Report backs greenhouse limits
WASHINGTON – Mandatory limits on all U.S. emissions of carbon dioxide and other “greenhouse” gases would not significantly affect average economic growth rates across the country through 2025, the government says.
That finding by the Energy Information Administration, an independent arm of the Energy Department, runs counter to President Bush’s repeated pronouncements that limits on carbon dioxide and other gases that warm the atmosphere like a greenhouse would seriously harm the U.S. economy.
Bush has proposed voluntary ways of slowing the growth rate in U.S.-produced greenhouse gases and methods to reduce emissions of methane internationally. But he rejected U.S. participation in the Kyoto international treaty negotiated by the Clinton administration – a pact that seeks to mandate reductions in emissions.
Sen. Jeff Bingaman, D-N.M., asked the EIA to study the possible effects of a proposal by the National Commission on Energy Policy, a nongovernment panel created and funded by several U.S. philanthropic foundations.
The commission proposed capping how much carbon dioxide, methane and other gases that factories, mines and power plants can emit. Beginning in 2010, businesses that pollute more than their allotment would have to pay up to $7 a ton to those that pollute less. The buying and selling of such pollution would slow growth of greenhouse gas emissions by 2.4 percent a year, the commission said.
EIA estimates the commission’s plan would cut greenhouse gases by 7 percent, or 622 million tons, from what is forecast for 2025. Emissions would still increase 1 percent a year on average during the interim. But without imposing the limits the plan suggests, that rate would be 1.5 percent.
Carrying out the plan also would reduce total fossil fuel consumption by 2.7 percent by 2025, though “oil use is reduced only minimally,” EIA said. At the same time, EIA found coal use would increase 22 percent over that time, while total electricity prices would rise less than 5 percent and gasoline prices would go up by a few pennies a gallon.
William K. Reilly, the commission co-chairman who headed the Environmental Protection Agency under the first President Bush, said it was an old argument that the economy could not withstand greenhouse gas reductions. He said both his commission and the EIA have now shown otherwise.
“This is a reassuring set of conclusions,” he said.
The commission also recommended a 36 percent increase in the average fuel economy for cars and light-duty trucks between 2010 and 2015, and doubling to $3 billion a year the budget for federal energy research and development. In addition, it called for new tax incentives for gasifying coal and building nuclear plants.
Adding those measures to the greenhouse gas plan, EIA estimated, would reduce the nation’s gross domestic product in 2025 by about four-tenths of 1 percent.
The White House said Friday the commission’s plan would amount to losses of about $313 billion in GDP and 101,000 jobs a year by 2025.
“Any reduction in U.S. GDP is serious, and would impact not only American businesses, but American families,” said Michele St. Martin, a spokeswoman for the White House Council on Environmental Quality.