Friday, January 8, 2010
Cap And Trade Faces Major Hurdles
Sen. Jeff Bingaman, D-N.M., said there's no consensus on what form a cap-and-trade system would take, but strong desire exists in both the Senate and House to pass other energy-related bills that would curb pollution blamed for global warming.
Bingaman said the concern is that if Congress does not move forward on cap-and-trade legislation, emission reductions will be forced by federal regulators. "That will also drive up utility rates," he said. "The question is what will drive up utility rates the least, so that's what we're still trying to determine."
President Barack Obama will have to rely on support from Bingaman and others in the Senate to achieve one of his top domestic priorities, which is setting up a cap-and-trade system that would put a price on each ton of carbon dioxide and other greenhouse gases that are released.
Until Congress finds consensus on cap and trade, Bingaman is trying to tackle the problem through other legislative means, including an effort to encourage the production of renewable energy technologies in the U.S. by expanding a $2.3 billion manufacturing tax credit that was initially funded with stimulus money.
The American Clean Technology Manufacturing Leadership Act would provide an additional $2.5 billion in tax credits. Bingaman said that's enough to leverage $8.33 billion in new domestic investment to help meet America's growing demand for alternative energy. "There's no simple, one solution to the problem. There's a whole range of things we need to be doing more," Bingaman said.
The senator's comments came after a tour of Schott Solar's sprawling manufacturing plant on the southern edge of Albuquerque. Bingaman was among the officials who helped recruit Schott to New Mexico. The plant is the first in the U.S. to produce receiver tubes used in utility-scale concentrated solar power plants. Employees were preparing to ship out dozens of tubes off the assembly line during Bingaman's visit.
Schott also produces solar photovoltaic panels. At the beginning of the year, the plant ramped up production to seven days a week.
Despite a downturn in the photovoltaic market last year, Schott Solar CEO and president Gerald Fine said the company is "reasonably optimistic" about the potential over the next few years given that federal and state policies are encouraging a transition to renewable energy.
Fine said a significant market is developing in North America and that European markets are growing. "There's lots of uncertainty. There are going to be lots of challenges coming up, but we feel like we're in the forefront of an important economic change in this country," Fine said.