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Ms. TIERNEY. Assuming that you included no change in the prices of power sold to today's customers, from today's capacity.

Mr. HASTERT. You say you go out and competitive bid. And when you

Ms. TIERNEY. For the increment, for the additional power output that you could have associated with the new investment to get more efficient equipment here. You are going to increase the output potential of these projects.

Mr. HASTERT. And if you put out for competitive bidding, you could wield it and you deal with an OPP you probably put it out for a higher price?

Ms. TIERNEY. Sure.

Mr. HASTERT. So you don't prohibit from putting out to get a higher price?

Ms. TIERNEY. We think this could be sold for competitive rates, not just the local service territory, but beyond that.

Mr. HASTERT. The second question, coming back to action point 39, and not to beat something to death, but I do have an area, an agricultural area, beef production and dairy production in my area. You know, the bovine animal does—is a ruminant. Ruminants do create flatulence and that is partly the methane problem. But one of the other things in the red meat industry is that they have been working to reduce fat products. I mean so the market has dictated.

The interesting thing is on the milk production, the dairy production side, you know, your administration subsidizes people on butter fat production. And you might look at what the incentive is, what the carrot is out there, instead of trying to change the diet of those animals.

Ms. TIERNEY. We will follow up on that suggestion.
Mr. HASTERT. Thank you. I yield back.

Mr. SHARP. I appreciate the gentleman. This administration probably hasn't had time to change what the Congress probably through intense lobbying has made the

Mr. HASTERT. It should be an interesting dynamic.

Mr. SHARP. But I guess the gentleman is making a good argument, the market will take care of this and change the dietary habits. Let me ask, well, we will be interested, when will your legislation be up here? Have you decided? I realize that was

Ms. TIERNEY. I think within a 3-month period of time. I may be overstating it or understating it slightly, but that would be my best guess.

Mr. SHARP. All right. We will, when we receive your initiative on the hydro, we will be glad to proceed and whatnot. And I trust, too, there is the age old issue of the preferred purchaser, I can't think what the right

Ms. TIERNEY. Preference power.

Mr. SHARP. Preference power, do I understand that the increment is exempt from, the Federal preference power requirement that certain customers automatically get the power? Have you decided that yet?

Ms. TIERNEY. That would be the question before you in the legislation.

Mr. SHARP. I see, you are going to give that one to us. OK. Well, I don't know that the private public power dispute is as intense as it was historically in this country. We will find out.

Well, did the gentleman from Virginia have any further questions?

Mr. SHARP. Yes, Mr. Hausker.

Mr. HAUSKER. Could I just make one comment I regret not making in my opening remarks. When you talk about entrepreneurship and your follow-up comments reminded me about this, I don't think the entrepreneurship at DOE has been widely recognized. DOE in the first 9 months since launching the climate challenge, has brought the electric utility industry from where they were last year, to the point of signing up 60 percent of the generating capacity in this country to recognize a problem, to have some of those utilities commit to stabilization, to have others commit to significant reductions. This is just a tremendous accomplishment that I don't think has been given the attention that it deserves. But that is an incredible change.

Ms. TIERNEY. You can tell this is a new administration when EPA and DOE are saying nice things about each other.

Mr. SHARP. The test will be how long this lasts. I appreciate that. And indeed we will be happy to help reinforce the availability of information and the knowledge about the progress that we are getting from the private sector commitments, because the people making those commitments, we want to do everything we can to at least give them credit for that, since they, like people in the government, take enormous criticisms for failure to act on various ways, and we want to do everything we can to make this publicprivate partnership work. And I think it is in their intense political interest to do so, because many of those who are stepping up to do this clearly do not wish to have us further regulate them and, to be frank about it, one of the key issues is going to be whether we can expect the marketplace and voluntary commitments to produce results or whether we will have to in the end come in with more draconian steps, or whether we have to do both, and as we define what the control mechanism is it can leave room and recognition for that.

Indeed, Mr. Boucher, I guess it was Mr. Synar, Mr. Cooper, Mr. Boucher was somewhat concerned about it, but we clearly in the legislation that is now the law try to identify who is, so they can voluntarily step forward and document what they have done in order to reduce emissions so that if we design a regulatory program in the future, we are in a position to try to recognize those investments and to have a baseline. And so we want to reinforce that it behooves the private sector to step forward now.

None of us know what the future will bring, but we did anticipate that we wanted to think in terms of recognizing and rewarding and then providing the incentives for those that are willing to take voluntary action.

Ms. TIERNEY. Could I tell you one other thing that you anticipated using this chart? If you look at the 2000 no-action column, and you look at the 2000 plan column, there is a difference there of about 212 million metric tons. We estimate that the Energy Policy Act authority for changing standards, as well as the programs we have put in place that use Energy Policy Act authority, are 86 million metric tons of that 212. So there is a huge contribution that you anticipated that was—that is reflected in the building blocks of this plan.

Mr. SHARP. We tried to tell people we were in fact trying to do something about it last year, even though we didn't think it was grandiose. We thought it was at least useful, helpful, and in the right direction. And I think it is when we take aggressive effort on all your parts to see to it that within the government we carry out the possibilities.

And we will welcome your suggestions if we are hamstringing through various requirements that we put into the law, that capacity to do that, let us know and we will have opportunities to make corrections.

Mr. HASTERT. Mr. Chairman, just one thing, I want to build off something you said and something Mr. Hausker said. The private sector has a potential, huge potential contribution, if we set them loose and go at it. I think you have done a very good job domestically. I would think that we wouldn't want to just hamstring people, is the word here, just domestically but internationally, you know.

There was an Illinois plant at one time that said that we have industry in that State that could go to China, go to the Soviet Union and cut down the methane rate and the CO2 and carbon emissions, and if we allow them to do thatand tremendous technologies that could start to help, you know, world problems, not just something that is within the confines of this country. So I think you need to further look at that and the ability to give the incentives, the carrot, so to speak, for letting us, to unbinding our industry and private sector, that we could affect good results worldwide as well as just domestically.

And finally, Mr. Chairman, I ask that the statements of Mr. Moorhead and Bilirakis be entered into the record.

Mr. SHARP. Yes, without objection. I was about to do that. Mr. Moorhead was here and unfortunately has another hearing. I believe Mr. Bilirakis also. And of course Mr. Moorhead is the ranking member of the full committee; Mr. Bilirakis of the subcommittee.

Ladies and gentlemen, thank you very much. We appreciate your time and attention and we will look forward to updates as you and we proceed.

[Whereupon, at 11:30 a.m., the subcommittee was adjourned, to reconvene at the call of the Chair.) (The following statements were received for the record:)

STATEMENT OF HON. CARLOS J. MOORHEAD Mr. Chairman, I appreciate the opportunity to have this hearing on the administration's new Climate Change Action Plan. This hearing provides us the opportunity to gain a greater understanding of the plan and how it will work.

I want to commend the administration for putting together a plan that does not contain recommendations for mandatory limits on greenhouse gas emissions. Based on what we know or don't know-about the science of global warming, I think a plan that encourages people to take cost effective actions to save energy is going to be the most successful in curbing greenhouse gas emissions,

I also want to commend the administration for including the concept of joint implementation in its plan. However, I am concerned that it was not given full status in the plan, but rather relegated to a pilot program. I believe joint implementation can be one of the most cost-effective ways to reduce greenhouse gas emission around the world. If the program is structured correctly, I think the administration will recognize this and give it full status in the U.S. national action plan.

I also have other concerns with the plan. To begin with, the goal of the plan is tougher than the goal of the International Treaty on Climate Change. I recognize that it is the President's privilege to set goals for the country, but I just hope he is not setting climate change goals that will put the United States at a disadvantage in terms of international trade and economic growth.

I also have questions about the assumptions used in formulating this plan. The plan assumes that businesses and individuals will have adequate incentives to spend billions of dollars to reduce greenhouse gas emissions. I hope that is the case, but I think we need more information to make sure that this plan is not setting unrealistic expectations.

Mr. Chairman, I want to welcome our witnesses and I look forward to their testimony.

Thank you.

STATEMENT OF HON. MICHAEL BILIRAKIS Mr. Chairman: Thank you for holding this hearing on the administration's "Climate Change Action Plan.” Despite a 2-month delay, I am pleased that we are finally able to review the specific details of the plan. I welcome the administration officials who are with us today, and I look forward to the benefit of their insight on these issues.

First, I would like to commend the administration for its reliance on cooperative programs with industry. I believe this plan will allow businesses to reduce greenhouse gas emissions in a more cost-effective and efficient manner, as it provides a great deal of flexibility.

Also, I was pleased to learn that the administration has included a pilot program on joint implementation in its action plan. However, I am concerned that the administration's plan does not fully recognize the value of this approach.

As you know, joint implementation is the process whereby the United States through a variety of initiatives, such as tree-planting, improved forest management and sales of clean coal, natural gas, renewable energy and efficiency technology in less developed countries-reduces greenhouse gas emissions.

With proper verification and monitoring, joint implementation may represent the most cost-effective U.S. strategy for reducing greenhouse gas emissions. In addition, joint implementation holds the promise of creating American jobs through increased exports of our electric power technologies to overseas markets.

in its plan, the administration acknowledges the economic and environmental benefits of joint implementation. However, the plan does not permit the use of joint implementation to meet its goals for reducing emissions.

The administration should not limit itself to pursuing only domestic actions in its plan. In fact, I strongly urge the administration to take a leading role in developing criteria to allow joint implementation to be a part of our national action plan.

As you know, greenhouse gas emissions truly are a global problem-and merely reducing emissions in the United States will not make a significant scientific difference.

If we, as a Nation, are going to lead on this issue, let's lead globally.

Mr. Chairman, President Clinton has stated that good environmental policy and good economic policy can go hand-in-hand. I am hopeful that the President's approach to global warming will be consistent with this philosophy, and I look forward to the opportunity to learn more about the administration's plans from our witnesses today.




Washington, DC. The subcommittee met, pursuant to notice, at 11:15 a.m. in room 2322, Rayburn House Office Building, Hon. Philip R. Sharp (chairman) presiding.

Mr. SHARP. The subcommittee will please come to order. Today the subcommittee welcomes several witnesses from outside the Federal Government to comment on President Clinton's Climate Change Action Plan.

Last month, the subcommittee held a briefing at which three administration officials presented the plan, which is designed to implement President Clinton's pledge to reduce global emissions of greenhouse gases to 1990 levels by the year 2000. The plan is largely voluntary in nature, relying on partnerships and nonprescriptive alliances between government and industry in order to achieve emissions reductions.

The President unilaterally committed this country to stabilize our greenhouse gas emissions. And we now have the best plan in the world, not only because it is the only plan but because it contains sensible, measured steps to mitigate the risks climate change may pose.

Neither the obvious limits on Government resources, nor reluctance to impose command and control obligations on U.S. industries should keep us from doing the doable now.

The administration relied primarily on its existing authorities and, above all, employed ingenuity in devising a plan to meet the goal for the year 2000. Because of the plan's voluntary character, its success or its failure will depend greatly on the ability of both government and the private sector to sustain their focus.

There may well be future control requirements to fulfill the commitments made at Rio last year. This action plan should give our country a good head start and experience with voluntarism that should hold costs down and bring important efficiency gains to our economy in the interim if industry and if the government will in fact make it work.

I look forward to hearing our witnesses' concerns about the President's plan, particularly regarding practical implementation problems.

For example, how will we ask the right questions about success or failure? How can we encourage experimentation? How will we


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