[Congressional Record Volume 145, Number 99 (Wednesday, July 14, 1999)]
[Extensions of Remarks]
[Pages E1542-E1543]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




              CREDIT FOR VOLUNTARY ACTIONS ACT--H.R. 2520

                                 ______
                                 

                            HON. RICK LAZIO

                              of new york

                    in the house of representatives

                        Wednesday, July 14, 1999

  Mr. LAZIO. Mr. Speaker, I am introducing today legislation designed 
to encourage voluntary actions by industry to reduce the potential 
environmental problems caused by greenhouse gas emissions. The Credit 
for Voluntary Actions Act represents what I believe is a ``New 
Environmentalism''--a new way to look at how all of these groups can 
partner together to effect change in the way business affects the 
environment.
  I am proud to say that with the passage of this Credit for Voluntary 
Actions legislation, environmental regulation will no longer be a zero-
sum game. This legislation successfully combines the interests of both 
industry and environment in a way that is mutually beneficial and 
unprecedented. The major hindrance to industry cooperation in the 
reduction of greenhouse gases is the great uncertainty of the 
regulatory environment. There is a skepticism of scientific knowledge 
and a feeling that the high cost of pollution reduction will not be a 
good investment economically.
  Additionally, there is no way to predict the future of global climate 
change or how effective reduction measures taken now will be in the 
long run. The current regulatory situation actually does more to 
discourage action than to promote environmentally-conscious activity.
  The Credit for Voluntary Actions bill addresses these concerns 
directly. This is a voluntary program that allows a broad spectrum of 
U.S. business to participate in ways that make fiscal sense for them. 
This bill is not creating a regulatory program or buying into any 
international agreements. It is simply authorizing companies to reduce 
greenhouse gases without fear of punishment later. Many businesses have 
come to us and told us they would like to take actions to reduce 
greenhouse gas reductions but are concerned that they would be 
penalized in the future if they did so. Does it make sense to stop 
these companies from doing the right thing for the environment, and 
their own bottom lines? I didn't think so.
  This bill is good for the environment, and good for business. What 
once might have been considered an anomaly, you see here as a new way 
to look at environmentalism for the 21st century--representatives from 
utilities and the oil and gas industry partnering with members of 
environmental groups; Democrats and Republicans--all standing unified 
in an understanding that we must find a way to address the issues of 
climate change.
  There are those who are concerned that this bill will pave the way 
for implementation of the Kyoto Protocol. This bill is neutral on the 
issue of the Kyoto Protocol and does nothing to implement that accord. 
Nor does this bill create any other domestic regulatory regime to 
address the issue of climate change. The purpose of this bill is to 
pave the way for voluntary actions by companies who are looking at 
major investments today, but who worry about being penalized tomorrow. 
Through these voluntary actions, this bill will result in demonstrable 
and measurable progress on greenhouse gas emissions and the issues 
associated with global climate change.
  This bill embraces the principles of: (1) environmental progress 
through market-driven approaches; (2) flexibility allowing the 
creativity and innovation which have created the largest economy the 
world has ever seen; (3) non-bureaucratic methods focusing on results 
not progress; and finally (4) voluntary, not mandatory, efforts 
allowing us to work with those that can and are willing to contribute 
to the solution rather than concentrating on efforts on enforcing 
against those who cannot. In short, this bill embraces the legislative 
approaches of the 21st century to address this emerging environmental 
issue.
  I would like to elaborate on how these important principles apply to 
this bill. Central to this bill is the concept of tradable emission 
credits, a market-based approach proven in the Acid Rain provisions of 
the 1990 Clean Air Act. Tradable credits allow the environmental 
objectives to be met at lower costs. To achieve these credits, 
companies are not constrained by pre-conceived methods of reducing 
greenhouse gas emissions. Rather, they

[[Page E1543]]

have the flexibility to develop agreements which are tailored to their 
unique situation. These types of agreements have been successfully used 
in energy efficiency initiatives. Credits are awarded for measured 
reductions against a company's historic releases. This results-oriented 
approach which rewards environmental benefits, not regulation savyness, 
is similar to the Second Generation approach several of my colleagues 
are exploring for improving environmental performance in general. 
Finally, this bill, by focusing on voluntary actions to meet society's 
needs, mirrors the successes many of our States and localities have had 
in addressing a wide range of domestic issues.
  I am proud to join with my esteemed colleagues in introducing this 
innovative legislation, and I encourage all of my colleagues in the 
House to support our efforts.

                  Section-by-Section Analysis of Bill


                 Section 1--Title and Table of Contents

       Section 2--Purpose. To encourage voluntary actions to 
     mitigate potential environmental impacts of greenhouse gas 
     emissions by ensuring that the emission baselines of 
     participating companies receive appropriate credit. These 
     credits for voluntary mitigation actions would be usable in 
     any future domestic greenhouse gas emission program.
       The purpose is to encourage voluntary actions, not to 
     encourage a future domestic program. The bill is not tied to 
     Kyoto or any specific international greenhouse gas agreement. 
     Credits would be usable in any domestic program.
       Section 3--Definitions. A number of terms are defined 
     including a number of terms specific to the carbon 
     sequestration portion of the bill.
       Section 4--Authority for Voluntary Action Agreements. This 
     section provides the authority for entering into these 
     agreements to the President and allows delegation to any 
     federal department or agency.
       Section 5--Entitlement to Greenhouse Gas Reduction Credit 
     for Voluntary Action. Provides authority for credits for: 
     certain projects under the initiative for Joint 
     Implementation program; prospective domestic actions 
     (includes a significantly revised sequestration); and 
     retrospective past actions.
       This section includes a third party verification provision 
     to the past actions.
       This section also includes a Congressional notification 
     provision when the amount of credits equals 350 million 
     metric tons carbon equivalent. This provision is designed to 
     preserve future Congress' options.
       Section 6--Baseline and Base Period. This section provides 
     guidance on developing baselines from which reductions are 
     measured.
       Section 7--Sources and Carbon Reservoirs Covered by 
     Voluntary Action Agreements. This section explains how 
     sources are calculated. This bill provides provisions for 
     dealing with a company's growth. This section allows baseline 
     adjustments to reflect a company's increased (or decreased) 
     output, net of the general economic growth of the country. 
     Thus, in effect, companies with major growth are rewarded by 
     having their baselines increased, while the environment is 
     protected by offsets from companies which are not growing. 
     This section also includes guidance on ``outsourcing'', where 
     companies contract out portions of their work, thus reducing 
     their emissions (but increasing the contractor's emissions) 
     while increasing their production (thus raising their 
     baselines).
       Section 8--Measurement and Verification. This section 
     provides the reporting responsibilities of participants.
       Section 9--Participation by Manufacturers and Adopters of 
     End-Use, Consumer and Similar Technologies. This section 
     provides guidance for manufacturers of products sold to 
     consumers, such as autos, refrigerators, and computers. Use 
     of these products contribute substantially to the overall 
     green house gas emissions. However, without this section, 
     energy efficiency improvements in these areas would not be 
     captured in the voluntary program. This section provides 
     incentive for manufacturers of these products to increase 
     their energy efficiency and other emission reductions efforts 
     in the products they produce.
       Section 10--Carbon Sequestration. This section provides 
     guidance on what carbon sequestration projects qualify for 
     voluntary action credits. This guidance is designed to ensure 
     scientifically acceptable methods are utilized in designing 
     these projects, as well as requirements for monitoring, 
     reporting and verification. Credits for carbon sequestration 
     are limited to 20% of all credits available under this act.
       Section 11--Trading and Pooling. This provides authority 
     for trading credits and arranging pooling agreements among 
     participants. The pooling authority can provide a means for 
     small businesses and others to participate.
       Section 12--Relationship to Future Domestic Greenhouse Gas 
     Regulatory Statute. This provision gives the companies the 
     guarantees they need that these actions will be applicable to 
     any future program that could be authorized by the Congress.

                               

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