Senator
Bob Smith
Ranking Member,
Environment & Public Works Committee
Full Committee
Legislative Hearing on S. 556,
Good Morning & thank
you Mr. Chairman for holding this hearing. I also want thank all of the
witnesses -- and a special welcome to Ken Colburn, who has come down from New
Hampshire. Ken does a great job for the people in the
State, and he has been extremely helpful to me and my staff.
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I have long been a proponent of reducing our
utility emissions
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Unfortunately, Current law often fosters a
combative relationship that does too little to increase environmental
protection and too much to increase litigation, delay, and uncertainty.
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In many ways, the law can actually be an
obstacle to cleaner air.
The bottom line is that
we have a system that discourages new energy production: increases the cost for current
production: and delays environmental
protection. This is unacceptable.
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I want to change that -- and began an inclusive process when I first became Chairman
two years ago
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I want to applaud Chairman Jeffords for
continuing that process
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It is vital that we reduce our emissions and, at
the same time, separate ourselves from the current command and control system
to one that is more effective and efficient
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We need to embrace the free-market mechanisms
that rely on innovation
It is my belief that
innovation and technology will one day make regulation a thing of the past. We
already have a successful model to follow - that of the Acid Rain program. Clearly,
we need further reductions in the sulfur emissions level, but no other
environmental program compares with the efficiency and effectiveness of the
Acid Rain Program.
We have seen compliance
under this program exceed 99%; that’s unheard of for any environmental
program. Many of the reductions were
realized ahead of schedule as well. Second, although there was concern that the
Acid Rain cap & trade program would create so - called Ahot spots@ - EPA data has shown that this is not
occurring.
This
chart shows the monitored reductions in SO2 deposition due to the
Acid Rain Program. The map on the
left shows deposition for 1989-1991, and the map on the right shows deposition
for 1997-1999 B the few years after Phase I of the Program went into effect.
The
significant reduction in red and yellow areas on the map indicates that the
most adversely affected areas have seen the greatest environmental benefit from
the Acid Rain Program.
The
existing hot spots have been cooled B new ones have not been
created by trading.
And
finally, one last success of the Acid Rain Program has been the steady decline
in estimates of annual compliance costs.
This
next chart shows that actual annual costs are less than half the lowest cost
estimate at the time of enactment.
Other
estimates at the time of enactment were up to 7 times higher than actual
costs.
A program that is
market-based, flexible and incentive driven has proven to be the most effective
and efficient environmental program on the books. We need to embrace that approach. I want innovation to replace regulation B
and I believe that can happen
I want to thank the
Chairman for his efforts . I believe that there is more work to be done. I don’t
believe that his bill S. 556 is complete and ready for mark-up yet. Discussions with
Members simply have not yet gotten to the point where we are ready for a vote
on the bill. We have a great deal more work to do to establish broad support
for specific legislation on this issue. One thing is clear - absent a broad consensus, there will be no
progress.
I appreciate his efforts
and pledge my continued constructive participation in this very important
process. It is my hope that this will be the first in a long line of
legislative hearings where Members are able to discuss options. I
don’t think that we are far away from reaching that point of consensus. We only
have one good shot at this, so lets not rush it, lets get it right.
If we do this right;
with flexibility, market based emissions trading and clear emissions limits, we
will create a system that not only reduces air pollution, but costs less, while
enhancing fuel diversity. Both EIA and EPA have completed analysis
of multipollutant reduction scenarios Senator Voinovich and I requested. BOTH
indicate that we can make dramatic reductions for an annual cost that is below
the original cost estimates by EEI for the Acid Rain Program.
Significant reductions
in NOx, SO2, Mercury (EPA=s analysis also includes CO2) for less than the
expected cost for partial reductions in just SO2. What’s
more, coal consumption in the east increased in this analysis. This makes me
quite optimistic that we can improve on the current system.