Markey Says ‘Political Obstacles' Impede Broad Climate Bill

Energy and Climate Report provides current, thorough coverage of clean energy, efficiency, and climate change legislation, regulation, policy, legal developments, and trends in the U.S. and...

Retaking control of Congress in November could provide a new window for Democrats to pursue climate change legislation. But Sen. Edward Markey, who was either the primary author or co-sponsor of countless energy and environment statutes as well as cap-and-trade legislation that passed the House in 2009 but not the Senate, predicts that any new legislation must overcome staunch opposition in Congress, particularly from Republicans. The Massachusetts Democrat points to a recent House vote against a carbon tax that suggests broad legislation faces an uphill battle even if voters put the Speaker's gavel back in Nancy Pelosi's hands for the first time in six years.

Markey, who served 37 years in the House before a 2013 special election sent him to the Senate, sat down last week with Dean Scott, Bloomberg BNA's senior reporter for climate change, to discuss prospects for moving climate legislation if Democrats take the Senate in November. The senator was Pelosi's point person on climate change the last time the Democrats pursued a broad climate bill; today he is the top Democrat on two Senate subcommittees: the Subcommittee on Superfund, Waste Management and Regulatory Oversight within the Environment and Public Works and the Subcommittee on Africa and Global Health Policy within the Foreign Relations Committee.

This interview was edited for clarity and length.

Bloomberg BNA:

There seems to be growing optimism of enough Democratic wins to take back control of the Senate this fall. Do you think you are in a good position to retake the majority? And where does climate change fit into that?

Ed Markey:

Yes. And why is that? Because Donald Trump is a uniter and not a divider. Donald Trump in other words is going to unite the Democratic party in a way that they have not been united in a generation. The more that he calls climate change a hoax, the more that he relies upon Koch brothers-based science, the more clear it is that his climate science—Trump's climate science—is as bogus as a degree from Trump University.

So one, this is going to help us win the election; two it is going to help us inject the [climate] issue into this presidential campaign in a way that is going to be very advantageous for the Democratic party.

Bloomberg BNA:

And if Democrats take the majority, where will climate change in your mind rank as an agenda item? Where is this item relative to other competing issues if Democrats win and take over [the Senate] in 2017?

Markey:

I think climate change and a clean energy strategy are going to be near the top of the list of agenda items for the Democrats. And for the new president: President [Hillary] Clinton.

Bloomberg BNA:

Talking to Democratic senators on this issue but also some Republicans like Sen. Susan Collins (R-Maine), they say the way forward is through incremental change rather than broad climate legislation. Where do you see the Senate going on this issue: bills that take small bites of the issue, or is there some wind in the sails ahead for a comprehensive bill?

Markey:

To start, we have fuel economy standards on the books now to reach 54.5 miles per gallon by the year 2025. If Hillary Clinton wins, that goal is unlikely to change. The Obama Clean Power Plan affecting the utility sector is being challenged in court, yes, but we have high confidence that it will be upheld and that a President Clinton will continue to implement that plan. So in two major sectors, we're going to see a dramatic change in policy. The same thing is true in the renewable electricity sector.

Last year in the U.S. we added 8,600 new megawatts of wind and 7,500 new megawatts of solar, 6,000 megawatts of natural gas. All other sources including coal were at less than 500 megawatts [of new capacity]. In 2016, an estimated 14,500 megawatts of solar are to be installed, 9,000 new wind and 8,800 new megawatts of natural gas, but everything else combined will be negligible, meaning there is now a dramatic change that is taking place in the sources of electrical generation in America.

By the end of 2015, coal was down to 33 percent [of electricity generation]; natural gas was 33 percent; nuclear was steady at 20 percent but that will be declining; and hydropower was 6 percent and steady.

But wind and solar were up to 6 percent of all electrical generation in 2015. Combined, it's projected we will add a percent or a percent-and-a-half a year [of wind and solar] every year between now and 2030. Conservatively, one-third of electricity generation ultimately will be from renewable sources.

Bloomberg BNA:

What's needed to ensure the U.S. stays on that trajectory?

Markey:

We have to keep the tax breaks [for wind and solar] on the books. And we have to ensure that going forward, we add tax breaks for offshore wind; they were excluded from the deal that was cut in December of 2015. Offshore wind has enormous potential [and is] entitled to the same kind of tax breaks that onshore wind and solar are receiving if they [offshore wind sites] are going to fully maximize their potential.

So I am very optimistic about these multiple revolutions that are taking place, including the energy-efficiency revolution taking place.

Bloomberg BNA:

So what's missing there in terms of policies? Don't we still need steeper reductions in emissions to get them down to the level scientists say are needed by 2050?

Markey:

We need to continue to innovate. We need tax breaks for all-electric vehicles, we need tax breaks for new battery technologies; we need a continuation of tax breaks in wind and solar that are on the books. But also the fuel cell geothermal tax breaks have to be put back on the books, they were removed [in the 2015 omnibus deal between Obama and the Republican-controlled Congress].

Bloomberg BNA:

Do you subscribe to this idea that a significant legislative change would require a carbon tax or perhaps taking another run at cap and trade? Where are you on a carbon tax? And are you a pessimist or an optimist that we'll ultimately have a grand bargain of broad tax reform to include a carbon tax? Is a tax a better bet at this point than putting weight behind taking another run at a broad cap-and-trade bill?

Markey:

Well, I was not happy that every single Republican in the House voted for a resolution saying a carbon tax should never be adopted under any circumstances, joined by half a dozen Democrats. [The nonbinding resolution, H. Con. Res. 89, put the House on record as opposing an economywide carbon tax and was approved by that chamber June 10 by a vote of 237 to 163].

So that's a real challenge. And as we're moving forward, if there is a moment for comprehensive tax reform, and a carbon tax was included, we'd also have to make sure that the poor and the middle class were completely held harmless under that formula. That would also be a significant legislative challenge. But as long as the House remains in the solid Tea Party anti-carbon tax control, which is the case right now, then it just creates real logistical obstacles.

Bloomberg BNA:

So you don't think there's necessarily any more wind in the sails for a carbon tax versus a comprehensive climate bill?

Markey:

That vote in the House is just so recent. The nature of that vote informs us clearly on the political obstacles we'd have to overcome to move forward.

Bloomberg BNA:

On Waxman-Markey, the Senate never took up the bill passed by the House in 2009. If we ever get to the point of legislation moving through both chambers, would the Senate have to go first given there are long memories of that vote in the House, their vote on cap and trade was used against them in that campaign. Should the Senate have an obligation to move first or even politically, as a bellwether to show the House it can be done? If not, why would House Democrats put themselves on the line?

Markey:

When Nancy Pelosi is speaker next January, I would never tell her what she should or shouldn't pursue. Yes, Nancy Pelosi is going to be [House] Speaker in January. When she created the Select Committee on Energy Independence and Global Warming and asked me to be the chair in January 2007, she made it clear that it was, for her, one of her flagship issues. So I don't question her zeal in continuing to ensure that comprehensive legislation ultimately passes. To some extent, you need both [House and Senate bills] to move in tandem, in order for this to be successful. But we could never have anticipated in 2009 the complexity of having a health-care bill pass the Senate that took far more time than any expert thought that it would. Health care wasn't finished until March 2010, which then left little time for the Senate to consider the climate legislation, which had been sitting there since June 2009 out in the House. But that was not something that was anticipatable in January 2009 [when President Barack Obama first took office.]

I don't think that people anticipated that the health bill would be more complicated than the climate bill, but that's ultimately what happened.

Bloomberg BNA:

On coal, there was a lot of discussion during the negotiations on Waxman-Markey that somewhere between $5 billion to $10 billion annually would have gone to the coal industry to deploy carbon capture and storage (CCS) technologies for coal-fired power plants. In the years since, it's been said the coal industry made a mistake in not broadly supporting the bill and would never get the deal again. Do you agree? And when you look at the decline of the industry since then, to what degree would that deal have helped it compete with what has since been a rapid expansion in renewable energy sources?

Markey:

The way that Henry Waxman and I and Nancy Pelosi viewed the coal industry was that we were going to try to create a bridge for them to the clean energy era. To accomplish that, we needed significant investment in CCS so coal could be burned but the greenhouse gases could be sequestered and thus not add to the problem.

Toward that goal we built in a program that was between 2009 and 2050 worth approximately $200 billion dollars total, which was aimed at helping the coal industry make that transition. The Edison Electric Institute [representing investor-owned electric companies] as part of that negotiation agreed to endorse Waxman-Markey, which they did. But Peabody [Energy], Alpha [Natural Resources] and Arch Coal continued to oppose the bill on the sidelines, not withstanding the enormous amount of funding that we put into the bill for carbon capture.

So what I said at the time is true today. I said that they had to choose between legislation and regulation. I said that legislation was preferable because we had the flexibility to try to deal with the costs to industry, to workers and to other elements in the society as this transformation took place. I made it clear that if the alternative was just pure regulation—which is what the EPA's Clean Power Plan is—that that kind of flexibility would not exist.

The coal industry decided that they would run that risk. So today the Clean Power Plan is on its way to implementation but without the $200 billion, which could have helped dramatically to ensure that the coal industry had the technology to sequester the carbon and make it a more viable industry in the years ahead.

We worked in good faith with the United Mine Workers, with the coal industry and with the utility industry to fashion a provision which we thought would work. And in retrospect, I think maybe people wish they could go back in time, and take the deal that we offered them. Because coal in terms of electricity generation in America has fallen from 51 percent to 33 percent in total electrical generation in America, and that's with no Waxman-Markey on the books and no Clean Power Plan on the books. [EPA's Clean Power Plan has been stayed by the U.S. Supreme Court pending a lower court review].

So the renewable electricity and gas revolution have inflicted a tremendous market-based punishment on the coal industry that was at least partially avoidable—if they had accepted the investment in carbon capture and sequestration, which Henry Waxman and I were offering.

To contact the reporter on this story: Dean Scott in Washington at dscott@bna.com

To contact the editor responsible for this story: Greg Henderson at ghenderson@bna.com

Copyright © 2016 The Bureau of National Affairs, Inc. All Rights Reserved.