The CLEAR Act

In December, Senators Maria Cantwell (D-WA) and Susan Collins (R-ME) introduced the CLEAR Act, another promising bill to reduce climate change.  CLEAR stands for Carbon Limits and Energy for American Renewal. Its approach is called cap-and-dividend.  Under this bill:

• the Department of Energy would auction carbon shares (1 share = a permit to emit a ton of CO2), to U.S. companies that import and produce fossil fuels
• 75% of the auction proceeds would be divided evenly among U.S. consumers each month
• 25% would go to a fund (the Clean Energy Reinvestment Trust Fund) to pay for additional greenhouse gas emissions reductions, low‐carbon energy investment, climate change adaptation, and regional economic adjustments
• The number of permits sold each year would decrease to achieve a 20% reduction in greenhouse gas emissions from 2005 levels by 2020 and an 83% reduction by 2050 
• The permit price would be determined by bidding on permits but regulated to be within a certain range to reduce the economic damage caused by too much price volatility 
• Only producers and importers would be required to purchase permits and allowed to bid

The apparent advantages of this bill, pointed out by Mike Sandler at the Huffington Post, are that 100% of permits are auctioned, no offsets are allowed (offsets let an emitter buy shares in a project that reduces CO2 rather than reducing the emitter's CO2 production), and no one but producers and importers can bid on permits (no speculators, investment firms, etc.). In other bills, such as ACES (Waxman-Markey, which passed the House last year), many permits were given away for free, offsets were allowed, and third parties could buy and sell permits.

What do you think of this bill?  Post your comments, and
Stay cool,
Bonney