UPDATE: Waxman Panel Chair Win Bodes Stronger Climate Bill
Thursday November 20th, 2008 / 21h00
(Updates with more comments, details, background) By Ian Talley Of DOW JONES NEWSWIRES WASHINGTON -(Dow Jones)- The U.S. House of Representatives is likely to produce much more stringent climate change legislation and craft energy bills favoring renewable energy industries with the naming of a new key committee chairman Thursday. Rep. Henry Waxman, D-Calif., who has been chairman of the House oversight committee, wrested control of the Energy and Commerce Committee from the dean of the House, Rep. John Dingell, D-Mich., a long-time supporter of the auto industry. While environmental groups applauded Waxman winning the post after a House Democratic caucus vote, many big business interests cringed, especially as the panel will play the pivotal role in developing an economy-wide program to reduce greenhouse gas emissions. Besides crafting much more moderate climate proposals, Dingell has strenuously worked to moderate higher fuel efficiency requirements and block allowing California's standards for regulating automobile greenhouse gas emissions from taking effect - a goal of Michigan's auto makers. With support from the next administration under President-elect Barack Obama, the California representative's success has paved the way for allowing those emission standards to go forward and accelerating higher fuel economy levels. "Waxman's victory is a breath of fresh air - of clean air," said Frank O'Donnell, president of Clean Air Watch, adding, "It was a stunning defeat for the corporate lobbyists on K Street." "Waxman would far more likely move ahead with more effective and aggressive legislation on global warming," he said. Bill Kovacs, vice president of the U.S. Chamber of Commerce's environment and regulatory affairs department, said he feared legislation to cut greenhouse gases developed under Waxman could push business out of the country. "A Dingell climate bill would be much more oriented to the practical side of things, integrating the technology and the reductions," Kovacs said. "Congressman Waxman has a philosophy which says, you put enough of mandates on, you'll drive a solution, and what worries me about mandates is that it just may drive business somewhere else," he said. Although a climate change bill will affect nearly every sector in the economy, two industries in particular are seen as initially losing the most from Dingell's ouster: the auto and coal industry. "A Waxman win changes the character of House Democrats' views toward coal and cars, the two principal sources of greenhouse gas emissions in the U.S. economy," said Kevin Book, a senior analyst at FBR Capitol Markets in a flash note to clients. Dingell has long protected the Detroit-based auto industry, and Rep. Rick Boucher, D-Va., the chairman of the subcommittee on Energy and Air Quality who supported the Michigan Democrat maintaining his tenure, has strong connections to the coal industry. FBR's Book also speculated Waxman may replace Boucher with Rep. Ed Markey, D-Mass., one of the most outspoken lawmakers on the hill for tough environmental regulation. For the past two years, Markey chaired the House Select Committee on Energy Independence and Global Warming Committee, a panel specially created by House Speaker Nancy Pelosi to highlight climate change legislation and to counter Dingell's more moderate position. Waxman has a record of pushing for much more stringent environmental standards. Like much of the Democratic California delegation - such as Pelosi and Sen. Barbara Boxer, whose greenhouse gas bill earlier this year was quickly shot down in the Senate - Waxman wants much more strict emission reductions sooner and across a wider spectrum of the economy than Dingell has proposed. The California lawmaker's views on greenhouse gas legislation are more in line with what Obama is seeking, targeting a reduction to 1990 emissions by 2020 and an further 80% cut by 2050. Environmentalists, however, said Dingell's near-term targets and timetables fell far short of the goal they're seeking. "I could not frankly have a better partner," said Senate Environment and Public Works Committee Chairman Barbara Boxer, D-Calif., who said that she plans to push legislation next year to impose mandatory reductions in greenhouse-gas emissions. "It just signals the change - the sea change - that we're facing. It's a good sea change. It's momentous. The problems are momentous as well." Furthermore, while Dingell and Boucher proposed giving revenue raised by placing a premium on carbon emissions directly to industry to develop gas capture and storage technology, Waxman is an advocate of a greater distribution of those funds, meaning industry would have to bear a greater burden of the costs associated with cutting emissions. The Natural Resources Defense Council said following the Caucus vote Thursday that Waxman would help to push climate change legislation through more quickly. "Our nation faces many challenges, including the climate crisis, and Congressman Waxman understands that we can't delay in taking on these issues," said Karen Wayland, NRDS's legislative director. The question that many raise, however, is whether Waxman will be able to build the consensus necessary to pass a climate change bill. In the past two weeks since the oversight committee chairman issued the challenge for Dingell's seat, environmentalists and industry lobbyists alike have expressed skepticism that Waxman's would be able to create a climate change bill that could pass the House, much less the Senate. "It's not clear to me that having Dingell in the background is better than having him in the foreground," said one environmental lobbyist. "If he's not managing the process, after a very bloody fight, he's not going to be inclined to play a very productive role," the lobbyist said. Dingell said in a statement that he would work closely with Waxman, but would continue to fight for his constituents in Michigan. But besides the 137-122 vote that could be read as a bell weather for how many members will vote on greenhouse gas legislation, O'Donnell says that it was Waxman's initiative on several environmental issues in decades past - including the 1990 Clean Air Act amendments - that shows the California lawmakers's ability to legislate. It's the Clean Air Act that has now given the Environmental Protection Agency the ability to regulate carbon dioxide emissions, and which many industries, including coal-fired generation, fear will create such onerous conditions that many companies will migrate out of the country. -By Ian Talley, Dow Jones Newswires; 202-862-9285; ian.talley@dowjones.com (Siobhan Hughes and Fawn Johnson in Washington contributed to this report) Click here to go to Dow Jones NewsPlus, a web front page of today's most important business and market news, analysis and commentary: http://www.djnewsplus.com/al?rnd=ZeJWYD76SSUIrDh7xN%2BBbg%3D%3D. 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