Statement of Energy and Air Quality Subcommittee Chairman Boucher

"Climate Change: Lessons Learned from Existing Cap and Trade Programs"

March 29, 2007

In 1990 this Committee under Chairman Dingell's leadership pioneered the cap and trade concept as a regulatory means of achieving air quality control.

            We applied cap and trade for the first time to the control of sulfur dioxide emissions in the 1990 Clean Air Amendments with highly positive results.

            Based largely on that successful experience the EPA and the states have established other cap and trade programs for fine particular matter, for mercury emissions, and for emissions leading to ground level ozone formation.

            Today the subcommittee will begin its consideration of whether cap and trade should be chosen as the preferred method for a nationwide economy-wide program of greenhouse gas controls.

            It is noteworthy that in order to comply with the Kyoto Protocol, the European Union adopted cap and trade to control greenhouse gas emissions from a range of emitting sources.

            We intend to gain the full benefit of the European experience with cap and trade in this context as we design a mandatory control program for the U.S.

            In today's hearing and during an upcoming European visit, we will ask those who have had this first hand experience to advise us on what the EU did properly in designing its cap and trade program and to tell us what perhaps could have been done better.

            We will ask similar questions about the experience to date of the voluntary greenhouse cap and trade program coordinated by the Chicago Climate Exchange.

            And we note the decision of the Northeastern and Mid-Atlantic states comprising the Regional Greenhouse Gas Initiative to use cap and trade to reduce CO2 emissions from power plants and the announcement of 5 western states to do likewise.

            I would stress that we have made no decisions about the method we will adopt for a U.S. greenhouse gas control program.

            During today's hearing and through further inquiries we will be examining closely cap and trade as one possible choice.

            I want to welcome today's witnesses and thank each of them for sharing their views and experiences with us.

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