NCPA - National Center for Policy Analysis


October 2, 2009

On June 26, 2009, the U.S. House of Representatives passed HR 2454, the 1,480 page American Clean Energy and Security Act (ACES), by the slim margin of seven votes.  The U.S. Senate plans to consider this bill as early as October.  As the nation's leading energy producer, Texas would be more severely impacted by this bill's aggressive carbon caps and new federal energy mandates than any other state, says Kathleen Hartnett White, a researcher with the Texas Public Policy Foundation.

Policymakers in Texas and across the country need to review the full scope of this bill, says White.  The length and complexity of ACES, however, almost preclude a grasp of its full contents and the radical change it augurs.  This paper attempts to provide meaningful access to ACES in its entirety.  What follows is an overview of the full bill, focusing on the central and more provocative provisions in all five Titles.  The cap and trade program, under Title III, will be considered first.

Initially known as the Waxman-Markey bill after authors Henry Waxman (D-Calif.) and Edward Markey (D-Mass.), it is typically labeled as the "cap and trade" bill.  ACES, however, is so much more, explains White:

  • The cap and trade provisions comprise only 400 of the bill's almost 1,500 pages.
  • ACES, viewed in its entirety, contains a dizzying array of federal dictates and programs to transform and control U.S. energy production and use.
  • The bill imposes more than 1,000 new federal dictates through 21 federal agencies.
  • The senior attorney for the Sierra Club recently commented that ACES "is the most complex piece of legislation in the history of our country, which may make it the most complex piece of legislation in human history … it imposes on EPA alone approximately 600 [new] mandates."

The colossal price tag of this massive bill is also rarely noted, says White:

  • The Congressional Budget Office's (CBO) estimated federal cost in direct spending at $822 billion, another nearly trillion dollar burden on American taxpayers.
  • CBO's revenue estimate for ACES, however, is $846 billion.
  • The bill is deficit neutral; the revenues to the federal treasury are from the indirect carbon tax imposed on energy users -- all economic sectors and consumers.

In short, ACES sanctions 85 percent of the U.S. energy supply from fossil fuels and pours money and mandates at renewable energy and energy efficiency.  Nuclear energy is barely mentioned.  In so doing, the legislation wagers U.S. economic vigor on as yet untested, unproven, more expensive energy sources with inherent limitations, says White.

Source: Kathleen Hartnett White, "A Federal Leviathan: The American Clean Energy and Security Act of 2009; Carbon Caps and Sweeping Federal Mandates for Energy," Texas Public Policy Foundation, September 2009.

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