Montana utilities and environmentalists are giving a cool reception to what appears to be the U.S. Senate’s main global-warming bill.
Rural electric cooperatives worry that their consumers will bear the financial burden of pollution caps placed on coal-fired power plants under the Senate’s American Power Act, similar to an earlier global-warming bill by House Democrats.
Environmental groups say they, too, were hoping for something different from the Senate, namely more rewards for conservation-minded Montana consumers and more incentives for developing renewable energy sources.
The bill introduced by Sens. John Kerry, D-Mass., and Joe Lieberman, I-Conn., is falling flat in the Treasure State, where fans of “cap and trade” are hard to find. So-called cap-and-trade laws limit the amount of carbon dioxide that polluters can produce and allow facilities operating beneath the cap to sell their leftover emissions allowance — most likely through market exchanges— to over-polluters, who would otherwise be penalized.
Cap and trade
“Really, I think just in general cap and trade for Montana is not the best thing for the majority of Montana consumers,” said Kyla Wiens, who tracks federal climate change legislation for the Montana Environmental Information Center.
MEIC favors a “cap and dividend” approach, in which the government would sell emission credits to polluters and rebate the revenue to consumers.
Wiens said cap and dividend might still have a chance despite Kerry and Lieberman’s rollout of the American Power Act. The American Power Act is 900 pages long and lacks Republican support since co-author Sen. Lindsey Graham, R-S.C., pulled his endorsement last month.
There is a cap-and-dividend bill, known as the Carbon Limits and Energy for American Renewal Act, that has Democratic and Republican sponsors and is only 35 pages long, Wiens said.
Dave Wheelihan, Montana Electric Cooperatives Association chief executive, said there are some cap-and-dividend elements in the American Power Act, though he has concerns about both plans.
Increase in bills
The Senate legislation is softer than cap-and-trade legislation passed last year by the House, Wheelihan said, but it still poses the likelihood of an increase to Montana utility bills. MECA sports a news ticker on it website with a scrolling stream of articles debunking climate change.
“It’s still cap and trade. That’s why our national association is busy crunching numbers,” Wheelihan said. “At this point, we simply don’t know enough to put the details all together.”
NorthWestern Energy, the state’s largest electric and gas utility, said it wasn’t familiar enough with the American Power Act to discuss its consequences. Last year the utility sent letters to customers warning that home utility bills could increase $225 a year because of cap and trade. The company said it would work with Montana Democratic Sens. Max Baucus and Jon Tester on the Senate legislation.
“We appreciate the responsiveness to regional concerns and look forward to working with our delegation as the bill is evaluated and goes through the legislative process,” NorthWestern President Bob Rowe said in a written statement.
The Western Organization of Resource Councils, based in Billings, said the American Power Act spends too much effort trying to capture pollution from fossil fuel energy and not enough effort developing new renewable energy resources. A coal-fired power plant that spends 30 percent of its energy capturing carbon pollution simply has to burn 30 percent more coal to keep up with its consumer demands, said Ed Gulick of WORC.
“This bill is basically trying to take the existing fuel mix and make it work in a carbon-constrained future,” Gulick said. “There are a lot of cheaper, faster ways to meet the same end.”