The Assembly Clean Energy Jobs Committee is holding its last public hearing today on Assembly Bill 649, the 174-page bill encompassing numerous policy recommendations from the Governor’s Task Force on Global Warming. (The Senate companion bill is SB 450.)

The Senate finished its hearings last week. The biggest news from the Senate hearings last week were statements made by Democrat Senators Jeff Plale (South Milwaukee) and Bob Jauch (Superior) noting their concerns with portions of the bill, in particular the Low Carbon Fuel Standard (LCFS) provision. An LCFS would essentially restrict the use of oil derived from Canada’s oil sands. Wisconsin currently receives roughly 50 percent of its oil from Canada. An LCFS would also punish ethanol.

Once the hearings conclude, it is expected that legislators may begin paring back controversial provisions to make the bill more likely to pass. What, if anything, is removed remains to be seen.

Hamilton Consulting Regulatory Watch will continue to provide timely updates as the legislation moves forward.

As noted last week, the Senate and Assembly special committees created for the climate change bills (AB 649/SB 450) begin a slate of hearings today, beginning at 11:45 a.m. at the Capitol. Beginning today, Hamilton Consulting Regulatory Watch will provide updates of all of the hearings.

Today’s hearing is for informational purposes only, meaning that the public is not yet allowed to provide public comments. It will be an opportunity for legislators on the committees to ask questions about the very complex piece of legislation.

To view Hamilton Consulting Regulatory Watch’s analysis of the 174-page bill, please click here.

Senators Jeff Plale and Mark Miller today announced a series of hearings on Gov. Doyle’s global warming bill, dubbed the “Clean Energy Jobs Act.” The 174-page bill (SB 450/AB 649) would considerably alter Wisconsin’s economy. For more information about what is in the bill, see Hamilton Consulting’s analysis.

Below is a schedule of hearings on particular topics within the omnibus legislation: 

• 10:45 a.m., Wed., Jan 20: Informational hearing (Room 412-E).
• 10 a.m., Wed., Jan. 27: Public hearing focusing on: Public Service Commission, industrial energy incentives (412-E).
• 10 a.m., Wed., Feb. 10: Public hearing focusing on: Vehicles; fuels, planning, transportation infrastructure; energy efficient buildings and equipment; bioenergy (412-E).
• 10 a.m., Thu., Feb. 11: Public hearing on: Goals, program coordination and evaluation, public education, state and local government, cap and trade report (412-E).

Gov. Jim Doyle yesterday introduced his 174-page global warming legislation (Assembly Bill 649 and Senate Bill 450), which includes policy recommendations from the Global Warming Task Force he convened in 2008.

Below are some of the key provisions of the legislation:

• Renewable Energy Mandates. The bill increases Wisconsin’s renewable energy mandate from 10 percent by 2015 to 10 percent by 2013. The renewable energy mandate then jumps to 20 percent by 2020, and to 25 percent by 2025.
• Low Carbon Fuel Standard. The bill calls for a “low carbon fuel standard,” which seeks to limit “carbon intensive” fuels. Its ultimate aim is to prohibit oil from Canada’s oil sands and limit corn ethanol. Both fuels are more carbon intensive than conventional gasoline. Wisconsin receives roughly 50 percent of its oil from Canada.
• California Car Low Emission Vehicle Standards. The bill requires Wisconsin to adopt California’s low emission vehicle standards. By doing so, Wisconsin would cede its regulatory authority to California bureaucrats. Automobile manufacturers and car dealers argue there is no need to adopt California’s expensive regulations given that the federal government is currently in the process of promulgating emissions and fuel efficiency regulations equally as stringent as California’s. They also argue that the federal regulations are preferable to a patchwork of state laws.
• Requiring Stricter Building Codes. The bill would force new homes and commercial buildings to follow the stringent International Energy Conservation Code (IECC). The bill also allows the Department of Commerce to require builders to adopt even stricter energy codes. Builders have concerns with such regulations because the stricter energy codes add to the cost of a home and argue that the codes do not provide any energy savings.
• Adds New Greenhouse Gas Emissions Reporting Requirements. The bill grants DNR rulemaking authority to force businesses emitting a certain amount of CO2 to report its emissions to the DNR. After collecting the data, the DNR is required to assess whether the state is meeting its goals, and if not, determine what further regulations should be implemented to reduce CO2.

Businesses affected by the bill voiced their opposition to the bill, arguing that it will increase energy costs, hurt businesses, and lead to fewer jobs. Twenty-three business groups submitted a letter to the Legislature and the Governor last month explaining their concerns with the legislation.

Hamilton Consulting Regulatory Watch will continue to closely monitor this legislation and provide timely updates.

As the Wisconsin Legislature is poised to begin debating climate change legislation, an interesting scenario is taking place in California, which became the first state to adopt sweeping global warming legislation in 2006.

Nearly four years after the law (Assembly Bill 32) was enacted, a movement is afoot in California to stop the law from fully taking effect until the state’s unemployment rate drops below 5.5 percent. Currently, California’s unemployment rate is hovering over 12 percent. According to the New York Times’ blog, Green Inc., a group known as the People’s Advocate and a state legislator are seeking signatures to place an initiative on the ballot.

In Wisconsin, legislators recently unveiled legislation (LRB 3883/1) which includes a number of provisions similar to California’s law - including a low carbon fuel standard, increasing the state’s renewable energy mandate, and forcing Wisconsin to adopt California’s emission standards for vehicles. The bill is expected to be introduced later this month, and public hearings scheduled shortly thereafter.

The Wisconsin BizTimes reports that a vast majority of small businesses oppose pending federal cap-and-trade legislation. Key findings from the National Federation of Independent Business survey include:

• 66 percent of small business owners and managers oppose a federal cap-and-trade system while 24 percent are in favor of such a system.
• 54 percent of small business owners and managers believe a federal cap-and-trade system would lead to more job losses while 15 percent believe it would have no effect and 17 percent believe it would create jobs.
• 71 percent of small business owners and managers believe a federal cap-and-trade system would increase energy costs while 14 percent it would have no effect and only 5 percent believe it would lower costs.
• 58 percent of small business owners and managers believe a federal cap-and-trade system will limit economic growth while 14 percent say it will have no effect and 14 percent believe it will increase growth.

Not surprisingly, the survey found that the economy and jobs are the biggest issues. A majority of small businesses believe that a federal cap-and-trade program would lead to job losses and increase energy prices.

Now that the Copenhage Climate Change Change Conference has ended without a major treaty, the question remains whether the U.S. Senate will pass climate change legislation. Congress earlier this year passed sweeping climate change legislation imposing a cap-and-trade program. A similar bill introduced in the Senate has since stalled.

After a brusing debate over controversial health-care legislation, Politico.com is reporting that a number of moderate Senate Democrats are indicating that they are unwilling to tackle climate chnage legislation, especially during this economic downturn. According to the article:

The creation of an economy-wide market for greenhouse gas emissions is as the heart of the climate bill that cleared the House earlier this year. But with the health care fight still raging and the economy still hurting, moderate Democrats have little appetite for another sweeping initiative - especially another one likely to pass with little or no Republican support.                                                     

“We need to deal with the phenomena of global warming, but I think it’s very difficult in the kind of economic circumstances we have right now,” said Indiana Democratic Sen. Evan Bayh, who called passage of any economy-wide cap and trade “unlikely.”

This does not mean, however, that greenhouse gases will escape federal oversight. Earlier this month the Obama Administration announced its endangerment finding, setting the stage for the EPA to regulate greenhouse gases. In addition, as The Wall Street Journal discusses in its editorial pages this morning, the issue of climate change is entering the federal courts as environmental groups seek to impose significant damages on entities that emit greenhouse gases.

The Hamilton Consulting Regulatory Watch website will continue to track the issue at all levels over the upcoming months.

After months of meetings and drafting, the global warming legislation has been officially released. The bill, 174 pages in length, would dramatically change energy consumption and Wisconsin’s economy. 

Most notable are provisions adding a “low carbon fuel standard,” which is aimed at curtailing the use of Canadian crude derived from oil sands in Alberta, Canada. Wisconsin receives nearly 50 percent of its oil from Canada. If a low carbon fuel standard is adopted, Wisconsin’s oil supply would be drastically affected, leading to considerably higher gas prices.

The bill would also force Wisconsin to adopt California’s low emission vehicle standards. Under the federal Clean Air Act, California is the only state allowed to create its own set of greenhouse gas emission standards. States may adopt California’s standards, but once they do, they must follow any changes adopted by the California Air Resources Board. To meet California’s very strict standards, states must restrict the sale of trucks, minivans and SUVs. This could prove to be extremely problematic for Wisconsinites, who rely heavily on such vehicles for hunting, farming, and getting around during our harsh winters.

Hamilton Consulting  is analyzing the language released yesterday and will provide continuous updates as the bill moves forward. Updates can be found at the Hamilton Consulting Regulatory Watch.

The next few months are likely to be very active when it comes to climate change legislation. Wisconsin legislators are expected to unveil comprehensive climate change legislation in the next week that could prove to be controversial. Climate change legislation narrowly passed in Congress earlier this year, and is now being debated in the U.S. Senate. World leaders are meeting in Copenhagen over the next few weeks in an effort to reach agreement on ways for countries to limit their CO2 output.

Despite all of the action surrounding climate change at the international, federal, and state levels, there is still another entity seeking ways to impose regulations on manufacturers, businesses, and utilities here in the Midwest. Implemented in November 2007, the Midwestern Greenhouse Gas Reduction Accord is comprised of signatories from six states (Iowa, Illinois, Kansas, Michigan, Minnesota, and Wisconsin) and one Canadian province (Manitoba). The purpose of the Accord is to draft model legislation that would include a regional cap and trade program.

Although the Accord stopped meeting earlier this year, staff has continued drafting final recommendations implementing a cap and trade program. According to some officials linked with the Accord, the purpose of the Accord is a fallback if no federal legislation is enacted.

Some believe that Midwestern Accord officials would try to link Midwestern states with two similar regional programs on the East and West Coasts, known as the Regional Greenhouse Gas Initiative and Western Climate Initiative. The theory is that if Feds fail to act, the three regional entities could step in and impose a cap and trade scheme.

While most of the focus has been at the federal and state levels, the Accord is quietly working on both a cap and trade program and “complementary policies,” such as a low carbon fuel standard. A low carbon fuel standard would discourage Canadian crude oil derived from the oil sands in Alberta, Canada, where the Midwest receives a significant amount of its oil.

Thus, while most people are closely watching climate change legislation in Washington, D.C. and Madison, businesses would be wise to continue to monitor what is taking place with the Midwestern Accord.

The EPA today is expected today to declare carbon dioxide (CO2) a dangerous pollutant, and thus hand the agency sweeping regulatory authority under the Clean Air Act (CAA).

An endangerment finding under the CAA is the first step toward regulating CO2 and other greenhouse gases. The proposed endangerment finding will be issued under § 202 of the CAA, which pertains to mobile sources. However, similar “endangerment” language exists in other sections of the CAA, thus EPA’s expected announcement today is likely the first step towards the EPA regulating stationary sources as well.

The Wall Street Journal reports that the EPA’s decision is a source of major concern for businesses, in particular manufacturers, which argue that regulating greenhouse gases under the CAA will be extremely costly.

The Obama Administration’s endangerment finding coincides with the opening of the Climate Conference in Copenhagen, where it was once expected that world leaders would sign a successor to the Kyoto Protocol. However, it appears that there will be no major treaty, disappointing many environmentalists who see Copenhagen as the last chance to lock countries into an agreement to reduced GHGs.