Climate bill chaos: Your guide to the two newest proposals

In the madness leading up to and following the U.N. Climate Conference in Copenhagen two weeks ago, many have lost track of the climate change legislation working its way through Congress in the U.S. The last many heard of it, the controversial Kerry-Boxer bill was bound up in committee, poised for almost certain doom. Since then, two shiny, new proposals have been put on the table. But do they really have a better shot?
Before we take a closer look at the two fresh packages, called the Kerry-Lieberman-Graham bill (PDF) and Cantwell-Collins bill (PDF), respectively, let’s take a moment to ponder what all this activity will actually accomplish. When it comes to successfully pushing laws through Congress, strong backing, and cohesiveness are key. So these bills — pitched on consecutive days — are facing some steep odds. Not only has the urgency of emissions reductions been weakened by Copenhagen’s failure to produce a treaty, but now Senate’s attention is being divided between several different ideas.
Their saving grace?: Bipartisan and moderate Democrat sponsors that might make their approval more palatable to previously staunch opponents of climate change legislation. Then again, Sen. John Kerry (D-Mass.) and Sen. Joe Lieberman (D-Conn.) don’t necessarily have popularity and political capital on their side right now. So it will be interesting to watch.
First, let’s look at Kerry-Lieberman-Graham, since it debuted first. Like the Kerry-Boxer and Waxman-Markey bills before it, it would establish a fairly elaborate cap-and-trade system for carbon permits. It’s surprising that Kerry is still peddling this idea after its drawn such ire from his peers in the Senate. Republicans and moderate Democrats have done a good job arguing that cap-and-trade would further burden companies still struggling to rebound from the recession, and ultimately hurt consumers. Cap-and-trade also proved unpopular in Copenhagen, and the ranks of those against it continue to swell.
Kerry-Lieberman-Graham would also:

Set a goal of a 17 percent reduction in carbon emissions (below 2005 levels) by 2020, and an 80 percent reduction by 2050.
Create a global system for trading carbon offsets and carbon-based securities. (Offsets are tricky business because they are basically promises from organizations that they will prevent a certain amount of emissions from being released — there are no guarantees.)
Distribute an initial round of carbon permits (85 percent of them at least) to utilities and other organizations, which could then sell them to bring in revenue. (Some are viewing this as an underhanded subsidy for utilities without many strings attached.)
Earmark government support for nuclear energy, clean coal technology and more efficient oil and gas drilling. (This seems like a concession to opponents who say the bill will hurt the job market.)

The Cantwell-Collins bill, also proposed before the world got swept up in Copenhagen, slims the climate change issue down considerably (it’s about 50 pages instead of 1,500). Its sponsors, Sen. Maria Cantwell (D-Wash.) and Susan Collins (R-Maine), claim that, if implemented correctly, it could cut greenhouse gas emissions by 20 percent by 2020 and 83 percent by 2050 — actually exceeding the goals of Kerry-Lieberman-Graham.
Its real strength, however, is that it would refund 75 percent of all of the revenue it might bring in. Instead of using the typical language of cap-and-trade systems, the bill says it would sell “carbon shares” to fuel makers, and return the proceeds to American taxpayers in the form of a monthly rebate check. It’s estimated that this system could result in annual payments of $1,100 for an average family of four — amounting to $21,000 between 2012 (when it would go into effect) and 2030. Americans certainly do like to get paid — so this proposal is sounding easier to swallow already.
Here’s the rundown on Cantwell-Collins (also known as the CLEAR Act):

It would cap fossil fuels both imported and produced domestically. They would have to buy emissions permits from the U.S. government at monthly auctions, that they could then trade on a secondary market.
The regulations are targeted at the actual producers of fossil fuels — not anyone else along the supply chain. For example, the coal mining companies would be the ones to purchase the permits, not power plant operators or utilities.
While 75 percent of the money generated by the government from the program would be distributed to regular citizens as rebate checks, the other 25 percent would be funneled into clean energy research.
Early estimates say that the Cantwell-Collins program could raise between $10 to $32 billion every year to start, a figure that will go up as carbon prices inevitably rise.
Just like Kerry-Lieberman-Graham builds in support for nuclear and clean coal interests, this bill also includes provisions to cut down on non-carbon greenhouse gases like sulfur dioxide and methane, and to encourage carbon sequestration.

The two proposals are impressively different (finally, options!), and Cantwell-Collins seems particularly progressive. Whether or not it will actually achieve reductions in emissions is up for debate. Many are arguing that it would take too long for its initiatives to make a difference in how fuel producers operate, and that the resulting investment in cleantech research would be minimal. But some money is better than nothing — and if not too many allowances to polluters dilute the permitting market, it seems like the bill should have some teeth.
Regardless of their various merits and drawbacks, one of these bills needs to win a majority on the Senate floor this year to make any difference at all. And the sooner the better. Former vice president Al Gore is calling for a deadline of Earth Day in April, and this seems like a fair timelines, considering how swiftly the health care measure moved once Obama gave it his full attention.
If had to make a prediction, I’d place my bets on Cantwell-Collins. Based on response to Kerry-Boxer and Waxman-Markey before that, the idea of carbon trading has about 40 solid supporters (all Democrats). What will push one of the bills over the top is how it communicates the nature of the trading system. Cantwell-Collins appears to be much simpler in its approach (making it easier to explain to constituents), and seems to give fewer perks to Wall Street and utility fat cats. It also distinguishes itself by emphasizing the importance of further research into sources of clean energy. At the same time, it takes the interests of the existing oil, gas and coal infrastructures into account with its auction-based pitch. And the clincher: it means money in regular people’s pockets. This will almost certainly sway the moderate Democrats and Republicans that have stymied earlier legislation.
While there’s a chance that neither bill will make it past the Senate, one thing is for certain: President Barack Obama will have to choose between them at some point. He was a big supporter of both Waxman-Markey and Kerry-Boxer, and seems to be a proponent of cap-and-trade in general. That said, he needs to get something passed, and fast, to make it looking like he’s making good on his major campaign promises. He already missed his end of 2009 deadline. So if Cantwell-Collins seems to have a better shot, it’ll probably get his blessing.