SAN FRANCISCO California and other states with aggressive environmental agendas said on Wednesday they fear a federal climate bill may unacceptably weaken their power, in a new sign of uncertainty over compromise legislation being crafted by Senator John Kerry and his allies.
Democrat Kerry, independent Senator Joseph Lieberman and Republican Senator Lindsey Graham are expected to unveil a bill next week to cut greenhouse gas emissions that navigates among competing interests groups, after a previous effort failed.
"There is a gray area there where there could be mischief or litigation," California's top climate change regulator, Air Resources Board Chair Mary Nichols, told reporters on a conference call, outlining concerns.
"We want the statute to be clear that unless there is very explicit reason to the contrary, that states are encouraged to move forward."
States fear the bill could include a ban on state and regional carbon trading markets, the loss of California's ability to set clean car standards, and vague language that could lead courts broadly to curtail state action, said Emily Figdor, global warming program director of Environment America, a non-governmental group.
Fuel composition standards and performance standards for big polluters were examples of areas at risk, she said.
Analysts including researcher Point Carbon see the federal legislation as a longshot for passage this year, and states that favor strong federal action are in a delicate position. They do not want to lose the ability to try new regulations or take action if the federal efforts don't meet their goals.
At a meeting of the Western Climate Initiative last week, state representatives discussed fears that any criticism of the federal bill could be used by opponents to block it.
The federal bill is expected to include a key provision for a cap-and-trade program, which limits total greenhouse gas emissions and lets big polluters trade permits to emit.
Similar state plans are expected to be forbidden. That would be more drastic than a moratorium on state cap-and-trade considered in a bill passed by the House of Representatives.
The U.S. northeast has such a system working and California and the Western Climate Initiative plan their own market to begin trading on January 1, 2012.
"To just have one program that would preempt states and have a one-size-fits all federal approach really not only ignores the whole history of success in the environmental area but also would not be the wisest way to go in terms of either maximizing greenhouse gas reductions or to maximize the amount of job creation," said Illinois Environmental Protection Agency Director Doug Scott.
(Editing by Chris Wilson)