Full Text of HB3668 96th General Assembly
HB3668ham001 96TH GENERAL ASSEMBLY
|
Executive Committee
Filed: 3/19/2009
|
|
09600HB3668ham001 |
|
LRB096 11297 JDS 23179 a |
|
| 1 |
| AMENDMENT TO HOUSE BILL 3668
| 2 |
| AMENDMENT NO. ______. Amend House Bill 3668 by replacing | 3 |
| everything after the enacting clause with the following:
| 4 |
| "Section 1. Short title. This Act may be cited as the | 5 |
| Climate Action and Clean Energy Investment Act of 2009. | 6 |
| Section 5. Legislative findings. | 7 |
| (a) The General Assembly finds that: | 8 |
| (1) The Intergovernmental Panel on Climate Change has | 9 |
| concluded that it is "unequivocal" that the Earth's climate | 10 |
| is already warming and that most of the warming is due to | 11 |
| the burning of fossil fuels and other human activities. | 12 |
| (2) Warning signs of global warming are being | 13 |
| discovered and reported throughout the world. Melting | 14 |
| glaciers, severe storms, prolonged drought, reduced | 15 |
| mountain snow-pack, and dying coral reefs are among the | 16 |
| signs that global warming is underway. |
|
|
|
09600HB3668ham001 |
- 2 - |
LRB096 11297 JDS 23179 a |
|
| 1 |
| (3) Decisive action at the international, national, | 2 |
| state, and local levels to address the threat of global | 3 |
| warming is necessary to meet the challenge posed by global | 4 |
| warming. | 5 |
| (4) Illinois businesses and industry will benefit from | 6 |
| proactive policies that make the State competitive as the | 7 |
| world's economy shifts from high-carbon to low-carbon | 8 |
| energy technologies. | 9 |
| (5) By exercising a global leadership role, Illinois | 10 |
| will position its economy, technology centers, and | 11 |
| financial institutions to benefit from the new low-carbon | 12 |
| economy, with millions of "green jobs" expected to be | 13 |
| created from the next generation of industries that produce | 14 |
| and sell alternative fuels, export renewable energy, | 15 |
| design high-tech energy efficiency solutions, and sell | 16 |
| carbon emission reduction credits. | 17 |
| (6) Many of the clean energy policies that reduce | 18 |
| global warming pollution also provide economic and quality | 19 |
| of life benefits such as reduced energy bills, green space | 20 |
| preservation, air quality improvements, reduced traffic | 21 |
| congestion, improved transportation choices, and economic | 22 |
| development and job creation through the application of | 23 |
| energy conservation and new energy technologies. | 24 |
| (7) In the absence of a federal policy, states and | 25 |
| cities are establishing their own plans to reduce carbon | 26 |
| dioxide emissions. For example, 8 northeastern states |
|
|
|
09600HB3668ham001 |
- 3 - |
LRB096 11297 JDS 23179 a |
|
| 1 |
| began a regional cap and trade program this year to reduce | 2 |
| greenhouse gas emissions from their electric power | 3 |
| industry. Ten western states have adopted a regional cap | 4 |
| and trade plan to reduce GHG emissions from power plants, | 5 |
| transportation fuels, building energy use, and industrial | 6 |
| sources. Thirteen states have adopted automobile standards | 7 |
| to address global warming. | 8 |
| (8) The mayors of more than 376 U.S. cities, including | 9 |
| Richard M. Daley of Chicago, Ross Ferraro of Carol Stream, | 10 |
| Michael Belsky of Highland Park, Al Larson of Schaumburg, | 11 |
| and Richard Hyde of Waukegan have signed the U.S. Mayors | 12 |
| Climate Protection Agreement, pledging, among other | 13 |
| things, to meet the Kyoto Protocol goal of reducing | 14 |
| greenhouse emissions in those cities to 1990 levels by | 15 |
| 2012. | 16 |
| (9) A market-based cap and invest program holds great | 17 |
| promise to help Illinois reduce greenhouse gas emissions in | 18 |
| a cost-effective manner. The cap and invest program is best | 19 |
| pursued in cooperation with other states, particularly | 20 |
| Midwestern states. The interests of the public are best | 21 |
| served by a cap and invest program that is as broad, | 22 |
| simple, predictable, equitable, and transparent as | 23 |
| possible. | 24 |
| (10) The right to emit greenhouse gases should be | 25 |
| auctioned rather than given away. An auction of emissions | 26 |
| allowances would generate hundreds of millions of dollars |
|
|
|
09600HB3668ham001 |
- 4 - |
LRB096 11297 JDS 23179 a |
|
| 1 |
| annually, and the proceeds of each auction should be used | 2 |
| to create green jobs, develop clean energy sources, and | 3 |
| help consumers manage and reduce their energy costs. | 4 |
| (11) The Illinois Environmental Protection Agency | 5 |
| shall propose and the Illinois Pollution Control Board | 6 |
| shall adopt a market-based cap and invest program that | 7 |
| achieves the greenhouse gas reduction targets specified in | 8 |
| this Act. The program shall be developed and implemented in | 9 |
| consultation with State agencies and stakeholders, | 10 |
| including the environmental justice community, industry | 11 |
| sectors, business groups, academic institutions, | 12 |
| environmental organizations, and others, in a manner that | 13 |
| minimizes costs and maximizes benefits for the economy in | 14 |
| Illinois, improves and modernizes energy infrastructure in | 15 |
| Illinois, maintains electric system reliability, maximizes | 16 |
| additional environmental and economic co-benefits for | 17 |
| Illinois, and complements the State's efforts to improve | 18 |
| air quality.
| 19 |
| Section 10. Definitions. | 20 |
| "Agency" means the Illinois Environmental Protection | 21 |
| Agency. | 22 |
| "Allowance" means an authorization from the Agency to emit, | 23 |
| during a specified year, up to one ton of carbon dioxide or an | 24 |
| equivalent amount of other greenhouse gases, as determined by | 25 |
| the Agency. |
|
|
|
09600HB3668ham001 |
- 5 - |
LRB096 11297 JDS 23179 a |
|
| 1 |
| "Board" means the Illinois Pollution Control Board. | 2 |
| "Cost-effective" or "cost-effectiveness" means the cost | 3 |
| per unit of reduced emissions of carbon dioxide or an | 4 |
| equivalent amount of other greenhouse gases, as determined by | 5 |
| the Agency. | 6 |
| "Direct emissions" means greenhouse gas emissions made by a | 7 |
| greenhouse gas emission source at that source. | 8 |
| "Emissions offset" means an action that (i) is undertaken | 9 |
| by a greenhouse gas emission source not subject to the | 10 |
| emissions cap, (ii) achieves the equivalent reduction of | 11 |
| greenhouse gas emissions over the same time period as a direct | 12 |
| emission reduction, and (iii) is approved by the Agency. | 13 |
| "First deliverer of electricity" means: (i) for | 14 |
| electricity generated within Illinois or other participating | 15 |
| states, the generator of that electricity; (ii) for electricity | 16 |
| generated outside Illinois, the entity that first delivers the | 17 |
| electricity to Illinois customers for consumption in Illinois. | 18 |
| "Greenhouse gas" (GHG) or "greenhouse gases" includes all | 19 |
| of the following gases: carbon dioxide, methane, nitrous oxide, | 20 |
| hydrofluorocarbons, perfluorocarbons, and sulfur hexafluoride. | 21 |
| "Greenhouse gas emission source" or "source" means any | 22 |
| source or category of sources that emits greenhouse gases at a | 23 |
| level that, in the opinion of the Agency, necessitates | 24 |
| participation by the source or category of sources in the cap | 25 |
| and invest program in order for the State to effectively reduce | 26 |
| greenhouse gas emissions and monitor compliance with the |
|
|
|
09600HB3668ham001 |
- 6 - |
LRB096 11297 JDS 23179 a |
|
| 1 |
| Statewide greenhouse gas emissions limit. | 2 |
| "Leakage" means a reduction in emissions of greenhouse | 3 |
| gases within Illinois or other participating states that is | 4 |
| offset by an increase in emissions of greenhouse gases in | 5 |
| non-participating states. | 6 |
| "Market-based cap and invest program" means a program | 7 |
| established under this Act and corresponding regulations that | 8 |
| creates a "cap" on the sum of all GHG emissions from all | 9 |
| covered sources; reduces the cap over time; creates tradable | 10 |
| emissions "allowances" equivalent to a specified amount of GHG | 11 |
| emissions, with the total amount of allowances equal to the | 12 |
| emissions cap; requires covered sources to submit allowances | 13 |
| equivalent to the level of emissions for which they are | 14 |
| responsible at the end of each of compliance period; authorizes | 15 |
| covered sources to choose the best mix of reducing emissions or | 16 |
| buying allowances for their situation; provides for the | 17 |
| auctioning of emissions allowances by the Agency and the | 18 |
| investment of those proceeds in technologies and projects to | 19 |
| help Illinois meet the Act's GHG reduction goals; mitigates | 20 |
| potential transition costs; and promotes adaptation to climate | 21 |
| change impacts. | 22 |
| Participating state" means a state of the United States | 23 |
| that has adopted a similar market-based program to reduce GHG | 24 |
| emissions and that has signed a Memorandum of Understanding | 25 |
| with the Agency to allow interstate trading of allowances and | 26 |
| emissions offsets.
|
|
|
|
09600HB3668ham001 |
- 7 - |
LRB096 11297 JDS 23179 a |
|
| 1 |
| Section 15. Market-Based Cap and Invest Program. | 2 |
| (a)
Pursuant to the Illinois Administrative Procedure Act, | 3 |
| the Agency shall propose and the Board shall adopt by October | 4 |
| 1, 2010, rules necessary to establish and implement a | 5 |
| market-based cap and invest program effective January 1, 2012, | 6 |
| to limit the emissions of greenhouse gases, subject to the | 7 |
| provisions of this Act. The rules shall be designed to | 8 |
| facilitate the State's participation in the emerging | 9 |
| midwestern greenhouse gas cap and trade system. The rules shall | 10 |
| require aggregate greenhouse gas emission reductions from | 11 |
| covered sources of at least 25 percent below 2005 levels by | 12 |
| 2020, 45 percent below 2005 levels by 2030, and 80 percent | 13 |
| below 2005 levels by 2050. | 14 |
| (b) In developing and adopting these rules, the Agency and | 15 |
| Board shall do all of the following: | 16 |
| (1) design the rules in a manner that is equitable, | 17 |
| seeks to minimize costs and maximize the total benefits to | 18 |
| Illinois, and encourages early action to reduce greenhouse | 19 |
| gas emissions; | 20 |
| (2) ensure that activities undertaken to comply with | 21 |
| the rules do not disproportionately impact low-income | 22 |
| communities; | 23 |
| (3)
ensure that entities that have voluntarily reduced | 24 |
| their greenhouse gas emissions prior to the implementation | 25 |
| of this Section receive appropriate credit for early |
|
|
|
09600HB3668ham001 |
- 8 - |
LRB096 11297 JDS 23179 a |
|
| 1 |
| voluntary reductions; | 2 |
| (4) ensure that activities undertaken under the rules | 3 |
| complement and do not interfere with efforts to achieve and | 4 |
| maintain federal and State ambient air quality standards | 5 |
| and to reduce toxic air contaminant emissions; | 6 |
| (5) consider the cost-effectiveness of the rules; | 7 |
| (6) consider overall societal benefits, including | 8 |
| reductions in other air pollutants, diversification of | 9 |
| energy sources, and the provision of other benefits to the | 10 |
| economy, environment, and public health. | 11 |
| (7) minimize the administrative burden of implementing | 12 |
| and complying with these rules; | 13 |
| (8) minimize leakage. | 14 |
| (9) consider the significance of the contribution of | 15 |
| each source or category of sources to statewide emissions | 16 |
| of greenhouse gases; | 17 |
| (10) ensure that greenhouse gas emission reductions | 18 |
| achieved are real, permanent, quantifiable, verifiable, | 19 |
| and enforceable by the Agency; and | 20 |
| (11) ensure that greenhouse gas emission reductions | 21 |
| are in addition to any greenhouse gas emission reductions | 22 |
| otherwise required by law or regulation, and any other | 23 |
| greenhouse gas emission reductions that otherwise would | 24 |
| occur in Illinois or a participating state. | 25 |
| The Agency shall consult with the Illinois Commerce | 26 |
| Commission and the Illinois Power Agency in the development of |
|
|
|
09600HB3668ham001 |
- 9 - |
LRB096 11297 JDS 23179 a |
|
| 1 |
| the rules as they affect electricity and natural gas providers | 2 |
| in order to minimize duplicative or inconsistent regulatory | 3 |
| requirements. | 4 |
| After January 1, 2012, the Agency may revise rules adopted | 5 |
| under this Section and adopt additional rules to further the | 6 |
| provisions of this Act. | 7 |
| (c) All allowances issued by the State shall be auctioned, | 8 |
| and the proceeds of each auction must be used to benefit the | 9 |
| public under Sections 20 and 25. Auctions shall be implemented | 10 |
| quarterly by the Agency. Two pre-compliance auctions shall be | 11 |
| held between January 1, 2011, and December 31, 2011, to | 12 |
| facilitate market price discovery and compliance planning by | 13 |
| capped sources. | 14 |
| Each source shall own and provide to the Director at the | 15 |
| close of the applicable compliance period allowances equal to | 16 |
| its direct emissions during that period; such allowances may be | 17 |
| issued by other participating states with which the Agency has | 18 |
| established a trading relationship. A source may acquire | 19 |
| emissions offsets from other sources in lieu of reductions at | 20 |
| its facilities. However, offsets should be limited to 1% of | 21 |
| total emissions or 10% of required emissions reductions for | 22 |
| that compliance period, whichever is less. Emissions offsets | 23 |
| should be generated by projects implemented within the | 24 |
| participating states to capture the economic benefits of these | 25 |
| projects and to protect public health by reducing conventional | 26 |
| smog-forming and toxic air pollutants. |
|
|
|
09600HB3668ham001 |
- 10 - |
LRB096 11297 JDS 23179 a |
|
| 1 |
| Rules adopted under this Section shall, at a minimum, cap | 2 |
| emissions from the following sources: sources that are the | 3 |
| first deliverer of electricity in the State, including | 4 |
| electricity generated outside the State; large industrial | 5 |
| stationary sources; large manufacturers and distributors of | 6 |
| transportation fuels, including, but not limited to, oil | 7 |
| refineries, oil storage facilities, and wholesale and retail | 8 |
| distributors; manufacturers and distributors of natural gas | 9 |
| and oil used to heat and power buildings, including, but not | 10 |
| limited to, oil refineries, oil storage facilities, and | 11 |
| wholesale and retail distributors of natural gas; and any other | 12 |
| sources or categories of sources that the Agency determines may | 13 |
| be included under the cap without undue administrative | 14 |
| difficulty and from which emissions can be reliably quantified | 15 |
| and monitoredy.
| 16 |
| Section 20. Global Warming Action Fund. The Global Warming | 17 |
| Action Fund is established as a special fund in the State | 18 |
| treasury to receive revenues from the auction of allowances | 19 |
| under subsection (b) of Section 15. Revenues generated by the | 20 |
| auctioning of allowances shall be used to support programs and | 21 |
| projects that contribute to the emission reduction goals of | 22 |
| this Act, including, but not limited to, those that (i) | 23 |
| increase utilization of renewable energy, energy efficiency, | 24 |
| low-emitting modes of transportation, geologic carbon | 25 |
| sequestration, and terrestrial sequestration (such as programs |
|
|
|
09600HB3668ham001 |
- 11 - |
LRB096 11297 JDS 23179 a |
|
| 1 |
| that enhance the stewardship and restoration of the State's | 2 |
| forests and wetlands) (ii) address transition costs, including | 3 |
| job training or transition programs that help industries adapt | 4 |
| to clean technology and production, and (iii) provide | 5 |
| assistance to utility consumers.
| 6 |
| Section 25. Analysis of Investment and Expenditure | 7 |
| Options.
| 8 |
| (a) The Agency and the Department of Commerce and Economic | 9 |
| Opportunity shall conduct the analysis described in this | 10 |
| Section and present their findings and recommendations to the | 11 |
| General Assembly by January 1, 2010. The Agency and the | 12 |
| Department of Commerce and Economic Opportunity shall consult | 13 |
| with the Illinois Finance Authority, the Illinois Department of | 14 |
| Labor, the Illinois Commerce Commission, the Illinois Power | 15 |
| Agency, the Illinois Department of Natural Resources, the | 16 |
| Illinois Department of Agriculture, and other interested | 17 |
| stakeholders, including, but not limited to, the environmental | 18 |
| justice community, industry sectors, business groups, academic | 19 |
| institutions, and environmental organizations. The analysis | 20 |
| shall consider how the State can best use the revenues in the | 21 |
| Global Warming Action Fund to serve the State's overriding | 22 |
| interest in making the transition to an economy with low | 23 |
| greenhouse gas emissions in a way that maximizes public | 24 |
| benefits and minimizes public costs. | 25 |
| (b) The analysis shall make recommendations regarding the |
|
|
|
09600HB3668ham001 |
- 12 - |
LRB096 11297 JDS 23179 a |
|
| 1 |
| specific apportionment of allowance revenues among various | 2 |
| options that benefit the public, including, but not limited to, | 3 |
| those programs and projects discussed in Section 20. | 4 |
| (c) The analysis shall model and estimate the impact of | 5 |
| revenue apportionment on the State economy, its residents, and | 6 |
| its natural resources of the various options considered and | 7 |
| shall recommend the optimal mix of revenue uses. In determining | 8 |
| the optimal mix of revenue uses, the analysis shall recognize | 9 |
| the long-term nature of the transition and prioritize those | 10 |
| investments with a long-term yield. In identifying the optimal | 11 |
| uses of revenues, the analysis shall select uses that: | 12 |
| (1) produce the most cost-effective emission | 13 |
| reductions on a societal basis; | 14 |
| (2) maximize greenhouse gas emission reductions in | 15 |
| capped and non-capped sectors; | 16 |
| (3) minimize disruptive economic impacts on workers, | 17 |
| businesses, and low-income and other consumers; | 18 |
| (4) equitably distribute the costs and benefits of the | 19 |
| transition among State residents, communities and economic | 20 |
| sectors, with specific recommendations and strategies to | 21 |
| assist low-income residents in reducing their greenhouse | 22 |
| gas emissions; | 23 |
| (5) maximize sustainable economic development and job | 24 |
| growth; | 25 |
| (6) protect and enhance the public health, water | 26 |
| quality, air quality, habitat, and other natural |
|
|
|
09600HB3668ham001 |
- 13 - |
LRB096 11297 JDS 23179 a |
|
| 1 |
| resources; and | 2 |
| (7) avoid creating among revenue recipients a sense of | 3 |
| entitlement to a long-term stream of revenues which would | 4 |
| in turn create incentives to oppose emission reductions | 5 |
| that would reduce the size of the Fund. | 6 |
| When possible the analysis shall quantify the impact of | 7 |
| each revenue use on emissions, emission reduction costs, jobs, | 8 |
| and other benchmarks related to the goals stated in this | 9 |
| subsection.
| 10 |
| Section 30. Transition to a federal program.
If the | 11 |
| federal government adopts a program that the Agency determines | 12 |
| to be comparable to the market-based cap and invest program | 13 |
| authorized in Section 15, the Agency shall immediately begin to | 14 |
| transition into the federal program in order to create one | 15 |
| national system of tradable greenhouse gas emissions.
| 16 |
| Section 35. Enforcement.
The Agency shall monitor | 17 |
| compliance with and enforce any rule adopted by the Board under | 18 |
| this Act.
| 19 |
| Section 80. The State Finance Act is amended by adding | 20 |
| Section 5.719 as follows: | 21 |
| (30 ILCS 105/5.719 new) | 22 |
| Sec. 5.719. The Global Warming Action Fund.
|
|
|
|
09600HB3668ham001 |
- 14 - |
LRB096 11297 JDS 23179 a |
|
| 1 |
| (415 ILCS 140/Act rep.)
| 2 |
| Section 90. The Kyoto Protocol Act of 1998 is amended by | 3 |
| the repealing Act. | 4 |
| Section 99. Effective date. This Act takes effect upon | 5 |
| becoming law.".
|
|