About | HeinOnline Law Journal Library | HeinOnline Law Journal Library | HeinOnline
LOG IN
LOG IN

GAO-09-724R 1 (2009-07-08)

handle is hein.gao/gaobaanom0001 and id is 1 raw text is: im Am,GA 0 T E IAccountability * Integrity * Reliability United States Government Accountability Office Washington, DC 20548 July 8, 2009 The Honorable Max Baucus Committee on Finance, Chairman United States Senate Subject: Climate Change Trade Measures: Considerations for U.S. Policy Makers Dear Mr. Chairman: Changes in the earth's climate attributable to increased concentrations of greenhouse gases may have significant environmental and economic impacts in the United States and internationally. To mitigate climate change effects, countries are taking or considering varying approaches to reducing greenhouse gas emissions, such as carbon dioxide, which is the most important greenhouse gas due to its significant volume. These approaches range from measures to increase energy efficiency to longer-term efforts to develop technologies to establish a less carbon-intensive energy infrastructure. A U.S. policy to mitigate climate change may require domestic production facilities to achieve specified reductions or employ a market-based mechanism, such as establishing a price on emissions. Between 2007 and 2009, Congress introduced a number of climate change bills, many of which contained proposals for a domestic emissions pricing system, such as a cap-and-trade system' or a carbon tax2. Through greenhouse gas emissions pricing, governments create an incentive for parties to lower their greenhouse gas emissions by placing a cost on them. However, imposing costs on energy-intensive industries in the United States could potentially place them at a disadvantage to foreign competitors. In addition, emissions pricing could have negative environmental consequences, such as carbon leakage, whereby emissions reductions in the United States are replaced by increases in production and emissions in less- regulated countries. As the Congress considers the design of a domestic emissions pricing system, a key challenge will be balancing the need to reduce greenhouse gas emissions with the need to address the competitiveness of U.S. industries. In anticipation of Senate deliberation on climate change legislative proposals, you asked us to examine how greenhouse gas emissions pricing could potentially affect the international competitiveness of U.S. industries, and to examine trade measures being considered as part 'A cap-and-trade system is an emissions pricing system in which the government applies an aggregate cap or quota to limit total emissions from regulated sources, which are required to hold allowances to cover their emissions. Allowances are allocated by the government and may be traded. Sources whose allowances exceed their emissions may offer permits for sale, while sources for which emissions exceed allowances will need to buy them. 2Under a carbon tax system, regulated sources pay a charge based on the level of their emissions.

What Is HeinOnline?

HeinOnline is a subscription-based resource containing thousands of academic and legal journals from inception; complete coverage of government documents such as U.S. Statutes at Large, U.S. Code, Federal Register, Code of Federal Regulations, U.S. Reports, and much more. Documents are image-based, fully searchable PDFs with the authority of print combined with the accessibility of a user-friendly and powerful database. For more information, request a quote or trial for your organization below.



Contact us for annual subscription options:

Contact Us

Already a HeinOnline Subscriber?

Log In

profiles profiles most