establish a program to provide financial support for: (1) technology to assist in compliance with this Act; (2) the restoration of habitat to help fish and wildlife adapt to climate change; and (3) restoration of large-scale aquatic ecosystems.
Amends the Coastal Zone Management Act of 1972 to require the Secretary of Commerce to: (1) report to Congress on the oceanic and coastal impacts of climate change; and (2) assist certain coastal states in preparing persons to adapt to climate change.
Requires the Director of the Office of Science and Technology Policy to: (1) establish a program on adaptation technologies as part of the Climate Technology Challenge Program; and (2) perform regional infrastructure cost assessments of the impacts of climate change. Requires the Secretary of Commerce to: (1) submit a climate change adaptation plan to Congress; and (2) research the impact of climate change on low-income populations worldwide.
Amends the Pittman-Robertson Wildlife Restoration Act to provide funding for the Wildlife Conservation and Restoration Account that may be used by states to develop and implement climate change impact mitigation plans.
[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4226 Introduced in House (IH)]
110th CONGRESS
1st Session
H. R. 4226
To accelerate the reduction of greenhouse gas emissions in the United
States by establishing a market-driven system of greenhouse gas
tradeable allowances that will limit greenhouse gas emissions in the
United States, reduce dependence upon foreign oil, and ensure benefits
to consumers from the trading in such allowances, and for other
purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
November 15, 2007
Mr. Gilchrest (for himself and Mr. Olver) introduced the following
bill; which was referred to the Committee on Energy and Commerce, and
in addition to the Committees on Science and Technology, Natural
Resources, Foreign Affairs, Agriculture, and Ways and Means, for a
period to be subsequently determined by the Speaker, in each case for
consideration of such provisions as fall within the jurisdiction of the
committee concerned
_______________________________________________________________________
A BILL
To accelerate the reduction of greenhouse gas emissions in the United
States by establishing a market-driven system of greenhouse gas
tradeable allowances that will limit greenhouse gas emissions in the
United States, reduce dependence upon foreign oil, and ensure benefits
to consumers from the trading in such allowances, and for other
purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Climate Stewardship and Economic
Security Act of 2007''.
SEC. 2. TABLE OF CONTENTS.
The table of contents for this Act is as follows:
Sec. 1. Short title.
Sec. 2. Table of contents.
Sec. 3. Definitions.
TITLE I--MARKET TO REDUCE GREENHOUSE GAS EMISSIONS
Subtitle A--Tracking Emissions
Sec. 101. National Greenhouse Gas Database and registry established.
Sec. 102. Inventory of greenhouse gas emissions for covered entities.
Sec. 103. Greenhouse gas reduction registration.
Sec. 104. Measurement and verification.
Subtitle B--Mandating Emission Reductions
Sec. 121. Covered entities must submit allowances for emissions.
Sec. 122. Compliance.
Sec. 123. Exemption of source categories.
Sec. 124. Establishment of tradeable allowances.
Sec. 125. International reserve allowance program.
Sec. 126. Penalties.
Subtitle C--Controlling Compliance Costs
Part 1--Use of Allowances
Sec. 141. Trading.
Sec. 142. Banking.
Sec. 143. Borrowing against future reductions.
Sec. 144. Domestic offsets.
Sec. 145. International credits plan.
Sec. 146. Outreach initiative on revenue enhancement for agricultural
producers.
Part 2--Carbon Market Efficiency Board
Sec. 151. Establishment of Board.
Sec. 152. Duties.
Sec. 153. Powers.
Sec. 154. Estimate of costs to economy of limiting greenhouse gas
emissions.
Subtitle D--Allocation of Tradeable Allowances
Sec. 161. Determination of tradeable allowance allocations.
Sec. 162. Provision of tradeable allowances.
Sec. 163. Ensuring target adequacy.
Sec. 164. Initial allocations for early participation and accelerated
participation.
Sec. 165. Bonus for accelerated participation.
TITLE II--CLIMATE CHANGE CREDIT CORPORATION
Sec. 201. Establishment.
Sec. 202. Purposes and functions.
TITLE III--MISCELLANEOUS
Sec. 301. NOAA report on climate change effects; preparation
assistance.
Sec. 302. Adaptation technologies.
Sec. 303. Mitigating climate change's impacts on the poor.
Sec. 304. Wildlife conservation.
SEC. 3. DEFINITIONS.
In this Act:
(1) Administrator.--The term ``Administrator'' means the
Administrator of the Environmental Protection Agency.
(2) Baseline.--The term ``baseline'' means the historic
greenhouse gas emission levels of an entity, as adjusted upward
by the Administrator to reflect actual reductions that are
verified in accordance with--
(A) regulations promulgated under section
101(c)(1); and
(B) relevant standards and methods developed under
this Act.
(3) Board.--The term ``Board'' means the Carbon Market
Efficiency Board established under section 151.
(4) Carbon dioxide equivalents.--The term ``carbon dioxide
equivalents'' means, for each greenhouse gas, the amount of
each such greenhouse gas that makes the same contribution to
global warming as one metric ton of carbon dioxide, as
determined by the Administrator.
(5) Covered sectors.--The term ``covered sectors'' means
the electric power, transportation, industrial, and commercial
sectors, as such terms are used in the Inventory.
(6) Covered entity.--The term ``covered entity'' means an
entity (including a branch, department, agency, or
instrumentality of Federal, State, or local government) that--
(A) owns or controls a source of greenhouse gas
emissions in the electric power, industrial, or
commercial sector of the United States economy (as
defined in the Inventory), refines or imports refined
petroleum products for use in transportation, or
produces or imports hydrofluorocarbons,
perfluorocarbons, or sulfur hexafluoride; and
(B) emits, from any single facility owned by the
entity, over 10,000 metric tons of greenhouse gas per
year, measured in units of carbon dioxide equivalents,
or--
(i) refines or imports refined petroleum
products that, when combusted, will emit;
(ii) produces or imports
hydrofluorocarbons, perfluorocarbons, or sulfur
hexafluoride that, when used, will emit; or
(iii) produces or imports other greenhouse
gases that, when used, will emit,
over 10,000 metric tons of greenhouse gas per year,
measured in units of carbon dioxide equivalents.
(7) Database.--The term ``database'' means the National
Greenhouse Gas Database established under section 101.
(8) Direct emissions.--The term ``direct emissions'' means
greenhouse gas emissions by an entity from a facility that is
owned or controlled by that entity.
(9) Facility.--The term ``facility'' means a building,
structure, or installation located on any 1 or more contiguous
or adjacent properties of an entity in the United States.
(10) Greenhouse gas.--The term ``greenhouse gas'' means--
(A) carbon dioxide;
(B) methane;
(C) nitrous oxide;
(D) hydrofluorocarbons;
(E) perfluorocarbons; or
(F) sulfur hexafluoride.
(11) Indirect emissions.--The term ``indirect emissions''
means greenhouse gas emissions that are--
(A) a result of the activities of an entity; but
(B) emitted from a facility owned or controlled by
another entity.
(12) Inventory.--The term ``Inventory'' means the Inventory
of U.S. Greenhouse Gas Emissions and Sinks, prepared in
compliance with the United Nations Framework Convention on
Climate Change Decision 3/CP.5.
(13) Leakage.--The term ``leakage'' means--
(A) a potentially unaccounted increase in
greenhouse gas emissions by a facility or entity caused
by an offset project that produces an accounted
reduction in greenhouse gas emissions; or
(B) a potentially unaccounted decrease in
sequestration that is caused by an offset project that
results in an accounted increase in sequestration.
(14) Permanence.--The term ``permanence'' means the extent
to which greenhouse gases that are sequestered will not later
be returned to the atmosphere.
(15) Registry.--The term ``registry'' means the registry of
greenhouse gas emission reductions and increases in
sequestration established under section 101(b)(2).
(16) Secretary.--The term ``Secretary'' means the Secretary
of Commerce.
(17) Sequestration.--
(A) In general.--The term ``sequestration'' means
the long-term capture, separation, isolation, or
removal of greenhouse gases from the atmosphere.
(B) Inclusions.--The term ``sequestration''
includes, as the Administrator determines appropriate
for carrying out this Act--
(i) agricultural and conservation
practices;
(ii) reforestation;
(iii) forest preservation;
(iv) production of cellulosic biomass
crops; and
(v) any other method of long-term capture,
separation, isolation, or removal of greenhouse
gases from the atmosphere.
(C) Exclusions.--The term ``sequestration'' does
not include--
(i) any conversion of, or negative impact
on, a native ecosystem; or
(ii) any introduction of non-native
species.
(18) Source category.--The term ``source category'' means a
process or activity that leads to direct emissions of
greenhouse gases, as listed in the Inventory.
(19) Stationary source.--The term ``stationary source''
means any source of greenhouse gas emissions except those
emissions resulting directly from an engine for transportation
purposes.
TITLE I--MARKET TO REDUCE GREENHOUSE GAS EMISSIONS
Subtitle A--Tracking Emissions
SEC. 101. NATIONAL GREENHOUSE GAS DATABASE AND REGISTRY ESTABLISHED.
(a) Establishment.--As soon as practicable after the date of
enactment of this Act, the Administrator, in coordination with the
Secretary, the Secretary of Energy, the Secretary of Agriculture, State
governments, and private sector and nongovernmental organizations,
shall establish, operate, and maintain a database, to be known as the
``National Greenhouse Gas Database'', to collect, verify, and analyze
data on greenhouse gas emissions by entities.
(b) National Greenhouse Gas Database Components.--The database
shall consist of--
(1) an inventory of greenhouse gas emissions; and
(2) a registry of greenhouse gas emission reductions and
increases in sequestrations.
(c) Comprehensive System.--
(1) In general.--Not later than 2 years after the date of
enactment of this Act, the Administrator shall promulgate
regulations to implement a comprehensive system for greenhouse
gas emissions reporting, inventorying, and reduction and
sequestration registration.
(2) Requirements.--The Administrator shall ensure, to the
maximum extent practicable, that--
(A) the comprehensive system described in paragraph
(1) is designed to--
(i) maximize completeness, transparency,
and accuracy of data reported; and
(ii) minimize costs incurred by entities in
measuring and reporting greenhouse gas
emissions, emission reductions, and
sequestrations; and
(B) the regulations promulgated under paragraph (1)
establish procedures and protocols necessary--
(i) to prevent the double-counting of
greenhouse gas emissions, emission reductions,
or sequestrations reported by more than 1
reporting entity;
(ii) to provide for corrections to errors
in data submitted to the database;
(iii) to provide for adjustment to data by
reporting entities that have had a significant
organizational change (including mergers,
acquisitions, and divestiture), in order to
maintain comparability among data in the
database over time;
(iv) to provide for adjustments to reflect
new technologies or methods for measuring or
calculating greenhouse gas emissions, emission
reductions, or sequestrations;
(v) to account for changes in registration
of ownership of emission reductions or
increases in sequestration resulting from a
voluntary private transaction between reporting
entities;
(vi) to prevent a covered entity from
avoiding the requirements of this Act by
reorganization into multiple entities that are
under common control; and
(vii) to clarify the responsibility for
reporting in the case of any facility owned or
controlled by more than 1 entity.
(3) Serial numbers.--Through regulations promulgated under
paragraph (1), the Administrator shall develop and implement a
system that provides--
(A) for the provision of unique serial numbers to
identify the registered emission reductions or
increases in sequestration made by an entity;
(B) for the tracking of the registered reductions
or sequestrations associated with the serial numbers;
and
(C) for such action as may be necessary to prevent
counterfeiting of the registered reductions or
sequestrations.
SEC. 102. INVENTORY OF GREENHOUSE GAS EMISSIONS FOR COVERED ENTITIES.
(a) In General.--Not later than July 1st of each calendar year
after 2011, each covered entity shall submit to the Administrator a
report that states, for the preceding calendar year, the entity-wide
greenhouse gas emissions in the United States (as reported at the
facility level), including--
(1) the total quantity of direct emissions from stationary
sources, including process and fugitive emissions, expressed in
units of carbon dioxide equivalents, except those reported
under paragraph (3);
(2) the amount of petroleum products refined or refined
petroleum products imported by the entity for use in
transportation and the amount of greenhouse gases, expressed in
units of carbon dioxide equivalents, that would be emitted when
these products are used for transportation, as determined by
the Administrator under section 121(b);
(3) the amount of hydrofluorocarbons, perfluorocarbons, or
sulfur hexafluoride, expressed in units of carbon dioxide
equivalents, that are produced or imported by the entity and
will ultimately be emitted in the United States, as determined
by the Administrator under section 121(d); and
(4) such other categories of greenhouse gas emissions in
the United States as the Administrator determines in the
regulations promulgated under section 101(c)(1) may be
practicable and useful for the purposes of this Act, such as
indirect emissions.
(b) Collection and Analysis of Data.--The Administrator shall
collect and analyze data reported under subsection (a) for use under
this title.
SEC. 103. GREENHOUSE GAS REDUCTION REGISTRATION.
(a) In General.--Subject to the requirements described in
subsection (b)--
(1) a covered entity may register greenhouse gas emission
reductions and increases in sequestration achieved after 1990
and before 2012 under this section; and
(2) an entity that is not a covered entity may register
greenhouse gas emission reductions and increases in
sequestration achieved at any time since 1990 under this
section.
(b) Requirements.--
(1) In general.--The requirements referred to in subsection
(a) are that an entity (other than an entity described in
paragraph (2)) shall--
(A) establish a baseline; and
(B) submit the report described in section
102(a)(1).
(2) Requirements not applicable to entities entering into
certain agreements.--An entity that enters into an agreement
with a participant in the registry for the purpose of a carbon
sequestration project may register greenhouse gas emission
reductions or sequestrations without being required to comply
with the requirements specified in paragraph (1), unless that
entity is required to comply with those requirements by reason
of an activity other than the agreement.
(c) Procedure.--
(1) Voluntary reporting.--An entity described in subsection
(a) may submit to the Administrator for inclusion in the
registry--
(A) before January 1, 2012, data that relates to
any activity that resulted in the net reduction of the
greenhouse gas emissions of the entity or an increase
in sequestration by the entity that were carried out
during or after 1990 and before the establishment of
the database; and
(B) with respect to the calendar year preceding the
calendar year in which the data is submitted, data that
relates to any project or activity that resulted in the
net reduction of the greenhouse gas emissions of the
entity or a net increase in net sequestration by the
entity.
(2) Provision of verification information by reporting
entities.--Each entity that submits a report under section
102(a) or this subsection shall provide information sufficient
for the Administrator to verify, in accordance with measurement
and verification methods and standards developed under section
104, that the report--
(A) has been accurately reported; and
(B) in the case of each voluntary report under
paragraph (1), represents--
(i) actual reductions in greenhouse gas
emissions relative to historic emission levels
of the entity; or
(ii) actual increases in net sequestration.
(3) Failure to submit report.--An entity that submits data
for registration of emission reductions or increases in
sequestration in the registry and that fails to submit a report
required under this subsection shall be prohibited from using,
or allowing another entity to use, its registered emissions
reductions or increases in sequestration to satisfy the
requirements of section 121.
(4) Independent third-party verification.--To meet the
requirements of this section and section 104, an entity that
submits a report under this section may--
(A) obtain independent third-party verification;
and
(B) present the results of the third-party
verification to the Administrator.
(5) Availability of data.--
(A) In general.--The Administrator shall ensure
that information in the database is--
(i) published; and
(ii) accessible to the public, including in
electronic format on the Internet.
(B) Exception.--Subparagraph (A) shall not apply in
any case in which the Administrator determines that
publishing or otherwise making available information
described in that subparagraph--
(i) poses a risk to national security; or
(ii) discloses confidential business
information that can not be derived from
information that is otherwise publicly
available and that would cause competitive harm
if published.
(6) Data infrastructure.--The Administrator shall ensure,
to the maximum extent practicable, that the database uses, and
is integrated with, Federal, State, and regional greenhouse gas
data collection and reporting systems.
(7) Additional issues to be considered.--In promulgating
the regulations under section 101(c)(1) and implementing the
database, the Administrator shall take into consideration a
broad range of issues involved in establishing an effective
database, including--
(A) the data and information systems and measures
necessary to identify, track, and verify greenhouse gas
emissions in a manner that will encourage private
sector trading and exchanges;
(B) the greenhouse gas reduction and sequestration
measurement and estimation methods and standards
applied in other countries, as applicable or relevant;
(C) the extent to which available data on fossil
fuels, greenhouse gas emissions, and greenhouse gas
production, refining, and importation are adequate to
implement the database; and
(D) the differences in, and potential uniqueness
of, the facilities, operations, and business and other
relevant practices of persons and entities in the
private and public sectors that may be expected to
participate in the database.
(d) Annual Report.--The Administrator shall publish an annual
report that--
(1) describes the total greenhouse gas emissions, emission
reductions, and increases in sequestration reported to the
database during the year covered by the report;
(2) provides entity-by-entity and sector-by-sector analyses
of the emissions, emission reductions, and increases in
sequestration reported;
(3) describes the atmospheric concentrations of greenhouse
gases;
(4) provides a comparison of current and past atmospheric
concentrations of greenhouse gases; and
(5) describes the activity during the year covered by the
report in the trading of greenhouse gas emission allowances.
SEC. 104. MEASUREMENT AND VERIFICATION.
(a) Methods and Standards.--
(1) In general.--Not later than 1 year after the date of
enactment of this Act, the Administrator shall establish by
rule, in coordination with the Secretary, the Secretary of
Energy, and the Secretary of Agriculture, comprehensive
measurement and verification methods and standards to ensure a
consistent and technically accurate record of greenhouse gas
emissions, emission reductions, sequestration, and atmospheric
concentrations for use in the registry.
(2) Requirements.--The methods and standards established
under paragraph (1) shall include--
(A) a requirement that an entity submitting data
for the database use a continuous emissions monitoring
system, or another system of measuring emissions,
emission reductions, or increases in sequestration that
is determined by the Administrator to provide
information with precision, reliability, accessibility,
and timeliness similar to that provided by a continuous
emissions monitoring system where technologically
feasible;
(B) establishment of standardized measurement and
verification practices for reports made by all entities
participating in the registry, taking into account--
(i) protocols and standards in use by
entities requiring or desiring to participate
in the registry as of the date of development
of the methods and standards under paragraph
(1);
(ii) boundary issues, such as leakage;
(iii) avoidance of double counting of
greenhouse gas emissions, emission reductions,
and increases in sequestration; and
(iv) such other factors as the
Administrator, in consultation with the
Secretary, the Secretary of Energy, and the
Secretary of Agriculture, determines to be
appropriate;
(C) establishment of methods of--
(i) estimating greenhouse gas emissions,
for those cases in which the Administrator
determines that methods of monitoring or
measuring such emissions with precision,
reliability, accessibility, and timeliness
similar to that provided by a continuous
emissions monitoring system are not
technologically feasible at present; and
(ii) reporting the accuracy of such
estimations;
(D) establishment of measurement and verification
standards applicable to actions taken to reduce or
sequester greenhouse gas emissions;
(E) in coordination with the Secretary of
Agriculture, standards to measure the results of the
use of carbon sequestration, including--
(i) soil carbon sequestration practices;
(ii) forest preservation and reforestation
activities that adequately address the issues
of permanence, leakage, and verification; and
(iii) production of cellulosic biomass
crops;
(F) establishment of standards for obtaining the
Administrator's approval of the suitability of
geological storage sites that include evaluation of
both the geology of the site and the entity's capacity
to manage the site;
(G) establishment of other features that, as
determined by the Administrator, will allow entities to
adequately establish a fair and reliable measurement
and reporting system; and
(H) establishment of such other measurement and
verification standards as the Administrator, in
consultation with the Secretary of Agriculture, the
Secretary, and the Secretary of Energy, determines to
be appropriate.
(b) Public Participation.--The Administrator shall make available
to the public for comment, in draft form and for a period of at least
90 days, the methods and standards developed under subsection (a)
before issuing final regulations under this section.
(c) Experts and Consultants.--
(1) In general.--The Administrator may obtain the services
of experts and consultants in the private and nonprofit sectors
for the purpose of carrying out this section in accordance with
section 3109 of title 5, United States Code, in the areas of
greenhouse gas measurement, certification, and emission
trading.
(2) Available arrangements.--In obtaining any service
described in paragraph (1), the Administrator may use any
available grant, contract, cooperative agreement, or other
arrangement authorized by law.
(d) Review and Revision.--The Administrator shall periodically
review, and revise as necessary, the methods and standards developed
under subsection (a).
Subtitle B--Mandating Emission Reductions
SEC. 121. COVERED ENTITIES MUST SUBMIT ALLOWANCES FOR EMISSIONS.
(a) In General.--Beginning with calendar year 2012--
(1) each covered entity in the electric power, industrial,
and commercial sectors shall submit to the Administrator one
tradeable allowance for every metric ton of greenhouse gases,
measured in units of carbon dioxide equivalents, that it emits
from stationary sources, except those described in paragraph
(2);
(2) each producer or importer of hydrofluorocarbons,
perfluorocarbons, or sulfur hexafluoride that is a covered
entity shall submit to the Administrator one tradeable
allowance for every metric ton of hydrofluorocarbons,
perfluorocarbons, or sulfur hexafluoride, measured in units of
carbon dioxide equivalents, that it produces or imports and
that are deemed under subsection (d) to be emitted in the
United States; and
(3) each petroleum product refiner or importer that is a
covered entity shall submit one tradeable allowance for every
unit of petroleum product it sells that will produce one metric
ton of greenhouse gases when used for transportation, measured
in units of carbon dioxide equivalents, as determined by the
Administrator under subsection (b).
(b) Determination of Transportation Sector Amount.--For the
transportation sector, the Administrator shall determine the amount of
greenhouse gases, measured in units of carbon dioxide equivalents, that
will be deemed to be emitted when petroleum products are used for
transportation.
(c) Exception for Certain Deposited Emissions.--Notwithstanding
subsection (a), a covered entity is not required to submit a tradeable
allowance for any amount of greenhouse gas that would otherwise have
been emitted from a facility under the ownership or control of that
entity if--
(1) the emission is deposited in a geological storage
facility approved by the Administrator described in section
104(a)(2)(F); and
(2) the entity agrees to submit tradeable allowances for
any portion of the deposited emission that is subsequently
emitted from that facility.
(d) Determination of Hydrofluorocarbon, Perfluorocarbon, and Sulfur
Hexafluoride Amount.--The Administrator shall determine the amounts of
hydrofluorocarbons, perfluorocarbons, or sulfur hexafluoride, measured
in units of carbon dioxide equivalents, that will be deemed to be
emitted for purposes of this Act.
(e) Allowances Retired.--Upon receiving a tradeable allowance
pursuant to a requirement under this subtitle, the Administrator shall
retire the serial number assigned to that allowance.
SEC. 122. COMPLIANCE.
(a) Source of Tradeable Allowances Used.--A covered entity may use
a tradeable allowance to meet the requirements of this subtitle without
regard to whether the tradeable allowance was allocated to it under
subtitle D or acquired from another entity or the Climate Change Credit
Corporation established under section 201.
(b) Verification by Administrator.--At various times during each
year, the Administrator shall determine whether each covered entity has
met the requirements of this subtitle. In making that determination,
the Administrator shall take into account the tradeable allowances
submitted by the covered entity to the Administrator.
SEC. 123. EXEMPTION OF SOURCE CATEGORIES.
(a) In General.--The Administrator may grant an exemption from the
requirements of this subtitle to a source category if the Administrator
determines, after public notice and comment, that it is not feasible to
measure or estimate emissions from that source category, until such
time as measurement or estimation becomes feasible.
(b) Reduction of Limitations.--If the Administrator exempts a
source category under subsection (a), the Administrator shall also
reduce the total tradeable allowances under section 124(a)(1), (2),
(3), or (4), as applicable, by the amount of greenhouse gas emissions
that the exempted source category emitted in calendar year 2000, as
identified in the 2000 Inventory.
(c) Limitation on Exemption.--The Administrator may not grant an
exemption under subsection (a) to carbon dioxide produced from fossil
fuel.
SEC. 124. ESTABLISHMENT OF TRADEABLE ALLOWANCES.
(a) In General.--The Administrator shall promulgate regulations to
establish tradeable allowances, denominated in units of carbon dioxide
equivalents, as follows:
(1) For the first 8 calendar years beginning after 2011,
the number of tradeable allowances shall be equal to the number
of metric tons of greenhouse gases emitted in 2006, measured in
units of carbon dioxide equivalents, reduced by the amount of
emissions of greenhouse gases in calendar year 2012 from
noncovered entities, as calculated by the Administrator.
(2) For the first 10 calendar years beginning after 2019,
the number of tradeable allowances shall be equal to 85 percent
of the number of metric tons of greenhouse gases emitted in
2006, measured in units of carbon dioxide equivalents, reduced
by the amount of emissions of greenhouse gases in calendar year
2020 from noncovered entities, as calculated by the
Administrator.
(3) For the first 10 calendar years beginning after 2029,
the number of tradeable allowances shall be equal to 63 percent
of the number of metric tons of greenhouse gases emitted in
2006, measured in units of carbon dioxide equivalents, reduced
by the amount of emissions of greenhouse gases in calendar year
2030 from noncovered entities, as calculated by the
Administrator.
(4) For calendar years beginning after 2049, the number of
tradeable allowances shall be equal to 25 percent of the number
of metric tons of greenhouse gases emitted in 2006, measured in
units of carbon dioxide equivalents, reduced by the amount of
emissions of greenhouse gases in each such calendar year from
noncovered entities, as calculated by the Administrator.
(b) Serial Numbers.--The Administrator shall assign a unique serial
number to each tradeable allowance established under subsection (a),
and shall take such action as may be necessary to prevent
counterfeiting of tradeable allowances.
(c) Nature of Tradeable Allowances.--A tradeable allowance is not a
property right, and nothing in this title or any other provision of law
limits the authority of the United States to terminate or limit a
tradeable allowance.
(d) Noncovered Entity.--For purposes of this section only, the term
``noncovered entity'' means an entity that--
(1) owns or controls a source of greenhouse gas emissions
in the electric power, industrial, or commercial sector of the
United States economy (as defined in the Inventory), refines or
imports refined petroleum products for use in transportation,
or produces or imports hydrofluorocarbons, perfluorocarbons, or
sulfur hexafluoride; and
(2) is not a covered entity.
SEC. 125. INTERNATIONAL RESERVE ALLOWANCE PROGRAM.
(a) Purposes.--The purposes of this section are--
(1) to ensure that greenhouse gas emissions occurring
outside the United States do not undermine the objectives of
the United States to reduce greenhouse gas emissions and to
stabilize greenhouse gas concentrations in the atmosphere at a
level that would prevent dangerous anthropogenic interference
with the climate system;
(2) to ensure that manufactured products produced in the
United States remain competitive, in international and domestic
markets, with comparable products produced in foreign nations
that do not have restrictions on greenhouse gas emissions
comparable to those described in section 124; and
(3) to encourage effective international action to achieve
the purposes stated in paragraphs (1) and (2) through
procedures negotiated between the United States and other
countries or through measures taken by the United States that
comply with applicable international agreements.
(b) International Negotiations.--
(1) Finding.--Congress finds that the purposes described in
subsection (a) can be most effectively addressed and achieved
through procedures negotiated between the United States and
other countries.
(2) Negotiating objective.--To the extent that the
procedures described in paragraph (1) involve measures
affecting international trade in goods or services, the climate
change negotiating objective of the United States shall be to
conclude agreements on the reduction of greenhouse gas
emissions that will help to achieve the purposes described in
subsection (a).
(c) International Equity Program.--
(1) Establishment.--The President may establish a program
to require importers to pay the value of greenhouse gases
(based on the market price of tradeable allowances issued under
this Act) emitted during the production of goods or services
imported into the United States from any foreign nation other
than those described in paragraph (2).
(2) Nations not subject to program.--The foreign nations
referred to in paragraph (1) are those that--
(A) are a party to an agreement with the United
States that achieves the purposes of this section; or
(B) impose restrictions on greenhouse gas emissions
that are comparable to such restrictions imposed in the
United States.
(3) Negotiations.--The President shall not impose the
requirements of a program established under paragraph (1) on
imports from any foreign nation unless negotiations to achieve
an agreement described in paragraph (2)(A) have been attempted
by the United States with that foreign nation.
(d) Consistency With International Agreements.--A program
established under subsection (c) shall be designed to ensure that the
United States complies with all applicable international agreements.
SEC. 126. PENALTIES.
Any covered entity that fails to meet the requirements of this
subtitle for a year shall be liable for a civil penalty, payable to the
Administrator, equal to thrice the market value (determined as of the
last day of the year at issue) of the tradeable allowances that would
be necessary for that covered entity to meet those requirements on the
date that the tradeable allowances were due.
Subtitle C--Controlling Compliance Costs
PART 1--USE OF ALLOWANCES
SEC. 141. TRADING.
(a) In General.--Tradeable allowances may be sold, exchanged,
purchased, retired, or used as provided in this Act.
(b) Intersector Trading.--Covered entities may purchase or
otherwise acquire tradeable allowances from other covered sectors to
satisfy the requirements of this title, in addition to those from
within their own sector.
SEC. 142. BANKING.
Tradeable allowances not used to satisfy the requirements of this
title in a year may be used to satisfy the requirements in a later
year.
SEC. 143. BORROWING AGAINST FUTURE REDUCTIONS.
(a) In General.--The Administrator shall establish a program under
which a covered entity may--
(1) receive a credit in the current calendar year for
anticipated reductions in emissions in a future calendar year;
and
(2) use the credit in lieu of a tradeable allowance to meet
the requirements of this title for the current calendar year,
subject to the limitation imposed by subsection (b).
(b) Determination of Tradeable Allowance Credits.--
(1) In general.--Except as provided in paragraph (2), the
Administrator may make credits available under subsection (a)
only for anticipated reductions in emissions that--
(A) are attributable to the realization of capital
investments in equipment, the construction,
reconstruction, or acquisition of facilities, or the
deployment of new technologies--
(i) for which the covered entity has
executed a binding contract and secured, or
applied for, all necessary permits and
operating or implementation authority;
(ii) that will not become operational
within the current calendar year; and
(iii) that will become operational and
begin to reduce emissions from the covered
entity within 5 years after the year in which
the credit is used; and
(B) will be realized within 5 years after the year
in which the credit is used.
(2) Board.--The Administrator shall make credits available
under subsection (a) as instructed by the Board under section
153(a)(1) or (2)(A).
(c) Carrying Cost.--If a covered entity uses a credit under this
section to meet the requirements of this title for a calendar year (in
this subsection referred to as the use year), the tradeable allowance
requirement for the year from which the credit was taken (in this
subsection referred to as the source year) shall be increased by an
amount equal to--
(1) 10 percent for each credit borrowed from the source
year; multiplied by
(2) the number of years after the use year that the source
year occurs.
(d) Maximum Borrowing Period.--A credit from a year beginning more
than 5 years after the current year may not be used to meet the
requirements of this title for the current year.
(e) Failure To Achieve Reductions Generating Credit.--If a covered
entity that uses a credit under this section fails to achieve the
anticipated reduction for which the credit was granted for the year
from which the credit was taken, then--
(1) the covered entity's requirements under this Act for
that year shall be increased by the amount of the credit, plus
the amount determined under subsection (c);
(2) any tradeable allowances submitted by the covered
entity for that year shall be counted first against the
increase in those requirements; and
(3) the covered entity may not use credits under this
section to meet the increased requirements.
SEC. 144. DOMESTIC OFFSETS.
(a) Alternative Means of Compliance.--A covered entity may satisfy
up to 15 percent of its total allowance submission requirement under
section 121 by any combination of the following:
(1) Submitting tradeable allowances from another nation's
market in greenhouse gas emissions if--
(A) the Administrator determines that the other
nation's system for trading in greenhouse gas emissions
is complete, accurate, and transparent and reviews that
determination at least once every 5 years;
(B) the other nation has adopted enforceable limits
on its greenhouse gas emissions which the tradeable
allowances were issued to implement; and
(C) the covered entity certifies that the tradeable
allowance has been retired unused in the other nation's
market.
(2) Submitting a registered net increase in sequestration,
as registered in the database, adjusted, if necessary, to
comply with the accounting standards and methods described in
subsection (c). An increase in sequestration submitted under
this paragraph need not have been registered by the covered
entity submitting it.
(3) Submitting a greenhouse gas emissions reduction (other
than a registered net increase in sequestration) that was
registered in the database by a person that is not a covered
entity.
(4) Submitting credits obtained by the submitting covered
entity from the Administrator under section 143 or section 145.
(b) Dedicated Program for Sequestration in Agricultural Soils.--If
a covered entity satisfies a full 15 percent of its total allowance
submission requirements pursuant to subsection (a), it shall satisfy up
to 1.5 percent of its total allowance submission requirement by
submitting registered net increases in sequestration in agricultural
soils, as registered in the database, adjusted, if necessary, to comply
with the accounting standards and methods described in subsection (c).
(c) Sequestration Accounting.--
(1) Sequestration accounting.--If a covered entity uses a
registered net increase in sequestration to satisfy the
requirements of section 121 for any year, that covered entity
shall submit information to the Administrator every 5 years
thereafter sufficient to allow the Administrator to determine,
using the methods and standards created under section 104,
whether that net increase in sequestration still exists. The
covered entity shall offset any loss of sequestration by
submitting additional tradeable allowances of equivalent amount
in the calender year following that determination.
(2) Regulations required.--The Administrator, in
coordination with the Secretary of Agriculture, the Secretary
of Energy, and the Secretary, shall issue regulations
establishing the sequestration accounting rules for all classes
of sequestration projects.
(3) Criteria for regulations.--In issuing regulations under
this subsection, the Administrator shall use the following
criteria:
(A) If the range of possible amounts of net
increase in sequestration for a particular class of
sequestration project is not more than 10 percent of
the median of that range, the amount of sequestration
credited shall be equal to the median value of that
range.
(B) If the range of possible amounts of net
increase in sequestration for a particular class of
sequestration project is more than 10 percent of the
median of that range, the amount of sequestration
awarded shall be equal to the fifth percentile of that
range.
(C) The regulations shall include procedures for
accounting for potential leakage from sequestration
projects and for ensuring that any registered increase
in sequestration is in addition that which would have
occurred if this Act had not been enacted.
(4) Updates.--The Administrator shall update the
sequestration accounting rules for every class of sequestration
project at least once every 5 years.
SEC. 145. INTERNATIONAL CREDITS PLAN.
(a) Establishment.--The Administrator shall establish a program the
purposes of which are--
(1) to assist developing countries in achieving sustainable
development and in contributing to the objective of reducing
the greenhouse gas emissions; and
(2) to assist covered entities in achieving compliance with
the requirements of section 121.
(b) Program Components.--
(1) In general.--The program shall provide for the earning
of tradable allowances by covered entities from project
activities in developing countries resulting in certified
emission reductions. The Administrator shall ensure tradability
of emission reductions earned under this program with
reductions earned under other similar international programs.
(2) Approval criteria and review process.--By no later than
2011, the Administrator shall--
(A) develop criteria for the approval of projects
submitted for review; and
(B) establish a review process for submitted
projects that includes a procedure for providing the
results of the review, together with an explanation of
the reasons for approving or denying approval of a
submitted project, to the entity that submitted the
project.
(3) Fees.--The Administrator may charge an application fee
for the review of project proposals to cover the administrative
costs of the program.
(4) Certification of results required.--The Administrator
shall require entities participating in this program to obtain
independent third-party verification that--
(A) participation by all parties involved in the
project is voluntary; and
(B) the project produces--
(i) real, measurable, and long-term
benefits related to the mitigation of climate
change; and
(ii) reductions in emissions that are
additional to any that would occur in the
absence of the certified project activity.
(c) Use of Allowances.--Subject to the limitation in section
144(a), tradable allowances earned under the program may be used to
meet the requirements of section 121.
(d) Study.--Within 3 years after the date of enactment of this Act,
the Administrator, in coordination with the Secretary, shall conduct a
study of the impacts of the compliance cost reduction measures of this
section and section 144 on achieving the purposes of this Act. The
Administrator shall submit the results of the study to the Congress
along with any recommendations the Administrator considers appropriate.
SEC. 146. OUTREACH INITIATIVE ON REVENUE ENHANCEMENT FOR AGRICULTURAL
PRODUCERS.
(a) Establishment.--The Secretary of Agriculture, acting through
the Chief of the Natural Resources Conservation Service, the Chief of
the Forest Service, the Administrator of the Cooperative State
Research, Education, and Extension Service, and land-grant colleges and
universities, in consultation with the Administrator and the heads of
other appropriate departments and agencies, shall establish an outreach
initiative to provide information to agricultural producers,
agricultural organizations, foresters, and other landowners about
opportunities under sections 144 and 145 to earn new revenue.
(b) Components.--The initiative under this section--
(1) shall be designed to ensure that, to the maximum extent
practicable, agricultural organizations and individual
agricultural producers, foresters, and other landowners receive
detailed practical information about--
(A) opportunities to earn new revenue under
sections 144 and 145;
(B) measurement protocols, monitoring, verifying,
inventorying, registering, insuring, and marketing
offsets under this title;
(C) emerging domestic and international markets for
energy crops, allowances, and offsets; and
(D) local, regional, and national databases and
aggregation networks to facilitate achievement,
measurement, registration, and sales of offsets;
(2) shall provide--
(A) outreach materials, including the handbook
published under subsection (c), to interested parties;
(B) workshops; and
(C) technical assistance; and
(3) may include the creation and development of regional
marketing centers or coordination with existing centers
(including centers within the Natural Resources Conservation
Service or the Cooperative State Research, Education, and
Extension Service or at land-grant colleges and universities).
(c) Handbook.--
(1) In general.--Not later than 2 years after the date of
enactment of this Act, the Secretary of Agriculture, in
consultation with the Administrator and after an opportunity
for public input, shall publish a handbook for use by
agricultural producers, agricultural cooperatives, foresters,
other landowners, offset buyers, and other stakeholders that
provides easy-to-use guidance on achieving, reporting,
registering, and marketing offsets.
(2) Distribution.--The Secretary of Agriculture shall
ensure, to the maximum extent practicable, that the handbook is
distributed widely through land-grant colleges and universities
and other appropriate institutions.
PART 2--CARBON MARKET EFFICIENCY BOARD
SEC. 151. ESTABLISHMENT OF BOARD.
(a) Establishment.--There is established a board, to be known as
the ``Carbon Market Efficiency Board''.
(b) Purposes.--The purposes of the Board are--
(1) to promote the achievement of the environmental
objectives of the United States, including national mandatory
greenhouse gas emissions cap and reduction targets in this or
any other Act;
(2) to observe the national greenhouse gas tradeable
allowance market and evaluate periods during which the cost of
tradeable allowances provided under this Act or any other
Federal law might pose significant harm to the economy;
(3) to provide temporary, short-term relief at any time at
which a market program for tradeable allowances under this Act
or other Federal law is determined to pose a significant harm
to the economy, by using the cost relief measures prescribed
under section 153; and
(4) to submit to the President and Congress quarterly
reports under section 152(c).
(c) Membership.--
(1) Composition.--The Board shall be composed of 7 members,
who are citizens of the United States, to be appointed by the
President, by and with the advice and consent of the Senate.
(2) Requirements.--In appointing members of the Board under
paragraph (1), the President shall--
(A) ensure fair representation of the financial,
agricultural, industrial, and commercial sectors, and
the geographical regions, of the United States and
include a representative of consumer interests; and
(B) appoint not more than 1 member from each such
geographical region.
(3) Compensation.--
(A) In general.--A member of the Board shall be
compensated at a rate equal to the daily equivalent of
the annual rate of basic pay prescribed for level II of
the Executive Schedule under section 5313 of title 5,
United States Code, for each day (including travel
time) during which the member is engaged in the
performance of the duties of the Board.
(B) Chairperson.--The Chairperson of the Board
shall be compensated at a rate equal to the daily
equivalent of the annual rate of basic pay prescribed
for level I of the Executive Schedule under section
5312 of title 5, United States Code, for each day
(including travel time) during which the member is
engaged in the performance of the duties of the Board.
(4) Prohibitions.--
(A) Conflicts of interest.--An individual employed
by, or holding any official relationship (including any
shareholder) with, any entity engaged in the
generation, transmission, distribution, or sale of
energy, or an individual who has any pecuniary interest
in the generation, transmission, distribution, or sale
of energy, shall not be appointed to the Board under
this subsection.
(B) No other employment.--A member of the Board
shall not hold any other employment during the term of
service of the member.
(d) Term; Vacancies.--
(1) Term.--
(A) In general.--The term of a member of the Board
shall be 14 years, except that the members first
appointed to the Board shall be appointed for terms in
a manner that ensures that--
(i) the term of not more than 1 member
shall expire during any 2-year period; and
(ii) no member serves a term of more than
14 years.
(B) Oath of office.--A member shall take the oath
of office of the Board by not later than 15 days after
the date on which the member is appointed under
subsection (c)(1).
(C) Removal.--
(i) In general.--A member may be removed
from the Board on determination of the
President for cause.
(ii) Notification.--The President shall
submit to Congress a notification of any
determination by the President to remove a
member of the Board for cause under clause (i).
(2) Vacancies.--
(A) In general.--A vacancy on the Board--
(i) shall not affect the powers of the
Board; and
(ii) shall be filled in the same manner as
the original appointment was made.
(B) Service until new appointment.--A member of the
Board the term of whom has expired or otherwise been
terminated shall continue to serve until the date on
which a replacement is appointed under subparagraph
(A)(ii), as the President determines to be appropriate.
(e) Chairperson and Vice-Chairperson.--Of members of the Board, the
President shall appoint--
(1) 1 member to serve as Chairperson of the Board for a
term of 4 years; and
(2) 1 member to serve as Vice-Chairperson of the Board for
a term of 4 years.
(f) Meetings.--
(1) Initial meeting.--The Board shall hold the initial
meeting of the Board as soon as practicable after the date on
which all members have been appointed to the Board under
subsection (c)(1).
(2) Presiding officer.--A meeting of the Board shall be
presided over by--
(A) the Chairperson;
(B) in any case in which the Chairperson is absent,
the Vice-Chairperson; or
(C) in any case in which the Chairperson and Vice-
Chairperson are absent, a chairperson pro tempore, to
be elected by the members of the Board.
(3) Quorum.--Four members of the Board shall constitute a
quorum for a meeting of the Board.
(4) Open meetings.--The Board shall be subject to section
552b of title 5, United States Code (commonly known as the
``Government in the Sunshine Act'').
SEC. 152. DUTIES.
(a) Information Gathering.--
(1) Authority.--The Board shall collect and analyze
relevant market information to promote a full understanding of
the dynamics of the greenhouse gas emission tradeable allowance
market.
(2) Information.--The Board shall gather such information
as the Board determines to be appropriate regarding the status
of the market described in paragraph (1), including information
relating to--
(A) tradeable allowance allocation and
availability;
(B) the price of tradeable allowances;
(C) macroeconomic and microeconomic effects of
unexpected significant increases in emission allowance
prices, or shifts in the emission allowance market,
should those increases or shifts occur;
(D) economic effect thresholds that could warrant
implementation of cost relief measures described in
section 153(a) after the initial 2-year period
described in section 153(a)(1);
(E) in the event any cost relief measures described
in section 153(a) are taken, the effects of those
measures on the market;
(F) maximum levels of cost relief measures that are
necessary to achieve avoidance of economic harm and
preserve achievement of the purposes of this Act; and
(G) the success of the market in promoting
achievement of the purposes of this Act and any other
laws of the United States.
(b) Study.--Not later than January 1, 2014, the Board shall submit
to Congress a report describing the status of the initial market for
tradeable allowances to emit greenhouse gases in the United States,
specifically with respect to volatility within the market and the
average price of tradeable allowances during the 90-day period
immediately preceding such report.
(c) Reports.--The Board shall submit to the President and Congress
quarterly reports--
(1) describing--
(A) the status of markets for tradeable allowances
provided under this Act or other Federal law;
(B) the economic effects of the markets;
(C) regional, industrial, consumer, and energy
investment responses to the markets;
(D) any corrective measures that should be carried
out to relieve excessive costs of the markets; and
(E) plans to compensate for those measures;
(2) describing any cost relief measures carried out under
section 153;
(3) that are timely and succinct to ensure regular
monitoring of market trends; and
(4) that are prepared independently by the Board, and not
in partnership with Federal agencies.
SEC. 153. POWERS.
(a) Cost Relief Measures.--
(1) Initial period.--During 2012 and 2013, if the Board
determines that the average daily closing price of tradeable
allowances during any 90-day period exceeds the upper range of
the estimate provided under section 154, the Board shall
instruct the Administrator to increase the quantity of credits
under section 143 that covered entities may receive.
(2) Permanent authority.--Beginning on January 1, 2014, if
the Board determines that the tradeable allowance market poses
a significant harm to the economy of the United States, the
Board may carry out 1 or more of the following cost relief
measures to ensure a functioning, stable, and efficient market
for tradeable allowances to emit greenhouse gases:
(A) Instruct the Administrator to increase the
quantity of credits under section 143 that covered
entities may receive.
(B) Expand the period during which a covered entity
may repay the allocating agency for a tradeable
allowance provided under subparagraph (A).
(C) Lower the percentage of carrying costs required
under section 143(c)(1) with respect to tradeable
allowances provided under subparagraph (A), to a level
not less than the percentage of the Moody's seasoned
Aaa corporate bond rate most recently published in the
Federal Reserve Statistical Release on selected
interest rates, commonly referred to as the H.15
release.
(3) Subsequent actions.--On determination by the Board to
carry out a cost relief measure pursuant to paragraph (1) or
(2), the Board shall--
(A) allow the cost relief measure to be used only
during the applicable allocation year;
(B) exercise the cost relief measure incrementally,
and only as needed to avoid significant economic harm
during the applicable allocation year; and
(C) evaluate, at the end of the applicable
allocation year, actions that need to be carried out
during subsequent years to compensate for any cost
relief measure carried out during the applicable
allocation year.
(4) Increase in quantity of allowances.--
(A) In general.--If the Board carries out a cost
relief measure pursuant to paragraph (1) or (2) that
results in the expansion of borrowing of tradeable
allowances under Federal law, and if the Board
determines that the average daily closing price of
tradeable allowances for the 90-day period beginning on
the date on which borrowing is so expanded exceeds the
upper limit of the range of the estimate provided under
section 154, the Board shall instruct the Administrator
to--
(i) increase the total quantity of
tradeable allowances provided to all covered
entities in accordance with this paragraph; and
(ii) reduce the quantity of tradeable
allowances to be provided for a subsequent year
or years by the same amount.
(B) Requirements.--An increase in the quantity of
tradeable allowances under subparagraph (A) shall--
(i) apply to all covered entities;
(ii) be allocated in accordance with the
applicable formulas and procedures established
under this Act;
(iii) be equal to not more than 5 percent
of the total quantity of tradeable allowances
otherwise available for the applicable
allocation year under this Act;
(iv) be provided only during the 6-month
period immediately following a determination of
the Board under subparagraph (A); and
(v) specify the subsequent year or years in
which the quantity of tradeable allowances will
be reduced in accordance with subparagraph (A),
which shall be not more than 15 years after the
year in which the increase in the quantity of
tradeable allowances is provided.
(b) Limitations.--Nothing in this section gives the Board the
authority--
(1) to consider or prescribe entity-level petitions for
relief from the costs of a tradeable allowance allocation or
trading program established under this Act or other Federal
law;
(2) to carry out any investigative or punitive process
under the jurisdiction of any Federal or State court;
(3) to interfere with, modify, or adjust any tradeable
allowance allocation scheme established under this Act or other
Federal law; or
(4) to modify the goals of any limit on greenhouse gas
emissions.
SEC. 154. ESTIMATE OF COSTS TO ECONOMY OF LIMITING GREENHOUSE GAS
EMISSIONS.
(a) Initial Report.--The Administrator shall enter into an
arrangement with the National Academy of Sciences for a report, to be
submitted to Congress not later than December 31, 2011. Such report
shall, using economic and scientific analyses, describe the projected
price range at which tradeable allowances are expected to trade during
the period with respect to which this Act applies.
(b) Reassessments.--The Board may instruct the Administrator to
arrange for a reassessment and new report under subsection (a) as
necessary.
Subtitle D--Allocation of Tradeable Allowances
SEC. 161. DETERMINATION OF TRADEABLE ALLOWANCE ALLOCATIONS.
(a) In General.--The Administrator shall annually determine--
(1) the amount of tradeable allowances to be allocated to
each covered sector; and
(2) the amount of tradeable allowances to be allocated to
the Climate Change Credit Corporation established under section
201.
(b) Allocation Factors.--In making the determination required by
subsection (a), the Administrator shall consider--
(1) the distributive effect of the allocations on household
income and net worth of individuals;
(2) the impact of the allocations on corporate income,
taxes, and asset value;
(3) the impact of the allocations on income levels of
consumers and on their energy consumption;
(4) the effects of the allocations in terms of economic
efficiency;
(5) the ability of covered entities to pass through
compliance costs to their customers;
(6) the degree to which the amount of allocations to the
covered sectors should decrease over time;
(7) the need to maintain the international competitiveness
of United States manufacturing and avoid the additional loss of
United States manufacturing jobs; and
(8) the necessary funding levels for the initiatives and
programs described in section 202.
(c) Allocation Recommendations and Implementation.--Not later than
24 months after the date of enactment of this Act, and annually
thereafter, the Administrator shall submit the determinations under
subsection (a) to the Committee on Commerce, Science, and
Transportation and the Committee on Environment and Public Works of the
Senate, and to the Committee on Science and Technology and the
Committee on Energy and Commerce of the House of Representatives. The
Administrator's determinations under subsection (a)(1), and the
allocations and provision of tradeable allowances pursuant to that
determination, are deemed to be a major rule (as defined in section
804(2) of title 5, United States Code), and subject to the provisions
of chapter 8 of that title.
SEC. 162. PROVISION OF TRADEABLE ALLOWANCES.
(a) In General.--The Administrator shall, by regulation, establish
a process for providing tradeable allowances without cost to covered
entities described in subparagraphs (A) and (B)(i) and (ii) of section
3(5) that will--
(1) encourage investments that increase the efficiency of
the processes that produce greenhouse gas emissions;
(2) minimize the costs to the Government of providing the
tradeable allowances;
(3) give credit to covered entities for emissions
reductions made before 2012 and registered with the database;
and
(4) provide sufficient tradeable allowances for new
entrants into the sector.
(b) Allocation to Covered Entities in States Adopting Mandatory
Greenhouse Gas Emissions Reduction Programs.--For a covered entity
operating in any State that has adopted a legally binding and
enforceable program to achieve and maintain greenhouse gas emission
reductions that are consistent with, or more stringent than, reductions
mandated by this Act, and which requirements are effective prior to
2012, the Administrator shall consider such binding State actions in
making the final determination of allocation to such covered entities.
SEC. 163. ENSURING TARGET ADEQUACY.
(a) In General.--Beginning 2 years after the date of enactment of
this Act, the Under Secretary of Commerce for Oceans and Atmosphere
shall review the amount of allowances established under section 124 no
less frequently than biennially--
(1) to re-evaluate the levels established by that section,
after taking into account the best available science and the
most currently available data; and
(2) to re-evaluate the environmental and public health
impacts of specific concentration levels of greenhouse gases,
to determine whether the amount of those allowances continues to be
consistent with the objective of the United Nations' Framework
Convention on Climate Change of stabilizing levels of greenhouse gas
emissions at a level that will prevent dangerous anthropogenic
interference with the climate system.
(b) Review of 2012 Levels.--The Under Secretary of Commerce for
Oceans and Atmosphere shall specifically review in 2010 the level
established under section 124(a)(1), and transmit a report on his
reviews, together with any recommendations, including legislative
recommendations, for modification of the levels, to the Committee on
Commerce, Science, and Transportation and the Committee on Environment
and Public Works of the Senate, and to the Committee on Science and
Technology and the Committee on Energy and Commerce of the House of
Representatives.
SEC. 164. INITIAL ALLOCATIONS FOR EARLY PARTICIPATION AND ACCELERATED
PARTICIPATION.
Before providing any tradeable allowances under section 162, the
Administrator shall allocate--
(1) to any covered entity an amount of tradeable allowances
equivalent to the amount of greenhouse gas emission reductions
registered by that covered entity in the database if--
(A) the covered entity has requested to use the
registered reduction in the year of allocation;
(B) the reduction was registered prior to 2012; and
(C) the Administrator retires the unique serial
number assigned to the reduction under section
101(c)(3); and
(2) to any covered entity that has entered into an
accelerated participation agreement under section 165, such
tradeable allowances as the Administrator has determined to be
appropriate under that section.
SEC. 165. BONUS FOR ACCELERATED PARTICIPATION.
(a) In General.--If a covered entity executes an agreement with the
Administrator under which it agrees to reduce its level of greenhouse
gas emissions to a level no greater than the level of its greenhouse
gas emissions for calendar year 1990 by the year 2012, then, for the 6-
year period beginning with calendar year 2012, the Administrator
shall--
(1) provide additional tradeable allowances to that entity
when allocating allowances under section 164 in order to
recognize the additional emission reductions that will be
required of the covered entity;
(2) allow that entity to satisfy 20 percent (in addition to
the amount authorized under section 144(a)) of its requirements
under section 121 by any combination of--
(A) submitting tradeable allowances from another
nation's market in greenhouse gas emissions under the
conditions described in section 144(a)(1);
(B) submitting a registered net increase in
sequestration, as registered in the database, adjusted,
if necessary, to comply with the accounting standards
and methods described in section 144(c); and
(C) submitting a greenhouse gas emission reduction
(other than a registered net increase in sequestration)
that was registered in the database by a person that is
not a covered entity.
(b) Termination.--An entity that executes an agreement described in
subsection (a) may terminate the agreement at any time.
(c) Failure To Meet Commitment.--If an entity that executes an
agreement described in subsection (a) fails to achieve the level of
emissions to which it committed by calendar year 2012, including
through termination under subsection (b)--
(1) its requirements under section 121 shall be increased
by the amount of any tradeable allowances provided to it under
subsection (a)(1) of this section; and
(2) any tradeable allowances submitted thereafter shall be
counted first against the increase in those requirements.
TITLE II--CLIMATE CHANGE CREDIT CORPORATION
SEC. 201. ESTABLISHMENT.
(a) In General.--The Climate Change Credit Corporation (in this
title referred to as the ``Corporation'') is established as a nonprofit
corporation without stock. The Corporation shall not be considered to
be an agency or establishment of the United States Government.
(b) Applicable Laws.--The Corporation shall be subject to the
provisions of this Act and, to the extent consistent with this Act, to
the District of Columbia Business Corporation Act.
(c) Board of Directors.--The Corporation shall have a board of
directors of 5 individuals who are citizens of the United States, of
whom 1 shall be elected annually by the board to serve as chairman. No
more than 3 members of the board serving at any time may be affiliated
with the same political party. The members of the board shall be
appointed by the President of the United States, by and with the advice
and consent of the Senate, and shall serve for terms of 5 years.
SEC. 202. PURPOSES AND FUNCTIONS.
(a) Trading.--The Corporation--
(1) shall receive and manage tradeable allowances allocated
to it under section 161(a)(2);
(2) shall buy and sell tradeable allowances, whether
allocated to it under that section or obtained by purchase,
trade, or donation from other entities; and
(3) may not retire tradeable allowances unused.
(b) Use of Tradeable Allowances and Proceeds.--
(1) In general.--The Corporation shall use the tradeable
allowances, and proceeds derived from its trading activities in
tradeable allowances, to reduce costs borne by consumers as a
result of the greenhouse gas reduction requirements of this
Act. The reductions--
(A) may be obtained by buy-down, subsidy (including
through the Low-Income Home Energy Assistance Act of
1981, part A of title IV of the Energy Conservation and
Production Act, or the provision of financial
assistance to promote the availability of reasonably-
priced electricity in off-grid rural regions in which
electricity prices exceed 150 percent of the national
average), negotiation of discounts, consumer rebates,
or otherwise;
(B) shall be, as nearly as possible, equitably
distributed across all regions of the United States;
and
(C) may include arrangements for preferential
treatment to consumers who can least afford any such
increased costs.
(2) Transition assistance to dislocated workers and
communities.--The Corporation shall allocate a percentage of
the proceeds derived from its trading activities in tradeable
allowances to provide transition assistance to dislocated
workers and communities. Transition assistance may take the
form of--
(A) grants to employers, employer associations, and
representatives of employees--
(i) to provide training, adjustment
assistance, and employment services to
dislocated workers; and
(ii) to make income-maintenance and needs-
related payments to dislocated workers; and
(B) grants to State and local governments to assist
communities in attracting new employers or providing
essential local government services.
(3) Phase-out of transition assistance.--The percentage
allocated by the Corporation under paragraph (2)--
(A) shall be 20 percent for 2012; and
(B) shall be reduced by 2 percentage points each of
the next 10 years thereafter.
(4) Technology deployment programs.--The Corporation shall
establish and carry out a program, through direct grants,
revolving loan programs, or other financial measures, to
provide support for the deployment of technology to assist in
compliance with this Act by distributing the proceeds from no
less than 10 percent of the total allowances allocated to it
for each year. The support shall include the following:
(A) Coal gasification combined-cycle and geological
carbon storage program.--The Corporation shall
establish and carry out a program, through direct
grants, to provide incentives for the repowering of
existing facilities or construction of new facilities
producing electricity or other products from coal
gasification combined-cycle plants that capture and
geologically store at least 90 percent of the carbon
dioxide produced at the facility in accordance with
requirements established by the Administrator to ensure
the permanence of the storage and that such storage
will not cause or contribute to significant adverse
effects on public health or the environment. The
Corporation shall ensure that no less than 20 percent
of the funding under this program is distributed to
rural electric cooperatives.
(B) Agricultural programs.--The Corporation shall
establish and carry out a program, through direct
grants, revolving loan programs, or other financial
measures, to provide incentives for greenhouse gas
emissions reductions or net increases in sequestration
on agricultural lands. The program shall include
incentives for--
(i) production of wind energy on
agricultural lands;
(ii) agricultural management practices that
achieve verified, incremental increases in net
carbon sequestration, in accordance with the
requirements established by the Administrator
under section 144(c); and
(iii) production of renewable fuels that,
after consideration of the energy needed to
produce such fuels, result in a net reduction
in greenhouse gas emissions.
(5) Adaptation assistance for fish and wildlife habitat.--
The Corporation shall fund efforts to strengthen and restore
habitat that improve the ability of fish and wildlife to adapt
successfully to climate change. The Corporation shall deposit
the proceeds from no less than 10 percent of the total
allowances allocated to it in the wildlife restoration fund
subaccount known as the Wildlife Conservation and Restoration
Account established under section 3 of the Pittman-Robertson
Wildlife Restoration Act (16 U.S.C. 669b). Amounts deposited in
the subaccount under this paragraph shall be available without
further appropriation for obligation and expenditure under that
Act.
(6) Large-scale aquatic ecosystems.--The Corporation shall
use 25 percent of the total allowances allocated to it for each
fiscal year for projects to restore--
(A) large-scale freshwater aquatic ecosystems, such
as the Great Lakes and the Everglades; and
(B) large-scale estuarine ecosystems, such as
Chesapeake Bay, California Bay Delta, Coastal
Louisiana, Long Island Sound, and Puget Sound.
(7) Operations of board.--The Corporation shall provide
funding for the operations of the Board.
TITLE III--MISCELLANEOUS
SEC. 301. NOAA REPORT ON CLIMATE CHANGE EFFECTS; PREPARATION
ASSISTANCE.
The Coastal Zone Management Act of 1972 (16 U.S.C. 1451 et seq.) is
amended by adding at the end the following:
``report on effects of climate change
``Sec. 320. (a) In General.--The Secretary shall report to the
Congress not later than 2 years after the date of enactment of this
section, and every 5 years thereafter, on the possible and projected
impacts of climate change on--
``(1) oceanic and coastal ecosystems, including marine fish
and wildlife and their habitat, and the commercial and
recreational fisheries and tourism industries associated with
them; and
``(2) coastal communities, including private residential
and commercial development and public infrastructure in the
coastal zone.
``(b) Contents.--Each report under this section shall include
information regarding--
``(1) the impacts that may be due to climate change that
have occurred as of the date of the submission of the report;
and
``(2) the projected future impacts of climate change.
``(c) Impacts.--The impacts reported on under subsection (b) shall
include any--
``(1) increases in sea level;
``(2) increases in storm activity and intensity;
``(3) increases in floods, droughts, and other extremes of
weather;
``(4) increases in the temperature of the air and the water
on oceanic and coastal ecosystems, with a particular focus on
vulnerable fisheries and ecosystems; and
``(5) changes in the acidity of the ocean surface
associated with an increase in concentration of carbon dioxide
in the atmosphere.
``climate change preparation assistance
``Sec. 321. (a) In General.--The Secretary shall provide technical
assistance to each coastal State that has an approved coastal zone
management plan under this title, to assist such States in preparing
persons living within their coastal zones to adapt to climate change.
``(b) Identification of Affected Areas and Adaptations.--In
carrying out this section, the Secretary shall--
``(1) identify the projected impacts of climate change to
which persons located in coastal zones may need to adapt,
including--
``(A) increases in sea level;
``(B) increases in storm activity and intensity;
and
``(C) increases in floods, droughts, and other
extremes of weather;
``(2) identify the specific coastal areas of the United
States, and the public and private development in coastal
communities and the natural resources of the coastal zone, that
are vulnerable to the impacts identified under paragraph (1);
``(3) identify the various adaptation measures that may be
used to protect the areas and resources identified under
paragraph (2) from the impacts identified under paragraph (1);
and
``(4) estimate the costs of the adaptation measures
identified under paragraph (3).''.
SEC. 302. ADAPTATION TECHNOLOGIES.
(a) In General.--The Director of the Office of Science and
Technology Policy shall establish a program on adaptation technologies
as part of the Climate Technology Challenge Program. The Director shall
perform an assessment of the climate change technological needs of
various regions of the country. This assessment shall be provided to
the Committee on Commerce, Science, and Transportation of the Senate
and the Committee on Science and Technology of the House of
Representatives within 6 months after the date of enactment of this
Act.
(b) Regional Estimates.--The Director of the Office of Science and
Technology Policy, in consultation with the Secretaries of
Transportation, Homeland Security, Agriculture, Housing and Urban
Development, Health and Human Services, Defense, Interior, Energy, and
Commerce, the Administrator of the Environmental Protection Agency, the
Director of United States Geological Survey, and other such Federal
offices as the Director considers necessary, along with relevant State
agencies, shall perform 6 regional infrastructure cost assessments
covering the United States, and a national cost assessment, to provide
estimates of the range of costs that should be anticipated for
adaptation to the impacts of climate change. The Director shall develop
those estimates for low, medium, and high probabilities of climate
change and its potential impacts. The assessments shall be provided to
the Committee on Commerce, Science, and Transportation of the Senate
and the Committee on Science and Technology of the House of
Representatives within 1 year after the date of enactment of this Act.
(c) Adaptation Plan.--
(1) In general.--Within 6 months after the date of
enactment of this Act, the Secretary of Commerce shall submit a
climate change adaptation plan for the United States to the
Congress. The adaptation plan shall be based upon assessments
performed by the United Nations Intergovernmental Panel on
Climate Change, those as required by the 1990 Global Change
Research Act, and any other scientific peer-reviewed regional
assessments.
(2) Required components.--The adaptation plan shall
include--
(A) a prioritized list of vulnerable systems and
regions;
(B) coordination requirements between Federal,
State, and local governments to ensure that key public
infrastructure, safety, health, and land use planning
and control issues are addressed;
(C) coordination requirements among the Federal
Government, industry, and communities;
(D) an assessment of climate change science
research needs including probabilistic assessments as
an aid to planning;
(E) an assessment of climate change technology
needs; and
(F) regional and national costs assessments for the
range of costs that should be anticipated for adapting
to the impacts of climate change.
SEC. 303. MITIGATING CLIMATE CHANGE'S IMPACTS ON THE POOR.
(a) In General.--The Secretary shall conduct research on the impact
of climate change on low-income populations everywhere in the world.
The research shall--
(1) include an assessment of the adverse impact of climate
change on low-income populations in the United States and on
developing countries;
(2) identify appropriate climate change adaptation measures
and programs for developing countries and low-income
populations and assess the impact of those measures and
programs on low-income populations;
(3) identify appropriate climate change mitigation
strategies and programs for developing countries and low-income
populations and assess the impact of those strategies and
programs on developing countries and on low-income populations
in the United States; and
(4) include an estimate of the costs of developing and
implementing those climate change adaptation and mitigation
programs.
(b) Report.--Within 1 year after the date of enactment of this Act,
the Secretary shall transmit a report on the research conducted under
subsection (a) to the Committee on Commerce, Science, and
Transportation and the Committee on Environment and Public Works of the
Senate, and to the Committee on Science and Technology and the
Committee on Energy and Commerce of the House of Representatives.
(c) Authorization of Appropriations.--There are authorized to be
appropriated to the Secretary $2,000,000 to carry out the research
required by subsection (a).
SEC. 304. WILDLIFE CONSERVATION.
(a) Funding for Climate Change Impact Mitigation Planning.--Section
3(c) of the Pittman-Robertson Wildlife Restoration Act (16 U.S.C.
669b(c)) is amended by adding at the end the following:
``(4) Climate change impact mitigation plans.--Amounts
deposited in the Wildlife Conservation and Restoration Account
under section 202(b)(5) of the Climate Stewardship and Economic
Security Act of 2007--
``(A) may be used by States to provide relevant
information, training, monitoring, and other assistance
to develop climate change impact mitigation plans and
integrate them into State Comprehensive Wildlife
Conservation Strategies; and
``(B) shall be used by States to implement climate
change impact mitigation plans integrated into
Comprehensive Wildlife Conservation Strategies.''.
(b) Conforming Amendment.--Section 3(a)(2) of the Pittman-Robertson
Wildlife Restoration Act (16 U.S.C. 669b(a)(2)) is amended in the
second sentence by inserting ``(in addition to amounts deposited under
section 202(b)(5) of the Climate Stewardship and Economic Security Act
of 2007)'' after ``Wildlife Conservation and Restoration Account''.
<all>
Introduced in House
Introduced in House
Referred to the Committee on Energy and Commerce, and in addition to the Committees on Science and Technology, Natural Resources, Foreign Affairs, Agriculture, and Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Referred to the Committee on Energy and Commerce, and in addition to the Committees on Science and Technology, Natural Resources, Foreign Affairs, Agriculture, and Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Referred to the Committee on Energy and Commerce, and in addition to the Committees on Science and Technology, Natural Resources, Foreign Affairs, Agriculture, and Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Referred to the Committee on Energy and Commerce, and in addition to the Committees on Science and Technology, Natural Resources, Foreign Affairs, Agriculture, and Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Referred to the Committee on Energy and Commerce, and in addition to the Committees on Science and Technology, Natural Resources, Foreign Affairs, Agriculture, and Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
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Referred to the Committee on Energy and Commerce, and in addition to the Committees on Science and Technology, Natural Resources, Foreign Affairs, Agriculture, and Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Referred to the Committee on Energy and Commerce, and in addition to the Committees on Science and Technology, Natural Resources, Foreign Affairs, Agriculture, and Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Referred to the Subcommittee on Energy and Air Quality.
Referred to the Subcommittee on Energy and Mineral Resources.
Referred to the Subcommittee on Fisheries, Wildlife, and Oceans.
Referred to the Subcommittee on Energy and Environment.
Referred to the Subcommittee on Conservation, Credit, Energy, and Research.
Referred to the Subcommittee on Department Operations, Oversight, Nutrition and Forestry.