As you know, I signed on as an original co-sponsor to your Credit for Voluntary Reductions Act, S. 547. I believe this is a good starting point for discussions on how to give credit to companies that have decided to invest in opportunities to reduce or sequester greenhouse gas emissions. I look forward to working with you to address concerns that have been raised about the specifics in the bill. But again, I commend you and Senators Baucus and Lieberman and others for taking the lead on this important issue.
I think the purpose of providing a credit program is to remove uncertainty for companies that initiate voluntary greenhouse gas mitigation projects. Currently, companies are uncertain how their efforts will be treated if there is a future regulatory program to reduce greenhouse gas emissions.
For instance, if regulations are put in place in the future, companies that reduce their emissions now need assurances that they would receive credit for their actions. Otherwise they might be forced to make additional and more costly reductions while companies that didn't act early on could make their target at lower costs. This scenario penalizes companies that took the initiative to reduce their emissions early on and puts them at a competitive disadvantage to those that, for whatever reasons, chose to wait. Voluntary action, without a system of credit, can act as a disadvantage to companies that act now to reduce their emissions.
As you know, during the 105th Congress, the Senate voted 95 to zero that the U.S. should not be a signatory to any protocol that would result in serious harm to the U.S. economy or require developed countries to limit or reduce emissions unless such an agreement also requires developing countries to limit or reduce emissions within the same compliance period.
I strongly agree with this rationale. We should not put the U.S. in an economic or competitive disadvantage when other countries are not required to reduce emissions as well.
I do not believe that creating a credit system for voluntary reductions means that we are trying to implement the 1997 Kyoto Protocol or some other regulatory measure prior to Senate ratification. We are trying to create a voluntary program that creates incentives and reduces uncertainty in the future for companies that act now to reduce their emissions. I believe that if business is willing to voluntarily invest in measures that reduce greenhouse gases, and protect our forests and agriculture, then Congress should put in place a framework that rewards those actions.
In addition, we are trying to create a program that would allow companies that don't have the resources to reduce emissions now to be able to buy credits from companies that had the means to make those investments now.
Thank you, Mr. Chairman. I look forward to hearing today's panelists.