Gore, Buffett Take Sides in Tug-of-War Over Climate Change Bill

By Lorraine Woellert and Simon Lomax

June 25 (Bloomberg) -- Al Gore and Warren Buffett joined the fray over a bill that would limit greenhouse gas emissions, with each taking opposite sides as a legislative battle over the measure entered its final hours.

Gore, the former vice president who now focuses on environmental issues, is set to appear today on Capitol Hill to endorse the bill. Buffett, the chairman and chief executive officer of Omaha, Nebraska-based Berkshire Hathaway Inc., took to the airwaves yesterday to call the legislation “regressive.”

The measure got a boost earlier this week as its backers reached an agreement with agricultural and rural lawmakers to give farmers and coal-fired electric utilities added benefits. Democratic House leaders plan a floor vote on the bill tomorrow.

About 100 environmentalists and labor leaders rallied on Capitol Hill yesterday in support of the legislation. They were joined by venture capitalist Sunil Paul of Spring Ventures in San Francisco and Bill Keith, founder of St. John, Indiana-based SunRise Solar, who praised the measure.

“It used to be environmentalists on one side and industry on the other,” House Energy and Commerce Committee Chairman Henry Waxman said at the rally. “Here we have environmentalists, industry, labor unions and faith-based groups all together saying now is the time for the House to pass the energy bill.”

The Washington-based U.S. Chamber of Commerce and other business groups questioned its cost and workability.

‘Seriously Flawed’

The American Petroleum Institute, which represents oil and gas companies including Exxon Mobil Corp., asked lawmakers to vote against the bill, saying it would raise fuel prices. American Farm Bureau Federation President Bob Stallman called the legislation “seriously flawed” because it would raise fuel prices.

The measure would cap emissions and create a market system for trading pollution permits. The bill is designed to control greenhouse gases that contribute to climate change, reducing them 17 percent from 2005 levels by 2020.

Waxman, a California Democrat, and Agriculture Committee Chairman Collin Peterson, a Minnesota Democrat, reached an agreement this week on agricultural provisions of the bill after almost a month of negotiations.

Lawmakers and industry groups remain divided on several issues, including the measure’s cost and a provision that would ban over-the-counter trading of derivatives and other instruments based on pollution credits created by the legislation.

Energy Tax

Republican leaders labeled the measure an energy tax and predicted Democrats wouldn’t have the votes to pass it. Republican Whip Eric Cantor of Virginia predicted Democrats would have fewer than 200 votes for the bill.

“This bill is disconnected to the reality facing so many of America’s families and certainly families in the regions where coal is a big part of the economy,” Cantor told reporters yesterday.

Waxman, Peterson, House Speaker Nancy Pelosi, a California Democrat, and Representative Edward Markey, a Massachusetts Democrat, met with a group of Republicans yesterday in an effort to win their support. Markey and Waxman are the chief sponsors of the legislation, called the American Clean Energy and Security Act.

“We believe the changes we’ve made are going to increase the likelihood of passage of the bill,” Markey told reporters after the meeting. The agreement on agricultural provisions “is going to lead to support from moderate Republicans when the vote is cast,” he said.

Carbon Offsets

One revision would authorize the U.S. Department of Agriculture, rather than the Environmental Protection Agency, to oversee farm- and forest-based carbon offsets. Farmers and other agricultural interests had sought the change.

Another compromise, on the measure’s formula for distributing free pollution credits, would benefit not-for- profit coal-fired power plants, which would get more free permits. Companies such as Great River Energy in Maple Grove, Minnesota, would gain from the change.

The revision was made after the National Rural Electric Cooperative Association argued that the formula for allocating free carbon dioxide permits gave too much help to utilities with access to carbon-free sources such as nuclear power and hydroelectric dams and too little aid to coal-fired utilities.

The removal of this “windfall” means the association won’t fight to defeat the bill, the organization’s chief executive officer, Glenn English, said in an interview.

Some investor-owned utility companies, including MidAmerican Energy Holdings Co., a company controlled by Buffett’s Berkshire Hathaway, have objected to the bill’s formula for distributing carbon dioxide permits.

Even with changes that would give more free allowances to coal-fired utilities, the bill is “unworkable, and we continue to urge a no vote,” MidAmerican spokeswoman Ann Thelen said in a phone interview.

To contact the reporters on this story: Lorraine Woellert in Washington at lwoellert@bloomberg.net ; Simon Lomax in Washington at slomax@bloomberg.net .

Last Updated: June 25, 2009 00:01 EDT

		Email this article Printer friendly format