Sen. Bingaman introduces Clean Energy Standard Act of 2012
The proposal appears to be designed as a cap-and-trade scheme where credits would be allotted to generators based on their emissions
Washington, D.C., March 1, 2012 — Sen. Jeff Bingaman (D-N.M.) introduced the Clean Energy Standard Act of 2012, or CES. Bingaman, who is chairman of the Senate Committee on Energy and Natural Resources, said the legislation would modernize the nation's power sector and guide it toward a future in which more and more electricity is generated with cleaner and cleaner energy.
The proposal appears to be designed as a cap-and-trade scheme where credits would be allotted to generators based on their emissions. The framework would allow for a variety of generation technologies (solar, wind, nuclear, natural gas, coal with carbon capture and storage, etc.) and generators who produced fewer emissions per unit of electricity would be granted more credits.
This policy would allow market forces to determine what the optimal mix of technologies and fuels should be, and makes it easy for new technologies to be incorporated, Bingaman said.
"The CES employs a straightforward, market-based approach that encourages a wide variety of electricity-generating technologies, according to a release from Bingaman's office. It sets a national goal for clean energy and establishes a transparent framework that lets resources compete based on how clean they are, then gets out of the way and lets the market and American ingenuity determine the best paths forward," according to a release from Bingaman's office.
Bingaman's design for the CES draws on Energy Information Administration (EIA) modeling done at his request last year, and EIA's results showed that a properly designed CES would have almost zero impact on GDP growth, and little to no impact on national electricity rates for the first decade of the program.
To be considered "clean," a generator must either be a zero-carbon source of energy, like renewables and nuclear power, or have lower carbon intensity than a modern, efficient coal plant. (Carbon intensity means the amount of carbon dioxide emitted per megawatt-hour of electricity generated.) Accounting for "clean" this way means that the cleanest resources have the greatest incentive, and also that every generator has a continuing incentive to become even more efficient.
In addition to driving cleaner electricity generation in the power sector, the CES also rewards industrial efficiency. Combined heat and power units generate electricity while also capturing and using the heat for other purposes. These units are treated as clean generators under the CES. This will help deploy this kind of efficiency and provide another source of inexpensive clean energy. All that the CES requires is that the generation we do use (and add to our fleet) gradually becomes cleaner over time.
The CES does not put a limit on overall emissions. It does not limit the growth of electricity generation to meet the demands of a growing economy. All that the CES requires is that the generation we do use and add to our fleet gradually becomes cleaner over time.
Also, the CES does not cost the government anything, and it doesn't raise money for the government, either. If any money does happen to come into the Treasury as a result of the program, it goes straight back to the particular state from which it came, to fund energy efficiency programs.
"The goal of the CES is ambitious – a doubling of clean energy by 2035. But analysis has shown that the goal is also achievable and affordable. Meeting the CES will yield substantial benefits to our health, our economy, our global competitiveness and our economy," Bingaman said.
Several of Bingaman's colleagues are co-sponsoring the bill, including Sens. Wyden (D-OR), Sanders (I-VT), Mark Udall (D-CO), Franken (D-MN), Coons (D-DE), Kerry (D-MA), Whitehouse (D-RI) and Tom Udall (D-NM).