By Teryn Norris & Jesse Jenkins
Cross-posted from the Breakthrough Institute
The landmark Waxman-Markey 2009 American Clean Energy and Security Act was introduced in the House yesterday (May 15, download PDF here), and the Breakthrough Institute has performed a preliminary analysis of how it would invest over 1 trillion dollars in cap and trade revenue between 2012-2025. Our key findings for this period include (all numbers are approximate -- download spreadsheet here):
(Click to magnify)
Continue reading for more details on the Waxman-Markey climate bill...
- Polluting industries: 57.3% of allowances would be freely distributed to polluting industries, including 36.7% for the electricity sector, 12.3% for energy-intensive industries, 6.5% for local natural gas distribution companies, and 1.8% for oil refiners
- Direct consumer protection: 16.5% of allowances would be used for direct consumer protection , including 15% for low and moderate-income families and 1.5% to benefit users of home heating oil and propane
- Energy efficiency and clean energy technology: 12.2% of allowances would be used to fund energy efficiency and clean energy technology development and deployment
- Adaptation and technology transfer: 4.7% of allowances would be used for domestic and global climate adaptation and technology transfer
- Workforce development: 0.6% of allowances would be used to fund worker assistance and job training
- Deficit reduction and other: 8.6% of allowances would be used to fund deficit reduction and other public purposes
How much money would these allocations translate into? That depends on the average price for each pollution allowance -- the EPA's initial price estimate was $13-17 per allowance, so we will assume an average price of $15 per allowance. The allocation would look like this (click images to magnify):
Investment in clean energy technology development and deployment is broken out here (Note: the amount for clean energy technology within the "Renewable Energy and Efficiency" program is not specified):
Breakthrough's analysis finds that Waxman-Markey would spend about $9 billion annually on a range of things that could generously be classified as technology innovation. By contrast, the legislation would give $32 billion to utilities, $9 billion to heavy industries, and $11 billion to low-income consumers annually. This $9 billion is far less than what Obama promised ($15 billion) and far less than the $30 billion that three dozen energy scientists and experts, including several Nobel laureates, called for in a sign-on letter during the fall of 2007. The large allowance giveaway to polluters also stands in contrast to Obama's previous calls for a 100% auction, which was included in his final budget proposal.