Subscribe to our free, weekly email newsletter!


Report says cap and trade legislation may be running out of time

By Jeff Berman, Group News Editor
April 01, 2010

WASHINGTON—The concept of “cap and trade” as a cornerstone of a United States climate change policy appears to be losing steam, according to a recent New York Times report.

The Times report makes note of how opponents of cap and trade—a form of emissions trading used to control pollution by offering economic incentives—maintain it will be costly, adding that it’s not even mentioned in President Obama’s current budget.

The report added that Senator Lindsey Graham (R-S.C.), who is working on a climate change bill with Senators John Kerry (D-Mass.) and Joseph Lieberman (I-Conn.), pronounced cap and trade as “dead” last month. Graham and Kerry are working to draft a bill “that satisfies the diverse economic, regional, and ideological interests of the Senate,” according to the report.

Graham has previously said that the current cap and trade bills in the House and Senate are “going nowhere” and are not business-friendly enough and do not lead to meaningful energy independence.

Instead of cap and trade being used as a form of emissions trading to reduce emissions pollutants, the bill would initially include a cap on greenhouse gas emissions for utilities, with other industries potentially phased in later. The bill would also include a modest tax on gasoline, diesel fuel, and aviation fuel, accompanied by new incentives for oil and gas drilling, nuclear power plant construction, carbon capture and storage, and renewable energy sources like wind and solar.

Late last year, the White House introduced its U.S. emissions target, calling for an emissions reduction of 17 percent below 2005 levels in 2020 and an 83 percent reduction by 2050—as well as being in line with final U.S. energy and climate legislation. The Senate version calls for a 20 percent reduction below 2005 levels, and the House version calls for a 17 percent reduction below 2005 levels.

Both bills, like the White House, calls for an 83 percent reduction by 2050.

The notion that cap and trade’s future is decidedly murky has been kicking around for months. At a recent transportation conference, Patrick Larkin, partner at Strasburg & Price LLP in Washington, D.C., said that if the climate change bill does not pass by June 1, it could very well be dead for 2010.

If this ends up being the case, many freight transportation and logistics industry stakeholders maintain it will be for the best as they contend that cap and trade will raise taxes for all businesses and consumers and increase fuel costs by nearly $1.00 per gallon and cost taxpayers more than $840 billion.

David Miller, vice president of global policy and economic sustainability at Con-way, said that if cap and trade were to ever become law, freight transportation companies would have no chance at all to get the fuel and gasoline taxes needed to support critical infrastructure.

“What’s bizarre about this is that those of us that are huge energy consumers who move freight throughout the entire country are not going to be given any credits [in this legislation], but those that are supposed to be paying the taxes are being given all the credits,” said Miller. “It is entirely possible we could see a 30 percent to 40 percent increase in fuel costs should this be passed.”

About the Author

Jeff Berman headshot
Jeff Berman
Group News Editor

Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. .(JavaScript must be enabled to view this email address).


Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

Last week, the United States Department of Transportation took further steps to address various issues identified in recent train accidents involving crude oil and ethanol shipped by rail. The announcement was made by DOT with other DOT agencies, including the Federal Railroad Administration (FRA) and the Pipeline and Hazardous Materials Safety Administration (PHMSA).

Logistics Management Group News Editor Jeff Berman had an opportunity to interview Derek Leathers, President and Chief Operating Officer of Werner Enterprises, at this month's NASSTRAC Shippers Conference and Transportation Expo in Orlando. They discussed various aspects of the truckload market, including prices, fuel, and regulations.

During this webcast our presenters will apply the findings of the 23rd Annual Trends & Issues in Transportation and Logistics Study to the world of shipper-carrier decision making. They'll examine the primary aspects that will influence the future direction for shipper-carrier decision-making.

For February, the month for which most recent data is available, the SCI dropped to -1.0 from January’s 2.6, with FTR explaining that the short term positive impact from one-time adjustments for rapidly dropping diesel prices and the suspension of the 2013 motor carriers hours-of-service expires later this year.

Seasonally-adjusted (SA) for-hire truck tonnage in March was up 1.1 percent on the heels of a revised 2.8 percent (from 3.1 percent) February decline, with the SA index at 133.5 (2000=100). This is off 0.3 percent from the all-time high for the SA of 135.8 from January 2015 and is up 5 percent annually.

Article Topics

News · News and Analysis · All topics

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2015 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA