Key components of the U.S.

climate bill
A 987-page climate bill, crafted during months of negotiations and freshly tweaked in response to the Gulf of Mexico oil spill, was unveiled in the Senate.
The plan by Sens. John Kerry, D-Mass., and Joe Lieberman, I-Conn., sets goals ranging from limiting greenhouse gas emissions to setting new curbs on offshore drilling, and cutting oil imports. The key components:

Nuclear power Offshore drilling Clean power Greenhouse gases Consumer protections

• Speeds the process for obtaining • Authorizes sharing 37.5 percent • Agencies would work together to • Would limit U.S. emissions via a “cap • Two-thirds of sales of emissions
construction and operating licenses for of federal revenue from offshore oil establish methods for studying, regulating and trade” system; here’s how it would permits to utility companies under the
new nuclear reactors operations with states that allow drilling and funding technologies for greening the work: “cap and trade” system would be sent
use of coal, the primary U.S. source back to consumers as utility bill
• Designates a national laboratory as a • Allows states to ban drilling 75 miles of electricity 1. Government establishes a cap on refunds
research and development center for (121 km) from the coast overall greenhouse gas emissions, which
studying new methods for generating • Mandates the study and development is then divided into allowances that are • Eligible low-income households will
nuclear power and dealing with waste • Requires the secretary of the interior of large-scale projects for renewable given out or auctioned to companies receive rebates for utility payments
to conduct an impact study following an oil energy, currently a minor source
• Ensures that all inspections, tests and spill; based on the study results, an of electricity production 2. Companies whose emissions fall • An advocacy office would be
analysis have been carried out after new affected state could block leases for new below their allowance receive credits for established to identify consumer
licenses are issued drilling, even if the proposed lease is off a • New programs would study the feasibility that shortfall, which can then be sold on interests
neighboring state’s coast of building infra-structure for electric car the open market to companies that have
refueling exceeded their allowance
3. Over time the cap is lowered to reduce
U.S. electricity production Avg. residential utility costs
U.S. nuclear reactors 75-mile coastal boundary overall emissions
104
Current drilling areas by source 4. The system is designed to provide a
financial incentive for companies to find
Natural gas Electricity
100 2010, through April 20 ways to reduce emissions while allowing $ per thousand Cents per
the market to determine a price for cubic feet kilowatt hour
80 Coal Renewable* credits
60 48.3% 9.6% $15 12¢
40 10 10
20
Other 5 8
1960 1970 1980 1990 2000 2010 42.2%
1990 2000 1990 2000
*Inclues hydro, solar, wind, biomass
Source: American Power Act, Office of Sen. John Kerry, U.S. Energy Information Administration, Environmental Defense Fund
Graphic: Chicago Tribune © 2010 MCT