Electric Co-op Today

Weighing in on a key issue for co-ops, a group of 14 Senate Democrats wants to change a provision in a climate change bill that they say will unfairly hurt electricity consumers, particularly in the Midwest.

Sen. Tom Harkin

Led by Sen. Tom Harkin, D-Iowa, chairman of the Health, Education, Labor and Pensions Committee, the group is asking Senate leaders to revamp a formula that allocates valuable emissions allowances as part of a cap-and-trade system.

Those allowances, designed to cushion the cost of climate change legislation, should be distributed to local distribution companies, such as co-ops, solely on the basis of historic emissions levels, the group wrote Nov. 12 to Senate leaders.

Bills that cleared the House in June and the Senate Environment and Public Works Committee Nov. 5 allocate the tradable allowances on a 50–50 split of emissions levels and retail sales. That formula was written by the Edison Electric Institute, which represents IOU interests.

But the group told Senate Majority Leader Harry Reid, D-Nev., and three committee chairmen that the 50–50 formula means utilities that rely on coal for generation will have to purchase additional allowances to meet emissions reductions, and will pass those higher costs to ratepayers.

That raises the prospect of major disparities in the way different regions of the country fare under the bill, they said.

Tags: Cap and Trade, Climate Change Legislation, Kirk Johnson