H.R. 2454: The American Clean Energy and Security Act of 2009 (ACES)
Current Status:
On June 26, 2009, the U.S. House of Representatives approved H.R. 2454, the American Clean Energy and Security Act, by a vote of 219 to 212. The U.S. Senate is expected to take up climate change legislation in September with the goal of voting on a bill by the full Senate by the end of this year.
Issue Summary:
The goal of H.R. 2545 is to deploy clean energy resources, increase energy efficiency, cut global warming pollution, and transition to a clean energy economy. Major provisions include the following:
Cap-and-trade program
- Economy-wide reduction in global warming pollution
- Requires carbon emissions reduction to:
- Establishes annual tonnage limit on greenhouse gas emissions beginning in 2012- 83% of 2005 levels by 2020
- 17% of 2005 levels by 2050
- Creates tradable emission allowances: 1 allowance = permission to emit 1 ton of greenhouse gas
- No restrictions on who can purchase, sell or hold allowances
- Creates offset credit program at USDA for domestic agricultural and forestry sources
- Creates a strategic reserve of allowances to auction if prices exceed 160% of 3-year average
Emissions Allowance Allocation
-Emission allowances allocated to protect consumers from price increases, assist industry in transition and spur energy efficiency and clean energy technology
- Roughly 80% of allowances distributed free in early years; by 2031 about 70% are auctioned
- Electricity sector receives 32% of the allowances through 2025
- Formula for allowance allocation is 50% based on emissions/50% based on electric generation
- Unallocated allowances will be auctioned
Combined Efficiency and Renewable Electricity Standard
- Applies to retail electric suppliers selling more than 4 million MWh
- Requires combined renewable electricity and electricity savings of 6% by 2012; 20% by 2020
- Up to ¼ of the 20% requirement can be met with efficiency savings
- Governor of any state may petition FERC to increase the proportion of compliance that can be met with efficiency savings to up to 2/5 for electric suppliers
- Renewables: wind, biomass, solar, geothermal, certain hydro, biomass and biofuels, landfill gas, wastewater treatment gas, coal mine methane, and qualified waste to energy
- Establishes new energy-saving standards for new buildings and appliances
Clean Energy Investments
- $90 billion in energy efficiency and renewable energy by 2025
- $60 billion in carbon capture and sequestration
- $20 billion in electric and other advanced technology vehicles
- $20 billion in basic scientific research and development
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