Climate change bill includes incentives for natural gas vehicles

WASHINGTON — A Senate climate bill that includes new costs for some carbon emissions and incentives for natural gas vehicles was unveiled Wednesday, though its prospects for passage are uncertain.

Sens. John Kerry, D-Mass., and Joe Lieberman, an independent from Connecticut, released their long-awaited legislation, saying it would reduce greenhouse gases without hurting consumers or businesses.

Kerry said the bill would "change our nation’s energy policy from a national weakness into a national strength.”

The bill would effectively charge utilities and other sectors for carbon emissions, with pollution allowances that could be traded in a limited price range. To make up for higher utility bills, low-income consumers would be given rebates and others would get tax credits. In the transportation sector, a new tax would be levied on fuel after it was refined.

Coastal states that allow offshore drilling would get to keep some of the revenue; they could also reject drilling within 75 miles of their coasts.

Incentives are included to encourage more nuclear power and clean-coal technology, along with alternative vehicles.

The bill also includes tax incentives to convert heavy trucks to natural gas and to manufacture trucks that would run on the fuel.

Texas energy investor T. Boone Pickens, who has been pushing legislation to encourage natural gas use for heavy vehicles, said Wednesday that he was looking forward to working with the senators on that aspect of their bill.

"Achieving energy security is not easy, and I applaud their focus on a broad energy package that includes replacing foreign oil-diesel-gasoline with cleaner, abundant domestic natural gas in America’s heavy-duty vehicle fleets,” Pickens said.

Sen. Jim Inhofe, R-Tulsa, who is Congress’ leading skeptic that human activities are causing global warming, said the bill is no different than climate change bills he has worked against in the past.

Though the cap-and-trade mechanism is less extensive and less elaborate than the one in the House bill passed last year, Inhofe said it is "the same old cap-and-trade scheme that the Senate has defeated three times since 2003 … Only now, along with paying skyrocketing electricity prices, consumers will pay a gas tax.”

Inhofe said the bill was opposed by Republicans and Democrats and has "virtually no chance of passing the Senate.”

President Barack Obama got behind the bill, saying it would "put America on the path to a clean energy economy.”

Republican Sen. Lindsey Graham, of South Carolina, had been working with Kerry and Lieberman on the bill, but pulled out of the effort two weeks ago because he said Democratic leaders were more intent on passing immigration reform.

Kerry acknowledged that getting 60 votes in the 100-member Senate would be tough.

But, "despite Washington conventional wisdom, we are closer than ever to a breakthrough,” he said, noting that 54 senators supported a climate change bill in the last Congress.