    [Senate Hearing 110-1026]
    [From the U.S. Government Publishing Office]

                                                           S. Hrg. 110-1026

            STATE, REGIONAL AND LOCAL PERSPECTIVES ON GLOBAL WARMING

    =======================================================================

                                    HEARING

                                   before the

                   COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS
                              UNITED STATES SENATE

                           ONE HUNDRED TENTH CONGRESS

                                 FIRST SESSION

                                   __________

                                 MARCH 1, 2007

                                   __________

      Printed for the use of the Committee on Environment and Public Works

          Available via the World Wide Web: http://www.access.gpo.gov/
                                congress.senate

                                   __________

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                   COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS

                           ONE HUNDRED TENTH CONGRESS
                                 FIRST SESSION

                      BARBARA BOXER, California, Chairman
    MAX BAUCUS, Montana                  JAMES M. INHOFE, Oklahoma
    JOSEPH I. LIEBERMAN, Connecticut     JOHN W. WARNER, Virginia
    THOMAS R. CARPER, Delaware           GEORGE V. VOINOVICH, Ohio
    HILLARY RODHAM CLINTON, New York     JOHNNY ISAKSON, Georgia
    FRANK R. LAUTENBERG, New Jersey      DAVID VITTER, Louisiana
    BENJAMIN L. CARDIN, Maryland         LARRY E. CRAIG, Idaho
    BERNARD SANDERS, Vermont             LAMAR ALEXANDER, Tennessee
    AMY KLOBUCHAR, Minnesota             CRAIG THOMAS, Wyoming
    SHELDON WHITEHOUSE, Rhode Island     CHRISTOPHER S. BOND, Missouri

           Bettina Poirier, Majority Staff Director and Chief Counsel
                    Andrew Wheeler, Minority Staff Director

                                C O N T E N T S

                                  ----------
                                                                       Page

                                 MARCH 1, 2007
                               OPENING STATEMENTS

    Boxer, Hon. Barbara, U.S. Senator from the State of California...     1
    Inhofe, Hon. James M., U.S. Senator from the State of Oklahoma...     5
    Lautenberg, Hon. Frank R., U.S. Senator from the State of New
      Jersey.........................................................    42
    Voinovich, Hon. George V., U.S. Senator from the State of Ohio...    44
    Klobuchar, Hon. Amy, U.S. Senator from the State of Minnesota....    46
    Thomas, Hon. Craig, U.S. Senator from the State of Wyoming.......    48
    Sanders, Hon. Bernard, U.S. Senator from the State of Vermont....    49
    Bond, Hon. Christopher S., U.S. Senator from the State of
      Missouri.......................................................    50
    Clinton, Hon. Hillary Rodham, U.S. Senator from the State of New
      York...........................................................    52
    Craig, Hon. Larry E., U.S. Senator from the State of Idaho.......    53
    Cardin, Hon. Benjamin L., U.S. Senator from the State of
      Maryland, prepared statement...................................   138
    Lieberman, Hon. Joseph I., U.S. Senator from the State of
      Connecticut, prepared statement................................   147

                                   WITNESSES

    Corzine, Hon. Jon S., Governor, State of New Jersey..............    54
        Prepared statement...........................................    56
        Responses to additional questions from:
            Senator Thomas...........................................    59
            Senator Inhofe...........................................    60
    Perata, Hon. Don, President Pro Tem, California State Senate.....    80
        Prepared statement...........................................    81
    Nunez, Hon. Fabian, speaker, California State Assembly...........    82
        Prepared statement...........................................    84
        Response to additional questions from Senator Inhofe.........   104
    Adkins, Dennis, chairman, House Committee on Energy and
      Technology, Oklahoma State House...............................   104
        Prepared statement...........................................   106
    Harvey, Hon. Ted, Senator, Colorado State Senate.................   108
        Prepared statement...........................................   109
    Nickels, Hon. Greg, Mayor, City of Seattle, WA...................   110
        Prepared statement...........................................   112
        Responses to additional questions from:
            Senator Cardin...........................................   124
            Senator Inhofe...........................................   124
    Cownie, Hon. Frank, Mayor, City of Des Moines, IA................   125
        Prepared statement...........................................   126
    Homrighausen, Hon. Richard P., Mayor, City of Dover, OH..........   128
        Prepared statement...........................................   130
        Responses to additional questions from Senator Inhofe........   133

                              ADDITIONAL MATERIAL

    Reports:
        EPA, Inventory of U.S. Greenhouse Gas Emissions and Sinks:
          1990-2004, April 15, 2006..................................    68
        United Nations Foundation, The Scientific Research Society,
          Confronting Climate Change: Avoiding the Unmanageable and
          Managing the Unavoidable, February 2007.................... 30-41
    Letters from:
        Schwarzenegger, Arnold.......................................     3
        California Economists........................................    85
        Bruton, John, Ambassador, European Union, Delegation of the
          European Commission........................................    11
    Lists:
        Bipartisan Elected Officials.................................     9
        Climate Momentum Shifting: Prominent Scientists Reverse
          Belief in Man-made Global Warming-Now Skeptic.............. 20-28
    Article, Bay Journal, December 2004..............................   140

            STATE, REGIONAL AND LOCAL PERSPECTIVES ON GLOBAL WARMING

                                  ----------

                            THURSDAY, MARCH 1, 2007

                                           U.S. Senate,
                     Committee on Environment and Public Works,
                                                        Washington, DC.
        The committee met, pursuant to notice, at 10 a.m. in room
    406, Dirksen Senate Office Building, Hon. Barbara A. Boxer
    (chairman of the committee) presiding.
        Present: Senators Boxer, Inhofe, Voinovich, Lautenberg,
    Clinton, Cardin, Sanders, Klobuchar, Whitehouse, Craig, Thomas
    and Bond.

    STATEMENT OF HON. BARBARA BOXER, U.S. SENATOR FROM THE STATE OF
                               CALIFORNIA

        Senator Boxer. Good morning. The committee will come to
    order.
        Today's hearing is about State, regional and local
    approaches to global warming. We have wonderful witnesses today
    who can really, I think, help us as we grapple with these
    issues. I do want to welcome all of our witnesses, including
    the good Governor, former Senator Jon Corzine, a former member
    of this committee.
        I also particularly want to welcome the two members of the
    California State legislature. I never know in which order to
    introduce you, because to me you are partners and you are
    equals. I am very proud that Don Perata is here, President pro
    tem of the California State Senate and Speaker of the Assembly,
    Mr. Fabian Nunez.
        I also want to welcome Mayor Nickels, from Seattle, and the
    Mayor of Des Moines, IA, Frank Cownie. In addition, I want to
    welcome State Representative Dennis Adkins of Oklahoma.
    Welcome, sir. State Senator Ted Harvey of Colorado, welcome,
    sir. And Mayor Richard Homrighausen of Dover, OH. Are you here?
    He is on the way.
        Let me say that we will have a more formal introduction of
    Governor Corzine by Senator Lautenberg and hopefully by Senator
    Menendez if he arrives on time.
        Every day we learn more about how global warming is
    threatening the well-being of the plant. Just a few weeks ago,
    the Inter-Governmental Panel on Climate Change released its
    report, which makes it clear that global warming is happening
    now and there is a 90 percent certainty humans are causing most
    of the warming. Just yesterday, I was at a press conference
    with Senator Bingaman and former Senator Tim Worth to discuss
    this latest report Confronting Climate Change: Avoiding the
    Unmanageable and Managing the Unavoidable. It is another United
    Nations report by the United Nations Foundation, the Scientific
    Research Society. So yet more and more studies are coming in on
    this.
        The warming could have enormous consequences for mankind.
    Left unchecked, global warming will lead to increased extreme
    weather events, to sea level rises, to more floods and
    hurricanes and to change in our weather patterns that could
    reduce our water supplies. These are but a few of the effects
    that global warming will have on our States and cities in the
    years to come unless we act.
        Today's hearing is about those States, regions and cities
    that already recognize these facts and have taken strong,
    bipartisan action to help stop global warming. In my opinion,
    they are leading the way for the rest of the Nation. They
    understand what is at stake for our future and for our
    grandkids and their kids. They are sending us a signal that we
    must heed.
        I want to show you a map. It shows you that 29 States
    already have some form of climate action plan. Senator Inhofe,
    I wanted to call this to your attention to show you that 29
    States already have some form of a climate action plan. These
    29 States have a combined population of nearly 180 million
    people. Fourteen of the twenty-nine States shown in yellow have
    set greenhouse gas reduction targets. Eight northeastern
    States, including New Jersey, have agreed to reduce emissions
    from powerplants through the regional greenhouse gas
    initiatives. More States, such as Maryland, are expected to
    join in this effort.
        On Monday, California, Arizona, Oregon, Washington and New
    Mexico announced a regional initiative to address global
    warming. It is only a matter of time before more States follow.
    I am especially proud of my State, California, which enacted
    A.B. 32, the Nation's first economy-wide global warming bill,
    authored by State Assembly Speaker Nunez, who is here today.
    Under the leadership of State Senate President pro tem Perata,
    California has also set strong emission standards for new
    electricity generation.
        Now, I met yesterday with Governor Schwarzenegger. We had a
    terrific meeting. He again continued to speak out for us to pay
    attention to this issue. I am going to ask unanimous consent to
    place the letter that he wrote to me for today's hearing into
    the record. So without objection, it will be done.
        [The referenced material follows:]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Senator Boxer. I will just read simply one paragraph:
    ``Global climate change is one of the most critical
    environmental and political challenges of our time. The debate
    is over, the science is in, and the time to act is now. Only by
    putting aside our political differences and bringing all
    parties and stakeholders together will we truly be able to
    confront this crisis.'' I thank the Governor for this letter.
        Governor Corzine's recent executive order requires New
    Jersey to reduce its emissions to 1990 levels by 2020 and by 80
    percent from current levels by 2050. I commend his leadership.
        Our cities have also taken action. Led by Seattle Mayor
    Nickels, a bipartisan group of 407 mayors, representing over 59
    million people, have signed onto the Climate Protection
    Agreement. Finally, Mayor Cownie will tell us about the actions
    he is taking in Des Moines to help his city and his actions
    take action to fight global warming. They are fueling their
    fleets with ethanol and biodiesel, they are building more bike
    paths in Des Moines, they are encouraging their citizens to use
    compact fluorescent light bulbs.
        Now, these may seem like very small things. But in the end,
    they add up. People everywhere are waking up to the reality of
    global warming. Earlier this week, the investment community
    announced plans to take over a major Texas utility and to scrap
    its plans to build 11 new coal-fired powerplants. That decision
    took heed of the editorial that Senator Bingaman and I wrote,
    which made clear that permits for such plants to emit
    greenhouse gases would not be granted for free. The days when
    investors could ignore the possibility of greenhouse gas limits
    are coming to a close.
        There is increasing bipartisan consensus that we need to
    move now to limit emissions. The States and cities that we will
    hear from today are leading the charge. I am an optimist, and
    like the States and cities who are taking action today, I
    believe we can solve this problem, and in doing so, we will be
    better for it in every single way. I look forward to hearing
    all of the witnesses' testimony on this issue today.
        It is my pleasure to call on the Ranking Member, Senator
    Inhofe.

    STATEMENT OF HON. JAMES M. INHOFE, U.S. SENATOR FROM THE STATE
                              OF OKLAHOMA

        Senator Inhofe. Thank you very much, Madam Chairman. You
    mentioned a couple of things, some comments in your opening
    statement. As far as the TXU is concerned, that is a huge
    success that you guys have had in what I call divide and
    conquer, to be able to get the natural gas people and the
    nuclear people to realize how much money they can make by
    shutting down coal-fired plants. It is something perhaps the
    board of directors had a lot of pressure in getting them to do.
        As far as the IPCC fourth assessment is concerned, the
    interesting thing about this is, first of all, as we have said
    before, this is not any kind of a science report, this is a
    summary for policymakers. It has nothing to do with science. At
    the same time, the United Nations came out by reducing man's
    contribution by 25 percent. That is huge. And reducing the
    anticipated sea level by one-half and also coming out with a
    statement that livestock emissions are greater than man
    emissions and even the transportation sector.
        But we have an honest difference of opinion, and it will
    surprise a lot of people to know that we agree on a lot of
    things, such as the WRDA bill coming up that everyone in this
    room is very much concerned about today. We will be discussing
    the State perspectives on climate change. I would say to my
    friend, Governor Corzine, I used to say, and I am sure that
    Senator Voinovich would probably agree with me, with his
    background, I tell my fellow Senators sometimes, I know what a
    hard job is, I have been a mayor of a major city. The same
    thing is true with being Governor of a State. So I recognize
    you have a hard job right now.
        We are discussing, as you know, the States are, I consider
    to be 50 laboratories in this Country, each one taking a unique
    policy pathway forward. In doing so, the experiments give
    Federal policymakers examples of what policies work, what
    policies don't work. And of course, the Federal Government also
    has examples of failed ideas it should avoid repeating at all
    costs. Cap and trade ranks high among these.
        Multiple approaches have been taken that purport to address
    climate change. Some States have clean coal R&D programs.
    Others have tax credits for renewable energy and/or hybrid
    cars. Still others have renewable portfolio standards. Most of
    these States have taken a pragmatic approach that recognizes
    the uniqueness of their circumstances. A group of northeastern
    States and California have enacted cap and trade programs to
    reduce emissions. Additionally, four Governors have pledged to
    come up with plans to reduce emissions. Today we hear how
    ambitious and important they are and what they plan to
    accomplish.
        But these programs haven't accomplished anything so far.
    They are simply open promises that won't be kept and denials
    about costs that will surely be paid.
        California is a good example of an empty promise. It passed
    a law bringing emissions back to the 1990 levels by 2020. This
    baseline was not chosen arbitrarily, but to support the Kyoto
    Protocol, which also uses 1990 baseline. Since Kyoto is the
    only cap and trade program that is underway, I think it is
    worth asking, how well has that worked? Of the 15 western
    European countries that have signed onto Kyoto, and have
    ratified it, only 2 will meet their targets, that is Sweden and
    Britain. Great Britain only because it eliminated its coal
    industry in the early 1990s.
        Like most signatories, Canada and Japan won't meet their
    targets. The simple fact is that the United States has spent
    more Federal dollars on basic science as well as research and
    development and done more to reduce our emissions rate than
    Europe has since 2000. It is interesting, we have actually
    reduced our emission rates more in the United States than
    western Europe has. One thing, as long as we are talking about
    Canada, it is very interesting, even though they were one of
    the first ones to sign on, to ratify the Kyoto Treaty, the 60
    scientists that advised the Canadians are now petitioning Prime
    Minister Harper to withdraw, saying that ``If we had known 10
    years ago what we know today, we would not have been a part of
    Kyoto.''
        The simple fact is, jobs are fleeing the European Union
    because of its experiment into cap and trade. China, which will
    become the world's biggest emitter of greenhouses in 2009 and
    India and other developing nations will never sign on. As the
    Deputy Director General of China's Office of Global
    Environmental Affairs said in October, ``you cannot tell people
    who are struggling to earn enough to eat that they need to
    reduce their emissions.'' That is why California and the RGGI
    programs, I believe, will fail. Although each of these regions
    has yet to pay the cost, there will be costs and jobs will flee
    these States. Cost will go up and purchase power will decline.
        In RGGI States, for instance, the Charles River and
    Associates, the CRA estimate, estimated a similar proposal
    which would cost the region some 18,000 jobs in 2010.
    Electricity prices, according to them, this is CRA, will rise
    by 9 percent, hitting the elderly and the poor the hardest. The
    poor are having to shoulder the increased burden of more than
    double that of the rich, due to the cost of energy. Similarly,
    purchasing power would decline by $270 per family.
        It is interesting that this is based on this reduced
    program, while the Wharton Econometric Survey uses figures 10
    times greater, the average family of four, costing them in what
    we would refer to as a tax increase, some $2,750 a year. So
    let's be honest about these programs and their companion
    proposals are here in Congress. They are the biggest tax
    increases in history. In fact, they are worse than taxes,
    because they will cost more and be less effective.
        The only reason the alarmists have not proposed an outright
    tax yet is that they know it will be more difficult to reward
    the climate profiteers supporting them in their efforts, such
    as we witnessed down in TXU only in the last few weeks.
        So I would simply say in closing that I find it ironic that
    deliverables are so openly crafting programs to directly
    benefit powerful corporations and interest groups at the
    expense of the poor, the elderly, the fixed income and the
    working class. Thank you, Madam Chairman.
        [The prepared statement of Senator Inhofe follows:]
           Statement of Hon. James M. Inhofe, U.S. Senator from the
                               State of Oklahoma
        Thank you for holding this hearing, Madame Chairman.
        Today we are discussing State perspectives on climate change. As
    you know, the States are 50 laboratories of this country--each taking a
    unique policy pathway forward. In doing so, the experiments give
    Federal policymakers examples of what policies work. Of course, the
    Federal Government also has examples of failed ideas it should avoid
    repeating at all costs--cap and trade ranks high among these.
        Multiple approaches have been taken that purport to address climate
    change. Some States have clean coal R&D programs, others have tax
    credits for renewable energy or hybrid cars, and still others have
    renewable portfolio standards. Most of these States have taken a
    pragmatic approach that recognizes the uniqueness of their
    circumstances.
        A group of Northeastern States and California have enacted cap and
    trade programs to reduce emissions. Additionally, four Governors have
    joined Governor Schwarzenegger in pledging to come up with plans to
    reduce emissions. Today we will hear how ambitious and important they
    are, and what they plan to accomplish. But these programs haven't
    accomplished anything. They are simply empty promises that won't be
    kept and denials about costs that will surely be paid.
        California is a good example of an empty promise--it passed a law
    bringing emissions back to 1990 levels by 2020. This baseline was not
    chosen arbitrarily, but to support the Kyoto Protocol, which also uses
    a 1990 baseline. Since Kyoto is the only cap and trade program that is
    under way, it's worth asking--how well is that program working?
        Of the 15 original EU countries, only two will meet their targets--
    Sweden and Britain, and Britain only because it eliminated its coal
    industry in the early 90s. And like most signatories, Canada and Japan
    won't meet their targets either. The simple fact is that the United
    States has spent more Federal dollars on basic science, as well as
    research and development, and done more to reduce our emissions rate
    than Europe since 2000. How did we do that?--By rejecting Kyoto's cap
    and trade approach.
        The simple fact is jobs are fleeing the EU because of its
    experiment into cap and trade. And China--which will become the world's
    biggest emitter of greenhouse gases in 2009--and India and other
    developing nations will never sign on. As Lu Xuedu, Deputy Director
    General of China's Office of Global Environmental Affairs, said in
    October: ``You cannot tell people who are struggling to earn enough to
    eat that they need to reduce their emissions.''
        That is why the California and RGGI programs will fail. Although
    each of these regions has yet to pay the costs, there will be costs.
    Jobs will flee these States, costs will go up and purchasing power will
    decline.
        In the RGGI States, for instance, Charles River Associates
    estimated a similar proposal would cost the region 18,000 jobs in 2010.
    Electricity prices would rise 9 percent, hitting the elderly and poor
    the hardest, with the poor having to shoulder an increased burden more
    than double that of the rich due to the costs of energy. Similarly,
    purchasing power would decline $270 per family in 2010 and worsen
    annually.
        California will fare as badly. While the program they plan to
    implement the law is so uncertain economic modeling is difficult, the
    targets and timing suggest that the Wharton Econometric Forecasting
    Associates Kyoto Protocol study is useful. That study found California
    would see its economy decline by about 1 percent and 278,000 jobs.
        Let's be honest about what these programs and their companion
    proposals here in Congress really are--they are the biggest tax
    increase in U.S. history. In fact, they are worse than taxes because
    they will cost more and be less effective. And the only reason the
    alarmists have not proposed an outright tax yet is they know it will be
    more difficult to reward the climate profiteers supporting them in
    their efforts.
        In closing, I will simply say that I find it ironic that the
    liberals are so openly crafting programs to directly benefit powerful
    corporations and interest groups at the expense of the poor, elderly
    and working class.
        Thank you.

        Senator Boxer. I am a bit speechless after that.
        [Laughter.]
        Senator Boxer. I would like to put in the record the list
    of bipartisan elected officials who have attacked this issue
    and include Democrat and Republican Governors. So I would like
    to ask unanimous consent to place this in the record, showing
    the bipartisan list of officials who have taken action.
        [The referenced material follows:]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Senator Boxer. I also would like to ask unanimous consent
    that I be able to place into the record a statement from the
    European Union which says they are on track to meet their Kyoto
    commitment. It is a letter to me on that point.
        [The referenced material follows:]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Senator Inhofe. Madam Chairman, for the record, I would
    like to submit a list of scientists who at one time, 10 years
    ago, were very strong supporters of reducing man-made gases,
    and now realize that science has changed and they are on the
    other side of the issue.
        Senator Boxer. We would be happy to put that in the record.
        [The referenced material follows:]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Senator Boxer. In addition, we are also going to put into
    the record without objection, I hope, a list of the scientists
    who issued the IPCC report and also this latest report of
    scientific experts just yesterday who issued this report for
    the United Nations, Confronting Climate Change. So we will have
    the list of scientists who change their mind and the list of
    scientists who are actually putting these reports out as well
    as the letter from the European Union.
        [The referenced material follows:]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Senator Boxer. We are going to continue now, we are going
    to try to stick with the 5-minute opening statement. I am going
    to call on Senator Lautenberg for his opening statement, and
    then Senator, you can speak about your Governor now or you can
    wait until we have all statements made and you can then
    introduce him at that time.
        Senator Lautenberg. Can I do it without charge to my
    timeframe?
        Senator Boxer. Yes.

     STATEMENT OF HON. FRANK R. LAUTENBERG, U.S. SENATOR FROM THE
                          STATE OF NEW JERSEY

        Senator Lautenberg. First, I want to thank Senator Inhofe
    for his encouraging view of our intentions to reduce greenhouse
    gas, thank you very much.
        [Laughter.]
        Senator Lautenberg. Madam Chairman, before I introduce
    Governor Corzine, I just want to say that States are leading
    when it comes to combating global warming. Now the Federal
    Government needs to catch up. Our witnesses hail from States
    with innovative and active programs to cut greenhouse gases and
    control climate change.
        In addition to Governor Corzine's initiatives to cut
    emissions within our State, New Jersey has also joined six
    eastern States to launch their Regional Greenhouse Gas
    Initiative, which will help curb emissions from powerplants.
        Thirty-six of New Jersey's cities have joined nearly 400
    other cities from across the Country to do what the Bush
    administration won't do, and that is meet or beat the Kyoto
    Protocols. New Jersey and other States are beginning to weave a
    web of smart environmental regulations across the Country. But
    the Federal Government is not doing its part to strengthen that
    web. We can change that.
        I strongly support Senator Sanders' Global Warming
    Pollution Reduction Act, which calls for an 80 percent cut in
    global warming pollutants by 2050. If we don't take the steps
    now, we will continue to threaten succeeding populations,
    including my grandchildren's grandchildren. It is not something
    I am willing to throw away.
        I have also been joined by Senator Boxer and Senator Snowe
    in introducing the High Performance Green Buildings Act.
    Buildings, from apartments to skyscrapers, account for nearly
    40 percent of our greenhouse gases. The Federal Government is
    the biggest landlord in the Country. By getting Federal
    buildings to go green, we can put a significant dent in our
    emissions.
        But the Federal Government needs to do more. We need caps
    on greenhouse gas emissions from all powerplants and other
    facilities that produce pollution. We need to increase cap-
    based standards to get vehicle emissions and dependence on
    foreign oil down. We need incentives for cities and businesses
    to build in ways that are better for the environment.
        We have to end the censorship and suppression of Government
    scientists who do research on global warming. The public is
    taking better care of our environment and they want to do more.
    People are buying hybrids, cars based on fuel efficiency, for
    example. Some in the private sector are also taking some
    positive steps, the CEOs from some of America's largest
    companies, like General Electric and DuPont are now calling for
    Federal legislation to reduce greenhouse gases. So it is time
    for the Federal Government to step up, do its part and support
    our States, cities and towns that are already doing theirs.
        [The prepared statement of Senator Lautenberg follows:]
         Statement of Hon. Frank R. Lautenberg, U.S. Senator from the
                              State of New Jersey
        Madame Chairman, thank you for holding today's hearing on how the
    States are leading when it comes to combating global warming--and how
    the Federal Government needs to catch up.
        Among today's witnesses is my Governor, Jon Corzine. Our witnesses
    hail from States with innovative and active programs to cut greenhouse
    gases and control climate change.
        In addition to Governor Corzine's move to cut emissions within our
    state, New Jersey has also joined six eastern States to launch the
    Regional Greenhouse Gas Initiative, which will help curb emissions from
    powerplants.
        And 36 of New Jersey's cities have joined nearly 400 other cities
    from across America to do what the Bush administration won't do: meet
    or beat the Kyoto Protocols.
        New Jersey and other States are beginning to weave a web of smart
    environmental regulations across the country. But the Federal
    Government is not doing its part to strengthen that web.
        We can change that.
        That is why I strongly support Senator Sanders' `Global Warming
    Pollution Reduction Act,' which calls for an 80 percent cut in global
    warming pollutants by 2050.
        I have also been joined by Senators Snowe and Boxer in introducing
    the `High Performance Green Buildings Act.'
        Buildings--from apartments to skyscrapers--account for nearly 40
    percent of our greenhouse gases. The Federal Government is the biggest
    landlord in the country and by getting Federal buildings to ``go
    green,'' we can put a significant dent in our emissions.
        But the Federal Government needs to do more.
        We need caps on greenhouse gas emissions from all powerplants and
    other facilities that pollute.
        We need to increase CAFE standards to get vehicle emissions and
    dependence on foreign oil down.
        We need incentives for cities and businesses to build in ways that
    are better for the environment.
        And we must end the censorship and suppression of government
    scientists who do research on global warming.
        The public is taking better care of our environment--and they want
    to do more. People are buying hybrids and cars based on fuel
    efficiency, for example.
        Some in the private sector are also taking some positive steps.
        The CEO's from some of America's largest companies, such as General
    Electric and DuPont, and now calling for Federal legislation to reduce
    greenhouse gases.
        It's time for the Federal Government to do its part--and to support
    our States, cities and towns that are already doing theirs.

        Senator Lautenberg. Madam Chairman, if I might just say a
    few words about Governor Corzine, no stranger to Capitol Hill.
    The Governor and I used to be Senate colleagues. Both of us
    initiated a job change, and I hope he enjoys as much as I do
    mine. Now I am one of his constituents, he is one of mine. New
    Jersey is proud of our Governor, because he is willing to step
    up and do the right thing, even if it looks at the moment like
    it is putting more pressure on us. But someone has to take a
    longer view, and Governor Jon Corzine is willing to do that. We
    see it in his leadership here to fight the fight against global
    warming.
        I am proud of New Jersey today, because New Jersey is among
    a small group of States that is leading the Nation when it
    comes to reducing global warming. Two weeks ago, Governor
    Corzine signed an order to reduce New Jersey's total emissions
    from cars, buildings and factories alike by 80 percent by 2050.
    New Jersey and California are two of just a few States to take
    such action.
        So I am happy to see Jon Corzine here, back in his familiar
    surroundings. But New Jersey needs him, so we will try not to
    keep him here too long, and let the Federal Government do what
    it needs to do. Please welcome Jon Corzine.
        Governor Corzine. Thank you.
        Senator Boxer. Thank you very much, and we will go to
    Senator Voinovich. Welcome, Senator.

     STATEMENT OF HON. GEORGE V. VOINOVICH, U.S. SENATOR FROM THE
                             STATE OF OHIO

        Senator Voinovich. Madam Chairman, I thank you for holding
    this hearing today and I am glad that we have State and local
    perspectives on global warming. I have often said this is a
    difficult and controversial topic, with some declaring it a
    hoax and some declaring that the end of the world is near. I
    share neither of these beliefs, and it is going to be really
    nice that we are having local government officials, State
    officials. Because ordinarily, this is about maybe the 12th
    hearing I have had in 8 years. Senator Corzine, you will
    remember that some of the hearings we have had, at the end they
    started out, the witnesses being very nice to each other, and
    at the end I thought we had to stop them from going after each
    other. I am sure that we are not going to have that today,
    Madam Chairman, with our State and local government officials.
        The reality is that not all global warming skeptics are
    denialists or idealogues. Those in the environmental movement
    are not all alarmists. We can learn a lot and achieve more if
    we listen a little more to each other, and I suspect that is
    what Americans believe and they expect, they expect us to work
    together.
        I do believe that global warming is something that will
    need to be addressed, and I look forward to hearing from the
    witnesses today. I am particularly happy that an Ohioan has
    been asked to testify, Mayor Richard Homrighausen, from Dover,
    OH. As a former mayor and Governor, I can relate to the
    problems cities and States face with respect to balancing both
    environmental and economic needs. Mayor, you have to deal with
    it every day. I have long advocated the need to harmonize our
    environment, energy and economic needs. I hope this hearing
    today helps us better understand how States are trying to
    achieve these goals.
        For the past 2 years, I have called for a second
    declaration of independence: independence from foreign sources
    of energy. For our Nation to take real action toward stemming
    our exorbitantly high oil and natural gas prices, instead of
    considering them separately, we must harmonize our environment
    and energy and economic needs. This is an absolute must as we
    consider any additional actions to address climate change. From
    my own humble opinion, I agree with much of what Senator Inhofe
    has had to say, too often we just don't get our energy,
    economic and environmental people to sit down together. In
    fact, the problem we have had for the last 8 years and why we
    haven't made any progress is because we can't get them together
    to put each others' shoes on and come up with something that
    makes sense.
        I think we also have to become well aware of the fact that
    what we do is also going to be impacted dramatically by the
    developing countries. For example, we know that China is
    building a new coal-fired plant every week to 10 days, and many
    of them lack modern pollution control devices. Those of you
    from California are already feeling the effects of what is
    going on in China.
        This is a worldwide problem. We have to realize that we
    have a role to play, but we also must recognize that others
    have a role to play. The more we can engage them in this debate
    the better off we are going to be, and so is the world. I think
    that as a result, and some of you may not be familiar with
    this, as a result of legislation we passed last year, we now
    have an international initiative that is called the Asian
    Pacific Partnership. It involves Australia, China, India,
    Japan, South Korea and the United States. These are developing
    countries, many of them, and what we are trying to do is come
    up with technology that will not only benefit us but benefit
    the world.
        We just can't say we are going to deal with this in the
    United States. We have to understand this is a global problem
    and that by 2009, the Chinese are going to exceed our emissions
    here in the United States. We were the bad guy for a long time.
    But these other developing nations are coming along and we have
    to be just as concerned about them as we are ourselves.
        I would like to reiterate that I believe that global
    warming is occurring. The ongoing debate is over how much is
    due to natural causes and man-made causes. The issue is what do
    we do from a responsible public policy perspective to deal with
    the problem. It is something I hope this committee can work
    together on to develop responsible global warming policies that
    ultimately harmonize our energy, environment and economic
    needs.
        I want to point out one other thing, Madam Chairman, that
    the technology, particularly to deal with emissions from coal-
    fired plants, is still in its infancy. The only real major
    thing that this Government has done is FutureGen, and that
    won't be built for the next 2 to 3 years. We ought to have a
    crash program of getting into that kind of research, so that we
    have these coal-fired plants that are out there, so they can
    retrofit, have the technology to retrofit them, make sure that
    the new plants that are being built deal with greenhouse gases
    responsibly.
        I know that some of the States represented here really
    don't care about it, because you get very little energy from
    coal. But the fact is, it is a reality. The United States is
    the Saudi Arabia of coal. Coal is going to be a part of our
    energy fix for a long, long time. Some of you from
    environmental group say, well, we don't want any coal. The fact
    of the matter is we are going to have coal. We had better get
    with it as soon as we possibly can to deal with technology that
    is going to limit those greenhouse emissions from those coal-
    fired facilities.
        Thank you, Madam Chairman.
        Senator Boxer. Thank you, Senator. I agree with your
    comments on coal. I think we are going to absolutely need to
    find a solution, because we have 250 years worth of it. It
    makes sense.
        Senator Klobuchar.

    STATEMENT OF HON. AMY KLOBUCHAR, U.S. SENATOR FROM THE STATE OF
                               MINNESOTA

        Senator Klobuchar. Thank you, Madam Chair, and thank you,
    Governor. Welcome. It is my belief that we have seen a major
    sea change this year with our committee focused not just on
    whether or not there is global warming, but clearly we are
    focused on the solutions. A big part of this is going to be the
    innovative efforts going on in the States across this Country.
        Think globally, act locally used to be a bumper sticker,
    and now it is a necessity. I can tell you that in my State, we
    are not content to just sit around and wait for things to
    happen. We have seen how long it has been taking to get the
    fishhouses out on the lakes. We have seen the effects that it
    has had for some of our hunters and activities. While we
    believe the scientists and we believe in science, we are
    actually seeing first-hand the effects of climate change in our
    State.
        Today's hearing is especially timely for local people in
    Minnesota. Just last week we passed a new law that is now
    considered the Nation's most aggressive standard for promoting
    renewable energy in electricity production. It is a 25-by-25
    standard. By the year 2025, the State's energy companies are
    required to generate 25 percent of their electricity from
    renewable sources, such as wind, solar, water and biomass.
        The standard is even higher for Minnesota's largest
    utility, Excel Energy, which must reach 30 percent by 2020.
    Excel, which supplies half the electricity in Minnesota, has
    said that it expects to meet the new standard without a price
    increase for consumers. Already, it has announced that it will
    build a $210 million wind farm in Minnesota.
        Almost as important as the renewable energy standard itself
    is the bipartisan political energy that produced the new law.
    It was adopted with overwhelming bipartisan support, the vote
    was 123 to 10 in the State House and 61 to 4 in the State
    Senate. It was quickly signed into law by Republican Governor
    Tim Pawlenty.
        The same thing is happening at the local level. I just went
    across our State, and talking about middle-class tax cuts and
    the Farm bill. Every place I went, people were bringing up
    climate change. I was in the little town of Lanesboro, MN, in a
    high school gym, Madam Chair, and all they wanted to talk about
    is the new light bulbs that their city council had ordered them
    to put up. They were very excited about their own efforts on
    the local level.
        That is what we are seeing across this Country, with the
    work in New Jersey, with the work just recently announced in
    the five western States and the work that is going on in
    California. I admire the States and communities for their
    initiative, and what they are doing should inspire national
    action. With all of these many efforts and initiatives at the
    local, State and regional levels, I ask, how many bills has
    Congress passed to actually limit the greenhouse gases that
    contribute to global warming and climate change? Right now, the
    answer is zero. My hope is that we will be able to change that
    number sooner rather than later.
        We are all students of government, so we know the famous
    phrase, laboratories of democracy. That is how Supreme Court
    Justice Louis Brandeis described the special role of States in
    our Federal system. ``It is one of the happy incidents of the
    Federal system,'' Brandeis wrote over 70 years ago, ``that a
    single, courageous State may, if its citizens choose, serve as
    a laboratory and try novel social and economic experiments
    without risk to the rest of the Country.''
        But Brandeis did not mean for this to serve as an excuse
    for inaction by the national Government. Good ideas and
    successful innovations are supposed to emerge from the
    laboratory and serve as a model for national policy and action.
    That is now our responsibility. The courage we are seeing in
    the States as they deal with global warming should be matched
    by courage right here in Washington. We should be prepared to
    act on a national level, especially when the local and State
    communities are showing us the way.
        In this spirit, I look froward to our discussion today.
        [The prepared statement of Senator Klobuchar follows:]
            Statement of Hon. Amy Klobuchar, U.S. Senator from the
                               State of Minnesota
        I look forward to today's discussion of local, State and regional
    perspectives on global warming and climate change.
        Some observers have suggested that public attitudes on global
    warming may soon reach a ``tipping point'' that will spur sweeping
    changes in our society.
        Already, many of the most innovative efforts are coming at the
    local, State and regional levels.
        Think globally, act locally'' used to be a bumper sticker. Now it's
    a necessity.
        I can tell you that, in my state of Minnesota, people are growing
    ever more concerned. Minnesotans love being out in nature. This winter
    I have heard from ice fishermen, snowmobilers and cross-cross skiers
    who tell me they personally see the signs of global warming and climate
    change:
        In our State, when we see something that concerns us, we're not
    content to sit around. We want to do something to make a difference. We
    want to take action.
        Today's hearing is especially timely.
        Just last week, Minnesota passed a new law that is now considered
    the Nation's most aggressive standard for promoting renewable energy in
    electricity production.
        It's a ``25-by-25'' standard. By the year 2025, the State's energy
    companies are required to generate 25 percent of their electricity from
    renewable sources such as wind, water, solar and biomass. The standard
    is even higher for Minnesota's largest utility, Xcel Energy, which must
    reach 30 percent by 2020.
        Xcel, which supplies half the electricity in Minnesota, has said
    that it expects to meet the new standard without a price increase for
    consumers. Already, it has announced that it will build a $210 million,
    100-megawatt wind farm in Minnesota.
        Almost as important as the renewable energy standard itself is the
    bipartisan political energy that produced this new law.
        It was adopted with overwhelming bipartisan support. The vote was
    123 to 10 in the State House, and 61 to 4 in the State Senate. It was
    quickly signed into law by Republican Governor Tim Pawlenty.
        This new law is further demonstration that elected officials and
    policymakers across the spectrum understand what's at stake.
        The same thing is happening at the local level. St. Paul, our
    capital city, has implemented a creative and forward-thinking Urban
    CO2 Reduction Plan to reduce its carbon footprint.
        It's not only about combating global warming and climate change.
    It's also about reducing pollution and improving air quality. It's
    about promoting economic development and technological innovation. And
    it's about ensuring our future energy independence and security.
        We are seeing other major climate change initiatives elsewhere in
    the country.
        Earlier this week, governors from five Western States (including
    California and Arizona) announced that they will work together to
    reduce greenhouse gases by setting regional targets for lower emissions
    and establishing a regional ``cap-and-trade'' system for buying and
    selling greenhouse gas credits.
        This new regional project builds on the greenhouse gas emissions
    measure that the California legislature passed and California Governor
    Schwarzenegger signed into law last year.
        And it builds on other regional initiatives--especially the
    landmark Regional Greenhouse Gas Initiative with seven northeastern and
    mid-Atlantic States that have also agreed to a regional ``cap-and-
    trade'' system aimed at reducing carbon dioxide emissions.
        One of the States in that initiative is New Jersey. I am pleased to
    see Governor Corzine with us today. I look forward to hearing more
    about the executive order he signed last month setting a State economy-
    wide goal for reducing greenhouse gas emissions.
        I also look forward to hearing from Seattle Mayor Greg Nickels, who
    has led the way with the U.S. Mayors Climate Protection Agreement. More
    than 400 mayors (representing over 59 million Americans) have pledged
    to meet or beat the Kyoto Protocol greenhouse gas reduction goals in
    their own communities.
        I admire these States and communities for their initiative. And
    what they're doing should be an inspiration for national action.
        With all of these many efforts and initiatives at the local, State
    and regional levels, how many bills has Congress passed to actually
    limit the greenhouse gases that contribute to global warming and
    climate change?
        Right now, the answer is zero. My hope is that we will be able to
    change that number--sooner rather than later.
        As Arizona Governor Janet Napolitano explained the other day: ``In
    the absence of meaningful Federal action, it has been up to the States
    to take action to address climate change and reduce greenhouse gas
    emissions in the country.''
        We are all students of government. So we know the famous phrase
    ``laboratories of democracy.'' That's how Supreme Court Justice Louis
    Brandeis described the special role of States in our Federal system.
        In this model, States are where new ideas can emerge . . . where
    policymakers can experiment . . . where innovative proposals can be
    tested.
        ``It is one of the happy incidents of the federal system,''
    Brandeis wrote over 70 years ago, ``that a single courageous state may,
    if its citizens choose, serve as a laboratory; and try novel social and
    economic experiments without risk to the rest of the country.''
        But he did not mean for this to serve as an excuse for inaction by
    the national government. Good ideas and successful innovations are
    supposed to emerge from the laboratory and serve as a model for
    national policy and action. That is now our responsibility.
        The courage we're seeing in the States as they deal with global
    warming should be matched by courage right here in Washington. We
    should be prepared to act on a national level--especially when the
    States and local communities are showing us the way.
        In this spirit, I look forward to our discussion today.

        Senator Boxer. Thank you very much, Senator.
        Senator Thomas.

    STATEMENT OF HON. CRAIG THOMAS, U.S. SENATOR FROM THE STATE OF
                                WYOMING

        Senator Thomas. Thank you, Madam Chairman. I will be short.
    I think it might kind of nice to listen to the witnesses that
    we have today.
        I thank you for having this hearing, however, and I believe
    hearing from the regional and about the regional impacts is
    very, very important. I am very concerned about having an
    energy mix. I believe we have to have an understanding of how
    important it is to deal with our resources as we look forward
    here, of course, as there has already been some discussion
    about coal. As you might imagine, I have a strong feeling about
    that.
        But we need to make sure what we do here doesn't injure our
    national economy. So I will file my report. I would tell you
    that we don't produce enough gas to provide for our energy. We
    have coal, as has been pointed out here, for about 200 years
    worth of energy. So our real challenge is how do we use the
    resources we have in an environmentally clean way and an
    efficient way to be able to do that. That is really where we
    are.
        So I will submit my statement. Thank you.
        [The prepared statement of Senator Thomas follows:]
     Statement of Hon. Craig Thomas, U.S. Senator from the State of Wyoming
        First, I'd like to thank the Chair for convening this hearing. I
    believe that the regional impacts of greenhouse gas reductions are the
    most important part of the climate change debate. I would have liked to
    hear from a witness that is as concerned about the role that coal plays
    in our economy and energy mix as I am. I believe several witnesses have
    a rational understanding of how important this resource is, however.
        I will repeat what we're all very used to hearing at this point. It
    is extremely important that any actions taken by the Federal Government
    do not harm our economy or our national energy security. I fear that
    extreme measures proposed by some will, in fact, cause this to happen.
    As an example, compliance with some proposals would require a shift to
    more natural gas. We can't produce all of that natural gas here in the
    United States. We're trying to help in Wyoming but it's not enough, and
    folks are growing tired of the breakneck pace of development in my
    State. Unless our coastal States begin to share more of this production
    burden, we will be in a very difficult situation.
        What we'll end up needing to do, of course, is building liquefied
    natural gas terminals in coastal States like New Jersey to import what
    we cannot produce here at home. The gas we'll import will come from
    countries like Iran and Russia. The leaders of these countries have
    already started talking about forming a cartel, like OPEC, for natural
    gas exports.
        I'd like to hear from Governor Corzine about what he thinks of
    liquefied natural gas terminals and drilling offshore. My guess is that
    he doesn't support either one. I support drilling off our coasts, but I
    am opposed to importing natural gas. We already depend on foreign
    countries for oil to run our transport sector. I do not want to become
    reliant on these same volatile regions to generate our electricity.
    That would harm our national security.
        What do we do about this problem then? Well, we have 200 years
    worth of energy sitting 60 feet underground in the Powder River Basin
    of Wyoming in the form of coal. What we need to do is advance clean
    coal technologies so this domestic resource can be used in a more
    efficient and environmental way.
        Another one we hear a lot about is that greenhouse gas emissions
    are an international problem. I agree. China is putting a coal
    powerplant into service every 10 days and India is growing just as
    fast. These countries will rely heavily on coal as their economies
    develop--that is a fact. Everyone, though, must understand that a
    liquefied natural gas terminal on our coast does nothing to reduce the
    emissions of China and India. Advancing clean coal technologies and
    sharing them internationally does a lot of good, however.
        Wyoming's perspective is one of a State that is willing to help,
    but we need to have a rational conversation about the best way to do
    these things. I hope that effort can begin today. I thank the witnesses
    for being here today.

        Senator Boxer. Thank you so much, Senator.
        Senator Sanders, welcome.

    STATEMENT OF HON. BERNARD SANDERS, U.S. SENATOR FROM THE STATE
                               OF VERMONT

        Senator Sanders. Thank you very much, Madam Chair, and then
    you for holding this important hearing.
        Let me be very clear. There are some people who say, well,
    we shouldn't be alarmists. Madam Chair, I am an alarmist. I
    think that the debate is over. I think global warming is real.
    I think global warming is man-made. I think if we as a Nation
    and as a planet do not get our act together, we are looking at
    disasters to come for our kids and our grandchildren. There are
    some people who say, well, gee, if we act too strongly, and you
    and I have proposed some very strong legislation, if we act
    very aggressively on global warming, it will have a negative
    impact on the economy.
        Let me tell you, if we do not act aggressively on global
    warming, the impact on the economy will be far, far more
    severe. I believe, there is no question in my mind that the
    Congress has been much, much too slow in moving forward and I
    hope this year we will change that pattern. To my mind, what
    this Country has to do is move toward a new Manhattan-type
    project. We moved aggressively on World War II, President
    Kennedy moved us forward in getting a man to the moon. Now is
    the time for a partnership between Government and the private
    sector to in fact say, we are going to break our dependency on
    fossil fuels, we are going to move toward energy efficiency and
    we can do that. The technologies are out there. What has been
    lacking for many years is the political will. I hope that that
    will be changed right now.
        I happen to believe that if we move forward in that
    direction we can create millions of good paying jobs, as we
    save the planet for our kids and our grandchildren.
        Now, in fact, while the Federal Government has not been
    aggressive, while we have a President who virtually refuses to
    acknowledge the reality of global warming, the truth is that
    cities and towns and States have been moving forward. As
    Senator Klobuchar mentioned, one of the beauties of our system
    is that if Minnesota moves forward or Vermont moves forward,
    the rest of the Country learns from that process. So I have
    been impressed by what States are doing. I have been impressed
    by what municipalities have been doing and I very much look
    forward to hearing the testimony today, so that we as a Federal
    Government can learn best practices.
        Thank you, Madam Chair.
        Senator Boxer. Thank you very much.
        Senator Bond.

     STATEMENT OF HON. CHRISTOPHER S. BOND, U.S. SENATOR FROM THE
                           STATE OF MISSOURI

        Senator Bond. Thank you very much, Madam Chair. It is
    always a pleasure to be able to join with you in these
    continuing discussions of global warming. I know this committee
    has other responsibilities, but we are having lots of
    opportunities and I thank you for holding this hearing to get
    the important impact from the States.
        One of the things I think we are going to learn today is
    that some of the current climate change proposals have the
    ability to hurt certain regions more than others. I think we
    have to account for the differences among the areas of the
    Country to ensure that actions we require are fair and
    affordable to all of our families and workers.
        There is an old principle, where you stand depends upon
    where you sit. That applies across bipartisan lines as well.
    The chart here, this chart shows why carbon plans will hit
    States differently. These pie charts show how different States
    derive their electricity from different fuel sources.
        Now, Missouri, we depend upon coal for 85 percent of our
    power. New Jersey depends upon coal only 20 percent, and
    California only 1 percent. So coal cost don't have an impact in
    California, much less in New Jersey. But these climate plans
    that hit coal hard will cause real economic distress,
    relatively speaking, States already emphasizing lower carbon
    energy with natural gas or nuclear are not going to be hit so
    badly.
        There are some economic consequences, Madam Chair. You have
    to have a strong economy to be able to afford environmental
    improvements. The strength of the American economy has allowed
    us to do a better job in controlling greenhouse gas emissions
    than our European Union friends who so loudly proclaimed their
    love for Kyoto but have not been able to cut the mustard.
    Keeping the economy strong will allow us to make more gains in
    dealing with environmental problems.
        I saw first-hand, Madam Chair, the environmental disaster
    of socialist East Germany. I went there just after the wall
    fell. I saw chemical plants with terrible smells putting fluid,
    liquid into open creeks, flowing into the sea. It looked like
    very dark coffee. But it smelled like something that I won't
    describe, because we are too close to lunch time to describe
    it. Getting the East German economy revived, West Germany with
    its strong economy, is the only way that we can make that
    progress.
        But there is also another problem. Putting heavy costs on
    coal can have major unintended consequences. I hope they are
    unintended. But the more you put pressure on coal, the less
    resources will be available to develop the clean coal
    technology that we must have. On the regional basis, plans that
    place an unfair degree of pain on midwestern families and
    workers would include caps set too low or too soon, lack of
    safety valves or requiring auctions that force consumers to pay
    twice for their energy, once when it is produced and again
    through the auction process.
        Now, the witnesses here today from New Jersey espouse this,
    just the same sort of anti-coal bias. Indeed, it is easy to
    determine who are for the plans that are unfair and
    unaffordable by many looking at this chart. Here are the States
    in the tan, our States that depend upon coal. The States not so
    colored are the ones, like the northeast and the west coast
    that don't depend upon coal. No wonder the people who are
    champions of carbon caps come from the white colored States. We
    in the Midwest don't intend to stand by and see it happen.
        I would say in my remaining seconds that one of the things
    that we have to do is wean the greedy natural-gas burning
    electric utilities off of that valuable resource. I have quoted
    before, but maybe somebody hasn't heard it, 25 years ago,
    Professor Glenn Seaborg, a Nobel laureate, said burning natural
    gas to produce electricity is like throwing your most valuable
    antique furniture into the fireplace to heat your house.
        Madam Chair, I have lots more, but I see my time is up, and
    I thank you.
        Senator Boxer. Senator Bond, it is really great to have you
    here, because you really are very animated on this. I just want
    to repeat, there seems to be an argument, I personally believe
    clean coal technology is absolutely essential. We have to deal
    with it, and I am very open to it and want to do it.
        I also wanted to mention, to get 20 percent of your power
    from coal is a lot of energy. So I do think we will look
    forward to hearing Senator Corzine on that.
        Senator Clinton.

    STATEMENT OF HON. HILLARY RODHAM CLINTON, U.S. SENATOR FROM THE
                           STATE OF NEW YORK

        Senator Clinton. Thank you, Madam Chairman. I could not
    disagree more with Senator Bond's description of the problems
    we face. We have heard an eloquent, passionate description of
    why we can't do anything. I reject that. I think that we can do
    whatever we put our minds to. We just haven't been willing to
    do that in the last several years.
        So I commend the Chairman, because she is willing to lead
    us on a path that will not only be good for the environment, it
    will be good for the economy and it will be good for our
    security. On Monday, I was at a coal-fired plant outside of
    Buffalo, NY, that is looking to be one of the very first in our
    Country to move toward an integrated gasifcation system. It is
    going to take some help in order for them to do that. We have
    subsidized the oil and gas industry for decades. It is time to
    take those subsidies, those tax breaks, and put them to work on
    behalf of clean coal and renewables. I hope that we can address
    that. I have a proposal to do that with a strategic energy fund
    that would get us on the right path for deploying new
    technologies in a way that will begin to let us seriously deal
    with climate change.
        I am delighted to see our former member of this committee
    here. If we ever stop talking, he will have a chance to
    testify. Governor Corzine and I shared a great, great time on
    this committee early on trying to deal with some of the
    consequences of the attacks of 9/11. He was the strongest voice
    with the best plan on dealing with chemical plants. He is back
    again to talk about more of his far-reaching ideas that will
    really make a difference.
        I notice, too, that there are representatives from
    California, both the President pro tem of the California State
    Senate, and the Speaker of the California State Assembly.
    Because it is interesting to note that when people talk about
    how we cannot deal with climate change without wrecking our
    economy, California has had a flat per capita usage of
    electricity for 30 years. Why? Because California took steps to
    try to reduce demand, to do more energy efficiency and
    conservation. The rest of the Country has had an increase in 50
    percent of the use of electricity on a per capita basis.
        So when people say we can't do this, I say, ``well, I don't
    think that is true.'' In fact, California is doing it.
        There are a lot of good ideas that are at work right now
    across our Country. I commend the Chairman for giving us this
    opportunity to learn more about what is actually working in the
    States. It is our challenge to take it to scale, to put into
    place a framework for a national program. That is what we are
    going to do under your leadership, and again, I thank you for
    leading the way.
        Senator Boxer. Thank you so much, Senator Clinton.
        Senator Craig.

     STATEMENT OF HON. LARRY E. CRAIG, U.S. SENATOR FROM THE STATE
                                OF IDAHO

        Senator Craig. Madam Chairman, I came late, and I
    apologize. So because of the patience of our former colleague
    here and his presence before the committee today, I say let the
    show begin.
        Senator Boxer. Well, the show began a long time ago.
        [Laughter.]
        Senator Craig. So I noticed.
        Senator Boxer. But you are most generous of spirit and we
    thank you.
        Just to delay it a tad more, I have asked Senator Menendez,
    because he felt so strongly about saying a few words, as
    Senator Lautenberg did, about his Governor. Senator?
        Senator Menendez. Thank you, Madam Chairlady, and thank you
    and Senator Inhofe for the opportunity to join in the honor and
    privilege of introducing my predecessor here in the Senate and
    our Governor Jon Corzine to the committee. In the years since
    Governor Corzine has taken office, he has exhibited tremendous
    leadership on a broad array of policy issues, taken on some of
    the toughest issues in our State. He has demonstrated a
    steadfast determination to work to improve the quality of life
    for all New Jerseyians.
        One of the areas that I am proud to say that he is leading
    New Jersey into excellence in is his stewardship of the
    environment, to a commitment of making the tough decisions that
    need to be made in order to ensure that our children and
    grandchildren are left with a healthier world than the one we
    are living in today. I think our Governor knows the tremendous
    risk that our State, our Nation and our planet face if we do
    not take serious action to combat global warming and that we do
    not do so sooner rather than later.
        But he also has the foresight to recognize the tremendous
    opportunities that New Jersey can take advantage of quickly and
    decisively, the advantage that the Nation as a whole could
    enjoy relative to the rest of the world if we, as Congress, act
    similarly. Now, having some of our colleagues' comments, I
    would say that what is not acceptable is to put any part of the
    Nation to put our collective health, security and well-being at
    risk. We are all in this together. I think that when we come to
    that conclusion we will all be able to move forward in a way
    that will achieve our collective goals.
        Individual actions to reduce greenhouse gases, either by
    making your home more energy efficient or purchasing carbon
    offsets are good starts, as are State and regional actions like
    the Regional Greenhouse Gas Initiative and the Western Regional
    Climate Action Initiative. But they are no substitute for a
    robust national climate policy.
        So I want to applaud Governor Corzine for his steps in New
    Jersey, making New Jersey one of the leaders on this issue. I
    applaud your leadership, Madam Chairlady, and the committee,
    for making this one of the highest priorities of the new
    Congress. Again, thank you for the opportunity to introduce our
    Governor and my good friend, Jon Corzine.

    STATEMENT OF HON. JON S. CORZINE, GOVERNOR, STATE OF NEW JERSEY

        Governor Corzine. Thank you, Madam Chairman, and I
    appreciate very much the kind words of Senator Menendez and
    Senator Lautenberg, who are great partners, by the way, in
    framing the issues for the public in the State of New Jersey in
    making sure that we are addressing these issues and moving
    forward. We are really in a partnership. I hope that we will
    have one more broadly with the Federal Government.
        I commend both Chairperson Boxer and Senator Inhofe for
    inviting me. Thank you very much for this opportunity to talk
    about an issue that, I guess I would concur that I am pretty
    well convinced we have a problem. I read the IPCC report and
    find it chilling.
        We have tried to, as you mentioned, Madam Chairman, set
    statewide targets for stabilizing New Jersey's greenhouse gas
    emissions, both resetting to 1990, but also putting together a
    long-term vision that will have to be matched with
    restructuring the 80 percent below 2006 levels by 2050. It
    should not be achieved on a precipitous basis. It needs to be
    done over a period of time, and restructuring our economy will
    be good. It is important that those of us at State and local
    levels are addressing this issue. I am proud of the steps that
    are being taken.
        I may not be the terminator of greenhouse gases, but we are
    working very hard to actually be a part of a broader movement
    that is occurring across the Country that recognizes the need,
    the vulnerability, but also accepts that there is a challenge,
    but not a prohibitive challenge, to make sure that we do the
    best job we can to keep our economy strong. In fact, I think it
    is a false choice. I will try to comment about that in a
    second.
        I look at this whole debate as one of both recognizing
    vulnerability and also recognizing opportunity. There is no
    question, I identify with the icehouses, fishing, if you go to
    the Jersey shore and its barrier coast and see the erosion of
    our beach line in a very tangible way, you can do the
    scientific research, which you can see for yourselves the
    reality. Something is changing. I believe it is the unchecked
    human caused emissions that are a part, if not the driving
    force of this. They have severe adverse impacts to our
    environment, and I believe the economy, since we are driven so
    much by our tourist economy and so much of our densely
    populated State lives within 50 miles of the coastline. I don't
    think this is just an issue that you can only look at what it
    is going to do to your business climate. You have to look at it
    much more broadly. I think New Orleans is a pretty clear case
    that there are vulnerabilities that end up costing money.
        That is the vulnerability side. On the opportunity side,
    and by the way, I could have talked about national security and
    energy independence with regard to vulnerability. I will leave
    that to other folks. The opportunity is this can be an economic
    driver in our society. We look at it as a driver for new
    markets in efficiency and clean energy technologies,
    technological innovation. New Jersey wants to be at the
    forefront, including by the way, clean coal technologies. We
    want to see that happen. We think we can change that carbon
    footprint.
        And I will say that there is another advantage. The States
    that are the first movers in this will have a competitive
    advantage when they speak to what happens in the world as we go
    forward. This change is going to be addressed. It is just when,
    not whether, in my view. If we in the State of New Jersey or
    California or New York or wherever it is that you have
    addressed these issues, will be in a much better position to
    have a stronger economy as time goes on. It shouldn't, again,
    be precipitous. It needs to be as we go forward.
        So I am very, very keen on making sure our State fulfills
    its responsibilities in being a strong voice for change here.
    It is important, though, that we begin to deal with this at the
    Federal level. I think I have heard these debates some time
    before, as Senator Clinton mentioned. I think we heard them
    actually in 2001 and 2002. But we need to do this for very
    serious reasons that apply to people's lives, like businesses
    need to make long-term capital plans. We need to make sure that
    the leakage problems that go on when we do it in one region or
    one State don't end up undermining the efforts. We all live in
    one world. So I think it is important that we do it.
        We need resources from the Federal Government to go along,
    whether it is developing new technologies like the strategic
    energy investments that Senator Clinton talked about or others.
    We need to be working on developing the output. That is going
    to take dollars, and I think the Federal Government needs to be
    working on that with us. We are going to put together, we are
    going to ask for a Governor's climate protection leadership
    council. I am going to call for all the Governors, hopefully we
    will get as many as possible to participate in this, both as a
    voice to push forward, the kinds of things that I think have
    been suggested, to improve it on targeting, but also in
    implications for policy. We need to move forward there.
        So I hope that you all will pass meaningful legislation,
    not just legislation that checks the box, but something that
    actually gets us into a position where we are changing. I think
    you need a portfolio approach. It is not just about energy
    production and powerplants. It is also about CAFE standards. It
    is about making sure that we have building codes that work and
    produce efficiencies. It is about renewable portfolio
    standards. It is a composite of things. If we don't think of it
    on a holistic basis, I think we will fail.
        In my formal statement I have laid down several principles
    that I think should be included in Federal legislation. There
    certainly should be a strong science basis to that, we ought to
    have a portfolio approach, as I talked about. You ought to look
    to the States for that laboratory of experimentation that was
    talked about.
        But maybe just as important, I am a little fired up about
    this with respect to chemical security efforts, we shouldn't
    have Federal legislation that preempts States that actually are
    taking aggressive stands with regard to pushing forward on
    this. So I commend the committee and the Chairwoman for the
    efforts to put together the leadership to move this forward.
    This is one of those issues that is most important to the
    future of our children and children's children. It is
    bipartisan and there is bipartisan support for us taking this
    on. I hope that you will come to a positive conclusion in
    embracing many of the ideas.
        Thank you, Madam Chairman.
        [The prepared statement of Governor Corzine follows:]
           Statement of Jon S. Corzine, Governor, State of New Jersey
        Thank you Chairwoman Boxer and Senator Inhofe for inviting me to
    testify. I particularly want to thank my good friend, the senior
    Senator from New Jersey, Senator Lautenberg, who has long been a leader
    on environmental protection. I am happy to be back among friends and I
    want to commend all my former colleagues and committee members on both
    sides of the aisle for holding this hearing and taking the steps
    necessary to begin tackling the issue of climate change on a national
    level.
        As most of you know, I recently issued an Executive Order that sets
    statewide targets for stabilizing New Jersey's greenhouse gas emissions
    at 1990 levels by 2020 and reducing greenhouse gas emissions to 80
    percent below 2006 levels by 2050.
        Yes, it is true that the challenges New Jersey faces are merely
    part of a much larger global problem. And, yes, we need to overcome the
    most crippling barrier we face--the false idea that we can't reduce
    greenhouse gas emissions without hurting the economy.
        But I took this action because climate change, driven by unchecked
    human-caused emissions of greenhouse gases, will result in severe
    adverse impacts to both the environment and economy of New Jersey.
        New Jersey is especially vulnerable to the environmental and
    economic effects of climate change, including the effect of sea level
    rise on the State's densely developed coastline from increased
    incidence and severity of flooding. Likewise, New Jersey's economy is
    also especially vulnerable to the effects of climate change with our
    active ports, a vibrant agricultural sector and a significant coastal-
    based tourism industry.
        While climate change presents acute risks for New Jersey,
    addressing this challenge also provides great opportunity. Reducing
    greenhouse gas emissions will support New Jersey's economic growth
    strategy by creating economic drivers that build markets for energy
    efficiency and clean energy technologies, and spur technical innovation
    and job growth.
        In short, reducing our carbon footprint can and should go hand-in-
    hand with increasing economic vitality.
        Moving aggressively now to reduce greenhouse gas emissions will
    also place New Jersey's economy at a competitive advantage in
    responding to the requirements of an anticipated Federal program to
    reduce greenhouse gas emissions.
        I am not alone in recognizing the economic opportunities presented
    by reducing greenhouse gas emissions. My counterparts in Maine,
    Vermont, New Hampshire, New York, Massachusetts, Connecticut, Rhode
    Island, Delaware and Maryland, along with New Jersey, are leading the
    charge through our work on the Regional Greenhouse Gas Initiative
    (RGGI).
        Governors Schwarzenegger of California, Napolitano of Arizona,
    Richardson of New Mexico, Gregoire of Washington, and Blagojevich of
    Illinois have all set aggressive greenhouse gas emissions reduction
    targets for their States. Additionally, Governors of five western
    States have formed the Western Regional Climate Action Initiative.
        Each day, additional States make commitments to fight the battle
    against global warming--regardless of whether they are red or blue--in
    large part because of the vacuum of leadership at the Federal level.
        While States are currently taking the lead, we need Federal action
    to set minimum requirements that allow businesses to make long-term
    capital planning decisions. State efforts will provide many useful
    lessons to inform the design of Federal legislation. However, absent
    unifying Federal policy that sets minimum requirements, multiple State
    efforts will create an environment of uncertainty for business.
        States' actions are the foundation for future Federal programs and,
    as such, the Federal Government needs to recognize the critical
    resources States bring to bear on this issue. Federal monies need to be
    made available now to States who are leading in the development of
    policies on this issue, acknowledging the critical role that those
    States' planning and actions have on development of Federal programs.
        To build momentum for Federal action, I intend to reach out to
    other governors that have asserted strong leadership in reducing
    greenhouse gas emissions to call for the formation of a Governors'
    Climate Protection Leadership Council. I believe that the time is ripe
    for States demonstrating leadership in reducing greenhouse gas
    emissions to coordinate their efforts, both to accelerate progress in
    implementing emissions reduction policies at the State level and to
    drive the policy debate at the Federal level.
        A coalition of leadership States will provide a more effective
    voice of advocacy for a strong Federal greenhouse gas regulatory
    program that acknowledges a role for States in its design and
    implementation.
        It is imperative for Congress to act, but it is also imperative for
    Congress to act to create meaningful--not symbolic--Federal laws. Weak
    or marginal Federal laws will only turn back the progress States have
    made.
        Today I ask you to redouble your efforts to pass meaningful Federal
    climate change legislation. The long-term wellbeing of New Jersey
    ultimately depends on a strong Federal program to reduce greenhouse gas
    emissions, as well as a reengagement by the Federal Government in
    international negotiations to further develop a global response to
    climate change.
        Additionally, more emphasis needs to be placed on energy efficiency
    initiatives, such as new appliance standards and enhanced building
    codes. I urge you to increase the Corporate Average Fuel Economy
    (``CAFE'') standards. In New Jersey, nearly 50 percent of our carbon
    dioxide emissions are from the transportation sector. Increased fuel
    mileage standards at the Federal level will greatly assist in our
    efforts to meet our climate change goals.
        I have attached a list of principles for Federal action on climate
    change that draws from the approach my administration has taken to
    designing emissions reduction policies and measures, both at the State
    level and through regional efforts, such as the Regional Greenhouse Gas
    Initiative.
        I hope that you will find these principles useful as you consider
    the multitude of Federal climate change bills that have recently been
    introduced.
        At a minimum, Federal climate change legislation should establish
    strong science-based emissions reduction limits. An emissions reduction
    on the order of 80 percent relative to current levels by 2050 will
    likely be needed to avoid dangerous interference with the climate
    system.
        Federal legislation should also acknowledge that a portfolio
    approach is required, and that implementing a Federal cap-and-trade
    program alone would be ill advised and insufficient. State climate
    change action plans have evaluated a multitude of policy measures for
    reducing greenhouse gas emissions. This portfolio approach should
    inform the development of Federal legislation.
        Federal legislation should acknowledge an ongoing role for States
    in the design and implementation of a Federal emissions reduction
    program. Congress can learn a great deal by reviewing the work already
    done at the State level to evaluate and develop greenhouse gas
    emissions reduction policies. One prominent example is the Regional
    Greenhouse Gas Initiative, which is the only effort in the United
    States to date to actually articulate the detailed design of a
    CO2 cap-and-trade program for the power sector. A role for
    States should be institutionalized through Federal legislation.
        Finally, I want to underline the following. States are currently
    the leaders in addressing climate change, and will likely continue to
    push the envelope after Federal legislation is enacted. Federal
    legislation should facilitate the role of the States as policy
    innovators by explicitly preventing Federal preemption of State
    programs that go beyond Federal minimum requirements, as well as
    preventing preemption of State programs outside the scope of Federal
    initiatives.
        New Jersey is a great example of this innovation. While the goals I
    have set for New Jersey are aggressive, we believe they can be met, and
    we intend to meet them by building on actions already underway to
    reduce greenhouse gas emissions.
        We have played a leadership role in the Regional Greenhouse Gas
    Initiative (``RGGI''), the first-ever cap-and-trade program addressing
    CO2 in the United States. RGGI will cap power sector
    CO2 emissions in 10 Northeast and Mid-Atlantic States at
    approximately current levels through 2014 and reduce emissions to 10
    percent below this level by 2019, a reduction of 16 percent relative to
    projected 2020 business-as-usual emissions.
        We have enacted California's greenhouse gas tailpipe standards for
    light-duty vehicles, which is projected to result in an 18 percent
    reduction in CO2 equivalent emissions from the New Jersey
    light-duty vehicle fleet in 2020 relative to projected business-as-
    usual emissions.
        We have increased the New Jersey Renewable Portfolio Standard to 20
    percent by 2020, which will require 20 percent of all electricity sold
    at the retail level in New Jersey to come from Class I renewable energy
    sources, such as solar, wind, and sustainable biomass.
        I have directed our Energy Master Plan Committee, a multi-agency
    initiative, to develop recommendations for reducing statewide energy
    use by 20 percent in 2020 relative to business-as-usual projections.
    Approximately 85 percent of New Jersey's greenhouse gas emissions are
    due to combustion of fossil fuels for energy.
        I have appointed a Director of Energy Savings in the Department of
    Treasury to set targets for reducing energy usage in State facilities
    and reducing fuel consumption by the State vehicle fleet.
        These measures take us a long way toward meeting New Jersey's 2020
    emissions target, but further actions will be necessary. I have
    directed New Jersey's Department of Environmental Protection, in
    coordination with representatives of the Board of Public Utilities, the
    Department of Transportation, and the Department of Community Affairs,
    to provide recommendations to me within the next 6 months for achieving
    New Jersey's 2020 and 2050 greenhouse gas emissions reduction targets.
        Thank you for this opportunity to testify on this important issue.
    I look forward to working with you as we jointly tackle the historic
    environmental challenge of climate change at both the Federal and State
    level.
                                     ______

                                   ATTACHMENT
     principles for effective, scientifically sound federal climate change
                                  legislation
        Emissions Reduction Requirement.--Incorporate a science-based,
    long-term emissions reduction requirement with a goal of avoiding
    dangerous anthropogenic interference with the climate system. Based on
    current state of the science, legislation should stabilize and begin to
    reduce greenhouse gas emissions within the next 10 years, and achieve
    emissions reduction of 80 percent relative to current levels by 2050.
        Legislation should institutionalize a periodic review of climate
    science and allow for a revision of emissions reduction requirements
    based on the current state of the science.
        Policy Approach.--Pursue a portfolio approach to reducing
    emissions, acknowledging that a cap-and-trade program may be
    appropriate for some sectors (e.g., large stationary sources), but that
    other policies may be more appropriate for addressing emissions from
    other sectors. States have a unique capacity to implement a portfolio
    of policies and measures that address energy production, energy
    efficiency, transportation, waste management, agriculture, and other
    economic sectors.
        Design Process.--Learn from and build upon the policy work already
    completed or underway at the State level when crafting federal emission
    reductions programs (e.g., RGGI, California AB 32, state climate action
    planning processes).
        Implementation Process (Role for States).--Institutionalize a role
    for States in designing and implementing statutorily mandated federal
    emissions reduction regulations under the auspices of a federal
    portfolio approach. This would provide a role for States to help
    articulate the details of Federal emissions reduction programs,
    building upon the analyses being done by leadership States through
    their climate action planning processes and regional emissions
    reduction programs such as RGGI.
        Explicitly prevent federal preemption of State programs that go
    beyond federal minimum requirements, as well as preemption of State
    programs outside the scope of federal initiatives.
        Cap-and-Trade Program Design.--Avoid the use of safety valves or
    price caps.
        Allocate allowances in a manner that maximizes consumer benefits
    and market transformation impacts. In the electric power sector,
    allowances should be auctioned, in recognition that large portions of
    the United States have instituted competitive wholesale electricity
    markets. The monies from the auctions should be used for measures that
    both reduce our carbon footprint and enhance our competitiveness, such
    as energy efficiency projects.
        Signal that new conventional coal-fired powerplants constructed
    from this day forward will not be grandfathered under a federal cap-
    and-trade system, and will need to purchase allowances on the open
    market.
        Limit the use of emissions offsets, to ensure that a majority of
    emissions reductions are achieved from the capped sector or sectors.
    Emissions offsets should be incorporated as a flexibility mechanism
    that is designed to be supplemental to on-system emissions reductions.
        Design robust requirements to ensure that emissions offsets are of
    high quality and represent incremental emissions reductions beyond
    business-as-usual reductions. Should include strong additionality
    criteria to avoid crediting of ``anyway tons'' and provide a reasonable
    assurance that the cap-and-trade program is what is actually driving
    emission reductions achieved through offsets. Quantification and
    verification protocols should be rigorous and detailed, and apply
    conservative assumptions when appropriate.
                                     ______

          Responses by Governor Corzine to Additional Questions from
                                 Senator Thomas
        Question 1. New Jersey is one of many States that have adopted
    regional efforts to reduce greenhouse gas emissions. I am concerned
    that the costs associated with making these changes are inevitably
    passed onto consumers. Can you describe to us what you believe are the
    top 3 most affordable ways to achieve these greenhouse gas emissions
    cuts?
        Response. The backbone of any greenhouse gas emissions reduction
    program is the implementation of aggressive mandatory policies and
    financial incentive structures to improve end-use energy efficiency.
    Very significant potential remains to reduce energy use through
    improvements in the residential, commercial, and industrial sectors.
    Energy efficiency improvements provide net financial benefits and often
    increase economic competitiveness. Aggressive energy efficiency
    improvements can also serve to reduce the market price of primary
    fuels, such as natural gas. In the electricity sector, aggressive
    energy efficiency and demand-side management actions have been shown to
    reduce the price of wholesale electricity at times when these prices
    are at their peak. Energy efficiency and demand-side management also
    enhances electricity reliability and defers the need to expand
    electricity transmission and distribution infrastructure, providing
    additional cost savings to consumers.

        Question 2. You discussed the Executive Order you've issued to
    stabilize gases at 1990 levels by 2020 and reduce them further by 2050.
    Can you explain the enforcement mechanism that was included in the
    Executive Order to make sure that those targets are in fact, achieved?
        Response. The greenhouse gas emissions reduction targets I set
    through Executive Order No. 54 were intended to focus multiple State
    agencies and policies on a unified objective of reducing greenhouse gas
    emissions. Pursuant to the Order, a number of key State agencies, led
    by the Department of Environmental Protection, were tasked with
    providing to me specific recommendations by the end of the summer for
    policies and mechanisms to meet both the 2020 and 2050 targets. In
    addition, the DEP will be required to report progress towards meeting
    the targets every 2 years to measure progress and recommend whether
    additional measures are necessary.
        A number of actions New Jersey is taking now to reduce greenhouse
    gas emissions place the State on a trajectory to meet the 2020 target,
    although additional measures will be necessary. The State is already
    targeting the two largest greenhouse gas-emitting sectors through
    mandatory programs and has proposed an aggressive statewide energy
    efficiency goal. Key measures enacted or under consideration include
    the following:
         The New Jersey Energy Master Plan goal of reducing
    statewide energy use by 20 percent in 2020 relative to projected
    business-as-usual energy use, and recommended measures to achieve this
    reduction, would achieve significant greenhouse gas emissions
    reductions (more than 85 percent of New Jersey greenhouse gas emissions
    are due to combustion of fossil fuels for energy). Completion of the
    Plan is expected in late 2007.
         Enactment of the California Low Emission Vehicle (LEV)
    program greenhouse gas omissions standards for tight-duty vehicles is
    projected to result in an 18 percent reduction in CO2-
    equivalent emissions from the New Jersey light-duty vehicle fleet in
    2020 relative to projected business-as-usual emissions. The adopted
    rules require automakers to reduce fleet-wide average greenhouse gas
    emissions from the vehicles they sell in New Jersey 30 percent by 2016.
         Implementation of the Regional Greenhouse Gas Initiative
    (RGGI) is projected to result in a 16 percent reduction in regional
    power sector CO2 emissions in 2020 relative to projected
    business-as-usual emissions. The first mandatory market-based program
    to reduce carbon emissions in the United States, the RGGI cap-and-trade
    program will cap regional powerplant CO2 emissions at
    approximately current levels from 2009 through 2014 and reduce
    emissions 10 percent by 2019.
         The increase of the Renewable Portfolio Standard in 2006
    to 20 percent by 2020 will support achievement of the RGGI cap and will
    lead to supplemental greenhouse gas emissions reductions that occur
    outside the geographic scope of RGGI (e.g., portions of the PJM
    electricity control area not subject to the RGGI program).

        Question 3. You discussed the economic advantages of acting early
    to make abiding by a federal requirement to reduce these gases easier.
    Do you believe that the economic advantages for your State remain
    intact if Congress decides against implementing a mandatory national
    program to reduce greenhouse gas emissions?
        Response. The economic advantages to New Jersey of acting now to
    reduce greenhouse gas emissions are apparent. Reducing greenhouse gas
    emissions will support New Jersey's economic growth strategy by
    creating economic drivers that build markets for energy efficiency and
    clean energy technologies, and spur technical innovation and job
    growth. While I believe that a national program is inevitable and
    crucial, given the compelling scientific consensus that human
    activities are driving climate change, New Jersey would still derive a
    competitive advantage through efforts to reduce greenhouse gas
    emissions, were Congress to decide against implementing a federal
    program. Energy efficiency, which is the backbone of New Jersey's
    strategy for meeting the 2020 emissions reduction target, will provide
    net economic benefits for the State and reduce our vulnerability to
    fossil fuel price volatility. In addition, improving energy efficiency
    will provide an engine for job growth, as saving a unit of energy
    creates more jobs than supplying one. Rather than shipping dollars out
    of State to purchase primary energy we will be investing dollars in the
    State to tap the large available energy efficiency ``virtual supply''
    to meet a greater portion of New Jersey's energy needs. As a result, I
    strongly believe that aggressive greenhouse gas emissions reduction
    policy is well aligned with sound energy policy in supporting the long-
    term sustainable growth of the New Jersey economy.
                                     ______

          Responses by Governor Corzine to Additional Questions from
                                 Senator Inhofe
        Question 1. Governor, given that the Kyoto Protocol cap and trade
    program is providing to be such a colossal failure, would you tell us
    how New Jersey's situation is different that would explain your
    optimism that a cap and trade program will work in New Jersey?
        Response. Emissions trading programs addressing SO2 and
    NO have demonstrated that cap-and-trade programs spur innovation and
    achieve emissions reductions at a significantly lower cost than
    originally projected by policy makers. Given the numerous potential
    measures and technologies for reducing greenhouse gas emissions in the
    context of a multi-sector emissions trading program, and the wide
    variation in control costs for different measures and technologies,
    there is every indication that greenhouse gases are even more amenable
    to a cap-and-trade approach than criteria pollutants.

        Question 2. Do you plan to build more nuclear plants in your State
    and do you support nuclear power?
        Response. Nuclear energy provides approximately 52 percent of New
    Jersey's in-state generation and obviously plays a significant role in
    our energy portfolio. A new nuclear facility has not been ordered in
    the United State in 28 years, however recent changes in the federal
    policy have brought about a resurgence in nuclear energy. Several
    reactors are in various stages of planning, international nuclear
    vendors are forming new alliances and rising uranium prices have led to
    the development of new mines.
        In spring 2007, PSEG announced that they were in exploratory talks
    with another company to build another reactor, most likely at their
    Salem Generating Station in southern New Jersey. The company cited the
    need to identify its intentions by the end of 2008 in order to take
    advantage of federal incentives, including tax credits, risk insurance
    and loan guarantees.

        Question 3. Where are you going to get your emission reductions to
    meet this target? Are you planning to shut down all remaining coal
    plants in your State and replace them primarily with natural gas?
        Response. The emissions reduction targets I have set for the State
    are multi-sector and are not limited to the electricity sector, as the
    question suggests. I have tasked an interagency working group to
    provide recommendations to me by the end of the summer for how best to
    meet both the 2020 and 2050 Statewide emissions reduction targets.
                    addressing electricity sector emissions
        New Jersey is a leader in the Regional Greenhouse Gas Initiative
    (RGGI), a 10-state CO2 cap-and-trade program for the power
    sector slated to begin in 2009. Extensive electricity sector modeling
    during the development of the RGGI program, using a model widely used
    by the industry itself, has shown that the costs of the program will
    likely be modest and are not projected to result in a significant
    retirement of existing coal-fired electric generating capacity in the
    region.
        While there are currently no fully commercialized end-of-stack
    control technologies for CO2, there are emerging end-of-
    stack options in the early commercialization and deployment phase,
    including carbon capture and storage technologies and carbon scrubbing
    technologies. Placing a price on carbon through a cap-and-trade program
    is critical to speeding the commercialization of these technologies,
    which will lower long-terms emissions reduction costs. These
    technologies will facilitate a continued role for coal-fired generation
    in a carbon-constrained economy. Absent end-of-stack controls, a number
    of compliance options are available in the near-term to electric
    generators subject to RGGI, including heat rate improvements, fuel
    switching, co-firing of biofuels, environmental dispatch of a company
    portfolio of units that considers the CO2 emissions rate of
    individual units, and the use of emissions offsets.
        RGGI will also address the demand-side of the equation, through an
    auction of allowances and the use of the realized revenue to provide
    incentives for improvements in electricity end-use energy efficiency.
    This approach is discussed in more detail in response to question no.
    4.
        Question 4. It is a fairly well understood economic phenomenon that
    closing significant numbers of coal plants increases gas demand and
    increases both the average cost and volatility of natural gas prices.
    Aren't you worried about higher electric costs in your State, lost jobs
    in the manufacturing sector which is heavily reliant on natural gas as
    a feed stock?
        Response. While RGGI is not expected to lead to a significant
    retirement of coal-fired generation, the RGGI program is addressing
    emissions reduction from both a supply-side and demand-side approach.
    The demand-side component of RGGI will mitigate both electricity and
    fuel price increases resulting from the imposition of a carbon cap.
        The RGGI cap-and-trade program establishes a regional emissions
    budget (the cap), and creates allowances, each of which allow a
    regulated source to emit one ton of CO2. These allowances
    may be traded freely among both regulated and non-regulated parties. At
    the end of a compliance period, a regulated source must submit
    allowances equivalent to its emissions. In past cap-and-trade programs
    for sulfur dioxide (SO2) and nitrogen oxides (NOx),
    allowances were distributed to sources for free, often based on
    historic operation. The RGGI memorandum of understanding (MOU) sets
    forth a different approach. Under the MOU, the RGGI-participating
    States agreed to allocate a minimum of 25 percent of the allowances to
    support ``consumer benefit or strategic energy purposes.''\1\ The
    understanding among RGGI-participating States is that these allowances
    would be auctioned and the revenues would be used to support the
    general program goals outlined in the MOU.
    ---------------------------------------------------------------------------
        \1\ The MOU defines these terms as including ``use of allowances to
    promote energy efficiency, to directly mitigate electricity ratepayer
    impacts, to promote renewable or non-carbon-emitting energy
    technologies, to stimulate or reward investment in the development of
    innovative carbon emissions abatement technologies with significant
    carbon reduction potential. . . .''
    ---------------------------------------------------------------------------
        During the negotiation of the MOU, New Jersey was at the forefront
    in advocating for a large consumer allocation, and also advocating that
    a primary focus of this allocation be on reducing electricity demand in
    the RGGI region. No end-of-stack controls are now commercially
    available to limit CO2 emissions.\2\ As a result, a
    CO2 cap-and-trade program will benefit from having a strong
    end-use component integrated into its design. This allows RGGI to adopt
    both a supply-side (electricity generation) and demand-side
    (electricity use) focus, facilitating the achievement of emissions
    reductions at least cost.
    ---------------------------------------------------------------------------
        \2\ As mentioned previously, there are emerging end-of-stack
    options in the early commercialization and deployment phase. Absent
    end-of-stank controls, a number of compliance options are available to
    electric generators subject to RGGI, including heat rate improvements,
    fuel switching, co-firing of biofuels, environmental dispatch of a
    company portfolio of units that considers the CO2 emissions
    rate of individual units, and the use of emissions offsets.
    ---------------------------------------------------------------------------
        Electricity market dynamics also support the use of CO2
    allowance value to reduce electricity demand, which will in turn reduce
    aggregate RGGI compliance costs. RGGI is being implemented in a
    restructured, competitive wholesale electricity market. Electric
    generators are therefore expected to factor the opportunity cost of
    using CO2 allowances into their bid prices whether
    allowances are given out for free or they are required to purchase
    allowances on the market.\3\ As a result, the carbon compliance cost of
    the marginal generation unit will be factored into the market-clearing
    price of electricity, which will allow generators subject to RGGI to
    recover a significant portion of their compliance costs through an
    increase in the wholesale market price of electricity (assuming
    generators must purchase allowances). If allowances are distributed for
    free, this allows the generation sector as a whole to realize a net
    increase in revenues as a result of the cap-and-trade program, because
    revenue received through a rise in wholesale electricity prices will
    substantially exceed CO2 compliance costs. This dynamic has
    in fact been borne out through the initial experience of the European
    Union Emissions Trading Scheme for CO2 which allocated the
    vast majority of allowances to regulated sources for free. Early market
    impacts in the EU have generated significant controversy and led for a
    call by many to auction allowances.
    ---------------------------------------------------------------------------
        \3\ Allowances will have a market value, irrespective of the
    original allocation method.

        Question 5. New Jersey relies far more heavily on natural gas for
    home heating than in other States on average. Aren't you worried about
    heating costs for the elderly, poor and working class in New Jersey?
        Response. As mentioned previously, aggressive efforts to reduce
    energy demand will provide net economic benefits and employment gains
    while reducing greenhouse gas emissions. A distinction should be made
    between energy prices and energy costs. A carbon constraint will
    increase prices for conventional fossil energy. However, the price
    signal from a greenhouse gas constraint will also incentivise energy
    efficiency, which if pursued aggressively, could reduce total energy
    costs paid by consumers. I do acknowledge that the poor face a higher
    energy cost burden as a percentage of their total income. For this
    reason, I support channeling energy efficiency incentives to low-income
    communities to help low-income consumers reduce their energy costs
    through the implementation of energy efficiency improvements and the
    provision ratepayer assistance where appropriate. We intend to dedicate
    a significant percentage of the revenue from the sale of RGGI
    allowances to support the energy needs of low-income households.

        Question 6. Since oven the Bingamnan proposal here in the Senate--
    which covers the entire economy--would only reduce temperatures by
    0.008 Celsius, what good do you think your plan will do in reducing
    global temperatures and do you think it is worth the harm it will do to
    the working class in your State?
        Response. Addressing climate change requires a global commitment
    from multiple nations, States, and localities. No action by single
    actor can solve a global environmental problem. However, the fact that
    multiple parties must take collective action does not negate the
    environmental value to be derived by the actions of each party, nor
    argue against action by individual parties. Such logic is an excuse for
    inaction, and ignores the reality that the global emissions reductions
    necessary to stabilize the climate will be achieved through incremental
    emissions reductions by many nations, States, and localities.
        As a State uniquely vulnerable to the impacts of climate change,
    New Jersey has a responsibility to take aggressive action to reduce
    greenhouse gas emissions. New Jersey is especially vulnerable to the
    environmental and economic effects of climate change, including the
    impact of sea level rise on the State's densely developed coastline
    from increased incidence and severity of flooding. Likewise, New
    Jersey's economy is also especially vulnerable to the impacts of
    climate change with our active ports, a vibrant agricultural sector,
    and a significant coastal-based tourism industry.
        The actions by New Jersey and other States, collectively through
    regional programs and individually, is in fact bearing fruit beyond
    State borders. State action is driving action at the federal level,
    which is vital if New Jersey hopes to mitigate the impact of climate
    change on our economy, infrastructure, and environment. Action at the
    federal level in the United States is in turn vital if we hope to bring
    large developing nations such as China and India into a mandatory
    international emissions reduction framework.

        Senator Boxer. Thank you so much, Governor. It is wonderful
    to have you back in the Senate.
        I am going to keep, if it is OK, including myself, keep the
    question period to 4 minutes so we can get to our next panel.
        Governor, I want to ask this question based on your
    expertise in the financial sector that you bring to your work.
    Earlier this week, Goldman Sachs, together with other
    investment firms, announced takeover plans for TXU, a Texas
    utility. Part of the deal was that the new TXU would scrap
    plans to build traditional style coal-fired powerplants. Do you
    think the investment community is waking up to this new reality
    and taking global warming into account as it plans for the
    future?
        Governor Corzine. Yes.
        [Laughter.]
        Senator Boxer. Do you see other example?
        Governor Corzine. I think actually what you are seeing is
    investors realizing that change is in process. It is entrained.
    That to invest in a power company that is not going to reflect
    that over a period of time is to actually impair the rates of
    return on capital for the buyers. The people that are actually
    involved in this TXU, aside from the Goldman Sachs people, who
    I don't know, are going to demand long-term rates of return on
    capital that are commensurate with the best alternatives. I
    think they are reflecting through those decisions what a lot of
    investors are doing, is we ought to get ahead of the curve as
    opposed to being behind it, which would be the case if you
    continue to build the 11 powerplants without the new
    technology.
        Senator Boxer. Sticking with the economic approach, are you
    familiar with the Stern Review?
        Governor Corzine. I am not.
        Senator Boxer. Sir Nicholas Stern, the former chief
    economist of the World Bank, conducted a recent study, October
    2006, of the cost of climate change. His principal conclusion
    is that the overall cost of climate change are equivalent to
    losing at least 5 percent of global GDP each year. The worst
    case scenarios increase the loss to 20 percent of global GDP.
    Based on the report's findings, a dollar invested now can save
    $5 later.
        Now, I am not asking you whether you agree with this,
    obviously you haven't read the report. But he is extremely well
    thought of.
        So I think the false choice, as you used that expression,
    that we have to choose between a terrible, if we do anything
    about global warming we are going to see terrible economic
    atmosphere is absolutely refuted by the experts. Coming from
    California, where we have done an amazing job in a bipartisan
    way, and I would say it is nothing to do with liberals, it is
    just smart, common sense steps on both sides of the aisle to
    make sure that we are energy efficient. We are actually saving
    money. Our businesses are saving money.
        So in my minute that I have left, I would like you to just
    expound a little bit about this shibboleth, as I call it, or if
    you do something for the environment you are going to have a
    weak economy. Because I think it is the opposite.
        Governor Corzine. Well, as I said, if you use a portfolio
    approach, you are looking to energy efficiencies, which
    hopefully will use less energy to accomplish the same ends if
    you have a renewable portfolio standard, that you don't
    implement precipitously but you do it over a period of time,
    you will have alternative sources that are competing. If
    everyone is operating with cleaner technology and we have a
    more healthy environment, I think it will show up in some of
    our costs with regard to health care and other issues.
        I believe there is a tremendous economic opportunity for
    those that are the creators of new technology and bring
    innovation to this. That is what you are seeing by this TXU
    investment. I think this is clearly a situation where there are
    some identifiable costs by not dealing with it, whether it is
    the shoreline along New Jersey, 127 miles of Atlantic Ocean
    that is no longer as productive as it would be otherwise, or
    the other elements that I talked about against, yes, there will
    be some short-term costs. But those will be more than paid for,
    in my view, by the positives that come through this process.
        Senator Boxer. Thank you.
        Senator Inhofe.
        Senator Inhofe. Governor Corzine, thank you for being here.
    It is nice to see you again.
        Let me just ask you a question. New Jersey is different
    than most other States in that you are reliant upon coal for
    only 20, 19 percent, I understand, of your energy.
        Governor Corzine. Something in that nature, yes.
        Senator Inhofe. Something like that. I saw the charts that
    were held up by Senator Bond, which showed the differences. I
    would suggest that my State of Oklahoma is very similar to
    Missouri. So it really would affect different States
    differently, and I think we understand that.
        It is hard to compare your Executive Order to meet the 1990
    levels by 2020 and then 80 percent reductions by 2050. Because
    that is not exactly what Kyoto did. But it is more stringent if
    you take it all the way out to 2050 than Kyoto.
        Now, Senator Boxer brings up, and I am glad she did, the
    cost of this. You are probably familiar with the Wharton
    Econometric Survey, because that was made actually when you
    were in the U.S. Senate. In that, they take the Nation as a
    whole and say that it would be very, very punishing
    economically to the Country. I think the best way to
    characterize it is that it would cost the average family of
    four $2,750 a year.
        I know that you are debating this, the other side of this
    issue, but you do not agree with that survey, is that correct?
        Governor Corzine. I think that is what an economic analysis
    might show, other things being equal. But I don't think other
    things are going to be equal at the same time. There are other
    issues that will provide for efficiency, alternative sources of
    energy and hopefully that there will be useful support for
    these alternative energies and clean fuels that come from the
    Federal Government in the same way that we supported the oil
    and gas industry.
        Senator Inhofe. I have to try and cut it a little bit short
    here, because it is a 4-minute timeframe. Would you, if you are
    going to meet these goals, you are going to have to have some
    kind of energy in New Jersey. Are you suggesting more nuclear
    powerplants in New Jersey?
        Governor Corzine. Well, not at this point, we certainly
    aren't. But that is an alternative. There are other
    alternatives that we are very closely examining right now, wind
    power, offshore, we are examining methane and other biofuels.
    We are talking about all kinds of other ethanol approaches to
    try to improve and we are looking at clean coal. We are
    building LNG plant in southern New Jersey.
        Senator Inhofe. So the clean coal, that is interesting, and
    I would agree with that. Actually the plants that were shut
    down as a result of the lawsuit in Texas, under TXU, were clean
    coal technology plants. In fact, they were replacing existing
    plants with newer technology. So I am glad to hear you say
    that, because there has to be a place in this mix for coal.
        Governor Corzine. We are in the mist of an energy master
    plan which is examining both likely demands, considering what
    we look to use alternative energies and efficiencies, and then
    we will lay out where we think we will generate that power
    from. But it is, it needs to be a very comprehensive approach
    that one takes in all these areas.
        On the TXU issue, I understand, at least from the
    conversations that I have had from some of the people that are
    involved in it, that there is a very strong sense that they
    will put the most powerful clean coal technology in place. But
    I am not familiar with the details.
        Senator Inhofe. Well, I would hope that would be true.
    However, if they are cutting down the number of new plants from
    11 down to 3, that makes it much more difficult for them. Of
    course, this is, this in a way is a Texas problem. But it is
    one that Governor Perry had the courage to stand up and say, we
    have to have energy for our citizens without taxing them
    disproportionately.
        Thank you, Madam Chairman.
        Senator Boxer. Thanks, Senator.
        Next we are going to go to Senator Lautenberg.
        Senator Lautenberg. Thank you, Madam Chairman.
        Governor Corzine, thanks for your leadership in New Jersey,
    in more areas than this. It is really appreciated by the
    citizens across the State.
        Is it possible to achieve the goals that are set out in our
    plans for New Jersey unless we have like programs developed to
    the west of us?
        Governor Corzine. We would do a lot better if the programs,
    the States to the west of us implement these kinds of
    initiatives. But it is not impossible for us. We are going to
    implement, as you well know, higher mileage standards for light
    vehicles and other issues. As a matter of fact, the greatest
    producer of greenhouse gases in New Jersey comes from cars. So
    to not include CAFE standards and changes in requirements with
    regard to tailpipes is a huge mistake. We can do a lot of self-
    help work in New Jersey by addressing some of our own issues.
    As I talked about the renewable portfolio standard and
    efficiencies in building codes, can take us a long way toward
    getting to our 2020 objectives. Getting to our 2050 objectives,
    I really believe is as much in your hands as it is in ours,
    although we will be able to accomplish some of our ends. A lot
    of leakage will occur if we don't have the help of the Federal
    Government.
        Senator Lautenberg. So many things we do here directly
    affect or are affected by other programs that are underway. For
    instance, in transportation, we know very well that if we put
    more into railroads, efficient railroads, we are going to
    reduce some of the pollution that comes from the cars sitting
    out there and that stuff.
        Senator Inhofe, I think maybe tried to throw you a slider.
    That was in the question about nuclear energy. I want to say
    this to you. There was a time that in this house you wouldn't
    even use the word nuclear. Now the NRC has applications for
    plants that are being widely of interest, trying to process
    these. Because in desperation to do something to protect our
    citizens, to protect this globe of ours from disappearing in a
    fog that they are looking for opportunities to reduce it. Maybe
    the politicians aren't always in tune with the people, but that
    is usually a lagging thing, anyway. It comes after elections,
    often, that you see the measure of the performance.
        But I think it is likely that all kinds of sources will be
    examined, the problems that we have are not unique, there are
    just more of them. Governor, I commend you for always being
    willing to take the path that is a little bumpy to get to a
    smooth ride at the end. We thank you very much.
        Senator Boxer. Thank you, Senator.
        Senator Voinovich.
        Senator Voinovich. Governor Senator, I am not going to ask
    you which title you like the best for the job.
        Governor Corzine. They have other titles in New Jersey.
        [Laughter.]
        Senator Voinovich. One of the things that I think is real
    important, and I am glad you brought it up, is that greenhouse
    gases are caused by lots of sources. It seems to me, Madam
    Chairman, we ought to have a chart up here about where it is
    all coming from, because so often we have a tendency just to
    concentrate on the emissions coming from fossil fueled
    utilities.
        I am suggesting to you, when I was chairman of the National
    Governors Association, we tried to get together, when I was
    going through the chairs, to get the northeast doing lenders
    together with the midwest and the far west on a policy. We
    couldn't do it, because at that time we were fingerpointing
    that, you know, your problems with emissions in New York was
    because of the Ohio plants and then we had, and you understand
    this because of your background in finance, you had the utility
    companies that all had their oar in the water also, because
    whatever you did would affect their rates. There was that
    competitive thing.
        Since that time, we have had an enormous number of mergers.
    So a lot of these utilities are wearing the same pair of shoes,
    for the most part.
        It seems to me that one of the most constructive things
    that you could do, now that the States are getting into this,
    would be to see if you can get Ray Shepach and the Governors
    Association to really sit down and look at this issue, talk
    about No. 1, some type of reasonable cap and trade, and I know
    that frightens a lot of people, what is reasonable in that area
    if you are going to go that route. Second of all, to talk about
    the issue of technology. It is one that I brought up in my
    opening statement, that the technology really isn't out there.
    There is this concept that, oh, yes, you can do it tomorrow,
    but the fact is, we can't. If you look at them, the way we are
    spending in the Department of Energy out of the 2005 bill, we
    are really not doing very much at all in terms of technology
    dealing with greenhouse gases, particularly from utilities.
        Now, Senator Clinton talks about a Manhattan project. The
    fact of the matter is, we don't spend the money that is
    necessary. It seems to me that the Governors could put together
    a kind of a consensus and come up here and really put the
    pressure on us to say, look, whether we have coal-fired or not
    coal-fired, we know this is an important issue that needs to be
    taken care of, not only for the United States, but for the
    world. We should be the leader in clean-coal technology, and
    take care of us and take care of the rest of the world.
        The other thing is that to recognize that we have an
    international problem and get them to come back here and talk
    about some initiatives that the Federal Government should be
    taking in order to have more of these Asian Pacific
    partnerships to deal with that issue, too, to put things in the
    kind of perspective that we need.
        But I think if you keep going the way we are, every State
    doing this and that, this issue, I know you don't want to be
    preempted, but you get, if you are out in the business, you can
    go crazy with all the various roles that you have. What do you
    think about that?
        Governor Corzine. Let me take that last piece. The reason
    that States are being so aggressive is that there isn't a
    feeling of action that is occurring with regard to this issue.
    Now, maybe that, different people respectfully can have
    different views about that. But the overwhelming weight of
    evidence in most of our minds in at least the States that were
    white, that Senator Inhofe showed up, is that there is a
    serious problem that needs to be addressed. From a practical
    standpoint, it doesn't matter whether it is natural or whether
    it is because it is man-made. Something is going on. The
    reality is that we need to take action to protect the quality
    of life we have.
        So if it is not going to happen on the Federal level, we
    want to be aggressive in trying to mobilize as much of the
    Country as we can. That is what, not on my watch, but under
    Governor Pataki's watch, the RGGI, or the cap and trade program
    was put together in the northeast and it is a Republican
    Governor in the west that is taking the initiative on elements
    of lead here.
        We need to be moving. If it is not going to happen, we
    shouldn't be preempted by the Federal Government writing
    regulations that are weak-kneed with regard to it. I hope we
    don't do that.
        I couldn't agree more that we need to invest in these
    technological advances. We have spent billions of dollars over
    decades on oil and gas production. We ought to turn that into
    alternative ways to produce energy that both reduce our
    dependence internationally, which is good for this Country to
    start with, and also, addresses this fundamental issue.
        Senator Boxer. Governor----
        Governor Corzine. Last, I would just say, you have to take
    a portfolio approach. Cars, how we transport ourselves is an
    important ingredient in this whole process.
        Senator Boxer. Thank you.
        Senator Voinovich, I think you are right. I will put in the
    record the U.S. emissions as of 2004 that show each greenhouse
    gas, carbon dioxides 85 percent of the problem, methane 8
    percent, nitrous oxides 5 percent and fluorinated gases 2
    percent. I will put that into the record just because I think
    it is an important part of this discussion.
        [The referenced material follows:]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Senator Boxer. Now Senator Klobuchar, we are going in order
    of arrival and back and forth.
        Senator Klobuchar. Thank you, Governor Corzine. That was
    just to explain that I am not the most senior member.
        [Laughter.]
        Senator Klobuchar. As if anyone didn't notice.
        I just wanted to follow up on some of the things you were
    saying about trying to move forward together and not divide
    people. I was thinking about what Senator Bond had been saying
    about the States in the midwest versus the other States
    represented here. I want to again reiterate that in our State
    just this week we passed a 25 percent renewable portfolio
    standard for electricity, by 2025. It was voted on 123 to 10 in
    the house, 61 to 4 in the State Senate, signed into law by a
    Republican Governor. I also point out that again, it is in the
    midwest, one of the States that showed up on Mr. Bond's chart.
        Along those lines, I want to follow up on what Senator
    Voinovich was asking about, and that is the technology issues.
    One of the things that I see with this issue is not only should
    we have an obligation to lead morally, but if we don't start
    leading technologically, other countries are going to pick up
    the slack. Could you comment about that, with your background
    in the Senate, Governor, and in the investment world?
        Governor Corzine. Capital is going to flow to where the
    returns are most attractive. As a business person I have seen
    that happen over and over again. If other countries come up
    with the clean coal technology that allows you to sequester it,
    allows you to produce the energy, those companies that generate
    that technology are going to win. It takes investment to be
    able to get to the answers on a lot of these questions. Some of
    it is basic, fundamental research that doesn't have immediate
    paybacks. It may have paybacks in 10 years. Sequestration is
    one of those areas where there is a lot of work that needs to
    be done if you want to use coal.
        We need to get on with that, or we are going to get left
    behind. Because other people are focusing on it and it is
    absolutely essential that we be at the cutting edge. We are not
    always going to win in the manufacturing sector in this world.
    We need to be at the cutting edge on innovation. So all of the
    Senators that have made this point, I underscore and put an
    exclamation point after it. I can assure you that New Jersey is
    going to do everything we can to make sure that our State
    uniquely is in the front edge of that curve.
        Senator Klobuchar. One last business question. You talked
    about in your written testimony about the effect that climate
    change could have on the economy in New Jersey. Specifically
    you mentioned the agricultural community. Could you talk a
    little bit about that?
        Governor Corzine. I think I actually said the tourism
    industry. I would hate to see Atlantic City covered with a foot
    of water. It wouldn't be good for the gaming business. But it
    is, we have had a series of floods on the non-Atlantic
    coastline of New Jersey on the Delaware River on a repeated
    basis. I think 3 out of the last 5 years, we have had major
    floods, because something is changing. Fifty-year floods, not
    just your normal floods, ones that have exceeded expectations.
    That is extremely expensive for the agricultural elements that
    are there, but it is very expensive for the community at large.
        So I think the practical dollars and sense that are going
    on year in and year out tell us we need to act.
        Senator Klobuchar. Thank you.
        Senator Boxer. Perfect timing.
        Senator Craig, and I understand that Senator Sanders, you
    have yielded your spot to Senator Clinton? Am I right on that?
        OK. So it will be Senator Craig then Senator Clinton.
        Senator Craig. Thank you very much, Madam Chairman, and
    again, Governor Senator. Thank you for coming before the
    committee.
        There is so much of what you say I agree with, even though
    some of my critics would not agree that I agree. It is always
    fascinating to watch how we all try to stereotypically create
    certain images. My frustration with what you are doing is not
    in the microsense, it is in the macrosense. Our Country, this
    Senate, some years ago refused to deal with Kyoto because they
    knew they could not, based on current technology, do so in a
    uniform way without damaging the economy and because there were
    major players in the world out there, like China and India, who
    simply refused to play. They couldn't afford to based on their
    perception of their economy and what was going on.
        I say that based on the context that we all believe in,
    especially those of us who have been in State legislatures,
    that States are marvelous laboratories from which to do things
    that Congress cannot collectively do. If you are a big enough
    State, I don't compare you with California, California has some
    uniqueness, you set it apart and it is still one of the world's
    larger economies. But the reality is quite simple, that some
    things that know no boundaries, i.e., like pollution,
    greenhouse gases and all of that, while States can create some
    uniqueness, they really don't become significant players. That
    is why national policy and broad-based international policy is
    so much more valuable in a concept like this.
        It is my observation, and I don't blame you for the
    politics of your State, that you could shut the economy of New
    Jersey off completely and make it the greenest State in the
    world and convince Harry Reid to take your nuclear waste. If
    you did all of that, you wouldn't change the temperature in the
    increasing warming pattern of this earth one-tenth of 1
    percent, if at all. Now, I think that is what frustrates all of
    us here, not of your effort. That is yours to do and that is
    for the citizens of New Jersey to choose.
        But we are not happy with where we are as a Country. I am
    not. We have passed some significant energy policy and we have
    to do more. But in the process of doing more, none of us want
    to turn the economy off. It is so interesting, I was kind of
    Peck's bad boy week before last when I appeared before the G-8
    plus 5 and suggested to them that in the last two quarters, as
    a unit of production, based on CO2 emissions, the
    United States had become the cleanest country in the world. It
    was viewed as a statement of arrogance. I found that really
    quite fascinating, Governor, because it is a true statement.
    Because we are now all about technology and all technology
    being clean technology.
        So I applaud your efforts, I don't criticize them. I have
    one of the cleanest States in the Nation, because I have the
    great privilege of having hydro-based power as a dominant
    force. We are inexpensive, we make California look like a
    pauper when it comes to energy prices. We do very well.
        But we also have some coal-fired that we would hope down
    the road we retrofit and make cleaner. I say that as an
    observation, but to welcome you to the committee, and
    appreciate your presence here.
        But Madam Chairman, I become very skeptical of a piece-by-
    piece solution to a very big problem. The reality that why
    Idaho won't be a player until we have a national solution is
    because we could impact our own economy but have zero effect in
    reality. That is, I think, a concern. We are clean now, we are
    going to stay clean. The citizens of our State and our
    legislature have said so. We are fortunate. Other States are
    less the case, at the same time, you heard the Senator from
    Missouri talking about the risk of shut-down of their economies
    and concerns.
        My time is up. Madam Chairman, Governor, again, thank you.
    I don't have a question for you, but I do what to recognize
    your efforts and I don't collectively criticize them.
        Senator Boxer. Thank you, Senator.
        Senator Clinton.
        Governor Corzine. Madam Chairman, I want to say--15
    seconds?
        Senator Boxer. Yes.
        Governor Corzine. This is an issue that is bottoms up in
    its solution. We will find it. We have a community, West
    Orange, that is putting itself on an energy diet. The kids are
    out trying to convince folks to go from incandescent bulbs to
    fluorescent bulbs. You are right, we can't change what is
    happening in the global environment, because we are just a
    little slice of it in the State of New Jersey.
        But if we don't take our steps, just like those children
    who are out selling this concept of going from incandescent
    bulbs to fluorescent bulbs, we won't change the world. It is
    important that those of us stand up and stand together and that
    increasingly is happening on a broader basis. So I think that
    is positive, and hopefully that will lead to a national
    response.
        Senator Boxer. Senator Clinton?
        Senator Clinton. Amen, amen, Governor. Thank you, Senator
    Sanders. I appreciate that. I have to get to the Senate Armed
    Services Committee Afghanistan hearing.
        I just want to make three points. No. 1, as we move
    forward, I think it is important for this committee to try as
    best as we can to establish an evidence base for the decisions
    we are going to make. My understanding is that the European
    Union since 1990 has actually declined in its CO2
    emissions by .8 percent and the United States has gone up by 16
    percent. So I think that it is important that we get an
    evidence base on which to make policy.
        No. 2, I am absolutely in agreement with what Governor
    Corzine said, and we have some mayors who are going to be
    testifying in the next panel, the Mayor of Seattle, the Mayor
    of Des Moines, the Mayor of Dover and others. We have to have
    as much activity at all levels of society as we can.
        I remember when Sputnik went up, and my fifth grade teacher
    came in and said, children, the President wants you to study
    math and science. I actually thought that President Eisenhower
    had called Mrs. Krause and told her to go tell us to study math
    and science.
        We need a similar level of engagement. Now, my studying
    math wasn't going to change the world. But at the same time,
    having the political support starting in my household going up
    for President Eisenhower to do DARPA, for President Kennedy to
    do the space program and the Apollo program did change the
    world. So we are asking for action at all levels, both of
    Government and in the private sector as well as at the
    individual citizen level.
        No. 3, I really wish Senator Voinovich were still here,
    because he and I worked together in the last Congress to pass
    legislation to clean up diesel. Again, it wasn't going to
    change the world overnight, but it was an important marker to
    lay down. We put in legislation with appropriations to begin to
    try to clean up school buses, construction equipment and other
    ways that said, you know, we can do better. By the way,
    American companies will produce the technology that we need for
    these pollution controls. So it was a win-win.
        That is how I see the coal issue. I am very sympathetic to
    the concerns of those from the midwest and other States that
    have a very high percentage of their energy coming from coal.
    But I guess I would reverse the concern by saying, if we don't
    start now to come up with an American manufacturing base for
    clean coal technology, we will eventually get around to it, but
    the technology will be made and imported into our Country
    instead of made and exported from our Country.
        So when TXU decided not to build 11 plants and to only
    build 3, that was a step forward. The problem is they are still
    pulverized coal plants. What they should be are new generation
    clean coal technology that will capture and store the carbon.
    We need those experiments. This Congress is the only place
    where that money and direction can come from, to put in at
    least five demonstration projects, one of them I hope is
    outside Buffalo, NY, because they are all ready to go. The
    private utility is moving forward as quickly as it can within
    the investment environment as it exists now.
        But we could do more to incentivize that. So, I hope that
    Senator Voinovich and the Chair and others of us working
    together, we will deal with this coal issue. It is real and we
    can do better on it.
        I guess to Governor Corzine, you mentioned the need for new
    technology and new thinking about climate and energy. I also
    have proposed a model based on DARPA, which again, President
    Eisenhower created after Sputnik, the Defense Advanced Research
    Projects Agency. It took our best minds from our universities,
    our private sector, and just let them loose, figure out what we
    were going to do.
        Well, out of it did come the Internet and many other
    advances that have revolutionized our economy, put people to
    work, raised our standard of living. I am convinced if we did
    this in the energy field, we would have the same results within
    a decade. So there is work for all of us to do. I am thrilled
    that under the leadership of Senator Boxer, our Congress is
    going to begin to address that. Again, thanks to Governor
    Corzine for being such a leader in this and helping to set the
    stage for the rest of us.
        Senator Boxer. Senator Clinton, thank you so much. I like
    your idea of this evidence-based record. Because we do have
    different Senators putting out different comments and we just
    need to collect that. I will task the staff with that.
        Senator Sanders, to be followed by Senators Whitehouse and
    Cardin.
        Senator Sanders. Thank you, Madam Chair.
        Madam Chair, what we seem to be hearing from a number of
    Senators is the idea that it is absolutely imperative and
    Governor Corzine, you mentioned as well, I think, that we move
    forward in whether you call it a Manhattan project or new
    Apollo project, that in fact for the first time we recognize
    that we have a global crisis, a national crisis and that it is
    imperative that we harness the resources on the Federal
    leadership, the Federal Government has the resources, the
    private sector and the State and local government, that we
    begin to bring people together to say we have a crisis and we
    are going to solve this crisis within the next 20 or 30 years
    with the United States of America playing a leadership role.
        The components of going forward are breaking our dependence
    on fossil fuel, increasing energy efficiency and reducing
    greenhouse gas emissions. I think what the Governor has said,
    if I understood him correctly, that you believe as we go
    forward in fact we can create jobs. While there will be
    certainly some economic dislocation, overall it can be a
    positive.
        Governor Corzine. It is a long-run win, absolutely.
        Senator Sanders. What I would like to ask you is, based on
    your background both in the private sector and in Government,
    how would you envisage a new Manhattan project? What would be
    the relationship between the Federal, State and local
    governments and the private sector? How can we harness the
    energy to develop new technologies and make this economically
    successful?
        Governor Corzine. Well, first of all, I think that there
    does have to be serious investment dollars made in the core
    research functions. Whether it is taking solar technology and
    actually making it practical, whether it is sequestration,
    whether it is the kinds of things that Senator Clinton talked
    about, and some of that may actually need some subsidization.
        Senator Sanders. Let me ask you this. I just talked to a
    fellow from Germany the other day who helped write legislation
    in Germany which pays people if they have solar paneling in
    their own house, they get a very good price for producing that
    solar paneling. It is part of a decentralized subsidy. Is that
    something that New Jersey----
        Governor Corzine. Sure. We actually have a clean energy
    plan. It is, I wouldn't write home to mom about it being the
    best thing in the world, but it is trying to subsidize the
    applications of solar and other alternative fuels. But we have
    to do that. We have to do it actually in the energy production
    field. We need, if TXU is only going to produce three clean
    coal plants, because that is all they can afford to do, it
    might be possible that we would want to give them tax credits
    in the same way that we have given it for oil drilling and
    exploration, so that they could do four or five, if that were
    the demand. I don't know the layout.
        We need practical work on basic research in our
    universities and in our research communities. Then we need real
    effort in bringing that into an applied context.
        Senator Sanders. Let me ask you this. I know New Jersey is
    not generally considered to be a major agricultural State, but
    in fact----
        Governor Corzine. We are the Garden State, remember.
        [Laughter.]
        Senator Sanders. Right. What are you doing, what ideas do
    you have with regard to biofuels in the east?
        Governor Corzine. We have, unfortunately, far too many
    garbage dumps. So we have a lot of methane tapping that ends up
    producing gas. We also do----
        Senator Sanders. You are using the methane from the
    landfills?
        Governor Corzine. Right. We do geothermal.
        Senator Sanders. Do you do much biofuels? Are you farmers
    growing----
        Governor Corzine. We do not do biofuels. We are about to
    make a commitment on our first biofuels plant, which started
    out to be corn based, and we are trying to get it into
    cellulose.
        Senator Sanders. Thank you.
        Senator Boxer. Thank you, Senator.
        Senator Cardin is going to pass, is that right? And Senator
    Whitehouse. Then we are going to the next panel.
        Senator Whitehouse. Governor, I am delighted that you are
    here. You have the experience of executive leadership, you have
    the experience of having been in this building and know what we
    are all going through. You have considerable experience in the
    financial and capital worlds.
        Governor Corzine. I used to sit in that chair.
        [Laughter.]
        Senator Whitehouse. You were this junior once.
        I see a lot of the problems that we face here as ones in
    which the market forces operate very effectively and properly
    in a defined market. But they create externalities. Whether
    they are the negative externalities of pollution of positive
    externalities, in this case, of being able to seize export
    products in this new technology, protecting our climate from
    what unfortunate things we seem to see coming and the ability
    to concentrate both capital and expertise, so that we become
    sort of a center of energy and center of expertise in terms of
    this new technology.
        Now, when you have a situation like that in which there are
    huge positive externalities and you don't want to just leave it
    to the market, because it is not reflecting those positives, to
    drive the public policy result, you have to accelerate the
    market a little bit, what from your experience in the financial
    world would be, I understand what you told Senator Cardin about
    funding research and doing all the things we traditionally do.
    Are there ways to jump start or accelerate in the financial and
    capital markets their investment in this area and what are the
    ones that in your experience have proven either more effective
    or less effective? Are there ones you would give us caution
    about, ones you would encourage us to try to apply?
        Governor Corzine. That is a terrific question. I have seen
    loan guarantees that reduced the cost of capital that are
    wraparounds, you see it in the nuclear power industry, that was
    very important in the early stages of production of it that
    were really the foundation on which a lot of powerplants were
    built in another period and time. You see it in the housing
    industry. I would like to see more of it, actually, in the
    housing industry, so that we could have greater development of
    affordable housing. It is a way to both mix private capital and
    public capital. This is in the application fields.
        I think the basic research effort is going to have to be
    grant work and you have to get----
        Senator Whitehouse. Understood.
        Governor Corzine [continuing]. The NSA and other national
    science foundations and other elements focused on this as an
    issue. But I think using loan guarantees as opposed to outright
    grants has often been successful in other avenues where you
    wanted to get broad bases to it.
        Now, you know, the oil and gas industry has benefited from
    oil depletion allowances. This is not new work. So you can
    accelerate depreciation as another technique and it has been
    very successful. That might very well be the appropriate way to
    approach this issue with regard to restructuring the powerplant
    industry and applying clean coal technology when billions of
    dollars would be applied. You know, somebody asked about
    nuclear power earlier, you have to check, we will have to
    review if that were the direction that society wanted to take
    particularly as a transitionary step. Some of the most adamant
    environmentalists have actually switched to say we have to do
    that as an intermediate bridge. I am not advocating that, but
    we need to make sure that those kinds of capital elements are
    in place that would allow that to happen, if that is the
    direction we want to take.
        Senator Whitehouse. I thank you for your testimony, and I
    thank the Chair.
        Senator Boxer. Thanks, Senators.
        Governor, you have triggered a most amazing debate.
    Something about you that just brought out, I think, the best in
    everybody here. It has been wonderful and we thank you very
    much.
        Governor Corzine. Thank you very much, Madam Chairman.
        Senator Boxer. Our next panel, please come forward as fast
    as you can, because we are going to hold your statements to 4
    minutes each instead of 5. We didn't expect it to go so long,
    but we had such a terrific turnout of colleagues.
        Senator Cantwell is here to introduce our Mayor of Seattle.
    Senator Cantwell, you can just sit on the end here, in Senator
    Whitehouse's seat, because he has left. I would love you to,
    because I have already given a very flowery introduction of my
    two wonderful friends from California, why don't you introduce
    to us the Mayor of Seattle, and then we will start with Senator
    Perata, we will work our way right down this way.
        Senator Cantwell. Thank you, Chairwoman Boxer, and members
    of the committee, for the opportunity to introduce the Mayor of
    my State's largest city, Mayor Greg Nickels of Seattle. I am
    proud to be here today to introduce Mayor Nickels and even
    prouder of what the citizens of Washington State and Seattle
    have been able to do in our ongoing efforts to reduce our
    climate footprint and leave a livable planet for future
    Washingtonians.
        As most of you know, the United States contributes about
    one-fourth of the world's greenhouse emissions, but to my
    frustration and I am sure many of the people on this committee,
    the Administration has refused to engage in an international
    effort to begin tackling this critical challenge. Fortunately,
    in the absence of Federal leadership, a number of cities and
    States have taken it upon themselves to try to reduce their
    carbon footprints and the results have been impressive.
        In 2005, Mayor Nickels launched an initiative to get cities
    to pledge to cut their greenhouse emissions by 7 percent below
    the 1990 levels by 2012. His initiative is filling a vacuum
    nationwide. It has received enthusiastic reception and now has
    been endorsed by over 400 mayors in every State in America who
    collectively represent 60 million citizens. In our State, all
    our major cities have signed onto the agreement, and we are
    very proud of that fact. I know that our former colleague and
    now Governor noted the Garden State motto. Well, they don't
    call Washington the Evergreen State for nothing. So we are very
    proud of this effort.
        I believe that you will hear from the Mayor and these
    cities that they are reaping the economic and environmental and
    security benefits of these initiatives. I believe these more
    localized efforts are part of a growing groundswell of public
    awareness of the threat of climate change and the urgency to do
    something about it. As I can say from my own State, it is very
    important for us to deal with this issue. I know that members
    of this committee may look at it as a security issue or an
    economic issue or the opportunity to take advantage of new,
    high-energy wage jobs. But for us, it doesn't matter what the
    motivation is. The need to act and act immediately is
    important.
        Climate change, as the Mayor will tell you, is impacting
    every corner of the world. But for us in the pacific Northwest,
    we can become particularly hard hit, because our temperatures
    are rising faster than the global average. Glaciers in the
    Cascade Mountains and the Olympic Mountains have retreated for
    over the last 50 years, and climate change is expected to alter
    our region's historic water cycle, threatening drinking water,
    salmon recovery efforts and the availability of emission-free
    hydropower. As my colleague from the northwest was mentioning,
    the northwest hydro system, we are 70 percent reliant on our
    electricity from that hydro system. So impacts in global
    warming directly have impacts on that hydro system, and these
    changes will likely impact billions of dollars of our economic
    infrastructure associated with irrigation systems, municipal
    water supplies, national forests, ski resorts and a variety of
    other things. So we can wait no longer.
        So thank you, Madam Chair, for your committee's work and
    their importance of this hearing today. Thank you to Mayor
    Nickels and the other panelists.
        As a member of the Energy Committee, Finance Committee and
    Commerce Committee, we will all work with you to get
    legislation to the Senate floor and onto the President's desk.
    You will have an ally in me, and you couldn't have found a
    better witness for today's hearing than Mayor Greg Nickels.
    Again, I thank the Chairwoman and the committee.
        Senator Boxer. Thank you, Senator Cantwell. You are welcome
    to sit with us as long as you would like to.
        Now it is with great pride I introduce our first two
    panelists: Senator Don Perata, a real leader on this, and to be
    followed by Speaker Nunez.

      STATEMENT OF HON. DON PERATA, PRESIDENT PRO TEM, CALIFORNIA
                              STATE SENATE

        Mr. Perata. I thank you, Madam Chair and distinguished
    Senators. It is an honor to be here today to participate in
    this discussion. To date, it is very enlightening. I hope I add
    to that.
        I am not a climate scientist nor an economist. I am a
    former high school teacher and a native Californian, and like
    all of you, an elected official that has a singular concern,
    and that is the planet that we leave to our kids and our
    grandkids.
        I am going to cut more directly to something that has been
    riveting through the committee in the discussions, and that is
    whether or not you can reduce global emissions and stop climate
    change without doing injury to the economy. In California, we
    have been working on these issues for 30 years. As has been
    cited by Senator Boxer and Senator Clinton, we have made
    progress. Today, we are, in fact, Governor Reagan before he
    became President signed the State's first major energy
    efficiency law in 1974, when the first oil shock hit California
    and the United States.
        We have in California some of the best cutting edge
    technology in the world. What we are seeing right now is our
    policies that we are making in Sacramento are being implemented
    down the street, across the State. We are making it possible
    for others in the industry to break new ground. They are
    investing in California, they are investing in technologies
    because it is good for business and jobs are being produced. In
    the Silicon Valley, which is better known than for anything
    than technology chips and things of that nature, we are finding
    jobs being developed in the areas of solar panels, new
    computers that trigger the efficiencies as we discussed in your
    office yesterday, where now light coming into a room can adjust
    the lights in the room. So you are always one step ahead of
    where you need to be.
        In southern California, there have been great strides made
    for electric cars. In my own district, there is something very
    curious going on. We have been talking about diesel emissions.
    In the Bay area, there is a company that has developed and
    manufactures in California a device to be placed on school
    buses, tractor trailers, anything that has a diesel engine and
    can reduce immediately to zero emissions the carbon coming out
    of those engines.
        There are 280,000 trucks traveling daily to southern
    California ports. That bad air ends up being blown into the
    Central Valley and into the Inland Empire, the middle parts of
    our State. So by that one device being developed, we are in
    effect cleaning up the air around the coast and inland. For
    people who say, well, that is only California, yes, but it is
    California. If every State is able to do that, we first show by
    doing, and that is what we are finding effective in California.
        California has just passed $42 billion in bonds. In that
    are efficiencies and green legislation, so that as we do
    things, we build or rebuild California, we are doing it clean
    and green and we are making money and creating jobs. It can be
    done.
        I would ask only one thing in conclusion. Whatever you do,
    please don't do anything to preempt the strides that are being
    made in New Jersey, Washington, California and elsewhere. Thank
    you.
        [The prepared statement of Mr. Perata follows:]
       Statement of Hon. Don Perata, President Pro Tem, California State
                                     Senate
        Madam Chair and Distinguished Senators:
        Thank you for holding this hearing, and for the privilege of
    addressing the committee. I'm honored to be here with my fellow
    Californian, Assembly Speaker Fabian Nunez, and Mayor Nickels, both of
    whom are national leaders in the fight against global warming.
        I'm not a climate scientist or a resource economist--I'm a former
    school teacher, a native Californian and--like all of you--an elected
    official who worries about what kind of world we're leaving our kids
    and grandkids.
        Today, I want to make three points to the committee:
        First, California can serve as a model for federal efforts to
    combat global warming and its impacts. Last year we passed two very
    important laws: one prohibiting utilities from entering into long-term
    contracts for power produced by dirty coal-burning plants, and another
    setting a target to reduce the state's total greenhouse gas emissions
    over time.
        The latter measure, known as AB 32, has received plenty of
    attention. It's a good law authored by Mr. Nunez. The best thing about
    it is it commits the state to reining in its greenhouse gas emissions.
    Many of the details of how to do this must be worked out, but we're on
    the right track. The other law is one I wrote to promote cleaner coal
    technologies. I'm glad to see that the Chairwoman of this committee has
    included provisions of that measure in her bill. There are more than 30
    new coal plants proposed in the Western United States, and 150 for the
    nation as a whole. California is a big customer for the electricity
    from those plants. Taken together, those plants could produce up to 120
    million tons of carbon dioxide emissions; by contrast, the total
    emissions from all sources in the entire state of Oregon is about 70
    million tons.
        California enacted SB 1368 to send a strong signal to the western
    energy markets. Our energy must be clean--we won't buy power from coal
    plants spewing greenhouse gases by the ton. To be clear, California has
    not said ``no'' to coal; rather, we've said that we want cleaner coal
    plants that can provide us energy without producing massive global
    warming pollution.
        Similar measures to SB 1368 are being considered in the Oregon and
    Washington legislatures. While it's gratifying to know that other
    states are following California's lead, there is no substitute for a
    national policy. So I encourage all of you to move forward with the
    Chairwoman's legislation.
        Now, what we have done in California is much more than just pass
    two landmark bills. Climate change and its dramatic effects are front
    page news today. But long before global warming began grabbing
    headlines, California worked to protect the environment and reduce air
    pollution. California has led a quiet revolution for decades to achieve
    one of the lowest per capita carbon emissions rate in the country. Over
    the years, state lawmakers have boosted energy efficiency, increased
    the diversity of our energy sources and improved our air quality.
        It was in fact Governor Ronald Reagan who signed the state's first
    major energy efficiency law in 1974, in the wake of America's first
    foreign oil scare. Today, the same energy efficiency programs created
    30 years ago serve as a cornerstone of California's efforts to reduce
    greenhouse gases. By 2008, our state's energy efficiency programs will
    reduce carbon dioxide emissions--a major cause of global warming--by
    more than 3 million tons per year. That's the equivalent to taking
    650,000 polluting cars off the road. And since the cheapest kilowatt of
    electricity is the one not used, it will save Californians millions of
    dollars on their monthly utility bills.
        In California, we're proud to be trendsetters. And much of what
    we've done could easily be adapted at the national level. That brings
    me to my second point: We need your leadership to win this battle. Only
    with your help can we transform our current fossil-fuel based economy
    into the new energy economy needed in the 21st century.
        As you know, there are many things a state like California can do
    for itself, and there are many things it cannot. The challenge before
    you is to craft federal legislation that helps bend the curve, as
    California is doing, so that overall U.S. climate change emissions
    begin to head downward. That demands the same comprehensive approach
    taken by California to cover all major sources of global warming
    pollution--not a piecemeal plan affecting only one set of emission
    sources, one type of emissions, or one type of mechanism to achieve
    reductions. It means direct and measurable emission reductions,
    flexible financial and tax incentives, and addressing more than just
    carbon dioxide.
        We also need Congress to provide tools, such as a 10-year extension
    of the renewable production and investment tax credit. The uncertainty
    over this important incentive is a big problem for new renewable energy
    investments.
        And finally, we must have Washington's leadership to get off what
    the President has called ``our national addiction to oil.'' We can do
    this through more efficient cars, clean alternative fuels and better
    transportation policies.
        My third and final point is that reducing greenhouse gas emissions
    creates jobs and stimulates the economy. Over the past several decades,
    California has adopted the most aggressive clean air, energy efficiency
    and renewable energy policies in the United States. During that same
    time, our gross state product increased by 83 percent, the second
    largest rate of growth of any state in the country. Key business
    incubators--such as Silicon Valley in the north and the biotech
    corridor in the south--generate jobs, revenues, and clean technologies.
    The super-efficient solar panels produced by Powerlight Corporation in
    my district, and the sleek new electric cars manufactured by Tesla
    Corporation in the South Bay area, are examples of these technologies.
    Just two weeks ago, British Petroleum announced a new $500 million
    investment in a clean fuels research facility on the University of
    California campus in my Senate district.
        The evidence is clear: California's climate policies are attracting
    business and jobs to the state, not driving them away. Business and
    industry leaders support strong state climate change policies like the
    laws we have passed in California because they know it's good for
    business.
        In California, voters last fall approved the single largest
    infrastructure investment bond in the history of the United States. It
    provides $42.7 billion to revitalize transportation, housing, flood
    protection, and schools. The public wants us to overhaul our aging and
    inadequate infrastructure--and doing it will be good for our economy--
    but not at the expense of our air or environment. That is the
    overriding challenge of this new century: To continue to grow our
    economy while holding ourselves to higher standards of environmental
    protection.
        In closing, I want to emphasize that, for all of the work we've
    done, even states as large as California can't do it alone. We need
    strong and decisive action at the federal and international levels.
    After all, this is a global problem. The job ahead isn't easy or
    painless, as some would have us believe. We've only just begun to
    understand the scope of global warming and the magnitude of the changes
    it may bring. Today, more than ever, the state and Federal Government
    must cooperate and attack this problem together.
        Thank you again for the opportunity to testify before you today.

        Senator Boxer. Very important message.
        Mr. Speaker, welcome.

       STATEMENT OF HON. FABIAN NUNEZ, SPEAKER, CALIFORNIA STATE
                                ASSEMBLY

        Mr. Nunez. Thank you very much, Madam Chair. I hope it is
    politically correct in Washington to say Madam Chair as opposed
    to Madam Chairman.
        I want to thank you very much for inviting Senator Perata
    and I to express our thoughts on why California did what it did
    to confront the climate change concerns that we have. First of
    all, and certainly to all of the members of this committee, I
    want to be clear that when we approved Assembly Bill 32 in
    California, we didn't do it out of an altruistic sense that we
    wanted to do the right thing for the sake of doing the right
    thing, although that is important as well in some case. But in
    California, we saw a real threat, a threat to places like Los
    Angeles, residents of the Central Valley as well, and farmers
    who, if they saw that their fresh water that they needed wasn't
    available to them, or could be contaminated with salinity, it
    was a real challenge.
        We saw the threat to our natural resources, for example,
    including key environmental and economic treasures like the
    beautiful coast of California, Yosemite and Lake Tahoe. In
    response, through an unusual partnership between the Democratic
    legislature and a Republican Governor, last year in California
    we passed gold standard legislation, Assembly Bill 32, the
    Global Warming Solutions Act. AB32 establishes regulations that
    will phase in a 25 percent cut in carbon dioxide emissions from
    the State's largest emitters by the year 2020, which in essence
    is a reduction below the 1990 levels in that 16-year period. In
    2008, the California Air Resources Board is going to begin to
    require industries to report carbon dioxide emissions. The
    Board is also going to establish a cap on those greenhouse
    emissions.
        The data that we collect over that 4-year period is going
    to determine which industries are the most significant on the
    dioxide footprint. From 2008 to 2012, outreach programs are
    going to begin to educate industries on how to best achieve
    these reductions. Then from 2012 to 2020, industry will begin
    to implement efforts to reduce their carbon output and take
    advantage of established market mechanisms that may be required
    to reduce some of these emissions. Those cuts, in essence, are
    going to bring us down to the 1990 levels.
        I want to stress that this simply was not an effort
    supported by Democrats in the legislature and a Republican
    Governor, but businesses came to the table. One of the largest
    utilities in California, Pacific Gas and Electric, Senator
    Boxer, you are very familiar with them, were strong supporters
    of this legislation. Entrepreneurs stepped up to the plate.
    Several CEOs and venture capitalists came on board, people like
    John Doerr, whose firm has invested in venture capital efforts
    such as Amazon.com and Google and many other technology firms
    also came to the table because they saw the importance of
    making this investment in alternative fuels.
        Let me just say for me, on a very personal level,
    representing an inner city from Los Angeles, issues of
    environmental justice and economic opportunity are vital and
    are powerful, very, very powerful motivators. I want the
    economy for the future of the children of California to be a
    clean economy. I want the neighborhoods that children live in
    to be clean neighborhoods. I think that our enforceable limits
    provide clear market incentives that are going to reduce
    pollution and unleash entrepreneurs to pursue clean
    technologies in our State.
        U.C. economists predict a boom in our State's annual gross
    product of $60 billion. One study suggests that we are going to
    create, over a 12-year period, 83,000 jobs in this area,
    Senator. Just in closing, let me say that gold built the
    California economy. I believe that through AB32, green is going
    to be what sustains it.
        Thank you very much, Senator.
        [The prepared statement of Mr. Nunez follows:]
         Statement of Fabian Nunez, Speaker, California State Assembly
        Madam Chair, thank you for inviting me to discuss California's
    experience confronting climate change. In California, we saw the threat
    to Los Angeles residents and Central Valley farmers if the fresh water
    they need is contaminated with salinity. We saw the threat to our
    natural resources, including key environmental and economic treasures
    like the coast, Yosemite and Lake Tahoe.
        In response, through an unusual partnership between Democratic
    legislators and a Republican governor, we passed gold-standard
    legislation, AB 32, The California Global Warming Solutions Act. AB 32
    establishes regulations that will phase in a 25 percent cut in carbon
    dioxide emissions from the state's five largest emitters by 2020. In
    2008, the California Air Resources Board will begin requiring industry
    to report carbon dioxide emissions. The board will also establish a cap
    on greenhouse gas emissions.
        The data we collect over a 4-year period will determine which
    industries are the most significant on dioxide. From 2008 until 2012,
    outreach programs will educate industry on how to achieve reductions.
    From 2012 on to 2020, industry will begin to implement efforts to
    reduce carbon output and take advantage of established market
    mechanisms. That cut will bring carbon emissions down to 1990 levels.
        In addition to strong environmental support, even one of our
    State's largest utilities, PG&E, backed AB 32. Several high tech CEOs
    and venture capital leaders also came on board, including John Doerr
    whose firm provided venture capital to Amazon.com, Google, Intuit and
    other technology firms. I think they see the clear market signal we are
    sending to spur a high-tech, green economy for our state. For me,
    elected from inner-city Los Angeles, environmental justice and economic
    opportunity are powerful motivators. I want the economy for our
    children to be a clean economy. I want the neighborhoods they live in
    to be clean neighborhoods.
        Our enforceable limit provides clear market incentives to reduce
    pollution, unleashing entrepreneurs to pursue clean technologies. One
    study found meeting the limit we've established will create 83,000
    jobs. UC economists predict a boost to our state's annual Gross Product
    of $60 billion. Gold built the California economy. Green will sustain
    it.
        This year, in addition to overseeing the implementation of AB 32
    the Assembly is advancing legislation on green building and alternative
    fuels; developing R&D opportunities; reducing emissions from landfills,
    and using bond funds to promote sustainability. And in all of these
    efforts, we are at this committee's disposal to help replicate
    California's experience at the national level.
        Thank you for this opportunity Madam Chair. And thank you for your
    dynamic leadership on this issue.

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    Responses from Fabian Nunez to Additional Questions from Senator Inhofe
        Question 1. I am shocked that you would divert your State's
    economic resources toward reducing greenhouse gases when California is
    the dirtiest air pollution State in the Nation. Thousands of people die
    in your State every year because California has refused to take the
    actions necessary to meet existing laws. The elderly, those with
    children and anyone with respiratory problems should be outraged you
    would choose to make this symbolic measure more important than their
    health, their very lives. How do you respond to this statement?
        Response. The Senator's ``shock'' is misplaced. California has some
    of the strongest air pollution laws in the Nation, yet there are areas
    of our state where topography, traffic congestion, and concentrations
    of specific industries do continue to present air quality issues. As a
    response, last year the California Legislature worked in a bipartisan
    fashion with Governor Arnold Schwarzenegger to pass not only AB 32 to
    address global warming, but also to put over $40 billion of
    transportation, flood protection, parks and affordable hosing bonds
    before the voters. Embedded within each of these bonds are specific
    provisions to address a variety of environmental issues, particularly
    air quality issues. For example, within the transportation bond there
    is over $1 billion dedicated to address air quality issues. The bonds
    also commit billions of dollars to such air quality measures as
    alternative fuels, new/advanced technologies to move goods through
    California's ports, traffic congestion issues, and clean construction
    equipment and school buses as well as transit orientated development,
    urban infill housing, land conservation and proper land use planning.
    Additionally, in terms of fighting global warming, the American Lung
    Association notes that several studies have shown that increased
    emissions of air contaminants, higher temperatures and the increased
    smog that accompanies higher temperatures make many health conditions
    worse. Warmer temperatures would also increase the likelihood of
    increased wildfires along with the carbon dioxide and particulates they
    produce. Rather than the ``outrage'' Senator Inhofe calls for, all
    these actions have proven to be popular with the people of California.

        Question 2. What is the estimated impact on global temperature that
    AB 32 will have over the bill's lifetime?
        Response. If, as I expressed my hope for during my testimony before
    the committee, AB 32 is replicated in other states and by the Federal
    Government, I believe the global impact of AB 32 will indeed be
    significant. As you must know, AB 32 is just one step toward the
    ultimate goal of having the United States working with the global
    community to reduce greenhouse gas emissions and therefore global
    temperatures. Through AB 32's mandated requirements, California will
    reduce its greenhouse gases by 25 percent to 1990 levels, roughly 174
    million metric tons. Even the most committed global warming denier has
    to acknowledge the significance of that reduction.

        Senator Boxer. Thank you so much, Speaker.
        The Republican side has asked if we could break up the, let
    us just say, pro-action side of this debate. I think they are
    right, I think they are fair. So we are going to have the Hon.
    Dennis Adkins, Chairman of the House Committee on Energy and
    Technology, Oklahoma State House, go next, and after him, the
    Hon. Ted Harvey, Senator, Colorado State Senate, if that is OK.
        So the Hon. Mr. Adkins.

    STATEMENT OF DENNIS ADKINS, CHAIRMAN, HOUSE COMMITTEE ON ENERGY
                  AND TECHNOLOGY, OKLAHOMA STATE HOUSE

        Mr. Adkins. Thank you, Madam Chair, Ranking Member Inhofe
    and members of the Environment and Public Works Committee.
        I am Dennis Adkins and I am from the great State of
    Oklahoma, representing District 75, which includes parts of
    Tulsa and Broken Arrow in Oklahoma. I also serve as the Energy
    and Technology Chairman for the State of Oklahoma in the House,
    and I have served in that capacity since 2005.
        The Committee on Energy and Technology has jurisdiction on
    all State legislation affecting oil and gas, and it also has
    utility regulation under its jurisdiction. Oklahoma is an
    energy State. We have 10 percent of this Nation's proven
    reserves of natural gas. The oil and gas industry as a whole in
    Oklahoma has produced energy valued in excess of $10 billion
    for the past 2 years, representing more than 10 percent of our
    gross State product.
        During the past 15 years, Oklahoma's oil and natural gas
    producers have paid a gross production tax of more than $400
    million annually. In this most recent fiscal year, that figure
    was increased to $1 billion. This tax revenue from the energy
    industry funds our schools, roads, bridges, health care and
    other vital State services. No other industry in Oklahoma
    provides such a significant portion of the State's resources.
        Additionally, the energy sector employs 55,000 Oklahomans.
    In the past 24 months, this industry has created 4,000 new
    jobs. Oil and gas in Oklahoma is important and the salaries
    double for the Oklahoma workers if they are in the oil and gas
    industry.
        In electricity generation, Oklahomans heavily rely on coal
    and natural gas. Roughly 56 percent of the total electric
    generation is coal-based and roughly 38 percent is from natural
    gas-based generation, with a growing wind power sector as well.
    These percentages of electricity generation, of course, can and
    do vary greatly from State to State. For example, hydroelectric
    and nuclear resources can be and are reliable in other parts of
    the Nation.
        Like the rest of the Country, we in Oklahoma see many
    scientific, Government and media reports about climate change.
    We are interested in knowing the facts, also.
        I am not a scientist by profession, but I do intend to
    testify from this perspective. I am a State legislator and I
    believe that my job is to pass legislation to deal with
    problems facing my State based on the best available
    information. Therefore, I am greatly concerned by one fact.
    That fact is that there does not seem to be an agreement on
    climate change, and yet there does seem to be a great rush to
    action.
        The States represented here today can capably comment on
    what their States are doing or what their States are doing in
    conjunction with other States to address greenhouse gas
    emission controls. The representatives from these States
    certainly understand their State's energy profiles, needs and
    economic impacts better than I do. Instead of me describing
    what California does or doesn't do or what the Regional
    Greenhouse Gas Initiative in the northeast may or may not be
    doing right or wrong, it is better for me to describe what I
    think States like Oklahoma will be concerned about as any
    legislation addressing climate change is considered.
        Senator Boxer. Sir, could you try to wrap up with your most
    important thing, because we only have 20 seconds left on your
    time.
        Mr. Adkins. Sure. Our own Senator Inhofe is a national
    leader, especially on issues like climate change. I understand
    that he has said that carbon cap proposals would be the largest
    single tax increase to date, costing the American public more
    than $300 billion. However, regardless of the investments in
    renewable fuels, renewables can only provide a small part of
    the U.S. electric power. Oklahomans realize that we need a
    diversified energy supply, such as clean coal, natural gas and
    renewable sources.
        I appreciate the opportunity to testify before the
    committee, and I appreciate the committee allowing a
    representative from an energy State to come and testify. Thank
    you.
        [The prepared statement of Mr. Adkins follows:]
      Statement of Dennis Adkins, Chairman, House Committee on Energy and
                        Technology, Oklahoma State House
        Good morning, Madam Chairman, Ranking Member Inhofe, and Members of
    the Environment and Public Works Committee. I am Dennis Adkins, and I
    am an Oklahoma State Representative for District 75 that includes parts
    of the cities of Tulsa and Broken Arrow, Oklahoma. I am also the
    chairman of the Oklahoma House Committee on Energy and Technology and
    have served in that capacity since 2005. The Committee on Energy and
    Technology has jurisdiction on all state legislation affecting the oil
    and gas industry in Oklahoma and utility regulation. In addition to
    serving in the state legislature, I am involved in the American
    Legislative Exchange Council (ALEC) and the Energy Council. Both ALEC
    and the Energy Council are organizations comprised of state legislators
    from throughout the country.
        Oklahoma is an energy state. We have 10 percent of this Nation's
    proven reserves of natural gas. The oil and gas industry as a whole in
    Oklahoma has produced energy valued in excess of $10 billion for the
    past 2 years representing more than 10 percent of our gross state
    product. During the past 15 years, Oklahoma's oil and natural gas
    producers have paid gross production taxes averaging more than $400
    million annually, and in the most recent fiscal year that figure
    increased to $1 billion. This tax revenue from the energy industry
    funds schools, roads, health care and other vital state services. No
    other industry in Oklahoma provides such a significant portion of the
    state's revenue sources.
        Additionally, the energy sector employs more than 55,000
    Oklahomans. In the past 24 months, this industry has created more than
    4,000 jobs. Oil and natural gas workers are paid more than double the
    average salary for Oklahoma workers.
        In electricity generation, Oklahoman's heavily rely on coal and
    natural gas. Roughly 56 percent of total electricity generation is coal
    based followed by roughly 38 percent of natural gas based generation
    with a growing wind power sector as well. These percentages of
    electricity generation sources, of course, can and do vary greatly
    state to state as, for example, hydroelectric and nuclear sources are
    very viable in certain other parts of the nation.
        Like the rest of the country, we in Oklahoma see the many
    scientific, government, and media reports on climate change, and we are
    interested in knowing the facts.
        Respected people on both sides of the issue present seemingly very
    compelling facts about their particular point of view.
        I am not a scientist by profession, and do not intend to testify
    from that perspective. I am a state legislator. I believe it is my job
    to work to pass legislation to deal with problems facing my state based
    on the best available information and facts. Therefore, I am greatly
    concerned by one clear fact. That fact is that there does not seem to
    be agreement on the issue of climate change, and yet there seems to be
    a great rush to action.
        Without the facts, I think it would be very possible to pass
    federal legislation or legislation in the states that might cost people
    substantially. I do not wish to be misunderstood and simply labeled as
    a naysayer, but a rush to pass legislation addressing climate change
    may make it appear that we, as elected officials, are doing something
    to address a problem, but in reality, not accomplish anything
    meaningful toward solving climate change. I understand that even if all
    industrialized nations would have faithfully followed the caps
    implemented by the Kyoto Protocol, the result would only shave a
    fraction of a degree Celsius of earth's temperatures. After all, what
    we are principally talking about is controlling carbon dioxide
    emissions. However, this gas is non-toxic to humans. It does not impair
    visibility. It does not foul the air we breathe, neither does it cause
    respiratory diseases, all of which hardly are characteristics of a bona
    fide pollutant. In fact, I have even heard it argued that moderate
    warming from 0.5 to 1.5 degree Celsius might enhance agricultural
    productivity, which is also extremely important to my state and other
    states like Oklahoma.
        We already have seen at least a couple of examples of what states
    have developed or enacted into state law addressing greenhouse gas
    emissions. With Assembly Bill 32, the California Global Warming
    Solutions Act of 2006, California will require monitoring and annual
    reporting from the state's most significant contributors to greenhouse
    gas emissions. The legislation seeks to reduce carbon dioxide emissions
    to 1990 levels by 2020 and achieve additional reductions into the
    future. The Regional Greenhouse Gas Initiative (RGGI), an agreement
    among some Northeastern states, seeks to develop a northeastern
    regional cap and trade program covering carbon dioxide emissions from
    powerplants in that region, placing a cap on current carbon dioxide
    levels, and reducing carbon dioxide emissions levels by 10 percent by
    2019.
        The States represented here today will capably comment on what
    their state is doing or what their state is doing in conjunction with
    other states to address greenhouse gas emission controls. The
    representatives from these states certainly understand their states'
    energy profiles, needs, and economic impacts perhaps better than I
    would. Instead of me describing what California and what states in the
    Regional Greenhouse Gas Initiative in the northeast may have done wrong
    or right, which may simply be my opinion, perhaps it would be more
    productive to use my time to describe what I think a state like
    Oklahoma will be concerned about as any legislation addressing climate
    change is considered.
        First and foremost, we would be concerned about the impact on
    Oklahomans. We would want to carefully weigh the proposed benefits of
    any action to the impact it will have on our citizens' pocketbooks, our
    economy, as well as on the environment.
        Oklahoma is blessed to have an abundant supply of electricity at
    rates below the national average. Unfortunately, we are not as blessed
    when it comes to cool summers. Oklahoma can get hot in the summertime
    driving up power consumption as a result and that translates into high
    electric bills. I know because I hear from my constituents, and I am a
    ratepayer too.
        Frankly, while I am aware of polling that suggests that many
    Americans are concerned about climate change, I am not sure they have
    calculated the impact the cost of addressing it will have on them.
        As state and federal legislators, we all heard the public uproar
    when the cost of gasoline began climbing. A few winters ago, we heard
    loud and clear that citizens were not at all pleased with the increase
    in natural gas prices. Now, we are talking about taking steps that
    could drive energy prices even higher without a clearly articulated
    benefit.
        I suppose the easy thing to do would be to pass legislation
    federally or in the states to attempt to address climate change. But if
    we do, absent the facts surrounding the cost and benefit, I do not
    believe we have served our constituents very well.
        If I have ever heard of an issue that needs more comprehensive
    study, climate change is it. I think our nation is poised to make
    massive investment on the backs of consumers, not knowing if the proper
    technology even exists and if those investments will even help.
        Generally speaking, measures such as carbon caps, cap and trade
    systems, and emission allowances would inevitably raise energy prices,
    raise costs of consumer products and services, reduce profits, impair
    productivity and may not achieve global reductions of greenhouse gas
    emissions. For example, under the Kyoto Protocol, emissions reductions
    are imposed on developed countries, while developing countries such as
    India and China, which will ultimately surpass the United States in
    carbon dioxide emissions, are left out.
        I have read forecasts estimating various costs from compliance with
    carbon dioxide caps. For instance, I have read that implementing the
    Kyoto Protocol would have cost the entire U.S. economy over $300
    billion by 2010 and implementing the standards in Kyoto would have
    resulted in an annual lost of nearly $3,000 per household by 2010.
    Information published by the U.S. Energy Information Administration
    estimated that cutting carbon emissions five percent below 1990 levels,
    as required in the Kyoto Protocol, would have reduced the U.S. Gross
    Domestic Product to up to $340 billion by 2012 which it estimated would
    translate into a cost of $4,500 for every family of four. There have
    been many proposals circulating in Congress for the past number of
    years, and they all address greenhouse gas emission reductions from
    various industrial sectors in various manners. I am not going to
    pretend to be an expert on each proposal and their forecasted
    reductions and costs. However, what they all seemingly have in common
    are substantially increased energy costs for consumers.
        Our own Senator Inhofe, who is a national leader especially on the
    issue of climate change, I understand has said that carbon cap
    proposals would be the largest single tax increase to date costing the
    American public $300 billion annually.
        Does that mean we in Oklahoma are simply taking the posture of
    standing still in the meantime, of course not.
        In Oklahoma, for example, our utilities are becoming leaders in
    wind power. Without mandates, our state has over 500 megaWatts of wind
    power. Although I realize this falls behind larger states that have
    developed their infrastructure over a longer period of time, over the
    last three years, Oklahoma now has the fifth largest wind generation
    base in the country. In fact, as transmission costs climb to $1 million
    per mile, our largest problem is transmission of this energy from the
    western portion of the state throughout the rest state.
        Pending in the Oklahoma Legislature presently is a measure that
    will establish the Oklahoma Bio-fuels Center over the next four years.
    Oklahoma will invest $40 million in a consortium among the University
    of Oklahoma, Oklahoma State University, and the Noble Foundation to
    engage in research developing the bio-fuels sector focusing on
    cellulosic feedstock.
        At the same time, while the majority of the electricity capacity in
    Oklahoma is natural gas fired at roughly 58 percent, I know the utility
    sector is presently investing in building a new coal-fired plant in the
    central part of the state, and they are going above and beyond the
    standard technology. We are planning to build a cutting edge plant that
    will reduce greenhouse gases and other emissions.
        However, regardless of the investments in renewable fuels,
    renewables continue only to provide a small part of the total U.S.
    electric power. Oklahomans realize we need a diverse energy supply
    making use of clean coal, natural gas, and renewable sources with
    limited constraints on development and economic impacts.
        I appreciate the opportunity to testify before the committee this
    morning and appreciate this committee allowing a representative from an
    energy state like Oklahoma to share their views.
        Thank you.

        Senator Boxer. Thank you very much.
        The Hon. Ted Harvey, Senator, Colorado State Senate.

      STATEMENT OF HON. TED HARVEY, SENATOR, COLORADO STATE SENATE

        Mr. Harvey. Thank you, Madam Chair, and thank you to the
    committee for having me here today. It is an honor to be here.
        My name is Ted Harvey and I currently serve in the Colorado
    State Senate. For the last 6 years, I have served on the
    Agricultural, Natural Resource and Energy committees in the
    House and now in the State Senate. Additionally, I have a
    master's degree in public administration, with a concentration
    in environmental policy and law.
        As you are aware, there are many academic specialties in
    the field of environmental sciences. Trying to get the experts
    to agree on anything is almost impossible. The debate over
    global warming change is no different, and the debate has been
    going on for almost 100 years. ``Geologists think the world may
    be frozen again,'' this was the headline in the New York Times
    on February 24, 1885. On January 2, 1939, an article claimed
    the earth was warming again. On April 28, 1975, Newsweek
    published an article entitled ``The Cooling World.'' Indeed,
    the temperature of the earth's climate had been falling for 30
    years, according to Newsweek's 1975 article. Climatologists
    everywhere were offering doomsday scenarios if public
    policymakers such as yourself did not act quickly.
        Yet only 13 years later, in 1988, a NASA scientist
    testified before Congress that global warming was in effect and
    was serious. Thus began the current debate on global warming.
    Since 1988, studies on the cause of the current increase in the
    temperature of the earth's climate have resulted in
    contradictory conclusions regarding man's involvement.
    Scientists and politicians alike are using these findings to
    pursue their own political and geo-economic agendas.
        In his documentary, ``An Inconvenient Truth,'' Vice
    President Al Gore argues that unless we do something about
    CO2 emissions, much of Greenland's ice will melt
    into the ocean, rising sea levels over 20 feet by the year
    2100. This is a serious claim. The U.N.'s Intergovernmental
    Panel on Climate Change, the IPCC, recently released the
    summary for policymakers, that you all received, that predicts
    a rise in sea level between 8 and 17 inches. There is a big
    difference between 20 feet and 17 inches.
        Research following the IPCC's climate change 2100, the
    scientific basis, reveals that much of their conclusions have
    been called into question or totally disproved, specifically,
    the famous hockey stick graph that was the basis for much of
    the Gore movie and the Kyoto Protocol. In fact, just this
    month, Science magazine published an article stating that the
    recent loss of Greenland's glaciers has reversed.
        Over the last 40 years, this body has encouraged the
    development of new technology that is clean, renewable and
    economically viable. For example, through technology,
    competition and scientifically sound regulation, Colorado has
    made tremendous strides in cleaning its environment. Denver is
    no longer known for its brown cloud. In fact, one might argue
    that our air is as clean as it was in 1893, when America the
    Beautiful was written from the top of our very own Pike's Peak.
        Colorado very proudly leads the world in the development of
    clean technology from power generation. The National Renewable
    Energy Laboratory, NREL, is located in Colorado and is
    pioneering this new frontier.
        On the eastern plains, our spacious skies have winds strong
    enough to sustain large wind farms. Colorado was on the cutting
    edge of this new development. Our eastern plains are blanketed
    with miles of amber waves of corn, and we are using this
    resource to develop ethanol in impressive quantities.
    Colorado's purple mountain majesties are covered by pine
    forests that are being decimated by pine beetles. In true
    western ingenuity, we see this problem as an opportunity to
    reinvigorate a once-dying lumber industry, using these dead
    stands as biomass and biofuel, another renewable energy source.
        Finally, Colorado is known for its blue skies and over 300
    annual days of sunshine. NREL is capitalizing on our
    environment to develop the next generation of solar
    technologies. The United States of America is the greatest
    Nation on the face of the earth. Through Government policies
    that encourage ingenuity and responsibility, our free market
    system has brought forth environmental advancements that man
    could have only dreamt of 40 years ago.
        To impede innovation and dictate policy through draconian
    regulation would only harm our economy and endanger our
    Nation's competitiveness and security. I pray the Lord will
    give you wisdom as you deliberate the interests of our Country,
    and may God shed His grace on thee.
        Thank you for your time.
        [The prepared statement of Mr. Harvey follows:]
          Statement of Hon. Ted Harvey, Senator, Colorado State Senate
        Thank you Madam Chair and thank you committee for having me here
    today.
        My name is Ted Harvey, and I currently serve in the Colorado State
    Senate. For the last 6 years I've served on the Agriculture, Natural
    Resource and Energy Committee. Additionally, I have a master's degree
    in public administration with a concentration in environmental law and
    policy.
        As you are aware there are many academic specialties in the field
    of environmental sciences. Trying to get the experts to agree on
    anything is almost impossible. The debate over global climate change is
    no different. The debate has been going on for almost 100 years.
        ``Geologists think the world may be frozen again.'' This was the
    headline in the New York Times on February 24, 1885.
        A January 2, 1939 article claimed the earth was growing warmer.
        On April 28, 1975, Newsweek published an article entitled ``The
    Cooling World.''
        Indeed the temperature of the earth's climate had been falling for
    30 years prior to Newsweek's 1975 article. Climatologists everywhere
    were offering doomsday scenarios if public policy makers did not act
    quickly.
        Yet, only 13 years later in 1988, a NASA scientist testified before
    Congress that global warming was in effect and was serious . . .  and
    thus began our current debate on global warming.
        Since 1988 studies on the cause of the current increase in
    temperature of the earth's climate have resulted in contradictory
    conclusions regarding man's involvement. Scientists and politicians
    alike are using these findings to pursue their own political or geo-
    economic agendas.
        In his documentary An Inconvenient Truth, Vice President Al Gore
    argues that unless we do something about CO2 emissions much
    of Greenland's ice will melt into the ocean, raising sea levels over 20
    feet by the year 2100. This is a serious claim. Where did he get his
    data?
        The UN's Intergovernmental Panel on Climate Change (IPCC) recently
    released their Summary for Policy Makers that predicts a rise in sea
    level between 8 and 17 inches by 2100. There is a big difference
    between 17 inches and 20 ft.
        Research following the IPCC's Climate Change 2001: The Scientific
    Basis reveals that many of their conclusions have been called into
    question or totally disproved--specifically, the famous ``hockey
    stick'' graph that was the basis for much of the Gore movie and the
    Kyoto Protocols.
        In fact, just this month Science Magazine published an article
    stating the recent loss of Greenland's glaciers has reversed!
        Over the last 40 years Congress has encouraged the development of
    new technology that is clean, renewable and economically viable. For
    example, through technology, competition and scientifically sound
    regulation, Colorado has made tremendous strides in cleaning its
    environment. Denver is no longer known for its brown cloud. In fact,
    one might argue that our air is as clean as it was in 1893 when
    ``America the Beautiful'' was written from atop our very own Pikes
    Peak.
        Colorado proudly leads the world in the development of clean
    technology for power generation. The National Renewable Energy
    Laboratory (NREL), located in Colorado, is pioneering this new
    frontier.
        On the eastern plains, our spacious skies have winds strong enough
    to sustain large wind farms. Colorado is on the cutting edge of this
    development.
        Our eastern plains are blanketed with miles of amber waves of. . .
    corn, and we are using this resource to develop ethanol in impressive
    quantities.
        Colorado's purple mountain majesties are covered by pine forests
    that are being decimated by pine beetles. In true western ingenuity we
    see this problem as an opportunity to re-invigorate a once dying lumber
    industry using these dead stands as biomass for biofuel--another
    renewable energy source.
        Finally, Colorado is known for its blue skies and over 300 annual
    days of sunshine. NREL is capitalizing on our environment to develop
    the next generation of solar technologies.
        The United States of America is the greatest nation on the face of
    the earth. Through government policy that encourages ingenuity and
    responsibility, our free market system has brought forth environmental
    advancements that man could have only dreamt of 40 years ago.
        To impede innovation and dictate policy through draconian
    regulation would only harm our economy and endanger our Nation's
    competitiveness and security.
        I pray that Lord will give you wisdom as you deliberate the
    interests of our country and may God shed his grace, on thee. . . .
    Thank you for your time.

        Senator Boxer. I pray we do something about global warming.
    God is testing us, that is for sure.
        The Mayor of Seattle.

       STATEMENT OF HON. GREG NICKELS, MAYOR, CITY OF SEATTLE, WA

        Mayor Nickels. Thank you, Madam Chair and members of the
    committee. As the others have observed, it is an honor to be
    here and a pleasure to be able to talk about this important
    issue. I want to thank Senator Cantwell for her kind
    introduction.
        It is also a pleasure to be in front of the committee with
    three former mayors sitting on the committee, because I know we
    are in good hands.
        I am here today representing the 600,000 people of Seattle,
    and as co-chair of the U.S. Conference of Mayors' Climate
    Protection Council. I have submitted longer comments for the
    record, but I will keep my remarks before the committee brief
    this morning. Five years ago, when I became Mayor of Seattle, I
    was like a lot of people in this Country. I knew about global
    warming, I thought it was a serious problem, but I thought it
    was a long way away and far into the future.
        The ``aha'' moment for me came during the winter of 2004
    and 2005, which in the Cascade Mountains was a winter without
    snow. That is a bad thing. There was no ski season, and of
    course, that is a tragedy in and of itself. But for Seattle, we
    rely on that snow for our water and for our hydroelectric
    power. We have century-old systems, sustainable systems that
    captures that snow melt and turns it into drinking water and
    into very clean power.
        As I got weekly reports from my directors of water and
    power, it became clear that global warming was not a distant
    threat and it was not far in the future: it was happening today
    and it was happening in our community. In fact, according to
    the University of Washington's climate impact group, the
    average snow pack in the Cascade mountains has declined by
    about 30 percent since the end of World War II and even more in
    some of the lower elevation areas that we rely on for our water
    and our power.
        That winter, of course, the Kyoto Protocol went into effect
    in 141 countries but not in the United States. I was frustrated
    by the lack of action by our Country at the Federal level, so I
    pledged that Seattle would take local action to meet or exceed
    the reductions set by the Kyoto Protocol, specifically 7
    percent reduction by the year 2012. But I also realized that if
    Seattle did this alone, as Senator Craig pointed out, it would
    be purely a symbolic gesture, it would mean very little.
        So I challenged other mayors around the Country to join
    with me in this effort, and as of today 409 mayors have signed
    onto the U.S. Mayors Climate Protection Agreement and each and
    every one of them has pledged to take local action to reduce
    global warming pollution. Just to put that into perspective, if
    we were a country we would be slightly larger than the
    population of Italy, we would be equal to the population of the
    United Kingdom and we are catching up on France. These are
    mayors who are Democrats, Republicans and Independents. They
    are leaders of some of our largest cities, New York and Los
    Angeles and Chicago and Philadelphia and some of our smaller
    cities as well. They range from Boozman, MT to Akron, OH, from
    Belleview, NE to Burlington, VT, and Cleveland, OH, to Des
    Moines, IA.
        We are very much not a symbolic effort. You have not 50
    laboratories, you have 409 laboratories that are working to
    find creative ways to reduce greenhouse gas emissions.
        I pulled together community leaders in Seattle to figure
    out what we could do to reduce our emissions by 680,000 tons,
    which would be equivalent to that 7 percent. We are building
    our first light rail system. The cruise ships that visit our
    port plug into shore power, instead of running their diesel
    engines when they are in our city. We have among the most
    energy efficient green buildings of any city in the United
    States, and we are encouraging more and more people to give up
    long commutes and live instead in the heart of our city.
        Our publicly owned electric utility, Seattle City Light, is
    the first major power supplier in the Country to be greenhouse
    gas neutral. We literally are powering our city without
    toasting the planet. But we have a much bigger challenge ahead
    of us, Madam Chair, and I want to just suggest three things----
        Senator Boxer. If you do it quickly.
        Mayor Nickels [continuing]. That I would like this
    committee to face. One, like California, we believe a strong
    cap on emissions is necessary, 80 percent by the year 2050, we
    see as supported by science. Second, we believe that a cap and
    trade system will encourage markets to behave in a way that
    will reduce greenhouse gas emissions. Those are top down
    approaches that will get us part of the way.
        But in order to get all of the way, you are going to need
    to engage the people of America in this effort at the grass
    roots. Recognize the role of cities. For the first time in
    human history, we represent more than half of the people who
    live on this planet and we consume more than 75 percent of the
    energy that is consumed on this planet. Use us as laboratories.
    Create, based on the very successful Community Development
    Block Grant model, an energy and environment block grant, so
    that we can take these ideas and bring them up to scale, that
    can make a difference not only for our Nation, but for our
    globe.
        Thank you.
        [The prepared statement of Mayor Nickels follows:]
                 Statement of Greg Nickels, Mayor, Seattle, WA
                                  Introduction
        Chairwoman Boxer, Ranking Member Inhofe, members of the committee,
    thank you very much for the invitation to testify before you today.
    More importantly, thank you for your leadership on an issue of
    paramount importance to our nation: global climate disruption.
        We are at a historic juncture in this country. The scientific
    consensus on global warming is increasingly clear and unequivocal--it
    is happening and human activities are causing it.
        My message to you today is twofold:
        First, let's act now. Let's not wait until the 111th or 112th
    Congress. Let's seize the moment. Put in place a clear, strong and
    effective federal policy that is necessary to stabilize the climate: 80
    percent reduction of greenhouse gas emissions by 2050, based on 1990
    levels.
        Second, America's mayors are ready, willing and able to work with
    you to develop and implement this policy. We are ready to build public
    support in our communities--including our business communities--to meet
    this challenge. We are ready to implement local solutions. In fact,
    many of us are already doing just that.
        U.S. Mayors Climate Protection Agreement 409 mayors across the
    country have signed on to the U.S. Mayors Climate Protection
    Agreement\1\ that I initiated with eight other mayors just over 2 year
    ago. These mayors represent over 60 million people--nearly a fifth of
    the U.S. population--in all 50 states, plus the District of Columbia.
    They are Democrats, Republicans, and Independents. They are leaders of
    some of our biggest cities and smallest towns--from Richmond, Virginia
    and Bozeman, Montana to Akron, Ohio and Cookeville, Tennessee.
    ---------------------------------------------------------------------------
        \1\ See Attachment A: U.S. Mayors Climate Protection Agreement. The
    resolution can also be found at: http://www.usmayors.org/uscm/
    resolutions/73rd--conference/env--04.asp
    ---------------------------------------------------------------------------
        Like most economic and environmental issues, climate disruption
    does not follow geographic or political boundaries. Its impacts affect
    us all; however the opportunities that global warming solutions present
    are open to all. That's why the U.S. Mayors Climate Agreement has
    resonated across the country, regardless of where cities are on the
    map, and where mayors sit on the political spectrum. That's why
    Republican mayors from cities such as New York; San Diego; Bellevue,
    NE; and Arlington, TX have joined Democratic mayors such as myself.
        In signing the Agreement, these 409 mayors\2\ are pledging to take
    local action to significantly reduce greenhouse gas emissions in their
    own communities. Cities across our nation are pledging support for
    bipartisan greenhouse gas reduction legislation that includes (1) clear
    timetables and emissions limits and (2) a flexible, market-based system
    of tradable allowances among emitting industries.
    ---------------------------------------------------------------------------
        \2\ See Attachment B: Map of the Participating Cities. The map is
    updated at: http://www.seattle.gov/mayor/climate/default.htm#who
    ---------------------------------------------------------------------------
        We are not just signing a piece of paper. We are making tough
    choices. We are investing our taxpayers' money. We are transforming our
    cities into laboratories for climate protection. In short, we are
    making a difference, and laying the groundwork for strong federal
    policies and programs.
        For example, we are making the sometimes difficult but necessary
    changes to land-use policies and regulations. We are reining in sprawl
    and increasing density in our urban cities, changes that reduce energy
    and fuel use by cutting greenhouse gases an average of close to 30
    percent.
        We are investing heavily in public transit, building more bike
    paths and making it safer for pedestrians to walk to work, school and
    parks. By doing this, fewer people will need their cars to get around.
        We are walking the talk. City governments are using their
    purchasing power to buy electric hybrid vehicles and biodiesel for our
    fleets, energy-efficient computers for our offices, and super-efficient
    LED (light-emitting diode) bulbs for our traffic signals. We're
    designing ``green,'' energy-efficient buildings and re-using methane
    gas at our landfills and wastewater treatment plants.
        We are doing many of these things in Seattle. But we are most proud
    that our publicly-owned utility--Seattle City Light--is the first
    electric utility in the nation to be greenhouse gas neutral. It has
    achieved this through conservation, using renewable energy resources
    and investing in offset projects that lower our city's carbon
    footprint, encourage new business opportunities and improve local air
    quality. For example, City Light is working with the cruise ship
    industry to connect ships to shore power while in port rather than burn
    diesel. We have launched a biodiesel program that pays for the use of
    this cleaner fuel in local buses, Washington State ferries and city
    trucks. These and other programs are economically efficient and will
    help us lower greenhouse gas emissions.
        Seattle is certainly not alone in such pioneering efforts.
        The city of Irvine, California, the city is supporting the Zero
    Emission Vehicle Network Enabled Transport program (ZEV-NET), which
    makes zero-emission vehicles available to participating employers and
    their employees.
        Burlington, Vermont has a Climate Action Plan and joined the 10
    Percent Challenge Campaign. The campaign challenges everyone--
    individuals, businesses, the city and others--to reduce their emissions
    by 10 percent or more.
        In Dayton, city leaders are switching traffic signals to LED
    technology at hundreds of intersections, reducing carbon emissions
    significantly. They have also developed a co-generation facility at
    their wastewater treatment facility. Its engines use methane gas
    produced at anaerobic digester plant.
        Alexandria, Virginia, the historic city just across the Potomac, is
    modernizing its buildings to LEED standards. They have funded this
    project through bond revenues and the annual budget.
        In St. Paul, Minnesota, the city initiated the Saint Paul
    Environmental-Economic Partnership Project in 1993 to implement its
    Urban CO2 Reduction Plan. This plan includes diversifying
    transportation options, reforesting the urban landscape, increasing
    energy efficiency, promoting alternative energy and increasing
    recycling and reducing waste.
        The list goes on and on. Our nation's commitment to climate
    protection grows stronger each day.\3\
    ---------------------------------------------------------------------------
        \3\ These examples and others can be found in Energy and
    Environment: The United States Conference of Mayors Best Practices
    Guide, January 2007. To learn more about the Burlington, Vermont
    example, please go to: http://www.burlingtonelectric.com/SpecialTopics/
    Reportmain.htm .
    ---------------------------------------------------------------------------
        Why are a growing number of mayors and communities making global
    warming a local priority? There are three key reasons.
        First, we're increasingly concerned about local impacts, not only
    on our urban environments, but on our economies and overall quality-of-
    life. We are the first responders to emergencies and we will feel the
    most immediate effects of rising seas, more fires, more unpredictable
    weather patterns. In Washington State we are already beginning to see
    some of the impacts of global climate disruption in the Cascade
    Mountains, where changing snow melts and shrinking glaciers threaten
    our major source of water and electricity.
        Second, we're excited about the economic opportunities presented by
    this challenge to make our cities more climate-friendly--opportunities
    for our families and businesses to save money through increased
    efficiencies, and opportunities for our companies to create jobs and
    revenues by inventing and producing cleaner energy sources and
    technologies. In the Seattle area, for example, green building and
    biodiesel production already are emerging as strong and growing sectors
    of our economy.
        Third, we feel a strong sense of responsibility. A large percentage
    of the world's energy--something on the order of 75 percent--is
    consumed in or by the world's cities. So we can't solve global warming
    without making our cities significantly more energy-efficient and less
    dependent on fossil fuels. Cities are on the critical pathway to a
    global solution. And American cities, in particular--among the
    wealthiest on Earth--have a responsibility to lead the way.
                              seattle's experience
        That's why in February of 2005-- a year in which we were nearly
    ``snowless in Seattle''-- I challenged my own community to meet or beat
    the climate pollution-cutting goal of the Kyoto Protocol, and invited
    my fellow mayors across the country to do the same. In the longer term,
    I believe much deeper cuts are necessary. But I wanted to challenge the
    government and the community to make significant cuts in the short-
    term, on my watch as mayor: 7 percent reductions from 1990 levels by
    2012.
        By that time, we already had reduced our city government emissions
    by about 60 percent from 1990 levels, thanks in large part to the
    efforts of our publicly owned utility--Seattle City Light--to make
    itself the Nation's first ``climate-neutral'' utility. We also had
    aggressive recycling, green building and green fleet management
    programs underway.
        But despite our success as a city government, we saw that
    community-wide emissions were rising dramatically, driven in large part
    by motor vehicle emissions. So we turned our attention to shrinking the
    community's ``carbon footprint.'' We established a Green Ribbon
    Commission on Climate Protection consisting of about 20 of our
    community's most-respected leaders and experts. It was co-chaired by
    Denis Hayes, the president of the Bullitt Foundation and founder of
    Earth Day, and Orin Smith, the now-retired CEO of the Starbucks Coffee
    Company. And it includes the president of the board of REI, Inc., Bill
    Ruckelshaus, the three-time U.S. EPA Administrator, and many other
    leaders from the business, government, and nonprofit sectors.
        The commission spent a year poring over data and reviewing best
    practices from around the world. Their work culminated in the Seattle
    Climate Action Plan, which I released in September of 2006.\4\ This is
    a blueprint for significantly reducing greenhouse gas emissions in our
    community. It features a variety of strategies for reducing car-
    dependence in Seattle, increasing fuel efficiency and the use of
    biofuels, and improving energy efficiency and the use of renewable
    energy sources.
    ---------------------------------------------------------------------------
        \4\ See Attachment C: Seattle, a Climate of Change: Meeting the
    Kyoto Challenge-Climate Action Plan Executive Summary, September 2006.
    The Executive Summary and the full report can also be found at: http://
    www.seattle.gov/climate/.
    ---------------------------------------------------------------------------
        We've created the Seattle Climate Partnership, a voluntary pact
    among Seattle-area employers to assess and reduce their own carbon
    footprints, and to come together to help meet our community-wide goals.
    Thirty employers have joined the Partnership already, including
    Starbucks, REI, the Port of Seattle, the University of Washington,
    GroupHealth Cooperative, the Fred Hutchinson Cancer Research Center and
    the Greater Seattle Chamber of Commerce.
        Seattle does all this because our citizens are demanding it. They
    expect leadership from their elected officials, their business leaders
    and their public power agencies to step up to this tremendous challenge
    we all face.
        In addition to the activities we are undertaking in Seattle, the
    State of Washington is also moving toward implementing a climate plan.
    The governor has just issued an Executive Order calling for the state
    to implement a climate action plan that includes greenhouse gas
    reduction targets. Likewise, there are over a dozen bills pending
    before our state legislature calling for actions dealing with climate
    change. And this past Monday, my governor announced that Washington
    will join with Oregon, California, Arizona and New Mexico to form the
    Western Regional Climate Action Initiative, pledging to work together
    to reduce greenhouse gas emissions.
        However, while voluntary actions by cities or state mandates are
    important what we really need is federal leadership. Not just because
    it is the most powerful way to confront this problem but also because
    it will allow us to achieve the most reductions for the least costs to
    our economy.
        We believe this is the year for federal action. Specifically, we
    believe Congress needs to adopt a greenhouse gas reduction plan that
    calls for a hard and declining cap on emissions and allows for carbon
    trading among entities. To achieve the most reductions at the lowest
    possible cost we believe that this trading program should allocate
    allowances in ways that encourage hydropower and other renewable
    resources, rewards past and future conservation and energy efficiency,
    and recognizes credit for early action.
           united states conference of mayors and the 110th congress
        I am pleased that the U.S. Conference of Mayors has been the
    leading local government organization on this issue. The U.S.
    Conference of Mayors led by Mayor Douglas Palmer of Trenton, New
    Jersey, recently released its 10-Point Plan, for Strong Cities, Strong
    Families, for a Strong America at our 75th Winter Meeting.\5\ The
    mayors were so pleased, Madame Chair, that you could join them to share
    your vision on the need for action by Congress to further the nation's
    progress on climate protection.
    ---------------------------------------------------------------------------
        \5\A copy of 10-Point Plan, for Strong Cities, Strong Families, for
    a Strong America can be found at: http://usmayors.org/uscm/news/press--
    releases/documents/10-PointPlan.pdf
    ---------------------------------------------------------------------------
        In our 10-Point Plan, the nation's mayors have made action on
    federal climate legislation our lead issue. As I have noted, the mayors
    want to play a strong role in helping you and members of this committee
    make the federal policy changes that will further progress in our
    communities, in our states and the nation.
        The mayors are proposing an Energy and Environmental Block Grant
    initiative, modeled after the very successful Community Development
    Block Grant program. We believe such an initiative is particularly
    critical at this juncture as cities strive to expand their climate
    protection efforts. The nation has a real interest in expanding the
    many local initiatives that are underway in my city and others all
    across the country. This block grant would accelerate the many
    innovations emerging in our cities, which are the laboratories of
    future solutions to this vast challenge before us.
        Our goal with this block grant initiative would be to use federal
    grants to (1) improve community energy efficiency; (2) develop and
    implement community strategies to reduce carbon emissions, including
    but not limited to achieving ``carbon free'' buildings by 2030; (3)
    develop and implement community and transportation energy conservation
    programs; (4) encourage the development of new technologies and systems
    to decrease our dependence on foreign oil; and (5) promotion and
    development of alternative/renewable energy sources.
        We need the Federal Government to take on a leadership role now so
    that we move beyond the grassroots innovation that is blossoming in
    every state in the country. This Congress needs to move quickly to
    adopt meaningful carbon policies--ideally through a broad-based cap and
    trading program to reduce this country's greenhouse gas emissions. This
    will harness market forces and allow the powerful engine of our economy
    to find the most innovative and cost-effective solutions to this global
    challenge.
        Mayors from across the United States look forward to working with
    you on this challenge.

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

     Responses by Greg Nickels to Additional Questions from Senator Cardin
        Question 1a. I noted with interest your reference to an effort at
    the Port of Seattle to have ships ``plug-in'' while at dockside,
    enabling vessels to turn off their diesel engines and thus reducing air
    emissions.
        Response. Seattle City Light, Seattle's municipal electric utility,
    worked with the Port of Seattle, Princess and Holland-America cruise
    lines, and the Puget Sound Clean Air Agency (PSCAA) to provide shore
    power connections to four ships that visit the Port of Seattle
    facilities. These ships are in Port on Friday, Saturday and Sunday
    during the cruise season, May through September. Princess has been
    using shore power since 2005 and Holland-America since 2006. City Light
    engineers worked closely with the Port and cruise lines on tight
    deadlines to make the project a reality. A grant from the EPA West
    Coast Diesel Collaborative helped defray some of City Light's costs.
    The cruise lines pay for the electricity they use, and City Light
    purchases the greenhouse gas reduction rights (offsets) that result
    from using electricity rather than diesel. In addition to reduced
    greenhouse gas emissions, the use of shore power also eliminated diesel
    particulate emissions while the ships are in port, an important health
    benefit.

        Question 1b. Would you please provide additional information to the
    committee on this innovative approach, including: Who pays for/
    maintains the electrical hook-ups at dockside?
        Response. The cruise lines pay for and maintain the dockside
    electrical connections.

        Question 1c. Is the program voluntary or mandatory?
        Response. The program is voluntary.

        Question 1d. Is there an estimate of emissions reductions
    associated with this initiative?
        Response. When electricity is used instead of diesel, there are
    zero emissions at the dock location, an important health benefit since
    ports are often near major population centers. Studies by the Port of
    Seattle indicate that ``hoteling'' of ocean-going vessels is a source
    of criteria pollutants such as NOx, SO2, and particulates
    and diesel particulate matter. The overall emission reductions will
    depend on how the electricity is produced, and the emissions of the
    ship's diesel engines. If the northwest regional electricity market mix
    is assumed, Seattle City Light has estimated that several thousand
    metric tons of carbon dioxide are avoided each cruise season through
    the use of shore power.

        Question 1e. Are these air emission reductions part of the Clean
    Air Act Washington State Implementation Plan?
        Response. The cruise ship electrification is not part of the
    Washington SIP. It was implemented to reduce greenhouse gas emissions,
    sulfur dioxide and particulate emissions in the vicinity of the cruise
    ship terminal. Puget Sound Clean Air Agency negotiated it with the port
    and cruise lines after the cruise lines rejected the use of lower
    sulfur fuels while at the dock.
                                     ______

     Responses by Greg Nickels to Additional Questions from Senator Inhofe
        Question 1. It is estimated that even full implementation of Kyoto
    would impact global temperature by only 0.07C. What impact on global
    temperature will this program have? And at what cost to the 60 million
    residents of the 409-member cities? (Currently there are 527-member
    cities.)
        Response. The Kyoto targets embedded in the Mayor's Climate
    Protection Agreement (MCPA) are intended to be a first step to reduce
    greenhouse gas emissions by local governments and to spur action at the
    state and Federal Government levels. The Intergovernmental Panel on
    Climate Change (IPCC) has established the emission reductions necessary
    to truly normalize climate variability. Seattle endorses a long-term
    target of 60 percent emission reductions from 1990 levels, while
    remaining committed to the near-term target in the MCPA of 7 percent
    below 1990 levels by 2012.
        There are significant economic costs associated with inaction which
    could easily overwhelm costs associated with reducing greenhouse gases.
    Globally, the most recent report from the IPCC lists many widespread
    changes that are already being observed; many are considered warning
    signals of an already changing climate. For example, since the 1970's
    we have seen harsher and longer droughts in the tropics and subtropics
    and an increase in intense tropical cyclone activity in the Northern
    Atlantic. Heavy rain storms have increased over most land areas.
        The Pacific Northwest, where we are overwhelmingly reliant on
    hydropower, is particularly at risk. Seattle City Light, our city's
    publicly owned electricity provider, receives 90 percent of its
    electricity from hydropower, much of it from dams operating in the
    Northern Cascades. Snow packs have already been reduced in the Cascades
    since the end of World War II and University of Washington climate
    scientists expect to see this trend continue and even accelerate in the
    coming decades. Reductions in snow pack will reduce the viability of
    hydropower in the Pacific Northwest at great potential expense to area
    utilities and residents.

        Question 2. Were you aware that Claude Allegre--the former
    Socialist party Leader and geophysicist who is a member of both the
    French and U.S. academies of science who used to be a leading alarmist
    about global warming--has now reversed his position? He now thinks it
    may be due to natural variability and that this is about money. How do
    you respond to this statement?
        Response. The City of Seattle believes that human-related climate
    change is real; that it poses the single largest environmental threat
    with consequences for economies and communities throughout the world;
    that it is underway; and that Congress should act soon to pass
    legislation calling for greenhouse gas reductions. While continuing to
    press for national leadership to curb greenhouse gas emissions, the
    City of Seattle has chosen to take actions now, believing that local
    governments, citizens and businesses must lead by example.

        Senator Boxer. Thank you for that excellent testimony.
        Now we are going to hear from the Mayor of Des Moines,
    Frank Cownie, the Hon. Mayor. Welcome.

     STATEMENT OF HON. FRANK COWNIE, MAYOR, CITY OF DES MOINES, IA

        Mayor Cownie. Thank you, Madam Chair. I am Frank Cownie and
    I am the Mayor of Des Moines, IA, which is the capital of the
    great State of Iowa.
        As I thought about what I was going to testify to when I
    came here, one of the reasons we are so concerned about global
    warming and climate protection has to do with quality of life.
    We think that is our No. 1 asset. We have committed, in the
    city of Des Moines, to minimize all the costs and the causes
    that would jeopardize it and try to make strategic investments
    that we hope will improve that.
        It takes guts at every level of government, whether you are
    sitting in a Federal office or a State office or a local
    office, because the people are going to see the results of what
    we do or the consequences of what we don't do, and they are
    going to be people that we don't even know. They are
    generations away, mostly, and quite frankly, they will never
    vote for us. But we have to do it for them, that is part of our
    future and our calling.
        I will cite a few of the things and the initiatives that we
    have pursued in the city of Des Moines and were provided in my
    written testimony. We have a Mayor's Task Force that convenes
    citizens of every walk of life, whether they are low or
    moderate income, or those more well to do, that are coming
    together and looking at things that they can do in their homes,
    in their businesses, in their households. Our task force's
    written directives to the city council and the city manager, we
    have written resolutions, we have held town hall meetings with
    many national level environmental advocates, including
    Interfaith Power and Light president and founder, Sally
    Bingham.
        We have purchased hybrid vehicles for our police
    department. We have replaced other vehicles in other
    departments that operate on biofuels and we are told have a 30
    percent increase in fuel efficiency. We are retrofitting
    municipal buildings to become more energy efficient and improve
    the lighting and insulation and significantly reduce not only
    greenhouse gas emissions but operating costs.
        We have replaced incandescent street lights and stop
    signals with more efficient LEDs that already have saved us
    over $120,000 a year. We are encouraging the use and expanding
    our mass transit system, the Des Moines Area Rapid Transit
    System. We have recently entered into a contract for the
    development of a 100 million gallon ethanol production facility
    at our ag-emergent park which will be lead certified. Our
    regional solid waste landfill captures enough methane to
    provide electric power to 10,000 homes.
        All of our actions have not only benefited our bottom line,
    but we feel have improved the environment. Every level of
    government has its role, and Federal action, we feel, is needed
    now, because the challenge to protect our quality of life for
    every citizen is one that every city and every town across this
    Country faces.
        We cannot address this problem alone, quite frankly, we
    need your help.
        If I might take just a moment, a personal comment, we serve
    at the base level of government. We really are at the pothole
    level, people are in our faces every day. It seems to me that
    we cannot really impact climate change without people change.
    What people do in their everyday lives is the key. I sense a
    new awareness and a willingness on the part of Des Moines'
    citizens to seek change for the sake of the environment. If you
    can empower us at this pothole level of government to work
    directly with our citizens to develop grassroots solutions, we
    can achieve real progress.
        First, it is important for you to enact legislation to
    create Federal tax credits or other incentives that will
    promote energy efficiency. If I----
        Senator Boxer. Do you want to summarize the other action
    items for us?
        Mayor Cownie. Yes. I think we could look at other
    opportunities, like tax shifts from things that we want to
    things that we don't want, set standards, CAFE standards,
    renewable electric standards, packaging standards, recycling
    standards, water use standards, pedestrian-oriented development
    standards. Second, it is essential for you to fund research and
    development, so that we can commercialize some of the things
    through those programs with demonstration projects in our
    municipalities across this Country.
        [The prepared statement of Mayor Cownie follows:]
            Statement of Frank Cownie, Mayor, City of Des Moines, IA
        Chairman Boxer, distinguished members of the committee, good
    morning, and thank you for inviting me to testify about the important
    role of local governments in responding to global warming. My name is
    Frank Cownie, and I am the Mayor of the City of Des Moines, Iowa. My
    testimony today will focus on the leadership role that my city has
    played in practicing and promoting energy conservation.
        As both the capital and largest city, Des Moines is the cultural,
    economic, and geographic center of the State of Iowa. About 200,000
    people live in Des Moines, and the City is recognized as a center for
    government, education, business, culture, and the arts. Des Moines is
    also quickly becoming a national leader in using energy conservation
    and environmental protection strategies.
        I signed the Mayor's Climate Protection Agreement along with over
    400 other Mayors because our residents recognize that there is a finite
    amount of energy and resources available. Scarcity of resources
    increases costs. We view this as a crucial issue in protecting our
    economic vitality and our high quality of life. Our quality of life is
    our single greatest asset in Iowa, and we are committed to protecting
    it and to minimizing costs that would jeopardize it.
        That is why we have taken action at the local level. Last year I
    established the Mayor's Task Force on Energy Conservation and
    Environmental Enhancement to examine energy usage and environmental
    protection in Des Moines. We, as the local government, united the
    broad-based support of residents, businesses, faith-based and non-
    profit organizations. In addition to the direction set by the Mayor's
    Task Force, my colleagues and I on the City Council have made
    sustainability part of our overall goals for the City. Our objective is
    to become a leader in promoting environmental sustainability and
    transportation alternatives. To that end, we are pursuing a number of
    green initiatives.
        One of our first major initiatives was introducing hybrid and
    alternative fuel vehicles into our city fleet. Our Police Department
    now uses hybrid vehicles for neighborhood patrol and in the detective
    bureau. As a routine practice, our centralized fleet management staff
    strives to obtain greater fuel efficiencies every time they purchase
    replacement vehicles. This is accomplished by writing bid
    specifications for smaller vehicles or vehicles that utilize
    alternative fuels, like biodiesel and ethanol.
        Another important piece of our goal for sustainability in Des
    Moines is about providing transportation options to give our residents
    alternatives to driving their cars. The Greater Des Moines region is
    building a one-of-a-kind trail system, with over 300 miles of
    recreational trails to connect Central Iowa. The City of Des Moines
    alone maintains 29 miles of trails, and we are adding more bike lanes
    to make it easier for our residents and visitors to bike and walk
    rather than drive their cars.
        The Des Moines Area Regional Transit Authority (DART) was created
    last year as a regional approach to public transit. DART is planning to
    expand its routes and hours of operation. This year, for the first
    time, buses will run on Sundays, which will make it more convenient for
    our residents to get around without their cars. The City is also
    leading by partnering with the State and the business community to
    provide the initial seed money for a downtown shuttle. This service
    will encourage downtown workers to choose transit, again--instead of
    their cars, to get around the central city during the day. This will
    ultimately reduce energy consumption and emissions.
        We're also working to improve the energy efficiency of our
    municipal buildings and infrastructure. We have improved lighting and
    installed timers in our City parking facilities and in some municipal
    buildings. We have replaced incandescent traffic signals with more
    energy-efficient LED bulbs to reduce our electricity consumption. This
    alone is saving the City $120,000 on energy costs. We have done
    numerous facility roof insulation upgrades to reduce heating costs and
    emissions.
        We have completed comprehensive upgrades in our fire stations and
    parks facilities. These include energy efficient windows and improved
    roof insulation. In one building, the roof insulation alone will reduce
    energy costs and greenhouse gas emissions by approximately 40 percent.
    As another unique improvement, we are installing a solar hot water
    heating system to augment an existing gas-fired water heater. A solar
    hot water heating system can supply, on average in the Midwest, 65
    percent of the demand for hot water. This will result in significant
    energy savings and reduced carbon dioxide emissions. The City is also
    working on LEED (Leadership in Energy and Environmental Design)
    certification for municipal buildings, with one currently under
    construction. All of these improvements are part of previously planned
    and budgeted upgrades. In Des Moines, we view routine maintenance as an
    ongoing opportunity to pursue energy efficiency.
        Our Park and Recreation Department staff and volunteers have been
    strong leaders in the sustainability movement, particularly as it
    relates to preserving our open land and green spaces. The Park and
    Recreation Department is pursuing water quality projects, natural
    management plans for parks, natural forest regeneration, and planting
    native species. By planting more trees and native prairie grasses, we
    reduce the need for irrigation, conserve water, and use less chemical
    fertilizers. In short, conservation has become our way of doing
    business in Des Moines parks. A ``Green Design Checklist'' helps to
    ensure conservation efforts are infused into the design of all parks
    projects.
        For its efforts, the City of Des Moines Park and Recreation
    Department won a 2006 Urban Steward Award from the Polk County Soil and
    Water Conservation District. The City of Des Moines was recognized for
    its recycling program as well. MidAmerica Recycling awarded Des Moines
    with a Certificate of Recognition for Recycling Excellence for
    recycling nearly 6,800 tons in 2006.
        The City of Des Moines is also engaged in promoting the research
    and development of alternative fuel sources. We are in the process of
    selling land in our Agrimergent Technology Park to a company for a 100
    million gallon ethanol production facility. As part of the contract,
    the business is required to produce a LEED-certified project and to
    pursue innovative technologies to reduce its natural gas consumption
    through alternative fuels that will be more environmentally beneficial
    and more cost-effective, such as biogas.
        Finally, the Metro Waste Authority in Des Moines is recovering
    enough methane at our solid waste landfill to provide electricity for
    10,000 homes. This electricity is sold and provides a revenue stream
    for the Authority. Like our other initiatives, this action not only
    benefits the environment, but it helps our economic bottom line.
        In closing, I want to encourage the committee that federal action
    on this issue is needed now, because the challenge to protect our
    quality of life is one that every city and town in the country faces.
    We cannot address the issue on our own. We need your help.
        First, it is important for you to enact legislation to create
    incentives to promote energy efficiency and reduce resource
    consumption. These incentives might include federal tax credits, CAFE
    standards, recycling standards, water use standards or packaging
    standards that take into account the life cycle costs of product
    manufacturing, use and disposal.
        Second, it is essential for you to fund (a) research and
    development activities that can be commercialized, (b) greenhouse gas
    emissions inventories, and (c) demonstration projects in which
    municipalities like Des Moines can participate to engage our residents
    to DO JUST ONE THING.
        Many of our local initiatives have been aimed internally at
    improving energy efficiency in our municipal buildings and fleet. The
    next step is to help our residents to recognize the environmental and
    economic benefits of practicing energy conservation. It can be as
    simple as using compact fluorescent light bulbs, dialing the thermostat
    down in winter and up summer, buying vehicles that use bio-fuels or
    hybrid technology, taking the bus to work, planning trips for
    efficiency, carpooling, walking, biking, and planting trees--all that
    result in saving money and in protecting resources for future
    generations. These are steps that every citizen can take.
        Similarly, we need to convene our business partners and key
    greenhouse gas emitters and begin to empower them to take actions that
    will make a difference. Imagine all of the resources that could be
    conserved and costs averted. Imagine all of the new business
    opportunities that could result from increased market demand.
        We have a choice. Either we can stay the course, working on our own
    with marginal success, or we can move forward in partnership with the
    Federal Government to create a significant, positive impact upon on our
    environment and economy. We choose to go forward. It is now time for
    federal action to invest in our future, our children's future, our
    grandchildren's future and with a vision for the next seven
    generations. We are committed to improving the quality of life in our
    communities and appreciate your leadership to assist us in
    accomplishing this far-reaching goal. Thank you.

        Senator Boxer. Thank you, sir.
        And last but not least, we welcome the Mayor of the city of
    Dover, Ohio, the Hon. Richard Homrighausen. Welcome.

       STATEMENT OF HON. RICHARD P. HOMRIGHAUSEN, MAYOR, CITY OF
                               DOVER, OH

        Mayor Homrighausen. Good afternoon, Chairman Boxer, Senator
    Voinovich and committee members. My name is Richard
    Homrighausen and I am the Mayor of Dover, OH.
        Dover is a small community in southeastern Ohio with a
    population of approximately 13,000 members in the heart of the
    industrial midwest. There are more than 900 commercial and
    industrial business interests located in the city. As you would
    expect, our goal is to provide reliable, affordable services to
    these businesses and residents, including electric power. Our
    97- year history as a municipal electric community certainly
    supports these efforts.
        Dover's effort toward achieving our goal of affordable,
    reliable energy is accomplished by a diversified resource
    portfolio. With our onsite capacity, the city is able to
    generate 30 percent of its electric needs through a mix of
    coal-fired, coal with natural gas and diesel generation. In
    addition, the city owns 9 megawatts of capacity from AMP-Ohio's
    coal-fired Richard Gorsick station in Marietta, 1 megawatt of
    hydropower generated by New York Power Authority, 3 megawatts
    from a landfill gas joint venture and 3 megawatts generated by
    AEP. Any additional generation is purchased through our
    wholesale supplier, AMP-Ohio, a joint action organization with
    119 municipal member communities in five States on an as-needed
    basis.
        The reliability and security value of our onsite capacity
    was punctuated by the events of the August 2003 blackout in our
    part of the Country. While surrounding communities were without
    power for hours and in some instances days, the city of Dover
    never lost power. I am proud to say that Ohio is working to
    leave behind its outdated image as being the heart of the rust
    belt. Ohio's public power communities are leading the way in
    terms of environmentally responsible electric generation in our
    region, collectively, wind, run-of-the-river hydropower, and
    landfill gas are all part of the generation portfolio to
    available to AMP-Ohio member cities.
        Energy conservation is also a priority and something we
    have been working to implement and raise awareness of in the
    city of Dover. All of us share a concern about the environment
    and the recent attention being given to climate change, and the
    impact of greenhouse gas emissions is an important discussion.
    But as is usually the case, how best to address these issues is
    at the heart of the debate.
        My main concern is that the cost will fall
    disproportionately on the poor and the elderly, those least
    able to afford such measure, and that impact will hit
    especially close to home. Following the death of my wife
    Linda's father at age 45, my mother-in-law was able to raise
    her other two sisters and send them to school on her social
    security income alone. Today, her only source of income is her
    $720 social security check. She lives in a 928 square foot
    apartment that we were fortunate enough to be able to build for
    her next to our house. Twenty-four percent of her social
    security goes toward her utilities, $92 in gas and $80 for
    electric, water and sewer. Thankfully, she lives in a public
    power community that provides affordable and reliable electric
    generation by coal, or she would not be able to live alone.
    Granted, it is also a big help that we don't charge her any
    rent.
        [Laughter.]
        Mayor Homrighausen. My point is that it only leaves her
    $548 for food, medicine, insurance, gasoline and automobile
    expenses, cable and phone. Any increase beyond what she has to
    pay now would be devastating. Fortunately, she is not alone,
    but others are not as lucky.
        My point is to stress the importance of a message that
    there is no one-size-fits-all approach to addressing these
    issues. States are unique and have engaged on this issue in
    ways that make sense and work for them. A Federal program that
    sets limits on carbon dioxide and other greenhouse gases would
    disproportionately penalize some regions, including my own.
        Nationally, coal represents roughly one half of our
    available power supply, and that figure is higher in my region,
    with utilities emitting approximately 40 percent of all
    greenhouse gas emissions. Compare this to California, where
    coal has limited use in the generation of resource mix, and
    utilities are responsible for about 20 percent of the
    greenhouse gas emissions. In addition, California's economy
    does not reflect the same industrial base that exists in our
    region of the Country, an industrial base that supplies
    products throughout the Nation and is highly sensitive to
    electric prices in a global market. In-State generation of coal
    has not been an option for California utilities for decades,
    while the midwest region is highly dependent on coal-fired
    generation.
        Looking specifically----
        Senator Boxer. If you would like to wrap up, you have gone
    over time. If you want to leave us with one final fabulous
    idea.
        Mayor Homrighausen. As the committee continues to
    investigate climate change and consider possible new regulatory
    regimes, I urge you to remember cities like Dover, OH. Please
    recognize that we have an industrial base that helps supply the
    Nation, that we are located in a region with a still-struggling
    economy and that our part of the Country is historically
    dependent on coal-fired generation and doesn't have the ability
    to rely on renewable resources to the same extent as other
    regions.
        [The prepared statement of Mayor Homrighausen follows:]
         Statement of Richard P. Homrighausen, Mayor, City of Dover, OH
        Good morning Chairman Boxer, and members of the Committee on
    Environment and Public Works, my name is Richard P. Homrighausen, and I
    am the Mayor of the City of Dover, Ohio. As a Mayor from a small
    Southeastern Ohio town, I am honored to be invited for the third time,
    to testify before this committee and offer a state and local government
    perspective on climate change. I will focus my remarks on my concerns
    about how the regulations being discussed would impact local
    governments--especially those like my community, which owns and
    operates a small coal-fired generation facility.
        Dover, Ohio, with a population of approximately 13,000, is in the
    heart of the industrial Midwest, and I believe our experiences are
    shared by a great number of small to mid-sized municipalities across
    the region. There are more than 900 commercial and industrial business
    interests located in the City of Dover. As you would expect, our goal
    is to provide reliable, affordable services to these businesses and
    residents--including electric power. Our 97-year history as a municipal
    electric community certainly supports these efforts.
        Dover's effort toward achieving our goal of affordable, reliable
    energy is accomplished by incorporating a variety of different
    processes. The city-owned, 14-megawatt coal-fired powerplant (which is
    also co-fired with natural gas) is our main source of generation. An
    additional 18-megawatts of ``stand-by'' electricity can be generated by
    our natural gas turbine. We have seven diesel generators with a total
    capacity of 13.4 megawatts. Four of these diesel units are solely owned
    by the city and three are jointly owned by the city and AMP-Ohio. In
    addition to our on-site generation capacity, the city owns nine
    megawatts of capacity from AMP-Ohio's coal-fired Richard H. Gorsuch
    Generating Plant in Marietta, Ohio, one megawatt of hydro power
    generated by the New York Power Authority, three megawatts from a
    landfill gas joint venture, and three megawatts generated by AEP.
    Finally, any additional needs we have are purchased through our
    wholesale supplier, AMP-Ohio, on an as-needed basis.
        With our on-site capacity we are able to generate approximately 30
    percent of our energy demand locally. The reliability and security
    value of this local resource was punctuated by the events of the August
    2003 blackout in our part of the country. While surrounding communities
    were without power for hours, and in some instances days, the city of
    Dover never lost power. As noted, our partner in our effort to supply
    affordable reliable power to our community is American Municipal Power-
    Ohio, a joint action organization with 119 member-municipal electric
    systems in five states.
        I'm proud to say that Ohio is working to leave behind its outdated
    image as being the heart of the ``rust belt''. Ohio's public power
    communities are leading the way in terms of environmentally responsible
    electric generation in our region. Collectively, wind, run-of-the-river
    hydropower and landfill gas are all part of the generation portfolio
    available to AMP-Ohio member utilities. Energy conservation is also a
    priority--and something we've been working to raise awareness of in the
    City of Dover.
        All of us share a concern about the environment, and the recent
    attention being given to climate change and the impact of greenhouse
    gas emissions is an important discussion. But, as is usually the case,
    how best to address these issues is the heart of the debate. I've read
    about various statistics relating to the impact of the different
    climate change proposals on the economy, on energy production and on
    energy prices. Since I am not a scientist or economist, I cannot debate
    the validity of such studies and whether their results are high, low or
    right on. However, I am concerned that the cost impact will fall
    disproportionately on the poor and elderly--those least able to afford
    such measures. And, that the impacts will hit especially close to home.
        Following the death of my wife Linda's father, at age 45, my
    mother-in-law raised Linda's two sisters on social security alone, and
    she was able to put them through college. Today, her only source of
    income is her $720 Social Security check. She lives in a 928-square-
    foot apartment we were able to build for her next to our house. Twenty
    four percent of her Social Security goes for her utilities--$92 in gas
    and $80 for electric, water and sewer. Thankfully, she lives in a
    public power community that provides affordable and reliable
    electricity generated by coal or she would not be able to live alone.
    Granted, it is also a big help that we don't charge her rent, but my
    point is that almost a fourth of her income goes for utilities, which
    only leaves her $548 for food, medicine, insurance, gasoline and
    automobile expenses, cable and phone. Any increase beyond what she has
    to pay now would be devastating. Fortunately, she is not alone--others
    are not as lucky.
        My point is to stress the importance of the message that there is
    no ``one size fits all'' approach to addressing these issues. States
    are unique and have engaged on this issue in ways that makes sense and
    works for them. Some states have clean coal research and development
    programs, others have tax credits for renewable energy, and still
    others have renewable portfolio standards. A federal program that sets
    limits on carbon dioxide and other greenhouse gases could
    disproportionately penalize some regions. For example, for regions that
    are highly reliant on coal for delivery of electricity, or on natural
    gas for manufacturing, a federal mandatory program could be
    economically devastating--natural gas used for manufacturing would be
    diverted to electricity production and prices would become higher and
    much more volatile. This is something we have already experienced in
    recent years, although to a much smaller degree.
        One of the issues I was asked to consider in my testimony today was
    the California plan. There are obvious and important differences
    between California and other regions of the country. I believe that we
    need to strive to find answers that work to achieve desired goals--yet
    balance the needs of the entire nation, and in my case, Ohio in
    particular.
        Nationally, coal represents roughly one-half of our available power
    supply, and that figure is higher in my region with utilities emitting
    approximately 40 percent of all greenhouse gas emissions. Compare this
    to California where coal has limited use in the generation resource
    mix, and utilities are responsible for about 20 percent of the
    greenhouse gas emissions. In addition, California's economy does not
    reflect the same industrial base that exists in our region of the
    country--an industrial base that supplies products throughout the
    nation and is highly sensitive to electricity prices in a global
    market. In-state generation of coal has not been an option for
    California utilities for decades, but the Midwest region, and indeed
    the nation as a whole cannot shut coal out as a resource option--not if
    we also want to maintain our national goals of energy independence,
    reliability and affordability.
        One component, as I understand, of the California Plan is a
    utility-specific ban on long-term power supply agreements with coal-
    fired plants that emit more carbon than a combined cycle natural gas
    plant. Presumably, this is a stocking horse for integrated gasification
    combined cycle technology, which has become the belle of the ball in
    terms of coal generation in recent years, and many people feel
    represents the future of coal generation. They may be right, and I
    certainly support advancements that allow us to burn coal more cleanly.
    But, with respect to IGCC, the reality is that there is not enough
    operational data on the performance of IGCC in real world applications
    to crown it the only option.
        There are, however, promising back-end control technologies for
    traditional coal facilities, such as ammonia and amine scrubbing, with
    the potential to capture carbon as well. As the debate moves forward in
    Congress, I believe it is important to focus on the desired end result
    and take a technology-agnostic approach to allow for the development
    and deployment of as many innovative options as possible. We need to
    ensure that workable options to reduce carbon emissions from coal
    plants are both viable and credible and take into account not only
    costs, but also operational considerations.
        Looking specifically at my community of Dover, Ohio, we are highly
    dependent on coal-fired generation, both through our local facility and
    our purchases from the wholesale market. However, unlike larger private
    utility companies, we do not own or have access to a fleet of
    powerplants that we can selectively control or shut down. Any new
    climate program must recognize these differences and provide meaningful
    options for cities like Dover.
        Of course, the logical question is ``What is Dover doing?'' As I
    mentioned, Dover generates a portion of our electric needs by operating
    a 14-megawatt coal-fired boiler, co-fired with natural gas burners.
    Dover was the first municipal electric utility to install co-firing in
    a commitment to reducing emissions at start-up. Dover is also
    investigating wind generation by planning to install wind monitors at
    three of our water towers and at a fourth site the city owns. Although
    Dover is located in the Tuscarawas Valley, which experiences
    intermittent wind flow, we won't know if wind generation is feasible
    until all pertinent data is collected. By late August of this year,
    Dover's new bag house will be in operation, which will further reduce
    the emissions from our coal-fired unit. As we speak, our antiquated
    Boilers #1, #2 and #3 are in the process of being demolished to provide
    the needed space in our generating facility to install new, state-of-
    the-art clean coal generation should it become affordable. In the mean
    time, through our wholesale power supplier, Dover is a participant in
    the development of new coal-fired generation utilizing proven
    generation technology with innovative back end control technology, and
    we are participating in a pilot studying potential carbon capture
    methods. Through our wholesale supplier, we are also part of the
    Midwest Regional Carbon Sequestration Partnership.
        Public power communities in my region have taken important steps to
    diversify our existing generation supply and utilize ``clean''
    resources, including wind, landfill gas and run-of-the-river hydro
    power--and have been recognized statewide and nationally for those
    efforts. These investments have been at a scale and scope that work for
    our region--and we are looking at additional generation investments
    that are carbon free.
        The City of Dover has been designated a ``Tree City USA'' for 26
    consecutive years. During that time we have planted 3,540 curb strip
    trees. Additionally, for the past 23 years the city has distributed an
    average of 235 Dogwood trees to all first-grade students in the Dover
    grade schools, for a total of 5,405 additional trees. The city has
    three parks with several thousand trees, or an additional +/- 6,000
    trees. Since the mid 1980's the city has developed 13 residential
    allotments ranging in size from 12 lots to 150 lots, with each lot
    required to have a least one tree planted. (The majority of these trees
    are included in the curb strip tree numbers). This does not take into
    account all of the other trees in the city that are on private property
    and in addition to our curb strip trees. All combined, a minimum of
    15,000 trees have been planted within the city over the last 26 years.
        Energy efficiency is clearly a critical component in the climate
    change equation, since reduced consumption of electricity in most cases
    reduces emissions and in all cases postpones the need for new
    generation. We are utilizing tools that provide practical advice in
    energy conservation available from our national association, the
    American Public Power Association, for use with our consumers. The city
    has an energy audit program, working with our largest customers to help
    them identify the benefits of increased use of energy efficient
    lighting and other measures to reduce energy demand. We have made
    conservation a theme in communications with our residential customers
    through festivals and other events, emphasizing the critical importance
    of reducing demand. We routinely distribute energy information and
    energy conservation tips in our monthly utility bills. The city has
    also accomplished system upgrades, improving voltages and increasing
    overall efficiency of our electric system. The city has changed our
    street lighting program by replacing high voltage, high energy street
    lights with energy efficient street lights. Dover has 2892 total street
    lights. To date we have replaced 2250 or 78 percent of our street
    lights. The monthly savings in kWhrs realized is 18,667. It takes 1.35
    pounds of coal to generate 1 kWhr of electricity. Multiplying 18,667
    kWhrs by 1.35 equals 25,200.45 pounds of coal or 12.6 tons of coal per
    month which equals 151.2 tons of coal the City of Dover does not have
    to burn just by changing our street lights. Once we complete our
    change-out program this year, the City of Dover will save an additional
    43 tons of coal on an annual basis. In addition, we have held mercury
    thermometer recycling events, which not only keep these devices
    containing mercury out of our solid waste streams, but also serve to
    remind residents to ``think globally and act locally.'' These are
    outward and visible examples of a commitment to a clean environment and
    to future generations.
        As the committee continues to investigate climate change and
    consider possible new regulatory regimes, I urge you to remember cities
    like Dover, Ohio. Please recognize that we have an industrial base that
    helps supply the nation, that we are located in a region with a still-
    struggling economy, and that our part of the country is historically
    dependent on coal-fired generation and doesn't have the ability to rely
    on renewable resources to the same extent as some other regions.
        Please also recognize that we understand the need to be responsible
    environmental stewards and are looking for ways to balance the desire
    to do so with our need to maintain a viable economy. A plan that starts
    everyone at ``square one'' and doesn't recognize the investments
    already made is neither viable nor credible. In short, don't penalize
    us for our past good behavior, nor unreasonably restrict our ability to
    meet the needs of our community. We also encourage you not to pre-empt
    state efforts to tailor programs that work to balance the unique needs
    of the varying regions of our great country.
        I would hope that any regulatory structure enacted would be
    economy-wide and apply to all industry sectors, would take into account
    the financial impacts on consumers and protect the ability of the
    United States to compete in a global marketplace, and would recognize
    the need to maintain reliability and protect national security. I also
    whole-heartedly welcome investments the Federal Government can make in
    advancing a range of clean-coal technologies, renewable energy
    generation and energy efficiency programs that benefit all utility
    sectors and consumers.
        This committee, and Congress, has an enormous task at hand. I would
    ask you to consider the information I have presented, the information
    presented by my fellow panelists and all other pertinent information
    available, prior to finalizing any legislation. Please keep in mind
    that passing legislation too quickly increases the risk of passing the
    wrong legislation.
        Again, I want to thank you for this opportunity and your work on
    this issue, and I look forward to responding to any questions you might
    have.
                                     ______

     Responses by Mayor Richard Homrighausen to Additional Questions from
                                 Senator Inhofe
        Question 1. Mayor Homrighausen, if a federal law were enacted
    similar to California's and the Executive Order signed by Governor
    Corzine, what impact would that have on people like your mother-in-law?
        Response. The impact these measures will have on people like my
    mother-in-law will be devastating. While the intent of these measures
    is noble the reality is that the average American cannot afford the
    costs associated with compliance. As I see it, these measures are a
    back door attempt to achieve the Kyoto Protocol, which the majority of
    the American people and Congress do not agree with.
        It would be a different story if the 2 largest contributors to
    global warming, China and India, were made to comply, but they don't so
    the majority of the burden will lie on the backs of the American
    people. Additionally, Mexico, where a great deal of America's jobs have
    been outsourced to, does not have to comply, which only makes this
    burden the more unbearable.
        If we are to be serious in our attempt to curb global warming
    Congress must take measures to invoke serious economic sanctions on all
    countries, whether they be developing countries or not, who are not
    being good stewards of our environment by emitting vast quantities of
    pollutants into our atmosphere. If these measures are not taken then
    enacting these measures on our own people will be a hollow attempt, and
    fall far short in curbing a worldwide problem.
        As I have pointed out in my testimony, my mother-in-law cannot
    afford any additional cost beyond those she already has. Any increase
    in compliance costs will directly impact, not only my mother-in-law,
    but all people in our country.

        2Question 2. Mayor, you testified about the industrial base in your
    region which supplies the nation. If draconian policies are put in
    place which dramatically increase natural gas price volatility, what
    will that do to your local economy and those of neighboring Ohio towns
    and cities?
        Response. Dover is already experiencing the effects of high natural
    gas prices. Dover was the first Municipal Electric Utility in the
    country to install natural gas burners to co-fire our start-up process
    in an attempt to reduce our emissions. The high cost of natural gas has
    caused the city to limit the use of these burners because the cost far
    exceeds the benefit gained by burning natural gas.
        As natural gas prices increase the cost of doing business
    increases. As the cost of doing business increases the cost of goods
    produced increases. As the cost of goods produced increases profit
    margins decrease so does the competitive edge of any given company. As
    the ability to compete is reduced the desire to outsource these goods
    is increased. Once goods are outsourced these jobs are gone. The City
    of Dover, and/or any city in the country, need only look at the number
    of manufacturing jobs that have been lost over the past several years
    to determine what any major spike in natural gas prices will do to our
    economy.
        If you have an entire country dependant upon the majority of its
    electricity being supplied by natural gas generation then you have a
    recipe for disaster. The United States cannot afford to continue to put
    us at a disadvantage by placing more and more stringent requirements on
    our industry. Congress has to be serious about its desire and
    commitment to developing clean coal technology in order for us to
    continue to be the leader of the free world.
        During the hearing I was appalled when Senator Sanders made the
    following statement (on page 79 of the transcript) `` . . .  I am
    wondering what we could do at the Federal level. There have been some
    indications that if we literally gave away, gave away compact
    fluorescent light bulbs, we end up saving money.'' Now I totally
    understand the intent is to lower our energy usage which in turn
    reduces the amount of electricity needed, which reduces our demand for
    energy and the emissions from generation, which saves money everyone
    money. However, what I don't understand is why anyone in the Federal
    Government would even consider giving billions and billions of dollars
    to one of the worst polluters in the world--China--where these bulbs
    are made?
        Dover is home to one of the last incandescent light bulb
    manufacturing facilities in the country, General Electric, where they
    manufacture the filament used in incandescent bulbs. If the Federal
    Government were to supply billions of CFB's to our citizenry then GE in
    Dover will close. Why not expend these monies on producing affordable
    CFB's ``MADE IN AMERICA'' instead of funding our major competitor?

        Senator Boxer. I think that is a very important point,
    Mayor.
        So we have heard from everybody, it has been a terrific
    panel. I am going to use my 4 minutes to make a couple of
    comments, ask a question of my Californians. But I just wanted
    to point out, Mr. Harvey, before you leave, I want to give you
    this interesting article. It is so amazing that today this
    article would run. In the Washington Post, rapid warming
    spreads havoc in Canada's forests, tiny beetles destroy pines.
    Millions of acres of Canada's lush green forests are turning
    red in spasms of death. A voracious beetle whose population
    exploded with the warming climate is killing more trees than
    wildfires or logging. ``It's pretty gut-wrenching,'' said Allen
    Carroll, a research scientist at the Pacific Forestay Center in
    Victoria, whose scientific studies tracked a lockstep between
    warmer winters and the spread of the beetle. ``People say
    climate change is something for our kids to worry about. No,
    it's now.''
        Then, this is what really caught my attention in the
    article. Ironically, the town is booming. The beetle has killed
    so many trees, the officials have more than doubled the
    allowable timber harvest, just taking a lead from you, so
    loggers can cut and haul away as many dead trees as possible
    before they rot. The icy roads are choked with giant trucks
    growling toward the mills loaded with logs, marked with the
    telltale blue stain fungus. But the boom will end when what
    people hear called beetle wood is removed or rots out, and no
    one is sure how long it will take. The forest industry will be
    running at about half speed.
        So the point of this is, it is ironic that you mentioned
    the great opportunity you had. But this is a tragedy in the
    long run. We need to avoid the tragedy. I don't think it is a
    great thing to sit here and say, well, we will preside over the
    end of the forests. It is not right. We did inherit God's green
    earth and we do have an obligation. By the way, I agree with
    those of you from the coal States who are throwing up a red
    flag. We have to work together to make this work.
        So here is my question for my Californians, my heroes of
    the day here, along with Mayor Nickels and Mayor Cownie. But
    they are my home-grown heroes. Here is the thing. The others
    are making it sound like, some of the others who oppose what
    you are doing, in essence, or don't seem to understand it or
    don't get it, they are saying it was a piece of cake. Now, I
    don't understand how it could be so easy. It wasn't easy. The
    fact is, we drive more cars than anyone. Cars are responsible,
    mobile sources, for about at least a third of the problem.
        So I just want to ask you politically, it makes it look
    like this was the easiest thing in the world. If you could give
    us a sense of how it was. I don't think it was that easy.
        Mr. Nunez. Well, it certainly was a big challenge to pass
    Assembly Bill 32 in California last year. Just ask the oil
    refinery industry, for example, or the cement industry, for
    that matter, or heavy manufacturing in California, the utility
    industry. But I think in essence people realize that we are
    seeing the effects of global warming, as others are, at the
    local level.
        Just a quick example, the Sierra snow pack started melting
    in 2004 in mid-March, which was the earliest in 90 years. In
    essence, we rely on that snow pack to eventually get us water
    to southern California and to sustain the agricultural industry
    in the Central Valley. So I think in essence what happened is
    people were thinking that perhaps this was not a good idea,
    this was a tough thing to do, these standards were tough
    standards, albeit California has already played a major role in
    conserving electricity and gas and energy. Conservation has
    always been a big part of our home stay in California, as you
    know, Senator. We have always been very conscientious about
    water quality and air quality.
        But we felt that we needed to go further. Here is the
    reason why. I listened very carefully to what some of the
    Senators said earlier, who perhaps feel that we need to wait
    until countries like India or China act. Here is the problem.
    We represent, at the global level, as a Country, less than 5
    percent of the population of the world, yet we are responsible
    for over 30 percent of the world's emissions. In China, they
    are building a coal plant a week. India is going through the
    same type of industrial revolution that we went through over
    150 years ago. Yes, they are big polluters. But if we wait for
    them to act and don't play a central role at the global level
    as a Nation, there is a lot to lose. I believe that we owe it
    to our children and our children's children to act now.
        This wasn't easy to do in California. It was tough. It was
    a tough choice to make, not just for us as legislators,
    certainly for the Republican Governor in our State, Governor
    Schwarzenegger. It was a tough decision for him to make. But we
    did it because we believed that it was not only our
    responsibility, Senator, but our obligation to act.
        Senator Boxer. Thanks. Don, do you have anything quickly to
    add?
        Mr. Perata. California is really a self-contained
    laboratory. What we have found, the Speaker mentioned cement.
    We found that once we started talking about putting caps on it,
    they started talking about, can we add more limestone, which
    would cost less to produce, less energy and would have the same
    strength. In an earthquake State, that is important.
        Again, there is money to be made, there are jobs to be
    created. I think why most Californians understand that this is
    a valuable exercise, and beyond the environment, is that we
    have lost our defense base, we have lost our manufacturing
    base. These are the technologies that are going to create the
    new wave of jobs. We will develop something in California that
    at the time India and China decide that they are no longer
    going to choke on their air, we will be able to clean it for
    them.
        Senator Boxer. I think that is such an important point.
    This is such a plus. It is not gloom and doom and beetles and
    cutting down trees. It is avoidance of those things.
        Senator Voinovich.
        Senator Voinovich. Thank you. I just couldn't help but
    think, looking at all of you here, that I was before this
    committee as a member of the State legislature in Ohio, was the
    father of the Environmental Protection Agency and came down
    here and testified. As Mayor of the city of Cleveland, I was
    here testifying before this committee. I was here before this
    committee as Governor of Ohio. This is my 40th year in this
    business.
        I would like you to know that for the last 8 years, we have
    been trying to come up with some kind of compromise to deal
    with NOx, SOx, mercury and greenhouse gases. The problem has
    been, we have never been able to get any agreement on the
    greenhouse gases, because there is such a difference of opinion
    in terms of the science and so on. As a result of that, we
    really have not done a good enough job on NOx, SOx and mercury.
    So we are at the stage where we are probably going to continue
    to do nothing for the next couple of years, because of a lot of
    a difference of opinion.
        But one of the things that has come out here today, and
    Mayor Homrighausen, thank you for being here. I know you had a
    real health problem, thank you for being here. He has been here
    two or three times to testify. What I would like to do is to
    challenge each of you, I was very active in an NGA, and we had
    the Big Seven. We had the National Council of State
    Legislators. They have committees that deal with the
    environment. You are in charge at the U.S. Conference of Mayors
    in terms of their committee. In fact, when I thought of you, I
    thought of Charlie Royer, I don't know if you know Charlie or
    not.
        Mayor Nickels. Saw him night before last.
        Senator Voinovich. Really? If you see him again, say hello
    to him for me. Great, great guy.
        And then we have the National Governors. Madam Chairman, I
    think it would be really good if we would convene, we call it
    the Big Seven, to come together to talk about this issue, to
    see if we can get some consensus out there among State and
    local government organizations and come here to Congress with
    some reasonable proposal. Cap and trade has always been kind of
    a no, no, no. But I think that if done properly and with the
    right timing, it might be something that we could get done.
        But if you could get together and agree to something,
    representing, I gave you the statistics, I mean, it is
    different. California has hardly any coal, and Mayor, we have
    about 90 percent coal. It falls all over the Country
    differently.
        But the point that Mr. Nunez made, we are not looking to
    delay anything. I believe that we need to get going full blast
    to deal with this. But the real issue here is this whole issue
    of technology. It is the thing that is holding us back. What we
    need to do is get that technology, make it work here in the
    United States and then deal with what is going on around the
    world. Because a lot of those plants are going to be built
    without dealing with greenhouse gases. How do you put something
    on them that does deal with the greenhouse gases?
        So the only question I have is that, what do you think
    about the idea of all of you getting together and trying to
    come up with some policy that you can come up here and lobby us
    in terms of, this is what we want to do? You have taken the
    leadership, the States have, the cities have. You have done a
    great job. You have actually done more than we have done, a lot
    more. What do you think of that?
        Mr. Perata. I am up for it.
        Mr. Nunez. I certainly think that you have some great minds
    here in the Congress as well. I do believe that ultimately,
    there is a saying that says something like necessity is the
    mother of invention. I believe that until and unless you create
    a market through real specified mechanisms that require a
    reduction in our carbon footprint that the time with which the
    new technologies, for example, coal, I hear a lot of discussion
    about coal, coal gasification and other alternative ways to
    make our air cleaner and not depend upon the antiquated forms
    of energy that we continue to use. Until and unless we have a
    real necessity and an urgency to produce them, then those
    technologies will not come. I think we have to create them.
        Senator Voinovich. Let me say this. Senator Clinton talked
    about a Manhattan project. In other words, I think we are at
    that stage right now. If we are going to get a cap, reasonable
    cap and trade program, you have to have the prospect that we
    have the technology out there to really do a job with
    greenhouse gases. I think we have a role to play. I think if we
    wait for the market to do this, it is not going to happen. By
    the way, we don't have time to wait. There are people saying,
    well, put the caps on, and then all of a sudden, this is going
    to sprout. I think that it hasn't. I think we need to, we have
    a role in the Federal Government to get on this thing now.
        Mr. Perata. Senator, if I might, there are some great
    things going on in our State. We would love to have you come.
    We just got a $500 million grant from British Petroleum for the
    UC Campus at Berkeley to do renewable energy research. There
    are many things going on. It might be just the thing you need
    is a little time in California and we will show you some of the
    things that are happening. It is very stimulating. It really
    is.
        Mayor Cownie. Senator, I think that one thing you might do
    immediately that the Conference of Mayors has worked on is that
    energy and environmental block grant that is kind of patterned
    after the CDBG. My problems in Des Moines are different than
    they are in Seattle.
        Senator Voinovich. By the way, you had better lobby for
    CDBG, because they are going to try and knock it out again.
        [Laughter.]
        Mayor Cownie. As soon as we leave this meeting, we will
    head right over----
        [Laughter.]
        Mayor Cownie. But I think that whether it is Honolulu or it
    is New Orleans or Seattle or Des Moines, or any place across
    this Country, we all have different needs. Certainly we need to
    do baseline studies, we need to know what our emissions are,
    where they came from. Then we can put a plan together to try to
    reduce them.
        But there are things people can do every single day in
    their lives, and I think we need to empower them to do that and
    educate them. That is something else that we can do also with
    these dollars. Let local governments decide and State
    governments how they are going to use it and where it is needed
    in their particular localities.
        Senator Boxer. Mayor Nickels, you have the last word, and
    then we are going to go to Senator Cardin, who has been so
    patient. He hasn't even had round one yet.
        Mayor Nickels. And Senator Mayor, I think the U.S.
    Conference of Mayors would be very excited to engage in that
    kind of a process. We have sensed this year a real climate of
    change here on this issue, both here in the Senate and on the
    House side. We think that is very encouraging and we would like
    to participate in moving this issue forward, not next Congress
    or the Congress after, but this Congress.
        Senator Boxer. Thank you. Senator Cardin, you have been so
    patient. Please go ahead.
        Senator Cardin. Thank you, Madam Chair. I wanted to listen
    to our colleagues from State and local government, because I
    think we can learn a lot from the initiatives that have taken
    place. I believe in federalism, and I think it is very
    important.
        In order to get in two rounds, I am going to ask that my
    opening statement be included in the record.
        Senator Boxer. Absolutely, yes.
        [The prepared statement of Senator Cardin follows:]
          Statement of Hon. Benjamin L. Cardin, U.S. Senator from the
                               State of Maryland
        Madam Chair, thank you for holding this hearing today. Justice
    Louis Brandeis famously said that ``States are the laboratories of
    democracy.'' This hearing certainly attests to the truth of that
    dictum. The regional, state, and local initiatives to slow, stop, and
    ultimately reverse the growth of greenhouse gas (GHG) emissions that we
    will hear about today are truly significant.
        Consider California: if it were its own country, it would have the
    world's 8th largest economy. So when Californians set out to reduce
    their GHG emissions by 80 percent below 1990 levels over the next
    several decades, we shouldn't underestimate the impact that will have
    in fighting global warming.
        I applaud the witnesses here today who are taking the lead in
    fighting global warming on behalf of their states, cities, and
    communities.
        What's disheartening about today's hearing is that these officials
    feel compelled to act in large part because the Federal Government is
    abdicating its responsibility. As important as all of these regional,
    state, and local actions are, we still need leadership from President
    Bush and from Congress.
        We have heard from the scientists. The most recent
    Intergovernmental Panel on Climate Change (IPCC) makes it clear that
    global warming is happening and the causes are largely anthropogenic.
        We have heard from enlightened business leaders who formed the
    Climate Action Partnership to advocate national strategies for fighting
    global warming.
        I appreciate the fact that private sector and state and local
    public sector leaders are stepping in to fill the breach created by the
    current administration's inaction on the most pressing environmental
    issue of our generation. But the fact is, we need national leadership.
    And we need it right away.
        I'm proud of what Maryland is doing to fight global warming.
    Several cities, including Baltimore, Annapolis, Rockville, and
    Gaithersburg, are participating in the U.S. Mayors Climate Protection
    Agreement, which commits them to voluntarily implement Kyoto agreement
    within their municipalities.
        Later this year, Maryland will become a full partner in the
    Regional Greenhouse Gas Initiative (RGGI). ``REGGIE,'' as it is known,
    is a cooperative effort by several Northeastern and Mid-Atlantic States
    to reduce carbon dioxide (CO2) emissions from powerplants by
    stabilizing CO2 emissions at current levels from 2009 to
    2015, and then cutting them 10 percent by 2019.
        Maryland is particularly vulnerable to the effects of global
    warming. Tide gauge records for the last century show that the rate of
    sea level rise in Maryland is nearly twice the global average. Studies
    indicate that this rate is accelerating and may increase to 2 or 3 feet
    along Maryland's shores by the year 2100.
        More than 12 percent of the State's land is designated under the
    National Flood Insurance Program as a Special Flood Hazard Area. An
    estimated 68,000 homes and buildings are located within the floodplain,
    representing nearly $8 billion in assessed value. Allstate Insurance,
    one of our largest insurers, recently announced that it will stop
    writing new homeowners' policies in coastal areas of the State, citing
    concerns that a warmer Atlantic Ocean will lead to more and stronger
    hurricanes hitting the Northeast.
        About a third of the marshes at Blackwater Wildlife Refuge on
    Maryland's Eastern Shore have been lost to sea level rise over the past
    70 years. Smith Island, the only inhabited island community in Maryland
    and the subject of a recent documentary on global warming, has lost 30
    percent of its land mass to sea level rise since 1850.
        According to 2005 report of the Maryland Emergency Management
    Agency, Maryland is the 3rd most vulnerable state to flooding and has
    the 5th longest evacuation times during a tropical storm or hurricane
    event.
        So we don't have a choice. We need to do everything possible to
    curb global warming and rising sea levels. But we can't do it alone.
    The Federal Government has to join us in this effort.
        Thank you, Madam Chair.

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Senator Cardin. Speaker Nunez, I held your position in the
    Maryland legislature when we initiated the Chesapeake Bay
    program, worked first with the entities in Maryland, then our
    surrounding States, and then ultimately came to the Federal
    Government as a partner. I think we made great progress,
    because we tested the issues at the State level, the local
    level then the regional levels before coming to Washington. I
    think you are doing the same thing with the laws that you are
    passing.
        The California law is now being looked at in the Maryland
    legislature. I expect the Maryland legislature is going to pass
    a bill very similar to your initiative. That is what federalism
    should be all about. Mayor Nickels, seven of our
    municipalities, a part of your initiative, including Baltimore
    City. So we are working together, trying to come up with a
    proposal that will reflect what we need in this Country.
        I respect the different views that have been expressed by
    this panel. There are different views as to what we need to do
    as far as our environment is concerned. But I don't believe
    there is any disagreement that we need to become energy
    independent. We need to do that for many reasons. I think
    everyone on this panel would agree that for national security,
    we don't want to continue to give money to entities that are
    very much against our national security interest. Every time we
    fill up our tank, we are helping to support extremists who
    disagree with our way of life.
        I don't think there is any disagreement here about the
    economic impact, about becoming energy independent, so we don't
    have to worry about OPEC countries changing the price of oil
    affecting our economy. I would think we would also acknowledge
    that becoming energy independent will be much friendlier to our
    environment, something that we all have sensitivity to.
        So I would hope that we would frame this debate, rather
    than as Senator Voinovich has pointed out, there are different
    views here in Congress and our ability to pass legislation this
    year is very much compromised by that. But I don't think we can
    wait. States and local governments have done their job and they
    are continuing to do that. But there is a need for Federal
    action here. There is a need for leadership at the national
    level. We have a lot from what has been done at the State and
    local governments. We need, for the sake of our security,
    economy and environment, we need to move forward.
        I would hope that we would follow some of the
    recommendations that we have heard from our States. They have
    tested these programs, they know what works, they know the
    economic impact. They know how businesses have been able to
    respond and deal with the challenges of caps and the other
    issues. We have that information, thanks to the good work done
    by your States and your municipalities.
        I think it is now incumbent upon us to take a look at that
    and develop some national leadership, so that we can work in
    stronger partnership with the work that has been done here.
    Madam Chair, I thank you for taking us down this path. I have
    found this hearing to be extremely helpful. I just want to
    thank all the panelists for being patient and presenting your
    information. This will not be the last time that we are going
    to call upon you to help us as we wrestle with a national
    policy that I think will be good, not just for our environment,
    which we need to deal with, Madam Chair, I agree with you, we
    need to deal with our environmental risks of global warming.
    But it is also important for our national security and for our
    economic interests. I think all of us should be able to come
    together with the programs so the Federal Government has a more
    aggressive partnership in this effort. Thank you, Madam Chair.
        Senator Boxer. Thank you so much.
        Senator Sanders.
        Senator Sanders. Thank you, Madam Chair. This has been a
    fascinating and important hearing. We are one Country with
    States that have very different needs. While I disagree with
    our friends from the coal and oil producing States, I
    understand what you are talking about. Your economies are
    dependent upon that type of production, you are part of an
    America that has to be understood as we move, I believe, in a
    new direction, in the same way that I hope you understand the
    needs of Vermont, in a State where the weather gets 20 or 30
    below zero, and we all have our needs and we work together.
        It seems to me, in listening to the testimony, that what
    they call the lowest hanging fruit seems to be energy
    efficiency. I would like to hear some discussion from our local
    and State officials about what they are doing in terms of light
    bulbs, for example. In Australia, they are literally talking
    about banning incandescent light bulbs. The compact
    fluorescents are far more energy efficient. I want to hear what
    some of your cities and States are doing. I want to hear what
    you are doing in terms of moving your own transportation
    systems away from cars that get bad mileage, the hybrids, how
    far you have gone in that direction.
        I know in Burlington, when I was Mayor, we passed the bond
    issue. The result is that despite a lot of growth in
    Burlington, we are consuming less electricity today than we did
    20 years ago.
        So let's talk about it, let's start with California. The
    other question for my friend in California, who killed the
    electric car and what can we do about that?
        [Laughter.]
        Senator Sanders. Mr. Nunez, can you start on that one?
        Mr. Nunez. Sure, I will start. Senator Clinton alluded to
    that 30-year timeframe, in which California, in terms of our
    per capita consumption, has been flat while the rest of the
    Country has actually gone up 50 percent. That is true because
    of the laws that we have passed over the years in California,
    both in the area of the protection of the environment, but also
    in conservation. In the last 6 years, a lot of has been done
    also in terms of transportation and emission standards, which
    now in California, you know, we drive somewhere in the
    neighborhood of 20 to 30 percent of the hybrid vehicles.
        Senator Sanders. Is the electric car still being discussed?
        Mr. Nunez. It is being discussed, but there were some
    problems in terms of how efficient it was to move people from
    point A to point B. But I think there is no question that with
    the new technologies that are coming to bear, there certainly
    is the opportunity for electrical vehicle to once again make
    their way back into the California market.
        Senator Sanders. OK, let me ask anybody who wants to
    respond, just something as simple as light bulbs. I know
    Senator Boxer has been talking about that for the Federal
    Government, just moving away from incandescent light bulbs.
    What your cities or States been doing? Mayor Nickels, do you
    want to say a word on that?
        Mayor Nickels. Thank you, Madam Chair and Senator. Our
    electric utility, which is owned by the city, recently gave
    away 13,000 of the compact fluorescent bulbs.
        Senator Sanders. Let me ask you a question, and Madam
    Chair, I am wondering what we could do at the Federal level.
    There have been some indications that if we literally gave
    away, gave away compact fluorescent light bulbs, we end up
    saving money. Is that what you are saying, Mayor Nickels?
        Mayor Nickels. They are many times more efficient, and
    while the initial cost is higher, they last many times longer.
    The payback is remarkably short.
        Senator Sanders. So do you see a potential in encouraging
    them?
        Mayor Nickels. Yes. In Seattle, we decided we would lead by
    example. So we reduced the city government's emissions first by
    60 percent from 1990 levels. We did that by converting to many
    hybrid vehicles, we have converted our diesel to biodiesel. In
    fact, in my neighborhood, the local Safeway, which is the
    largest grocery chain, opened up a biodiesel pump at their
    station, first one in the Country in the Safeway chain. They
    are buying the biodiesel from a company in Iowa.
        We have traded in the beloved mayoral Town Car for a
    hybrid, a tough decision, but one I thought was important. We
    are striving to become the green building capital of America,
    so that the architects and engineers and suppliers in Seattle
    have a chance to create jobs in those industries that we can
    export the services and products elsewhere in the Country and
    the world.
        Senator Sanders. Mayor Cownie.
        Mayor Cownie. We are doing many of the same things that
    Mayor Nickels is doing. Additionally, when we go out and meet
    with citizens, and I talk about empowering citizens, they all
    were sitting around, tell us what to do, tell us what to do. So
    we have a Just-Do-One-Thing program that we are doing, and we
    give them a little bag, when we go to these town hall meetings,
    and we put a compact fluorescent in there. We tell them it
    takes 18 seconds to go switch out an old one, put in a new one.
    We give them a whole list of other things that they can do in
    their households each day to make a difference.
        Senator Sanders. That is great. My time has run out, Madam
    Chair, but I would also say that one of the areas we want to
    look at as we move away from incandescent to compact
    fluorescents, is we don't manufacture those bulbs, I don't
    believe, in the United States of America. If we are talking
    about getting millions of people to use those bulbs, we could
    make some money if one of these companies would start producing
    these things in one of our towns.
        Thank you very much.
        Senator Boxer. You are so right about that. Every single
    one of those bulbs, because believe me, I did a survey, made in
    China. The irony of all this. Basically with China saying, we
    are not ready to do anything. But they are making these light
    bulbs.
        Anyway, let me thank everyone so much. As my colleagues
    said, this has been a very long hearing for good reason.
    Because all of you are very provocative in what you said, and I
    thought Governor Corzine was as well. Colleagues are so
    interested, and it makes me so happy as a committee chair. It
    is like, what if you called a meeting and nobody came.
        [Laughter.]
        Senator Boxer. As you know, as Speaker, that does happen
    now and then. Here it is just a lot of attendance and it makes
    me really feel good. We even went to New Orleans on Monday for
    a field hearing and we had seven Senators there. So that was
    wonderful.
        OK, so in closing this, I get a chance to say the last
    word, which is always hard for people who don't agree with me.
    But let me just say, on the question of whether global warming
    is occurring, it always sort of breaks my heart when people say
    the science is confused and so on. I would love to share with
    those of you who are skeptics the latest scientific reports and
    the bona fides of the people who have signed onto these
    documents. Because it is one thing to keep saying there is no
    consensus. I am sure there were always those who said, the
    earth is flat. There are still people who say HIV doesn't cause
    AIDS. There are even people who say there is no link between
    tobacco and cancer. You always have a few.
        But the preponderance of the evidence on global warming is
    in. I just hate to see us waste time on it. I think the
    legitimate things that the antis said today are very important
    for us to hear, that please be mindful in a coal State, that if
    you move forward, we have to ease the burden on the consumers.
    Absolutely. I think that Senator Voinovich's call and Senator
    Clinton's and my own feelings on clean coal and a Manhattan-
    like project to find truly clean coal, those things are
    necessary. The technology piece has to go along with everything
    else we are doing.
        But I do agree with Speaker Nunez when he says that, if you
    are clear about the caps, then somehow the smart money will
    follow. We already see it happening with the biggest
    corporations coming forward and supporting us as we strive to
    find some common ground to become partners with those of you
    who have taken action. I think that is what I want to be, is a
    partner. I want to do things that enhance what you are doing
    and that allow you to still keep on going, because you are the
    laboratories in the best sense of the word.
        So in closing, I think we could put our hands over our eyes
    and then over our ears and our mouths and just say, we are not
    going to pay attention to this. Believe me, it is a lot easier.
    But the greatest generation, what they did for us, our grandpas
    and our great-grandpas, they did it for their great-grandkids
    that they may never see. We have this challenge. It is not as
    immediately life-threatening, obviously, as what they faced.
    But it is life-threatening to the future.
        So we can't just hide behind feel-good statements here. We
    have to get down and do it. I am, as I said in the beginning,
    an optimist. I am filled with hope. This is the greatest
    country on the face of the earth, Mr. Harvey, I totally agree.
    That is why we are up for this challenge. We can do this in the
    right way. I am so proud of my State, and Mayor Nickels, of
    what you have done, Mayor Cownie. All of you who are grappling
    with this on the ground, I used to be a county supervisor. I
    know the buck stops right there. They have your phone number,
    they meet you in the street. It is hard either way, and we have
    to have answers.
        So let's work together. I think that's the key. Let's not
    have these great divides, because time is clicking and it is
    not our friend.
        Thank you very much, and this hearing has come to a close.
    Thank you all.
        [Whereupon, at 1 o'clock p.m., the committee was
    adjourned.]
        [Additional statement submitted for the record follows.]
         Statement of Hon. Joseph I. Lieberman, U.S. Senator from the
                              State of Connecticut
        Thank you, Madam Chairwoman. And thank you for keeping the
    attention of this committee focused squarely on the supremely important
    need to curb global warming.
        Many of us here in Congress have been aware for some time that,
    when it comes to global warming, state and local governments have been
    filling the vacuum left by federal inaction. It was only in preparing
    for this hearing, however, that I had an opportunity to learn just how
    many state and local governments have taken strong steps already.
    Fourteen states have actually set state-wide targets for reducing
    greenhouse gas emissions. Twenty-nine states have completed climate
    action plans. Thirty-one states are involved already in regional
    greenhouse gas reduction initiatives. I am not sure whether the various
    members of Congress who still oppose federal legislation to mandate
    greenhouse gas reductions realize how many of their constituent
    businesses are already subject to such mandates. All of the businesses
    I talk to prefer, for several reasons, a uniform national system to a
    patchwork of state and regional ones. I would think the same would be
    true of many large employers in my colleagues' states.
        Of course, creating political pressure for a comprehensive national
    strategy is by no means the only virtue of these local, state, and
    regional initiatives. For one thing, the non-federal initiatives are
    reducing greenhouse gases right now. For another, they are doing
    invaluable design and testing work--dealing with emissions registries,
    monitoring and compliance programs, trading markets, and offsets--that
    will inform the inevitable federal system. The comprehensive national
    system that I believe Congress will soon enact will be more effective,
    more efficient, and more durable because of the ingenious and
    courageous work that is being done today at the local, state, and
    regional levels.
        I cannot discuss genius and courage on the issue of global warming
    without mentioning Connecticut. I am extremely proud to represent a
    state that has always been, and continues to be, a national leader on
    policies to reduce greenhouse gas emissions. Connecticut is a founding
    member of the Regional Greenhouse Gas Initiative for powerplants. In
    2004, the state passed laws and issued executive orders to reduce
    greenhouse gas emissions across all major sectors of the state's
    economy. For example, those laws adopt California's automobile
    emissions standards, set efficiency standards for products and
    appliances, require greenhouse gas emissions reporting, and mandate a
    plan to reduce statewide greenhouse gas emissions to 1990 levels by
    2010 and to 10 percent below 1990 levels by 2020. In early 2005,
    Governor Rell's administration submitted the plan to the Connecticut
    General Assembly. That document, encompassing 55 separate initiatives,
    represents one of the most, if not the most, comprehensive, economy-
    wide state plans for curbing global warming pollution. Many of the
    initiatives comprising Connecticut's plan are now in place and reducing
    emissions.
        Madame Chairwoman, I could not resist the temptation to brag a bit
    about Connecticut's enormously productive efforts in this area. I
    appreciate my colleagues' patience. I am just extremely proud of my
    constituents and Connecticut's government.
        Thank you, Madame Chairwoman.