In June, the U.S. House of Representatives narrowly approved a Democrat-sponsored version of an energy bill that includes a cap-and-trade system. In part, the legislation seeks to reduce greenhouse gas emissions by limiting the amount of carbon pollution private companies, such as those that operate coal fired power plants, can emit into the atmosphere. If companies produce more than the capped amount, they can purchase carbon credits to offset those added amounts.
This provision of the bill is where many critics take exception, calling it “cap and tax” legislation that would cost jobs and increase utility rates to consumers across the country.
The treasury department study cited by Conway during an interview on Wednesday concluded that a cap-and-trade system would come with a total of between $100 and $200 billion per year in new taxes, or nearly $1,800 per household, the equivalent of a personal income tax increase of about 15 percent.
“That is unacceptable to me,” Conway said, adding that he would be a “no vote on the cap-and-trade bill in the Senate.”
Conway, a Democrat, said he thinks there is room in today’s market for a variety of energy sources, including coal, wind, and solar, and he would like to see a bill that helps to harness those resources, but also keeps Kentucky coal as a viable part of the country’s energy portfolio.
“I’m not going to make any vote in the U.S. Senate that would harm Kentucky coal or that would do away with coal,” he said.
Conway noted that Kentucky harnesses about 91 percent of its energy from coal which allows for low rates to consumers, in turn helping officials lure new business to the state. He said he thinks “a new energy bill, if done right” can be a boon to Kentucky.
But the larger issue, he continued, is that coal continues to play a large role in the energy generation for the country, in all providing about 50 percent of the nation’s energy needs.
“For the foreseeable future, coal has to be an important part of baseload generation,” he said.
Meanwhile, the Senate version of the cap-and-trade bill, called the Clean Energy Jobs and American Power Act, was unveiled last week by Senators John Kerry, D-Mass, and Barbara Boxer, D-California. This Senate version drops any references to the term “cap-and-trade,” opting rather to call their initiative the “Pollution Reduction and Investment” program, which basically works in the same manner as the House bill. Companies can still produce carbon pollution, but if they want to produce over a set amount, they have to pay for it.
The Senate version also seeks to cut greenhouse gas levels by 20 percent by 2020 and provides $10 billion to support research and development of clean coal technology.