Power companies could get CO2 credits worth billions
NEW YORK, NEW YORK - U.S. power companies could get free carbon credits worth billions of dollars under global warming legislation being considered by the U.S. Congress, according to recently released report.
"Billions of dollars in allowances are at stake under the proposals to cap and reduce global warming pollution," Dan Lashof, the science director of the Natural Resources Defense Council, which released the report, said in a statement.
Congress is mulling several bills that aim to regulate emissions of gases that scientists blame for global warming.
Power utilities that burn large amounts of carbon dioxide-emitting coal and natural gas have lobbied Congress to ensure that they would receive allocations of carbon credits under such regulation to help them deal with the compliance costs.
The report, on the other hand, supported auctioning such credits to prevent their overallocation to power generators.
It said an overly generous allocation of credits to power companies in the early days of the European Union's carbon market, the Emissions Trading Scheme, knocked down carbon prices, led to excessive company profits and created few incentives for funding energy efficiency programs that would have cut emissions.
The report, also released by Ceres, a Boston-based coalition of environmentalists and investors, assumed carbon allowance prices to be around $10 a ton.
It estimated that under the Climate Security Act sponsored by Sens. Joe Lieberman, a Connecticut Democrat turned independent, and John Warner, a Virginia Republican, the 100 largest electric power generators would receive nearly $10.4 billion in annual free carbon credits by 2012.
Under the Carbon Economy Act, sponsored by Sens. Jeff Bingaman, a New Mexico Democrat, and Arlen Specter, a Pennsylvania Republican, the 100 largest power producers would receive nearly $18.3 billion annually, with $6.2 billion going to the country's 10 largest investor-owned utilities.
Related News
Coal demand dropped in Europe over winter despite energy crisis
PARIS - The EU burned less coal this winter during the energy crisis than in previous years, according to an analysis, quashing fears that consumption of the most polluting fossil fuel would soar as countries scrambled to find substitutes for lost supplies of Russian gas.
The study from energy think-tank Ember shows that between October 2022 and March 2023 coal generation fell 27 terawatt hours, or almost 11 per cent year on year, while gas generation fell 38 terawatt hours, as consumers cut electricity consumption in response to soaring prices.
Renewable energy supplies also rose, with combined wind, solar and hydroelectric output…
