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Sen. Lindsey Graham: “Cap and trade is dead”

February 28, 2010

South Carolina Senator Lindsey Graham was quoted Saturday as saying “cap and trade is dead” in a Washington Post story about the climate change bill he and Sens. John Kerry and Joe Lieberman are planning to introduce in the coming weeks.

Three key senators are engaged in a radical behind-the-scenes overhaul of climate legislation, preparing to jettison the broad “cap-and-trade” approach that has defined the legislative debate for close to a decade.

The sharp change of direction demonstrates the extent to which the cap-and-trade strategy — allowing facilities to buy and sell pollution credits in order to meet a national limit on greenhouse gas emissions — has become political poison. In a private meeting with several environmental leaders on Wednesday, according to participants, Sen. Lindsey O. Graham (R-S.C.), declared, “Cap-and-trade is dead.”

In recent weeks, President Obama has held press events on clean coal and nuclear energy.  His State of the Union address also referenced the need for off shore oil and gas exploration.    Last week, the President spoke about climate to the Business Roundtable.

But to truly transition to a clean energy economy, I’ve also said that we need to put a price on carbon pollution.  Many businesses have embraced this approach — including some who are represented here today.  Still, I am sympathetic to those companies that face significant potential transition costs, and I want to work with this organization and others like this to help with those costs and to get our policies right. 

In response to relentless international media attention that has chipped away at the credibility of climate science, the Commerce Department announced NOAA would become the National Weather Service equivalent of U.S. climate forecasts and information.  

Meanwhile, Kerry, Lieberman, and Graham have been working behind the scenes on what could be a last ditch attempt to bring a climate bill to the Senate floor before the 2010 elections.

According to several sources familiar with the process, the lawmakers are looking at cutting the nation’s greenhouse gas output by targeting, in separate ways, three major sources of emissions: electric utilities, transportation and industry.

Power plants would face an overall cap on emissions that would become more stringent over time; motor fuel may be subject to a carbon tax whose proceeds could help electrify the U.S. transportation sector; and industrial facilities would be exempted from a cap on emissions for several years before it is phased in. The legislation would also expand domestic oil and gas drilling offshore and would provide federal assistance for constructing nuclear power plants and carbon sequestration and storage projects at coal-fired utilities.

This has got to be a tough pill to swallow for the environmental crowd.

Environmental advocates, eager to pass comprehensive climate and energy legislation before the November midterm elections, said the shift in strategy represents the best shot at getting something done this year.

“The Senate is understanding this is not a simple problem — it’s multiple problems, and it requires multiple solutions,” said Carl Pope, executive director of the Sierra Club.

Click here for Illinois Farm Bureau talking points on cap and trade.

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