and welcome to the select committee on energy independence and global warming over the last two years the select committee has examined closely how the u s can fight climate change and improve our energy security but we are not in this fight alone and the progress that our country can make is deeply dependent on the progress that developing countries are making that is the focus of today's hearing to take an assessment based on the facts that exist in two thousand and nine not as they existed five or ten years ago of steps taken by the key developing countries to address global warming this inquiry is important because americans rightly want to know that they are not the only ones altering their policies to combat global warming this inquiry is also important because many members have rightly expressed concern about maintaining the competitiveness of critical industry sectors and they want to know that other countries are joining the fight and requiring their industries to move away from business as usual our discussion on what developing countries are doing needs to be fueled by current facts and not by old perceptions one old perception is that china is unwilling to join the fight against climate change and is wedded to growth at any cost our current reality is that china has already adopted an energy efficiency law that far exceeds anything on the law books of our country other examples abound of how developing countries are making progress i am not suggesting that the developing countries are doing everything they can do and they are certainly not doing everything that needs to be done but as we undertake climate change legislation in our country we should understand the steps taken by key developing countries around the world china india brazil mexico south africa are some of the biggest emitters of the developing world over the last years all of these countries have displayed an increasing awareness of the need to act just last week president obama acknowledged china in his speech to the joint session of congress for having launched the largest effort in history to make their economy energy efficient also last week greenpeace welcomed india's national climate plan's first step a market mechanism that could phase out four hundred million incandescent bulbs by tw december last year mexico set an aspirational target to cut in half its two thousand and two carbon emissions by two thousand and fifty and the brazilian government released its national plan on climate change these are encouraging signs of action but the world has to do more and the world has to act together despite the action and efforts shown around the world emissions continue to rise we have to reverse this trend and certainly developed countries will have to show clear commitment and live up to their promises and developing countries will need the support when accelerating their action to ensure that the world achieves the needed reductions we need a strong agreement in copenhagen and we need to monitor and verify the efforts all across the world we need to be sure that promises lead to action that plans get implemented that results live up to expectations the united states must show that it will lead this effort only by doing so will we collectively be able the aisle because last week we learned how expensive our response to climate change is going to be president obama's budget blueprint established potential domestic costs in today's hearing will highlight the mounting international demands the world is expecting increased energy efficiency from the developing world and the developing world is demanding compensation in return we have known for a while that the cap and tax policy which is my name for the carbon trading system pres developing countries india's government stated that the developed nations owe billions of dollars to developing nations to compensate for climate change in its submission to the u n framework convention on climate change the indian argued that this funding should be a legal obligation for developed countries that cannot be subject to the decisions of developed country governments or legislatures how that flies in the face of our constitution's requirement th nothing be paid out of the treasury except by appropriation i don't know they added that this funding should not be in the form of loans and that the providers of finance cannot be discretionary donors but must be legally obligated assessees in its own submission china argued that the developed nations should provide new additional adequate predictable and sustainable funding at least half to one percent of the nation's gdp over and the existing foreign aid the massachusetts institute of technology's joint program on the science and policy of global change a supporter of cap and tax policies estimated that welfare costs to developed countries goes well beyond compensating for mitigating costs and turns the mitigation policy into an instrument for global income redistribution unquote several developing countries have made effort to increase their energy efficiency which is good but many of these countries have publicly stated their good intentions and aspirational goals to reduce their emissions but it is their willingness and ability to actually implement these policies that will determine the ultimate success of our global efforts china has already resisted enforcement of wto's trade rules the u s trade representative found in its two thousand and eight report to congress on china's wto compliance that quote china has yet to fully implement important commitments and in other areas significant questions have arisen regarding china's adherence to ongoing wto obligations including co wto principles in my role as a member and the former chairman of the judiciary committee i sure found that out due to the lack of enforcement by china of intellectual property rights laws even though the chinese law on the books looks as good as the united states law or the laws that are in the european union a post kyoto treaty cannot succeed without china's participation but can we expect china's compliance with the climate change treaty given its history with the wto i think the answer is obvious today's witness lee lane a resident fellow at the american enterprise institute rightly recognizes that technological development is the crucial long term priority politics is the art of the possible but current proposals for emissions reductions go beyond not only what is politically possible but also what is actually achievable nations cannot afford to meet greenhouse gas reduction goals without substantial advances in energy technology the development of technology not higher taxes or global wealth redistribution schemes should be where congress focuses its efforts to confront climate change i look forward to hearing from our witnesses today and learning more about what role technology can play in these important climate change negotiations leading to the u n conference of the parties in copenhagen this december  american economy can be retooled to meet the challenge of climate change and that the second industrial revolution of this country can be a  revolution that would green our economy in more ways than one but i think that we are really in a unique position maybe even an awkward position because of the last decade almost a decade of ignoring the science of climate change and we are faced now with an opportunity for the president to go to copenhagen in december of this year and i think that in copenhagen the president is going to be watched and listened to perhaps in a more serious way than maybe ever a president or american official has dealt with this issue of climate change and so i am interested in hearing from the panel the things you think we must do before copenhagen before next december in order to have credibility  when the president speaks on the last day of the conference so i appreciate your presence i hope to be able to probe your considerable knowledge of the subject in order to ascertain information that will be developing what could lead to the first real international climate change ever at least that is my hope for the copenhagen meetings an international agreement must have enforceable targets must take care to rein in irresponsible practices by developing countries particularly china and india but we must realize that while large and growing these nations have much lower standards of living than ours and we need to be sympathetic to their desire to achieve what we in this country have been calling the american dream for more than two at the same time our economy is suffering and manufacturing is on the decline here at home any climate legislation that this congress needs to consider needs to take into account the impact it will have on people and businesses in the united states so there are twin challenges how do we get china and india and the developing world to agree to climate change goals that do not stifle their own growth and how do we limit our own contribution of greenhouse gases without further crippling the united states economy i believe in that answer we can find opportunity american businesses can lead the way in renewable and energy efficient technology for example just last week we had several witnesses testify about the work their companies are doing on energy efficiency and smart growth technology in the hudson valley of new york we have innovators working on waste to energy solar biomass and investors looking to fund renewable projects and such low tech solutions as weatherization which would hopefully capture the  thirty to forty percent heat loss or air conditioning loss as the case may be from individual homes we in our stimulus recovery package passed a large enough amount that new york state year will be receiving about twice for weatherization what the entire country received last year and a proportionate effort is being made nationwide it is a serious conservation effort and i am very proud of it and proud of the fact that my county duchess county will be hiring five times as many workers to go out and do insulation of storm doors storm windows weather stripping we are not talking high tech new inventions we are talking basic good building practices to save those homeowners money it is time to harness our ingenuity to solve the climate crisis and export manufactured goods once again we can fuel the carbon efficient global economy with just a little bit of investment the economic stimulus was a good start but more can be done and if we can do that we can help the developing countries meet their targets and make the planet a better place and make some money or save some money for our people at the same time we should not be afraid of this challenge we should welcome it i thank you mr chairman and yield back the chairman the gentleman's time has expired the chair recognizes the gentleman from colorado solar we have one hundred and fifty day average of sunshine in colorado and i believe that you know in renewable energy and the world's need for energy conservation and development of renewable sources of energy i think that the world has a real need for some type of moderate commonsense  our current economic situation is in this country but i want to talk a little bit today about how i believe that we can actually curb some of our carbon emissions i want to make sure that agriculture  is heard in all this debate i believe that agriculture can be a part of our carbon sequestration issue i am looking forward to today today is my first day and the speaker asked me to serve on this committee while i am not an expert in energy issues i do want to be part of the solution so thank you very much mister chairman and i yield back the chairman i thank the gentleman very much and whether it be solar or wind or invaluable contribution let me now turn to our panel and our first witness is mister carter roberts mister roberts is the president and the ceo of the world wildlife fund wwf is supported by close to five million members globally and its affiliates work in more than one hundred countries before joining wwf mister roberts worked on strategic planning and new international programs with the nature conservancy we welcome it and i am grateful for the opportunity to provide testimony today on behalf of our five million members and on behalf of our programs around the world as you point out we operate in all these countries around the world often with programs led by nationals leaders in those countries who have a deep appreciation for the context in these countries and we have an observer status for the unfcc process and often we as members of delegations from these countries to the negotiating process so it is from this vantage point and with this perspective that i offer my testimony today conventional wisdom says that developing countries do not take climate change seriously and that they will be an obstacle to a global deal nothing could be further from the truth key developing countries are taking concrete steps to reduce emissions at home they are also leading in many ways the international negotiations as we speak for the sake of our climate our economy and our international competitiveness i urge us to follow their lead i have three key points today that i want to make one is that things have changed the other is that they have changed for good reasons and finally that the u s needs to respond in kind both in our domestic legislation and in our international negotiations so first throughout much of the  developed world looked to developing countries to take the lead in solving the climate change problem that was clear their posture was understandable they contribute little in the way of emissions and were suffering some of the greatest impact all at the same time that the world's largest emitter was doing very little over the past year in particular developing countries have taken action to reduce their own emissions at home and have been constructing advancing solutions at an international stage two examples renewable energy and deforestation or avoided deforestation renewable energy standard is a classic part of any country's seriousness in replacing high carbon fuels with ones that produce zero emissions during the past several years as the u s has debated whether or not to have a renewable energy standard brazil india china mexico the philippines and many others have adopted their own and have begun implementing it with some success second deforestation you know that deforestation is the second largest sector in terms of co emissions around the world more than all the cars trucks planes trains and boats in the world bringing brazil and indonesia to the top five emitters around the world in december brazil announced a bold plan to cut their emissions from deforestation by seventy percent in ten years this would avoid four point eight billion tons of co emissions equivalent to over two thirds what the u s produces alone to back this up brazil has made a number of commitments at home first they have created one of the most impressive forest conservation programs in the world creating a series of parks in the amazon roughly equal to the size of the state of california second they developed a world class system of monitoring that has few peers around the world and is now regularly reporting on their progress in avoiding deforestation and finally they are creating governance systems particularly at a state level that provide the resources and the enforcement with local communities to reduce deforestation right at the edge of the forest frontier meeting all these goals will be tough brazil is committed to it but it can't do it alone it will need our help it will need technology it will need know how and it will need some financial flows to make this happen the reason these developing countries are taking these steps are pretty obvious they are very similar to our own risk and opportunity the risks that they see are even far greater than ours because they have billions of people who live below the poverty line and they lack the capital and the financial resources to respond to adapt and to change and so for nations with populations living at the a subsistence level even modest amounts of climate change change their water supplies change their food supplies and runs the risk of severe crop failures wait and see is not an option they also see that addressing climate change produces the promise of economic security and even growth dramatic swings in energy prices are problematic for countries with little financial reserves and those countries who are able to develop homegrown energy supplies are able to become leaders in areas like renewables right now china leads the world in installed renewable energy capacity and is projected to be the world leader by the end of this year in exports of renewable energy solutions finally my last point the u s as we enact cap and trade legislation here at home and enter international negotiations we should do so with developing countries in mind why first it is a global crisis and it requires a global solution just as the economic crisis requires countries to come together second a ton emitted in china or a ton emitted in brazil is just as costly to us at home as a ton emitted in ohio we need to ensure just as we are creating green jobs at home and sending funds at home to drive solutions that we also ensure that funds flow to those countries where low cost solutions can be found we need to solve the problem by solving it globally third by building the capacity of other countries we are building more stable societies we are also building potential markets for technological solutions for too long the u s has invented renewable technologies only to see other countries own those markets by having the right regulatory framework and by having good relations in markets of other countries last but not least the u s has had a long legacy of reaching out to other countries and solving global problems bringing our know how our capacity our money and our resources to help countries in need and to create a leadership role for us abroad we have done it with hivaids we have done it on security issues we need to do it on climate change in summary the developing world has changed as we speak they are playing a leading role they are taking action at home it is time for us as we pass cap and trade legislation here at home and enter international negotiations to respond to their leadership and to respond in kind it is in our best interest to do so thank you very much the chairman thank you mister roberts very much and our next witness is ms barbara finamore she is a senior attorney at the natural resources defense council and is the founder and director nrdc's china program she is also cofounder and president of the china u s energy efficiency alliance she has worked and lived in greater china for nearly twenty years and she has flown in national greenhouse gas mitigation efforts and achievements and challenges i also have three major points one is that china is currently pursuing an aggressive and ambitious greenhouse gas mitigation program as indicated by its th five year plan which runs from two thousand and six to two thousand and ten that plan includes a goal of reducing its energy intensity energy consumption per unit g percent from two thousand and five levels to two thousand and ten which equals four percent reduction per year it also sets a target of increasing the share of renewables in the energy mix by ten percent by two thousand and ten and fifteen constitutes the largest single greenhouse gas mitigation program by any country and i will detail what that progress is on that in a moment but i would also like to emphasize that china has reasons for the greenhouse gas mitigation programs that it has already achieved that provide a lot of room for reaching mutually beneficial common ground between the united states and china as they seek to achieve an international climate treaty and these include in particular china's growing awareness of the severe impacts on its own country of climate  change i think the turning point first came in two thousand and six when china issued a national climate change assessment program by forty different ministries a four hundred page report which for the first time detailed the impacts that climate change would have on the areas where china is already most vulnerable its water supplies it has only one quarter of the average water resources per capita as the world average they have already seen increasing droughts increasing flooding in other regions and just yesterday they announced their plan to build fifty nine new reservoirs to capture water resources in the west due to  rapid melting of the glaciers so the cost of adaptation is becoming increasingly apparent to china also impacts on their agricultural productivity and also on the economic development which is located primarily along their very long coastline and how it would be impacted by sea level rise i would also mention energy security as a primary motivating factor for china in its greenhouse gas mitigation efforts  and also social stability they are quite concerned about the high cost of its unsustainable energy path on the health of its people and on the environment the world bank as you may have known has estimated that seven hundred and fifty thousand people die each year from environmental air and water pollution in china also the economic downturn as it has affected china these is going to lead to increased social instability if they don't create more green jobs so there is a real opportunity here for holding hands across the ocean and finding green technologies that will benefit the global economic recovery the third point is despite all that china is doing there is a tremendous amount more that needs to be done and that can be done particularly through strengthen motivation factors is the desire to restructure their economic system away from the heavy industry that is the cause of the largest percentage of their greenhouse gas emissions and in fact approximately seventy seven percent of all their energy demand they have instituted policies already to help move their economy away from high polluting highly inefficient steel chemical cement industries not only that but even though they are continuing to grow their thermal power capacity to the tune of two coal fired power plants week it is important to note that that is accompanied by the shutting down of the smallest most highly inefficient power plants so that there is a net increase in the efficiency of their thermal powered generation which is leading to a dramatic reduction in greenhouse gas emissions from that sector in the energy efficiency side they are also closing backward production capacity slowing the expansion of high energy consuming industries through the elimination or reduction of export tax rebates for energy intensive products they have a renewed emphasis on energy efficiency particularly in the industrial sector focusing on the top one thousand highest energy consuming industries and our evidence indicates that they are on track to meet or surpass their target savings for that particular top one thousand factories which would translate thousand and seven they allocated three four billion u s dollars to promote energy efficiency and reduce emissions and forty one point eight billion renminbi or six dollars billion in two thousand and eight for the same purpose they beginning to implement provincial and municipal demand side management programs which use a portion of the revenue that utilities collect from their customers to reduce peak load and overall energy demand through large scale investments in energy efficiency although they have made significant progress much more can be done china's energy intensity is currently four times that of the united states and nine times that of japan in order to make further progress in meeting their a goals there is a need for increasing technical capacity in energy auditing and energy efficiency retrofit design monitoring and enforcing standards in industry power plants and buildings these are all areas in which the united states and china can profitably cooperate so in sum china is working aggressively to improve its energy efficiency reduce the carbon intensity of its energy mix a recent study by mckenzie global institute indicates if china pursued energy efficiency to the full extent possible and cut coal to thirty four percent of its power supply it could cut its projected greenhouse emissions by two thousand and thirty nearly in half engineering mister lane was previously a consultant to charles river associates international where he produced analyses of climate and energy issues he also helped found the climate policy center we welcome you mister lane analysis and research and education on a broad range of public policy issues aei does not take organizational positions on these issues and the views that i am going to express here this morning are entirely my own not necessarily those of the institute rising amounts of greenhouse gases in the atmosphere pose i believe several worrisome challenges at the same time many difficulties seem to rule out quick or easy solutions to the problems that are being posed to us my statement suggests some ways in which the u s might nonetheless make progress it makes three main points i noticed that all three speakers who have spoken so far have three main points so especially on that ground we have grounds for agreement the first point is that i think we need to acknowledge that whereas there seems to be an agreement a global consensus even on the need to reduce greenhouse gas emissions that seeming agreement masks what i think is a distinct lack of consensus about who should pay to make these reductions in greenhouse gases china india russia and many other countries that have expressed agreement in principle that emissions should be reduced have not been especially forthcoming in incurring costs to actually achieve those emissions reductions  now i certainly hear and i have read the statements of my colleagues on the panel here and i know that there have been a number of actions taken in china and elsewhere but fundamentally those steps appear to me to be what we in this country used to call no regrets policies well that is fine we should welcome whatever emissions reductions occur as a result of those policies but i don't think we should take those actions as suggesting that the world is any place close to being willing to bear the costs that would be required to really reduce greenhouse gas emissions to the level that would be required to halt climate change and actually stabilize concentrations of greenhouse gases in the atmosphere we are very very far from even discussing changes of that scale my second point is i believe that it is true that the u s cannot create global consensus where none exist attempts to lead by example or to use trade sanctions to change china's behavior are likely to be both costly and ineffective for developed countries to pay china's abatement cost is not an appealing option either a recent mit study the one that mister sensenbrenner referred to estimated that carrying this principle to its logical conclusion would for the u s alone entail annual income dollar added to the u s trade deficit this would heap a huge additional burden on a u s economy that during this same period will already be struggling to make many other daunting structural adjustments third and my final point is that the u s climate policy should candidly consider the likelihood that the needed global consensus on paying for abatement will be long in coming if so the world will probably fail to reach today's ambitious targets for stabilizing climate rather than striving to do the impossible u s policy should focus on coping with the unavoidable adopting a modest stable and gradually rising price on carbon emissions i believe is one step that we should take an attached statement at the back of my statement discusses a number of other options that i think are important especially focused on technological change and i think several of these are in fact even more important than putting a price on carbon emissions but i think a price on carbon emissions of the right kind would be an appropriate step too finally i guess i need to conclude with a note of caution the u s like most other nations has a real stake in curbing global greenhouse gas emissions but if our good intentions lead us to incur costs that exceed the benefits to the united states i fear those policies may not prove to be durable and as many people have noted climate policy is a marathon not a sprint and it is really important to muster a sustained effort and i thank you very much and i ask my statement be included in the record the chairman without objection it will be included in the record in its entirety our final witness is mister ned helme he is the president and cofounder of the center for clean air policy over the last two decades mister helme has advised not only congress state governments and the european commission but also developing countries from brazil to china so we welcome you mister helme whenever you are ready please heard from my colleagues let me start by putting a slide on the board here and this sort of summarizes what you have heard from my colleagues to the left and right of me this compiles the reductions that will be achieved by tw china brazil and mexico under laws that are currently on the books in these countries and as you can see the red block is more than what we would do here in the u s under the lieberman warner bill as structured last year by two thousand and fifteen and it comparable to the level of reduction we can expect from the europeans with their minus thirty percent reduction target so as my colleagues have shown you with the specifics the sum total of this is quite substantial and the world has really changed in terms of where we were in one thousand nine hundred and ninety seven in kyoto when very little was being done and where we are today where developing countries have really stepped up and carried their part of the burden here having said that i want to build on what you said mister chairman that this is great stuff but it is not enough if we look at where we are going we could zero out all the emissions of the developed nations by two thousand and fifty and we wouldn't get to the targets we are talking about so we clearly need a substantial additional effort by china and other key developing countries and i think that will be forthcoming in the process my second point is really to talk a bit about the bali action plan i think this is a major breakthrough from where we were in one thousand nine hundred and ninety seven for the first time we have agreement among developed and developing countries that both sides will commit to specific actions that will reduce in the case of developing countries growth and emissions and that is premised on monitorable and reportable and verifiable actions on both sides and it is also premised on the thought that we will have support in technology in finance and in building capacity from developed nations to developing nations that is the heart of the bali action plan and it is a real breakthrough in terms of the thinking and the way in which this process has evolved over the years in that action plan we are talking about taking nationally appropriate mitigation actions and there are three types of these actions that are kicking around in the debate at this point the first is action and these numbers you see up here a lot of what is here are actions that developing countries are doing on their own these are not reductions that are being bought and paid for through the clean development mechanism in the past in the kyoto protocol basically the only role was for projects in developing countries could generate credits and those could be sold to the europeans for example to meet the goals of their reductions by their companies in this case we are talking about a real reduction by developing countries on their own that is a contri atmosphere so in addition to what developed nations do we are going to see some real action by developing countries with some real costs i would take issue with lee's contention that all this is just no regrets that will really move us forward so that is the first and most important piece the second is a set of actions that would be premised on a conditionality we will go further if developed nations provide support in the financing and technology and capacity building and then third is if we have set a law let's say china sets an rps at twenty percent as they have done if they do more than twenty percent that could be turned into carbon credits to sell so they have to meet the target on their own if they go beyond it they could market those on the carbon market let me take you to a specific example mister chairman you alluded to this in your opening remarks mexico in december i put together the first really comprehensive approach that would show you what a national appropriate mitigation action on a sectoral approach would look like mexico proposed to set targets for reduction in cement steel oil refining and electricity three of those very internationally competitive sectors they have proposed that they would go further than the initial targets significantly further if there was support financially from developed nations to move that forward and they said they would do this through a cap and trade program a program that could combine with the u s cap and trade or a canadian cap and trade program on a north american basis so a very significant effort here when we are talking about financing we are not talking about big grants in their case they are talking about loans that would help them overcome financial barriers the banks in mexico don't have the ability to assess energy efficiency programs this is the kind of thing we are looking at so very significant and a concrete proposal for mexico that could move us forward i think when we think about mitigation actions we want to focus really on the six to ten largest developing countries they're responsible for over eighty to ninety percent of emissions we don't really care about zimbabwe and morocco and so on we really care about brazil china mexico korea india south africa those are the key players so it is a more workable and doable deal than it might have first appeared let me turn to the question of the united states role in this i think the u s is critical we are the linchpin of a copenhagen agreement i think the positive reactions you have seen internationally to president  's comments on minus fourteen percent below current levels is a very positive sign i think it can have a very positive impact in terms of moving this debate i think there will be two tests for us the first test is what is our target can we get that target together i am optimistic here with the congress that we could move something through the house at least it would give us a real signal to help our negotiators talk about what kind of target can we take and the second question is will we help financially that is i recognize a tougher question but it is a key question to make this ball move we need to do it and again let's be clear we are talking about help with technology we are talking about capacity we are talking about loans and breaking barriers we are not talking about huge block grants like might be envisioned if you look at india proposal which is i think an outlier in terms of the real thinking on the table let me close by addressing mr hall has left but he said there are twin challenges and i think he is right on the money he said the twin challenges are how do we deal with impacts on our companies in the united states and how do we also encourage china and india to go further and i think the answer is very clear on the issue of carbon leakage in the u s we have two choices we could either give allowances free to key any exports coming to the united states would have to buy carbon allowances i think that is very provocative in the debate not very helpful i think giving allowances out can take care of the carbon part of the problem so that companies are held harmless in terms of this phase through two thousand and twenty until china brazil mexico have taken similar action in the cement industry and the steel industry which i think we will see the second half of mister hall's challenge was how do we get china to move border tax adjustments is not the way to go china exports one percent of its steel to the united states putting a tax on chinese steel is going to have no impact on their policies internationally however incentives like we just talked about where we help them with the technology where we take the ccs technology that we are working on and we do it with them in china at the same time we are doing it here we don't do the old game of develop it here and twenty years later we put it in the developing countries as my colleague here said two coal plants a week we have got to deal with ccs now let me close my final thought for you is i think we had a real breakthrough two weeks ago when the u in the negotiations on a mercury treaty switched its position seven years we have said no international agreement on regulating mercury emissions in two weeks the obama administration changed direction and that completely dominated discussion china india argentina mexico the fifth paragraph you said america is well endowed with the resources required to make the needed adjustments on page twelve you said our responses need to account for the limitations on our resources and our abilities to  preferences of other societies can you help me fix the difference mister lane sure i think that the united states and i think this is generally agreed  because it is a very big country because it is quite a wealthy country has and because it is developed and has a well developed public health service and so forth has a lot of human and material capital is probably better able to adapt to climate change than most poorer countries are likely to be it also has a more temperate climate to begin with so that say in comparison with india or a country that is located much closer to the equator we are less likely to experience in the early decades of climate change really severe harm at the same time all of that being true it is still true that we don't have infinite resources to help the entire world convert from fossil fuels to alternative energy and for the united states in copenhagen to create for china and india in particular but all of the many of the developing nations the belief that there is a real connection between sustainable economic strength and hampering the environment i certainly agree i think that is very much in line with the kinds of things you see in the submissions from those countries south africa has been the leader but this idea of dealing with carbon and at the same time promoting sustainable development is a key element of the g seventy seven of developing countries perspective and i think they are already on that page what they are looking for is help with the technologies and with some of the new opportunities to really pursue that ideal i think we are on the same page on that issue  roberts i think for most developing countries the environment is clearly in their minds where their food comes from where their water comes from and they see the risks of that environment changing because of climate change they see it more clearly than we do because in places like indonesia they walk out their back yard and catch the fish now as the ocean is becoming more acidified they are seeing the coral reefs and fisheries change in front of their eyes and of the relationship between their livelihoods and keeping their environment intact and that is the main motivation for moving forward i see that as a powerful impetus for having that conversation in copenhagen i think it agreement a global pact on greenhouse gases gas caps with full trading of emissions allowances is probably not possible in copenhagen do you believe there is an agreement to be made in copenhagen mister helme i think there is i suggested in my testimony that we will have agreement on the targets for the developed nations i think we will have agreement on this proposing what they are looking for and at the end of the day exactly what we have agreed to so i think it doable i think it is a two step i think in copenhagen we get the structure done and after copenhagen after we have passed our law and we know what financing we can help with i think we get into the  now we are seeing these important bilateral conversations occur between the u s and china and the u s and brazil and the u s and europe that lays the groundwork for differentiated commitments and the kind of exchange and financing and technology  that we have talked about i believe in copenhagen we will see breakthroughs in framing issues like forests and deforestation and making them credible in the context of a global deal we will see the creation and the framing of financing mechanisms from funds to markets i also believe that we will make some progress in terms of framing differentiated commitments but i agree with my colleague to my right that it is a step along the way we will also see follow up in two thousand and ten we are on the right path copenhagen is an important moment but it is going to be a combination of bilateral discussions and agreements in question is what makes you believe that the chinese are going to act any different in keeping commitments in this area than they have failed to do in keeping commitments under the wto particularly in the area of intellectual property rights i think there is a big difference between the wto agreement and the climate change agreement as i said earlier and detailed it in my testimony there are strong motivations and driving forces compelling china to agree to some sort of international climate negotiation that are unrelated to just growing its economy or competitiveness concerns in fact they believe that improving their energy efficiency is going to increase their global competitiveness and i would also say that there is a lot of common ground here that i think needs to be explored in china's desire to move away from  and ninety seven and the fact that the treaty requires a two thirds vote to ratify what we are talking about here how do you get it ratified particularly when china is talking about this wealth transfer as mandatory spending which effectively makes china the recipient of a new foreign aid entitlement program ms finamore you quoted the comments made by the chief negotiator in china at the international climate agreements and i would just you for anybody who has spent any time in china you have to understand that china at least to my mind has some of the best negotiators in the world so what you are seeing is their negotiating position of course i would say that given the last meeting in poznam that lasted from six p m to three a m on saturday morning the third world led by china was asking for more money and this is money that the first world doesn't have our economy is in the tank so is europe's so aren't we talking about an academic exercise here because i don't know who is going to vote for a treaty that administration has changed its negotiating policy but certainly china and india haven't i think one of the reasons kyoto failed was because even president clinton who signed the kyoto protocol politically feasible as well as accomplishing something i heard the comment of shooting for the stars and hitting the moon i think probably the way we are going now is that this rocket will crash one hundred kilometers down range because of overestimations of what can be accomplished remember you do need a two thirds vote in the senate my time has expired that is well thought through through the house in a timely manner i think in the senate it is a bit more divided we will have to deal more with the gang of fifteen the members who are sort of swing votes so i think starting out in the house makes sense it is basically a political calculation can lane it would be to develop and implement a really carefully structured energy research and development program  think that actually secretary chu is talking about some of the changes that are exactly on target with what is needed especially in the area of basic and doing some of the longer term more basic scientific research that is necessary to produce real cost breakthroughs for the future it is terribly  important when we talk about r and d to focus on the earlier parts of the research process that are more basic and that the private sector will not do under any circumstances government china is one of the leading solar manufacturers in the world what do you think we can do to encourage them to use more solar instead of building more coal fire plants and a incentives that are listed actually in the renewable energy law that was passed in two thousand and five to implement them and to also find ways to make sure that these renewable energy technologies are connected to the grid so there are policy incentives that need to be strengthened in china because it already has the manufacturing capability i would add it is already the leader in the world in solar hot water heating technology i think it captures eighty percent of the world market one all of the plants that are coming on line now are what is considered super critical or ultra super critical so they are more efficient to begin with they are actually blowing up the smallest most highly polluting plant line in the next couple of years and they are going to be designing that so the carbon can be captured and stored i think this is another area where there is tremendous potential for cooperation between the u s and china on these two important element and a practical climate change strategy that is going to be broadly acceptable to the american people as some of the other questions from the members on the committee have noted and in your testimony and your response just now to mister salazar you note that china's thermal power expansion has been accomplished by replacing older plants with more modern plants and that china is pursuing clean coal technologies including integrated gasification combined cycle i represent the state of south dakota and  technology or other clean coal technology in the region and as you also i am sure know the president has spoken favorably of clean coal projects and i think it is clear that from a practical standpoint that coal fired power generation will play a significant role in the united states for years to come given that fact and china's interest in more efficient coal fired facilities and in clean coal technologies do you agree that the united states should commit the resources needed to be the world's also say that i think it is important to note that the best way to reduce emissions from coal fired power plants in china is to improve the energy efficiency studies have shown that china can cut its growth in energy demands by half just climate change initiative ms herseth sandlin perhaps you can get us the statistics on how many financial resources china has devoted to energy efficiency and we can compare that to what we have done here in the u s including what was recently included in the economic recovery plan supercritical kind of coal plant that barbara was talking about we will pay that part but what we are looking for is could the u s give a tax credit to ge to the vendor to help write down the cost it is thirty percent more expensive just like it is here and they would like to have that help on the technology any additional questions i will be able to recognize them for that purpose i am going to recognize myself right now for a question and that will be for any of you to raise the issue of india for us briefly if any of you would like to add that to the discussion china is obviously you know the issue of the day but india is moving rapidly as well would one of you like to address that about we have to have equal per capita emissions they have been very hard line on the financing and hard line on not supporting unilateral actions you notice i talked about countries are doing things and not being paid for it to date india has done very little that was not paid for in the problems in these developing countries there are impressive renewable energy targets in india brazil mexico but give me your honest what some of the members asked earlier i believe there is tremendous political will at the national level to achieve its renewable energy targets and energy efficiency targets the problem where they fall down is in implementation at the local level provincial government the government has just put into place is a system whereby the job promotions and actually ability to keep the jobs of the provincial governors is going to depend in part upon how well they meet these ambitious renewable energy energy efficiency and emission reduction goals i have found that single initiative has done more to concentrate the minds of the provincial leaders who are responsible the chairman so are you saying in beijing they tell the provincial governors you are going to be in or out of a job based upon your implementation of renewable energy and efficiency targets ms finamore in fact yes that is not the only factor that is going to be considered the chairman that would be the most important an integrated political system where provincial governors do in fact report to the central government so the government has the ability to do so it has made a huge difference the chairman we understand how tammany hall politics work it didn't end that long ago in boston we understand how the local bosses if they don't get the job done might not hold onto their jobs do you think that is something that is likely to be enforced ms finamore yes when the rubber meets the road it will be at the end of two thousand and ten at the end of this governors and states i don't know if any members of this committee attended the governors conference in l a that governor schwarzenegger held this past fall but the ownership that governors in states in the amazon and indonesia and china and elsewhere are taking of this issue and the leadership that they want to demonstrate to the people who vote them into office is quite clear and impressive and particularly their desire to join as part of it rather than the provincial governors so it all depends upon where the most committed public officials are within the nation's structure but at the end of the day we don't care what their governmental structure is as long we shouldn't i think look upon the chinese government as an entirely top down enterprise in which the provincial governments are operating at the behest of the central government that is why some of the five year plan inevitably there is going to be a lot of talk here about how we cap emissions and there are all kinds of opinions on that the ranking member mentioned as he often does cap and tax  i am intrigued by a concept that i have not heard a lot about and it is cap and dividend are any of you familiar with that revenue in the form of paying for the middle income tax cut perhaps assisting people in terms of paying their electric bills and that kind of thing that is the heart of it it is very intriguing because you look at it from an economic standpoint the way to reduce the overall cost of climate regulation the best way is to recycle money and use it as tax shifting eliminate more distortionary taxes it could cut the cost by fifty percent so we get more environmental bang for our buck small piece is for technology and small piece is for the poor which is important it is an opening bid i think the idea is a very intriguing one and one that makes it possible to do more in terms of climate target for less which of course we want to do in today's economic cont be a little hesitant about creating another cost of doing business mister helme remember this auction idea you are basically setting a cap which requires in his case he is saying fourteen percent reduction below two thousand and five levels  president's proposal so we are going to cap the total pollution that is allowed and we are only going to sell permits up to that level of cap so we are going to get a significant emission reduction we are not going to let them buy as many as they want and then pollute to their heart's delight we are basically saying we hello thank you i am sorry i have just been able to join you and you may have talked about this but i would like your thoughts on what we should ask china on either a bilateral or multilateral agreement is that there is a tremendous amount of mistrust that has grown up between the two countries over the years on this issue i believe there is a lot that can be done outside both within and outside the context of the international climate negotiations to help prepare for copenhagen between the u s and china which together account for forty percent of all co emissions in the world so we have developed a set of recommendations for how to strengthen the u s china climate engagement and that includes both  suggestions for how the two countries should focus their bilateral discussions to come up with common ground on some of the key sticking points in the international climate negotiations such as the financial  mechanisms and the technology transfers but i also suggest and this is i think very much in line with secretary clinton's statements on her trip to beijing recently which is there is tremendous opportunity here for bilateral cooperation on clean energy in particular and this has two effects one is that it can help to reduce the amount of mistrust that has built up i think it can provide economic benefits for both countries  importantly no matter what agreement is reached at copenhagen you are going to have this implementation problem in china and other developing countries and whatever bilateral efforts that you jump start right now are going to help jump start the implementation process i believe there is a lot that can be done at a very low cost to the united states in helping to provide technical assistance to china and that is the key area that should be explored now  by the countries of the world should there be one unified which will not be the exclusive place for r and d but should there be one institute that we all contribute to to generate new technologies in this regard for developing new technologies does there need to be one institute that drives that i am not so sure i believe what we have seen in bilateral negotiations between countries are a wealth of possibilities for attraction to this idea that we are going to have some joint global r and d program and maybe it is only one percent of our entire national r and d budget but to me there is a certain charm of the entire world uniting in an r and d project even if it is only a small portion of our global research budget it is just one congressman speaking mister roberts there is no question from our perspective that the more the world can come together and bring technology and finance to bear on these issues in a focused way the better so there will be opportunities in fact an imperative for us to take the cooperative consolidated approach and it will mean creating some new s it is a two year program and spreads out over ten sectors there is a big discussion this week it is the annual meeting of the national people's congress and there is a big debate whether or not it should be expanded so we could for mass transit purposes for reducing emissions from transportation there is some concern that it is going to require greater manufacturing of steel and concrete to build out the railway system three hundred and fifty billion renminbi or fifty dollars billion is earmarked for energy efficiency and environmental protection projects specifically but i would argue that there is an opportunity here for china to spend a lot of the remaining parts contrast about thirty eight percent of the chinese stimulus package by the same definition is going toward a low carbon economy so it is much more oriented toward the things we are talking about the chairman so you are saying twelve percent of eight hundred  indicated it is three hundred million tons a year which is very significant ms finamore just as mister helme said that we can reach a global climate initiative by focusing on just five or six developing countries china has found that it can go a long way towards achieving its ambitious energy efficiency goals by focusing on just one thousand factories and that's what this top one thousand factory program is together this one thousand enterprises constitutes thirty three percent one third of national energy consumption and nearly half of all of its industrial energy consumption they have targeted these plants and required every one of them to do an energy audit hire energy managers there are quotas and they are apparently on track to achieve their quotas for given what is going on with the drug cartels down there and that will be the first issue that the people raise what is the capacity for the government of mexico to implement such a bold plan do any of you want to cement are fairly efficient more efficient than u s production for example the two other sectors electricity and oil refining are national companies if you will they are nationalized they are incredibly inefficient oil refining the worst scored refinery in the world compared to any of the other world oil refining companies but the good news is these are nationally run agencies so we have a good chance i think with the government being able to take this on  cogeneration right there on the table today at these oil refineries and chemical plants they could do tomorrow they haven't been able to do it because mexican law basically says cfe the utility decides what they pay like we all used to do before you all passed the energy reform in  the business leaders in mexico most of the business leaders in mexico are quite committed to this and moving their industries in the right direction i think there is a real opportunity in mexico you raise  minute to summarize what it is that you want us to remember as we are going forward in terms of these developing countries and  what are reasonable expectations for our country and the world both in two thousand and nine and the years ahead because i think that is going to be the way in which this debate gets framed it will be in that long term economic context of where the burdens are and how they are going to be shared so why don't we go in  financing it is a tough sell here in the congress but i think it is in terms of our good faith as i said there are two tests of the u s one is do we have a real target and is it strong i think we can deliver on that side and can we step up and show we are willing to help the developing countries feel that price on carbon emissions i would be inclined to use that as the standard for assessing whether developing countries and developed countries are actually serious about reducing their greenhouse gas emissions are there comparable prices being put on greenhouse gas emissions i don't think it necessarily has to be a high price to begin with but i think we need to keep an eye on the relative prices and to make sure that ours don't get out of line with the rest of the world i guess the only other point i would add to that is it seems to me that this is likely to be an iterative procedure we need to continue to monitor this and adjust our behavior to make sure that it stays in line with the behavior of our major trading partners the chairman using your measurement of serious would you say that the price that is being set in the european community right now is serious  yes i would i would point out that their price applies to only a relatively small percentage of their total greenhouse gas emissions though it is important to keep in anything that gets us started toward having a price on emissions i think is a step in the right direction and a good point for further negotiations  there is no substitute here at home for putting a price on carbon all of the things that we are talking about will not go to scale the investments won't happen without putting a price on carbon at the same time we can't expect every other country to make the same kind of commitment that has clearly been established that there will be differential commitments that reflect different countries political contexts my final comments would be we need global reduction to solve the problems we have here at home the smart money is not to spend all of our money here in the u s but to provide financing and technology to achieve low cost solutions elsewhere in the world because a ton in china and a ton in mexico affects us just as much as a ton created here in the u s so i believe a smart provision of financing not just to clean technologies but also to adaptation through instruments like the global environmental fun essential to address the problem and i believe that we need to create partnerships with other countries through bilateral negotiations and through copenhagen to make this happen i would once again like to urge the committee to look beneath the negotiating posture of china to the tremendous progress that has already been made and the tremendous areas of common ground that exist between the two countries in order to break through the stalemate that has existed for so many years on climate issues a lot of the work that can be done should be going on now with bilateral dialogues some of the efforts going on now are to bring together legislatures from the u s and china to talk about these issues whenever we go to china my executive director is there right now we get questions about what is the u s thinking there is not a lot of understanding about what is happening with this new administration but a tremendous amount of interest i would also say that the bilateral work that needs to be done has already begun in fact nrdc has been working for over thirteen years in bringing together experts from the u s government and california and other leading states in the u s on these kind of technology transfer technical assistance programs so this can form the backbone of an expanded effort just last week for example we brought new acting chairman of the federal electricity regulatory commission to china to speak at a major energy efficiency conference that we sponsored and we got the new secretary of energy to participate by video  renewable energy technology in the world that is good news and of course it is bad news because that should be something that we are touting in the united states brazil has established a goal of reducing deforestation by seventy percent by all of the developing countries in the world as well that must be articulated in partnership with the developed nations and the united states in order to achieve this goal must be a leader  copenhagen that is the goal the congress has set for itself this year to develop legislation that will allow the president to go to that negotiation as a credible negotiating partner with the other nations in the world we thank each