Cap and Trade Changing Everything | NMCEP and Related News

Cap and Trade Changing Everything | NMCEP and Related News: "From the Lovington Leader by John Graham--Cap and trade legislation may be one of the biggest issues facing the oil and gas industry according to Dr. Daniel Fine, Associate of Policy, Strategy and Development at New Mexico Tech. He also serves on the New Mexico Center for Energy Policy which is hosting the presentation by former Shell Oil executive, John Hofmeister tonight.

“What is the purpose to cap and trade?” asks Fine. “Is the purpose to raise revenue? Is the purpose to lower CO2? Or both?” The bill (Waxman-Markey) coming out of the U.S. House of Representatives claims both purposes without a clear policy declaration.

The bill is now in the hands of the U.S. Senate.

Fine says determining the price or cost for one metric ton of carbon dioxide is the biggest omission in the bill that needs to be addressed before moving forward.

“What is the trigger price which would affect an investment from the utilities and others to move towards low carbon technology? How much should CO2 cost before it triggers a corporate strategic decision to invest in technology which would lower the greenhouse gas emissions?” asks Fine.

Without the price per ton of CO2, nothing can be implemented.

The house version has been worked over in the Senate with many changes. Fine says in the House bill, only 2% of the allowances (or credits) have been awarded to the oil and gas industry as opposed to 37% to the utility industry. “The Senate is currently looking at that in terms of equity,” said Fine.

Also there is no reference in that bill in support of nuclear energy.

“Nuclear energy, in terns of cap and trade, is a central part of the issue because it is emissions free,” added Fine."