[Congressional Record Volume 144, Number 142 (Saturday, October 10, 1998)]
[Senate]
[Pages S12309-S12312]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. CHAFEE (for himself, Mr. Mack, and Mr. Lieberman):
  S. 2617. A bill to amend the Clean Air Act to authorize the President 
to enter into agreements to provide regulatory credit for voluntary 
early action to mitigate greenhouse gas emissions; to the Committee on 
Environment and Public Works.


                  credit for early action act of 1998

  Mr. CHAFEE. Mr. President, I am proud to join with Senators Mack and 
Lieberman today to introduce the Credit for Early Action Act of 1998. 
This bipartisan legislation is designed to encourage voluntary, 
meaningful, and early efforts by industry to reduce their emissions of 
greenhouse gases. This is a bill to address the threat of global 
climate change.
  Before I get into the details of this legislative proposal, let me 
spend a few moments discussing the science of climate change.
  Human influence on the global climate in an extraordinarily complex 
matter that has undergone more than a century of research. Indeed, in 
an 1896 lecture delivered to the Stockholm Physics Society by the Nobel 
Prize-winning chemist, Svante Arrhenius, it was predicted that large 
increases in carbon dioxide (CO2) would result in a 
corresponding warming of the globe.
  Professor Arrhenius was the first to predict that large increases in 
CO2 would result in a warming of the globe. What have the 
world's scientists told

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us at different intervals over the last one hundred years, since Mr. 
Arrhenius identified the warming effects of CO2?
  In 1924, a U.S. physicist speculated that industrial activity would 
double atmospheric CO2 in five hundred years, around the 
year 2424. Current projections, however, call for a doubling sometime 
before 2050--some four hundred years earlier than predicted just 
seventy years ago!
  In 1957, scientists from the Scripps Institute of Oceanography 
reported for the first time that much of the CO2 emitted 
into the atmosphere is not absorbed by the oceans as some had argued, 
leaving significant amounts in the atmosphere. They are said to have 
called carbon dioxide emissions ``a large-scale geophysical 
experiment'' with the Earth's climate.
  In 1967, the first reliable computer simulation calculated that 
global average temperatures may increase by more than four degrees 
Fahrenheit when atmospheric CO2 levels are double that of 
preindustrial times. In 1985, a conference sponsored by the United 
Nations Environment Program (UNEP), the World Meteorological 
Organization (WMO), and the International Council of Scientific Unions 
forged a consensus of the international scientific community on the 
issue of climate change. The conference report warned that some future 
warming appears inevitable due to past emissions, regardless of future 
actions, and recommended consideration of a global treaty to address 
climate change.
  In 1987, an ice core from Antarctica, analyzed by French and Russian 
scientists, revealed an extremely close correlation between 
CO2 and temperature going back more than one hundred 
thousand years. In 1990, an appeal signed by forty-nine Novel prize 
winners and seven hundred members of the National Academy of Science 
stated, ``There is broad agreement within the scientific community that 
amplification of the Earth's natural greenhouse effect by the buildup 
of various gases introduced by human activity has the potential to 
produce dramatic changes in climate . . . only by taking action now can 
be ensure that future generations will not be put at risk.''
  Also in 1990, seven hundred and forty-seven participants from one 
hundred sixteen countries took part in the Second world Climate 
Conference. The conference statement reported that, ``. . . if the 
increase of greenhouse gas concentrations is not limited, the predicted 
climate change would place stresses on natural and social systems 
unprecedented in the past ten thousand years.''
  Finally, Mr. President, in 1995, the Intergovernmental Panel on 
Climate Change, representing the consensus of climate scientists 
worldwide, concluded that ``. . . the balance of evidence suggests that 
there is a discernible human influence on global climate.''
  This last development is significant, because the overwhelming 
majority of climate scientists concluded, for the first time, that man 
is influencing the global climate system. That conclusion, while 
controversial in some quarters, was endorsed unanimously by the 
governments of the ninety-six countries involved in the panel's 
efforts.
  Are these forecasted outcomes a certainty? They are not. The 
predictions of climate change are indeed based on numerous variables. 
Although scientists are improving the state of their knowledge at a 
rapid pace, we still have a lot to learn about the role of the sun, 
clouds and oceans, for example.
  The question is, will we ever have absolute certainty? Will we ever 
be able to eliminate all of the variables? The overwhelming majority of 
independent, peer-reviewed scientific studies indicate that we do not 
have such a luxury. By the time we finally attain absolute certainty, 
it would likely take centuries to reverse atmospheric damage and 
oceanic warming.
  Mr. President, I am not alone in this thinking. There are an 
increasing number of business leaders in our country who have arrived 
at the same conclusion that we need to act swiftly.
  In a ``dear colleague'' letter sent out this week under my signature, 
I repeated a remarkable statement issued by an impressive group of 
companies that have joined with the newly established Pew Center on 
Climate Change. American Electric Power, Boeing, BP America, Enron, 
Lockheed Martin, 3M, Sun, United Technologies, Toyota, Weyerhaeuser, 
and several others said that, ``we accept the views of most scientists 
that enough is known about the science and environmental impacts of 
climate change for us to take actions to address its consequences.''
  The legislation to be introduced today by Senator Mack, Senator 
Lieberman and I proposes an exciting framework that would appropriately 
recognize real and immediate action to combat climate change. While the 
climate debate will indeed continue over the next few years, we 
strongly believe that there is a voluntary, incentive-based approach 
which can be implemented now. Congressional approval of this approach, 
which the three of us and others will work for early next year, will 
provide the certainty necessary to encourage companies to move forward 
with practical, near-term emission reductions.
  Specifically, this legislation would provide a mechanism by which the 
President can enter into binding greenhouse gas reduction agreements 
with entities operating in the United States. Once executed, these 
agreements will provide credits for voluntary greenhouse gas reductions 
effected by those entities before 2008, or whenever we might have an 
imposition of any domestic or international emission reduction 
requirements.
  Importantly, this program is designed to work within the framework of 
whatever greenhouse gas control requirement may eventually become 
applicable within the United States. The credits would be usable 
beginning in the first five-year budget period (2008-2012) under the 
Kyoto Protocol, if the Kyoto Protocol is ratified. If the Protocol is 
not ratified, and we end up with a domestic program to regulate or 
otherwise control greenhouse gas emissions, the credits would be usable 
in that program.
  This sort of approach makes sense for a wide variety of reasons. 
Encouraging early reductions can begin to slow the rate of buildup of 
greenhouse gases in the atmosphere, helping to minimize the 
potential environmental risks of continued warming. Given the longevity 
of many climate gases, which continue to trap heat in the atmosphere 
for a century or more, it just makes sense to encourage practical 
actions now.

  By guaranteeing companies credit for voluntary early reductions, the 
bill would allow companies to protect themselves against the potential 
for steep reduction requirements or excessive costs in the future. For 
companies that want to reduce their greenhouse gas emissions, providing 
credit for action now adds years to any potential compliance schedule, 
allowing companies to spread costs over broader time periods. A focus 
on early reductions can help stimulate the American search for 
strategies an technologies that are needed worldwide. Development of 
such strategies and technologies can improve American competitiveness 
in the $300 billion dollar global environmental marketplace.
  This ``credit'' program may also make the greenhouse gas reductions 
achieved before regulations are in place financially valuable to the 
companies who make such reductions. Given the likely inclusion of 
market based approaches to any eventual domestic regulatory 
requirements, similar to the successful acid rain program of the 1990 
Clean Air Act, credit earned could be traded or sold to help other 
companies manage their own reduction efforts.
  Under a ``no credit'' approach, the status quo, it is more likely 
that early reduction companies will be penalized if greenhouse gas 
reductions are ultimately required, because their competitors who wait 
to reduce will get credit for later reductions. Such a ``no credit'' 
approach could even create perverse incentives to delay investments 
until emissions reductions would be credited.
  In anticipation of a potential global emissions market, decisions re 
being made now by entrepreneurial companies and countries. For example, 
Russia and Japan have already concluded a trade of greenhouse gas 
emission credits. Private companies such as Niagara-Mohawk and Canada-
based Suncor are moving forward with cross-boundary trades. Aggressive 
global energy companies, such as British Petroleum, AEP, and PacifiCorp 
are already implementing agreements in Central and

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South America--sequestering carbon and developing credits against 
emissions--by protecting rain forests.
  Mr. President, America can and should reward companies that take such 
positive steps to position themselves, and the US, for the 
environmental and economic future.
  On the international side, passage by the U.S. Congress of a program 
to help stimulate early action will be clear example of American 
leadership and responsibility. Developing countries currently argue 
that nations such as the United States, with huge advantages in quality 
of life and dramatically higher per capita emissions of green house 
gases, should take a leadership role in the reduction of greenhouse gas 
emissions. And they argue that developing countries should not be asked 
to take steps until the U.S. begins to move forward. This bill can work 
directly to change that situation, therefore removing a barrier to 
essential developing country progress.
  There it is, Mr. President. We are here today because we believe that 
climate change presents a serious threat. We believe it makes sense to 
get started now. And, as many leading American companies do, we believe 
that there are sensible, fair and voluntary methods to get on the right 
track.
  We encourage our colleagues to use the time between now and next 
January to review this legislation carefully. We are open to 
suggestions. Most importantly, we are looking for others to join us in 
this effort.
  Ms. MACK. Mr. President, as an original cosponsor of the 
Credit for Early Action Act, I rise to congratulate Senator Chafee on 
its introduction, as well as the other original cosponsor, Senator 
Lieberman, and to make several points about the bill.
  The purpose of the act is simple. It is to encourage and reward 
voluntary actions which businesses may take to reduce emissions of 
``greenhouse gases'' such as carbon dioxide. It would not require 
actions, but it would provide encouragement in the form of credit, 
credit that could be used by companies to manage future regulatory 
requirements, or in a market-based approach, traded or sold to other 
companies as they worked to meet their own obligations.
  Given the uncertainty that surrounds the discussion of greenhouse 
gases and global warming, I can understand why some may question the 
need for such a bill. As one who is not convinced that we understand 
this issue well enough, I can understand that question. In fact, it is 
precisely because of the uncertainty that I think such a bill makes 
sense.
  Of course there is a great deal of uncertainty surrounding such 
possible results, and frankly, as I said, I am not convinced that we 
know enough yet. The complexities and uncertainties associated with 
trying to understand the vast interactions of our climate, our 
atmosphere and our human impact on both, are enormous. And the 
consequences of actions targeted at changing our patterns of energy use 
can be dramatic.
  But uncertainty cuts two ways, and the possibility always exists that 
some of these projections about impacts could be more right than wrong. 
Perhaps then it makes sense to provide some appropriate encouragement, 
so that those who want to invest in improved efficiency, those who want 
to find ways to make cars and factories and power production cleaner, 
those companies can receive some encouragement, not based on government 
fiat or handout, but based on getting credit for their own initiative 
and actions. The environmental result will likely be some lessening of 
the potential problems associated with possible global warming, and 
that just makes sense.
  There is, of course, another uncertainty that gives me pause as well, 
and that serves as another strong reason for my interest in this bill. 
It is clear to me today that there is no desire on the part of this 
Congress to legislate requirements on carbon dioxide or any of the 
other ``greenhouse gases.'' I think that is the correct position.
  But we cannot know today what some future Congress, perhaps a decade 
away, might decide to do. Perhaps the science will become more 
compelling. Perhaps the majority will shift back to a more regulatory 
minded party. Perhaps a future Senate will decide to ratify the Kyoto 
Protocol. Perhaps a future administration and a future majority will 
combine to put a regulatory structure in place that will require 
substantial reductions of these gases. And while we may oppose such 
action today, we cannot know the outcome of this future debate.
  Given this regulatory uncertainty, I think a compelling argument can 
be made to provide protection for companies today, so that they are 
protected against the possibility of future requirements. What this 
bill will do is just that. By allowing companies to earn credit for 
actions that they take over the next few years, the bill will make sure 
that if a regulator comes to see them in the future, they can say, ``I 
already did my part.'' Companies can make decisions based on their own 
best interest, they can work to improve efficiency and reduce waste. 
And if this bill becomes law, they can get credit for those actions 
against any future regulatory controls on greenhouse gases. That seems 
like a good idea to me.
  In closing Mr. President, I again want to congratulate Senator 
Chafee, along with our other original co-sponsor Senator Lieberman, for 
this thoughtful, balanced approach to the uncertainty presented by the 
climate change issue. I am proud to be an original cosponsor of this 
bill, and I want to urge my colleagues to take a good look at this 
approach so that we can begin to move forward in earnest in the next 
Congress.
 Mr. LIEBERMAN. Mr. President, I am delighted to join today 
with my colleagues Senator Chafee, the chairman of the Environment and 
Public Works Committee, and Senator Mack in introducing this 
legislation. It will provide credit, under any future greenhouse gas 
reduction systems we may adopt, to companies who act now to reduce 
their emissions of greenhouse gases. This is a voluntary, market-based 
approach which is a win-win situation for both American businesses and 
the environment. Enactment of this legislation will provide the 
certainty necessary to encourage companies to move forward with 
emission reductions now. I'm particularly pleased that the legislation 
grows out of principles developed in a dialog between the Environmental 
Defense Fund and a number of major industries.
  The point of this legislation is simple. Many companies want to move 
forward now to reduce their greenhouse gas emissions. They don't want 
to wait until legislation requires them to make these reductions. For 
some companies reducing greenhouse gases makes good economic sense 
because adopting cost-effective solutions can actually save them money 
by improving the efficiency of their operations. Companies recognize if 
they reduce their greenhouse gas emissions now they will be able to add 
years to any potential compliance schedule, allowing companies to 
spread their costs over broader time periods. Acting now can help U.S. 
companies protect themselves against the potential for significant 
reductions that may be required in the future. This bill ensures they 
will be credited in future reduction proposals for action now.
  Early action by U.S. companies will also have an enormous benefit for 
the environment. Early reductions can begin to slow the rate of buildup 
of greenhouse gases in the atmosphere, helping to minimize the 
environmental risks of continued global warming. Given that once 
emitted, many climate change gases continue to trap head for a century 
or more in the atmosphere, it just makes sense to encourage practical 
action now.
  Climate change is neither an abstraction nor the object of a science 
fiction writer's imagination. It is real and affects us all. More than 
2,500 of the world's best scientific and technical experts have linked 
the increase of greenhouse gases to at least some of the increase in 
sea level, temperature and rainfall experienced worldwide in this 
century. Last year was the warmest year on record, and 9 of the last 11 
years were among the warmest ever recorded.
  The point of this legislation is to provide an incentive for 
companies that want to make voluntary early reduction in emissions of 
greenhouse gases by guaranteeing that these companies will receive 
credit, once binding requirements begin, for voluntary reductions they 
have made before 2008. These

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credits will enable US companies to add years to any potential 
compliance schedule for reductions, allowing them to spread costs over 
broader time periods. These credits may also be financially valuable to 
companies who make the reductions. Credits earned likely could be 
traded or sold to help other companies manage their own reduction 
requirements. A focus on early reductions can also help stimulate the 
search for and use of new, innovative strategies and technologies that 
are needed to help companies both in this country and worldwide meet 
their reduction requirements in a cost-effective manner. Development of 
such strategies and technologies can improve American competitiveness 
in the more than $300 billion global environmental marketplace.
  I'm pleased that this legislation builds on section 1605(b) of the 
Energy Policy Act which allowed companies to voluntarily record their 
emissions in greenhouse gas emissions, which I worked hard to include 
in the Energy Policy Act.
  Mr. President, the debate about climate change is too often vested--
and I believe wrongly so--in false choices between scientific findings, 
common sense, business investments and environmental awareness. The 
approach of this bill again demonstrates that these are not mutually 
exclusive choices, but highly compatible goals.
                                 ______