Dow urges quick action by US Senate on climate change

07 July 2009 18:45  [Source: ICIS news]

WASHINGTON (ICIS news)--Dow Chemical on Tuesday joined the Obama administration and environmentalists in calling for immediate action by Congress to impose a cap-and-trade emissions mandate.

Testifying on the first day of US Senate hearings on climate change, Rich Wells, Dow’s vice president for energy, said that his company accepts the conclusion of the UN’s Intergovernmental Panel on Climate Change (IPCC) that “it is very likely that human activities are causing global warming”.

“Left unchecked, the increase in greenhouse gas [GHG] emissions poses a significant hazard,” Wells said.

“A global climate change strategy calls for sharp, firm and direct action now to dramatically slow, stop and then reverse the growth of GHG levels in the atmosphere,” he said.

Dow has supported climate change policies since early 2007 as a member of the US Climate Action Partnership (US-CAP), which includes DuPont, General Electric, other manufacturers and various environmental groups.

However, Wells cautioned that climate change legislation being considered by Congress must be part of an international agreement involving commitments by all major-emitting countries to emissions reductions.

Wells also urged Congress to avoid penalising chemical firms and other industries that use natural gas as a feedstock to make products that capture carbon and do not emit greenhouse gases in use, such as insulation.

In his testimony before the Senate Environment and Public Works Committee, Wells also urged Congress to provide free allowances or emissions permits under a cap-and-trade plan to US industries that face foreign competitors unrestricted by emissions limits.

He also warned against climate legislation provisions that would accelerate fuel-switching among US electric utilities, many of whom already are shifting from coal-fired to gas-burning power generation.

US chemical makers and other manufacturers are heavily dependent on natural gas as a feedstock and energy fuel and fear that an emissions mandate would drive still more utilities to gas-fired generation and consequently drive up the cost of natural gas.

Also speaking in support of climate change legislation were Energy Secretary Steven Chu, Environmental Protection Agency (EPA) Administrator Lisa Jackson and Interior Department Secretary Ken Salazar.

But Mississippi Governor Haley Barbour testified against climate change legislation, warning that a cap-and-trade mandate - what he called a cap-and-trade tax - will undermine the nation’s economy.

“It is hard to believe that at a time when growing our economy is our number one priority, Congress is considering a bill that would reduce economic growth,” Barbour said.

Citing then-candidate and now President Barack Obama, Barbour said that under a federal emissions reduction requirement “electricity rates would necessarily skyrocket”.

The Environmental and Public Works Committee is the first Senate panel to begin consideration of a climate bill.  As many as three other Senate committees may hold parallel hearings as Senate and House Democratic leaders hope to have a final bill by the end of this month.

The US House narrowly approved a 1,200-page climate change bill on 26 June with a 219-212 vote.

Senator James Inhofe of Oklahoma, ranking Republican on the Environmental and Public Works Committee, said that the slim victory in the House - where 218 votes were needed for approval - suggests that climate change legislation faces an uphill battle in the Senate.

He noted that the Senate has previously rejected cap-and-trade emissions bills in 2003, 2005 and in 2008, adding:  “The public is already on record rejecting energy taxes”.

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By: Joe Kamalick
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