U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 

For sale by the Superintendent of Documents, U.S. Government Printing Office

Internet: bookstore.gpo.gov Phone: toll free (866) 512–1800; DC area (202) 512–1800

Fax: (202) 512–2104 Mail: Stop IDCC, Washington, DC 20402–0001

47–819 PDF 2008

ADMINISTRATION PERSPECTIVES ON 

UNITED NATIONS CLIMATE CHANGE 

CONFERENCE IN BALI 

HEARING 

BEFORE THE

SUBCOMMITTEE ON ENERGY AND AIR QUALITY 

OF THE

COMMITTEE ON ENERGY AND 

COMMERCE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED TENTH CONGRESS 

SECOND SESSION 

JANUARY 17, 2008 

Serial No. 110–80 

( 

Printed for the use of the Committee on Energy and Commerce 

energycommerce.house.gov 

COMMITTEE ON ENERGY AND COMMERCE 

JOHN D. DINGELL, Michigan, Chairman 

HENRY A. WAXMAN, California 

EDWARD J. MARKEY, Massachusetts 

RICK BOUCHER, Virginia 

EDOLPHUS TOWNS, New York 

FRANK PALLONE, JR., New Jersey 

BART GORDON, Tennessee 

BOBBY L. RUSH, Illinois 

ANNA G. ESHOO, California 

BART STUPAK, Michigan 

ELIOT L. ENGEL, New York 

ALBERT R. WYNN, Maryland 

GENE GREEN, Texas 

DIANA DEGETTE, Colorado 

Vice Chairman 

LOIS CAPPS, California 

MIKE DOYLE, Pennsylvania 

JANE HARMAN, California 

TOM ALLEN, Maine 

JAN SCHAKOWSKY, Illinois 

HILDA L. SOLIS, California 

CHARLES A. GONZALEZ, Texas 

JAY INSLEE, Washington 

TAMMY BALDWIN, Wisconsin 

MIKE ROSS, Arkansas 

DARLENE HOOLEY, Oregon 

ANTHONY D. WEINER, New York 

JIM MATHESON, Utah 

G.K. BUTTERFIELD, North Carolina 

CHARLIE MELANCON, Louisiana 

JOHN BARROW, Georgia 

BARON P. HILL, Indiana 

JOE BARTON, Texas 

Ranking Member 

RALPH M. HALL, Texas 

J. DENNIS HASTERT, Illinois 

FRED UPTON, Michigan 

CLIFF STEARNS, Florida 

NATHAN DEAL, Georgia 

ED WHITFIELD, Kentucky 

BARBARA CUBIN, Wyoming 

JOHN SHIMKUS, Illinois 

HEATHER WILSON, New Mexico 

JOHN B. SHADEGG, Arizona 

CHARLES W. ‘‘CHIP’’ PICKERING, 

Mississippi 

VITO FOSSELLA, New York 

STEVE BUYER, Indiana 

GEORGE RADANOVICH, California 

JOSEPH R. PITTS, Pennsylvania 

MARY BONO, California 

GREG WALDEN, Oregon 

LEE TERRY, Nebraska 

MIKE FERGUSON, New Jersey 

MIKE ROGERS, Michigan 

SUE WILKINS MYRICK, North Carolina 

JOHN SULLIVAN, Oklahoma 

TIM MURPHY, Pennsylvania 

MICHAEL C. BURGESS, Texas 

MARSHA BLACKBURN, Tennessee 

PROFESSIONAL STAFF

DENNIS B. FITZGIBBONS, Chief of Staff 

GREGG A. ROTHSCHILD, Chief Counsel 

SHARON E. DAVIS, Chief Clerk 

BUD ALBRIGHT, Minority Staff Director 

(II) 

(III) 

SUBCOMMITTEE ON ENERGY AND AIR QUALITY

RICK BOUCHER, Virginia, Chairman 

G.K. BUTTERFIELD, North Carolina, 

Vice Chairman 

CHARLIE MELANCON, Louisiana 

JOHN BARROW, Georgia 

HENRY A. WAXMAN, California 

EDWARD J. MARKEY, Massachusetts 

ALBERT R. WYNN, Maryland 

MIKE DOYLE, Pennsylvania 

JANE HARMAN, California 

TOM ALLEN, Maine 

CHARLES A. GONZALEZ, Texas 

JAY INSLEE, Washington 

TAMMY BALDWIN, Wisconsin 

MIKE ROSS, Arkansas 

DARLENE HOOLEY, Oregon 

ANTHONY D. WEINER, New York 

JIM MATHESON, Utah 

JOHN D. DINGELL, Michigan (ex officio) 

FRED UPTON, Michigan 

Ranking Member 

RALPH M. HALL, Texas 

ED WHITFIELD, Kentucky 

JOHN SHIMKUS, Illinois 

JOHN B. SHADEGG, Arizona 

CHARLES W. ‘‘CHIP’’ PICKERING, 

Mississippi 

ROY BLUNT, Missouri 

STEVE BUYER, Indiana 

MARY BONO, California 

GREG WALDEN, Oregon 

MIKE ROGERS, Michigan 

SUE WILKINS MYRICK, North Carolina 

JOHN SULLIVAN, Oklahoma 

MICHAEL C. BURGESS, Texas 

JOE BARTON, Texas (ex officio) 

PROFESSIONAL STAFF

SUE D. SHERIDAN, Chief Counsel 

JOHN W. JIMISON, Counsel 

RACHEL BLESHMAN, Legislative Clerk 

DAVID MCCARTHY, Minority Counsel 

(V) 

C O N T E N T S 

Page 

Hon. Rick Boucher, a Representative in Congress from the Commonwealth 

of Virginia, opening statement ............................................................................ 1 

Hon. Fred Upton, a Representative in Congress from the State of Michigan, 

opening statement ................................................................................................ 2 

Hon. John D. Dingell, a Representative in Congress from the State of Michigan, opening statement ....................................................................................... 4 

Hon. Ed Whitfield, a Representative in Congress from the Commonwealth 

of Kentucky, opening statement ......................................................................... 6 

Hon. Mike Doyle, a Representative in Congress from the Commonwealth 

of Pennsylvania, opening statement ................................................................... 7 

Hon. Michael C. Burgess, a Representative in Congress from the State of 

Texas, opening statement .................................................................................... 8 

Hon. Tammy Baldwin, a Representative in Congress from the State of Wisconsin, opening statement ................................................................................... 10 

Hon. G.K. Butterfield, a Representative in Congress from the State of North 

Carolina, opening statement ............................................................................... 11 

Hon. Joe Barton, a Representative in Congress from the State of Texas, 

opening statement ................................................................................................ 13 

WITNESSES

James L. Connaughton, Chairman, White House Council on Environmental 

Quality .................................................................................................................. 15 

Prepared statement .......................................................................................... 19 

Answer to submitted question ......................................................................... 123 

SUBMITTED MATERIAL

′′U.S. Clean Technology Development,′′ presentation by Alexander ′′Andy′′ 

Karsner, United States Assistant Secretary of Energy .................................... 60 

′′Actions to Address Climate Change in the Land Use Sector,′′ presentation 

by William Hohenstein, United States Department of Agriculture Global 

Change Program Office ........................................................................................ 91 

Bali Action Plan ....................................................................................................... 103 

′′Methane to Markets, Partnership Overview and USG Accomplishments,′′ 

presentation by William Irving ........................................................................... 108 

(1) 

ADMINISTRATION PERSPECTIVES ON UNITED 

NATIONS CLIMATE CHANGE CONFERENCE 

IN BALI 

THURSDAY, JANUARY 17, 2008 

HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON ENERGY AND AIR QUALITY, 

COMMITTEE ON ENERGY AND COMMERCE, 

Washington, DC. 

The subcommittee met, pursuant to call, at 10:05 a.m., in room 

2123 of the Rayburn House Office Building, Hon. Rick Boucher 

(chairman) presiding. 

Members present: Representatives Boucher, Butterfield, Melancon, Barrow, Markey, Doyle, Gonzalez, Inslee, Baldwin, Matheson, 

Dingell (ex officio), Upton, Hall, Whitfield, Shadegg, Buyer, Walden, Sullivan, Burgess, and Barton (ex officio). 

Staff present: Bruce Harris, Sue Sheridan, Laura Vaught, Chris 

Treanor, Rachel Bleshman, Alex Haurek, Kurt Bilas, David McCarthy, Tom Hassenboehler, Garrett Golding. 

OPENING STATEMENT OF HON. RICK BOUCHER, A REPRESENTATIVE IN CONGRESS FROM THE COMMONWEALTH 

OF VIRGINIA 

Mr. BOUCHER. The subcommittee will come to order. I want to 

begin this morning by welcoming to the position of ranking Republican member of the subcommittee our friend and colleague from 

Michigan, Mr. Upton. I have long admired Mr. Upton’s legislative 

work whether on energy policy or in his previous position as chairman of the Telecommunication Subcommittee, and most recently 

ranking member of that subcommittee. And I very much look forward to working closely with him as we undertake the challenges 

that lie ahead for the subcommittee this year. 

I have also been asked by Mr. Wynn to express that the reason 

for his absence from the subcommittee this morning is that he is 

attending a funeral in his district and will make every effort to join 

us later during the hearing. 

Today the subcommittee resumes its examination of climate 

change and the determination of an appropriate legislative response. Last year we conducted extensive hearings which helped to 

lay a foundation for the development of climate change legislation. 

We published a position paper announcing our intention to produce 

a mandatory greenhouse gas control program relying on cap-andtrade as the control methodology. 

2 

For the past 6 months our focus was the drafting and passage 

of the Energy Independence and Security Act of 2007. While that 

new law makes important contributions to the reduction of greenhouse gas emissions by increasing auto fuel economy, enhancing 

energy efficiency, and requiring the greater use of renewable fuels 

it does not address the climate change challenge in a comprehensive manner. Separate economy-wide legislation will be necessary 

to meet that challenge. It is our intention to produce that separate 

legislation during the current year. 

We will publish additional position papers focusing on various 

components of the legislation to come. We will conduct additional 

hearings. We will seek to involve all members of the subcommittee 

in a bipartisan process as the legislation is developed, as it is considered in the subcommittee, and as it is brought to full committee 

and subsequently to the House. We will consult with the Administration, with the private sector, and also with environmental advocates, and we will process through subcommittee, full committee, 

a bill for House consideration later during this year. 

The legislative response to climate change will be the subcommittee’s major focus, not our entire focus but certainly our major focus 

during 2008. Appropriately, we begin that work this morning by 

examining the process by which the nations that are signatories to 

the U.N. Framework Convention on Climate Change will address 

global climate change challenges after the expiration of the Kyoto 

Treaty in the year 2012. A key step in that process was the conference held in Bali in December which created the Bali Action 

Plan, sometimes referred to as the Bali road map. That plan forms 

the parameters for negotiations among the parties to the Framework Convention as they decide over the course of the coming year 

and for a portion of 2009 what agreement will replace the Kyoto 

Protocol in the post-2012 era. 

This morning our sole witness was the key U.S. representative 

in the Bali conference. He will also lead United States negotiations 

between now and the time of the Copenhagen conference in 2009 

at which it is expected that a final post-2012 agreement will be 

concluded among the convention parties. We are pleased to have as 

our witness this morning the Honorable James Connaughton, 

Chairman of the White House Council on Environmental Quality. 

He is the principal advisor to the President on among other subjects climate change, and we very much welcome him and are 

pleased that he could join us today. 

We will turn to his testimony following the receipt of opening 

statements by other members of the subcommittee, and at this 

time I am pleased to welcome the new ranking member of the subcommittee, and ask for the opening statement of Mr. Upton. 

OPENING STATEMENT OF HON. FRED UPTON, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF MICHIGAN 

Mr. UPTON. I thank my Chairman, and I thank him for his very 

kind words at the start, but I also thank him for the years of relationship that we have had and also serve in the same hallway, and 

we pass each other and walk to the floor quite often, but I too am 

very excited about this new role for myself, and obviously working 

with you and with Chairman Dingell and my great friend, Mr. BarVerDate Nov 24 2008 15:56 Apr 02, 2009 Jkt 037690 PO 00000 Frm 00008 Fmt 6633 Sfmt 6633 C:\DOCUMENTS AND SETTINGS\CWELLS1\110-80 SCOM1 PsN: JIMC
3 

ton. I also want to thank our distinguished witness today, Mr. 

Connaughton, for being with us. I had the opportunity to travel 

with him earlier last year along with Chairman Boucher and Ranking Member Hastert on energy and climate change and I look forward to your testimony today. 

Much of the focus of this committee over the next year will be 

on climate change, as the Chairman indicated. The U.N. Framework Convention on Climate Change and the Bali Action Plan are 

just in fact the beginning of what has shaped up to be a global 

issue of concern. Emphasis must be placed on the word global. 

While I feel strongly that addressing climate change is certainly 

important, I believe that we must address this through a global 

voluntary framework that focuses on innovations and technology 

and efficiency rather than a pure government mandate, and at the 

end of the day we will need to demonstrate that the price paid in 

both jobs and dollars equates to some tangible environmental benefits to the American people. 

In my view, spending trillions of dollars and losing a countless 

number of jobs to maybe alter temperatures by a tenth of a degree 

while China and India continue to spew emissions is not the option 

that we are looking for. By the year 2030 our energy needs are 

going to grow by more than 50 percent. Let me say that again. By 

the year 2030 our energy needs are going to grow by more than 50 

percent. That is a fact that we are going to have to deal with regardless of climate change. The cost and supply of energy have a 

direct impact on jobs in our economy. We cannot cap our economic 

growth and trade it away to China or India. We cannot cap American jobs and trade them to China or India. As far as I am concerned, these are not valid options. Unless we want to put a lid on 

our economy and burden consumers with a multi-billion dollar cost 

increase, energy demand must be met with reliable sources of energy that are also clean. 

While I support reducing greenhouse gas emissions, thoughtful 

choices need to be made on how we are going to meet increasing 

energy demand. I support renewable energy. We do need to expand 

the use of wind and other means. I support energy efficiency. That 

was my provision along with Ms. Harman, the Harman-Upton provision to increase lighting efficiency standards saving over 120 million tons of CO2 per year while simultaneously saving consumers 

billions in energy costs. I support clean energy. I am a strong advocate for nuclear which has a life cycle emission equal to wind and 

hydro. However, as we move forward and try to meet our energy 

demand, we must take a common sense approach that doesn’t 

needlessly pick winners and losers. Congress must not place mandates on the market that will only serve to increase energy costs 

for hard-working Americans while at the same time sending jobs 

overseas. 

I believe that a voluntary framework is best to insure that our 

future energy demands are met with clean and affordable power. 

For example, the so-called RPS that passed the House last year excluded new hydro and nuclear, two of the cleanest, most cost-effective energy sources available. The RPS won’t give us energy security. It won’t be effective in reducing greenhouse gas emissions. 

What we really need is a flexible clean portfolio standard that inVerDate Nov 24 2008 15:56 Apr 02, 2009 Jkt 037690 PO 00000 Frm 00009 Fmt 6633 Sfmt 6633 C:\DOCUMENTS AND SETTINGS\CWELLS1\110-80 SCOM1 PsN: JIMC
4 

cludes any source of power like nuclear that is both clean and affordable. If the goal is to reduce greenhouse gases, why pick the 

winners or losers? Let us be realistic. Currently we get approximately 20 percent of our electricity from nuclear. By comparison, 

France gets nearly 90 percent. Seven percent of our generation 

comes from hydro. Just to stay even with these two zero emission 

sources, we would need to build by 2030 over 50 new nuclear 

plants and almost 2,000 hydro plants, and that is just to stay even 

if we keep those same ratios. 

If we are serious about cutting emissions, our usage of nuclear 

needs to be much higher than 20 percent. During the climate debate it is easy to toss around numbers without a real understanding of perhaps what they mean. One gigaton of CO2 equals 

273 zero emission, 500 megawatt coal-fired plants or 1,000 carbon 

sequestration sites, we have only three today, or 136 new nuclear 

plants at 1 GW each, or 270,000 wind turbines of 1 megawatt each 

or 125 times the current global solar photovoltaics generation or 

convert a barren area of almost two times the size of England for 

bio-mass cultivation, or a barren area larger than Germany and 

France combined for a CO2 storage in new forests. 

Many nations that attended Bali and many members of this committee advocate cutting greenhouse gases by 50 percent by 2030, 

approximately 4 gigatons of CO2. Are we willing or able to build 

550 new 1 gigawatt nuclear plants, over a million new wind turbines, or 1,000 new zero emission coal-fired power plants? Current 

legislation measures seek to pick winners and losers, and will lead 

to higher costs for consumers, sending our jobs overseas, and disproportionately harming perhaps the poorest in our population. I 

do support the goal of cutting emissions but let us do it in a way 

that is least harmful to our economy. I yield back to my chairman. 

Mr. BOUCHER. Thank you very much, Mr. Upton. I am now 

pleased to recognize for his opening statement the Chairman of the 

full committee, the distinguished gentleman from Michigan, Mr. 

Dingell. 

OPENING STATEMENT OF HON. JOHN D. DINGELL, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF MICHIGAN 

Mr. DINGELL. Mr. Chairman, thank you, and I want to thank you 

and commend you for holding this hearing. I begin by welcoming 

my colleagues to this new session of Congress. We have a new 

ranking member on this subcommittee, my dear friend from Michigan, Mr. Upton, who I know will provide exceptional leadership 

and competence, and I welcome him with particular enthusiasm. 

We look forward to working with him as we continue to grapple 

with difficult energy issues in matters relative to climate change. 

Today we will embark upon what I believe is the third phase of 

this committee’s work on climate change in this Congress. The first 

phase was the intensive set of hearings convened by you, Mr. 

Chairman, last year. It served as the foundation for all members 

to become familiar with the difficult terrain on this issue. 

These hearings were very instructive, and I commend you, Mr. 

Chairman, for your leadership, and, quite frankly, for your stamina 

and patience. The second phase was the legislation introduced by 

5 

this committee that was ultimately enacted into law as it provided 

the framework of the legislation that was adopted by the Congress 

last year. It contained landmark provisions on CAFE, bio-fuels, and 

energy efficiency. The energy efficiency provisions alone will remove 10 million tons of carbon dioxide from the atmosphere by 

2030, the equivalent of taking all cars, trucks off the road, and all 

planes out of the skies for a period of 5 years. That is a remarkable 

achievement but it is only the beginning of what must be done. 

Now we begin the third phase of our work, crafting climate change 

legislation that will protect our environment without putting the 

American economy at a disadvantage. This undertaking will require us to work through an enormous amount of information in 

order to arrive at the best public policy in our nation. 

It will also require us to commence the assembling of a piece of 

legislation and the drafting of a very difficult piece of legislation in 

a rather constrained time frame. In doing this work, we must be 

mindful of the need to coordinate U.S. domestic policy with ongoing 

international negotiations pursuant to the recently adopted Bali 

Action Plan. We must also do something else which is important, 

and that is to see to it that the United States does carry out its 

responsibilities but also to see to it that we are not stuck with the 

entire bill for addressing the problem of climate change and global 

warming. This was one of the defects of the Kyoto plan, which left 

the United States with a significant burden and very few others 

with any burden of consequence. The end result of that was that 

it was rejected by the Senate which informed the Administrations 

then and now by a unanimous vote that there will be no legislation 

which does not impose burdens on others if the United States undertakes its responsibilities. This is something we are going to 

have to keep in mind both because of fairness to this country and 

because of the fact that we have a certain duty to our constituents 

to see to it that we do not be the only ones who do this thing as 

we move forward. 

We are going to require then bipartisan cooperation, and I hope 

my friends on both sides of the aisle will come to this task with 

an open mind and a willingness to be helpful. It is going to require 

active engagement in the Administration, something which remains to be seen. I would note that we had very small involvement 

with the Administration in our undertakings last year. I hope that 

that will significantly improve. Judging from the rather thin testimony presented to this subcommittee by our witness today, I must 

confess that I am less than optimistic. I hope that the remarks of 

our witness before the subcommittee will answer our questions and 

will be more forthcoming. Mr. Chairman, again I commend you for 

holding this hearing, and for initiating a very important phase of 

an extremely important undertaking. I yield back the balance of 

my time. 

[The prepared statement of Mr. Dingell follows:] 

STATEMENT OF HON. JOHN D. DINGELL

Chairman Boucher, thank you for holding this hearing. I want to begin by welcoming my colleagues to this new session of Congress. We have a new Ranking 

Member on this Subcommittee, my good friend from Michigan, Mr. Upton, who I 

6 

know will provide exceptional leadership. We look forward to working with him as 

we continue to grapple with energy issues and climate change. 

Today we embark on what I believe is the third phase of this Committee’s work 

on climate change in this Congress. The first phase was the intensive set of hearings convened by Chairman Boucher last year that served as a foundation for all 

Members to become familiar with the difficult terrain of this issue. Those hearings 

were very instructive and I commend Chairman Boucher for his leadership - and 

his stamina. 

The second phase was the legislation produced by this Committee that was ultimately enacted into law and contained landmark provisions on CAFE, biofuels, and 

energy efficiency. The energy efficiency provisions alone will remove 10 billion tons 

of carbon dioxide from the atmosphere by 2030, the equivalent of taking all cars, 

trucks, and planes off the road and out of the skies for 5 years. That’s a remarkable 

achievement, but it’s only the beginning. 

Now we begin the third phase of our work: crafting climate change legislation that 

will protect our environment without putting the American economy at a disadvantage. This undertaking will require us to work through an enormous amount of information in order to arrive at the best public policy for our Nation.In doing this 

work, we must be mindful of the need to coordinate U.S. domestic policy with ongoing international negotiations pursuant to the recently adopted ′′Bali Action Plan.′′ 

This will require bipartisan cooperation and I hope that my friends on the other 

side will come to this task with an open mind. It will require as well the active engagement of the Administration, which remains to be seen. Judging from the rather 

thin testimony presented to the Subcommittee by our witness today, however, I am 

less than optimistic. I hope his remarks before the Subcommittee and answers to 

our questions will be more forthcoming. 

Again, Mr. Chairman, I commend you for holding this hearing today and initiating the next phase of this important undertaking. 

Mr. BOUCHER. Thank you very much, Mr. Dingell. The gentleman from Kentucky, Mr. Whitfield, is recognized for 3 minutes. 

OPENING STATEMENT OF HON. ED WHITFIELD, A REPRESENTATIVE IN CONGRESS FROM THE COMMONWEALTH OF KENTUCKY 

Mr. WHITFIELD. Mr. Chairman, thank you very much. And like 

others on this subcommittee, we look forward to working with 

Ranking Member Upton and congratulate him on his new position, 

and all of us have some important issues in energy facing our country that we look forward to the opportunity to move forward. I 

want to welcome Chairman Connaughton and look forward to his 

testimony today and working with him as we move forward. I think 

today obviously we are going to be focused on the post-Kyoto world 

and a goal of reaching an agreement by 2009 that most countries 

in the world can sign and agree to. And I think that obviously as 

has been stated earlier, this is really going to be a balancing act 

because we are going to have to determine what responsibilities did 

the developing countries in the world have as well as the developed 

countries of the world. 

And as we move forward, I believe that we have to recognize that 

since the U.S. has a 250-year reserve of coal, and that coal has to 

continue to play an important part in meeting our energy needs. 

Fred Upton mentioned that our demand for energy is going to increase by 50 percent over the next 10, 15, 20 years, and we are not 

going to be able to meet those energy demands without using coal. 

And we know that in China they continue to develop coal-fired 

plants, and we do have the technology to use clean coal. But I 

think ultimately we simply have to look at what is the cost of making sure that we reduce these greenhouse gas emissions, what imVerDate Nov 24 2008 15:56 Apr 02, 2009 Jkt 037690 PO 00000 Frm 00012 Fmt 6633 Sfmt 6633 C:\DOCUMENTS AND SETTINGS\CWELLS1\110-80 SCOM1 PsN: JIMC
7 

pact or steps that we take are going to have on employment in the 

United States and how is it going to affect our competitiveness 

with other economies around the world. 

So we have a great opportunity. All of us are looking forward to 

trying to solve this problem and I look forward to participating in 

today’s hearing as we move forward. Thank you very much. 

Mr. BOUCHER. Thank you very much, Mr. Whitfield. The gentleman from Georgia, Mr. Barrow, is recognized for 3 minutes. 

Mr. BARROW. I thank the Chairman. In the interest of time, I 

will waive an opening. 

Mr. BOUCHER. The gentleman from Georgia waives his opening 

statement, and I would note for the benefit of other subcommittee 

members that in accordance with the rules of the subcommittee 

and full committee any member who waives an opening statement 

at this time will then have 3 minutes added to that individual’s 

time for propounding questions to the witness. The gentleman from 

Pennsylvania, Mr. Doyle, is recognized for 3 minutes. 

OPENING STATEMENT OF HON. MIKE DOYLE, A REPRESENTATIVE IN CONGRESS FROM THE COMMONWEALTH OF PENNSYLVANIA 

Mr. DOYLE. Thank you, Mr. Chairman. I also would like to welcome back all of our colleagues. I hope we have all returned well 

rested and ready to roll up our sleeves and begin working together 

to produce a comprehensive legislation to address the dangers of 

global warming. This monumental challenge is one I believe we can 

and must meet so that this Congress can deliver a workable solution to the American people this year. As everyone on this dais 

knows, I am firmly committed to insuring that our nation not only 

dramatically decrease our global warming gas emissions but leads 

the world to insure that all other nations do their part to reach our 

common goal. 

One thing is clear, Mr. Chairman. If we do nothing, others will 

do nothing. It is critical that we put our money where our mouth 

is so that we can push others to do the same. The meetings in Bali 

were an important step towards achieving this goal of a world of 

nations united to combat global warming. Development such as 

launching negotiations with developing countries instead of simply 

holding discussions are very important. I was also happy to see 

that the Bali Action Plan takes into account the challenges these 

nations face as they strive to do their part, and I think the plan’s 

focus on measurable, reportable, and verifiable mitigation plans 

based on individual country’s needs and resources will go a long 

way to achieving our shared goal. 

However, we are a long way from turning these commendable 

words and statements into action. We need a firm commitment 

backed up by concrete action, not words. I have to say in reviewing 

our witness’ testimony that I can’t remember another time during 

my service in Congress when a witness testified for a hearing and 

his testimony is a mere 1-page document that describes a slide 

presentation and a statement from the President. I would hope 

that this Administration doesn’t think that this committee is not 

worth preparing comprehensive testimony for. 

8 

We need, Mr. Chairman, concrete action. I stand ready to work 

with you and any member of this committee that wants to address 

the real world challenges that global warming presents. This is a 

global problem. It requires a global solution. I would hope that this 

Administration will join us in this critical effort as we move forward. With that, Mr. Chairman, I will yield back my time. 

Mr. BOUCHER. Thank you very much, Mr. Doyle. The gentleman 

from Texas, Mr. Burgess, is recognized for 3 minutes. 

OPENING STATEMENT OF HON. MICHAEL C. BURGESS, A 

REPRESENTATIVE IN CONGRESS FROM THE STATE OF TEXAS 

Mr. BURGESS. Thank you, Mr. Chairman. I certainly want to welcome our witness, Mr. Connaughton. Thank you for testifying before us today. It is timely that you are here to talk about the role 

the United States will play in global climate change negotiations 

over the next couple of years. It is also timely that we are having 

a hearing about the economic stimulus package that Congress is 

currently preparing or at least rumored to be preparing, so I am 

pleased we have held off on voting on that package long enough to 

consider the impact of our climate change plan on our efforts to 

stimulate growth in the American economy. 

Mr. Connaughton, from what I have heard, your representation 

of the United States in Bali was commendable, and I want to thank 

you for meeting the objectives and challenging all countries to participate. Global problems require global solutions, and I hope we 

can continue to pursue that goal. From your statements at the conference I understand that we want the United States to take a lead 

in the negotiations. That is as it should be. Your hand-outs from 

the conference show that since 2001 the United States has invested 

more money, $37 billion, into global climate change than any other 

country represented at the conference, including Kyoto-compliant 

countries. Let us state that again for emphasis. The United States 

has invested more money than any other country, including Kyotocompliant countries. 

We often hear about the lack of United States support for global 

climate change initiatives, so I hope you can shed some light on 

what we have provided so far and how we can engage in the negotiation process over the next 2 years to put together a package that 

would be workable in the future. Anecdotally, this committee took 

a field trip to Scandinavia in August, 2006. Many members who 

are on this subcommittee participated. We talked about energy and 

telecom issues. And in the country of Norway we met with some 

of our counterparts in the Norwegian parliament. Norway produces 

most of its power from hydroelectric, which obviously is carbon 

neutral, but they had a tough series of years where it didn’t rain 

for 3 years so their production was low. Well, they get a lot of natural gas from the North Sea so instead of liquefying it and putting 

it on the big orange boat over to Ed Markey’s district maybe they 

could just open up a couple of gas-fired electrical plants so that 

their constituents didn’t freeze to death during their winter. But 

they can’t do that because they are signatories of the Kyoto so they 

can’t burn the natural gas because that will put carbon into the atmosphere. 

9 

So in order to meet the demand of their constituents they would 

buy power from Denmark and provide power to their citizens that 

way, buy electricity from Denmark. How does Denmark generate 

their power? They burn coal. It is this sort of circuitous logic that 

goes on that just defies gravity, and this is one of the challenges 

that of course you and this committee have to confront is the myths 

that surround this global concern. In Texas on the way to the airport to fill up before coming here this week gasoline cost $3.10. 

January is the cheapest gas in Texas because the summer driving 

period isn’t here and we don’t have all the expensive ethanol blends 

that the Clean Air Act demands that we have. So Texans, I suspect, are going to be paying in excess of $4.00 a gallon for gas 

around Memorial Day. We have the economic stimulus package 

coming up. Every dollar that we provide, whatever we do, every 

dollar that we provide is going to be immediately eaten up in increased energy cost at least as it will affect the constituents in my 

district. 

Again, Mr. Chairman, I thank you for holding this hearing. I 

think it is timely. I think it is important work, and look forward 

to the testimony of our witness today. I yield back. 

[The prepared statement of Mr. Burgess follows:] 

STATEMENT OF HON. MICHAEL C. BURGESS

Thank you Mr. Chairman, 

I would like to welcome our witness, Mr. Connaughton, and thank him for testifying today. 

Mr. Connaughton, it is timely that you are here to talk about the role that the 

United States will play in global climate change negotiations in the next two years. 

It is also timely because we have been hearing about an economic stimulus package 

that this Congress is preparing. I am pleased that we have held off on voting on 

that package long enough to consider the impact of our climate change plan on our 

efforts to stimulate growth in the American economy. 

Mr. Connaughton, from what I have heard, your representation of the United 

States in Bali is commendable and I want to thank you for meeting the objectives 

and challenging all countries to participate. Global problems require global solutions 

and I hope we can continue to pursue that goal. From your statements at the Bali 

Conference I understand that we want the United States to take the lead in these 

negotiations. Your power point handouts from the Conference show that, since 2001, 

the United States has invested more money ($37B) into global climate change initiatives than any other country represented at the Conference, including Kyoto compliant countries. We often hear about the lack of United States support for global climate change initiatives, so I hope you can shed some light on what we have provided so far and how we can engage in the negotiation process over the next two 

years to put together a package that will be workable after 2012. 

Mr. Chairman, I am concerned that as a nation, we cannot expect to engage in 

economic growth if we continue to avoid the uncertainty of the cost of climate 

change compliance. All of our constituents are worried about the rising cost of energy and the uncertainty in our markets. In fact, last week in Texas I stopped and 

filled up with $3.10 gasoline. As I am sitting here today, I am trying to calculate 

exactly how much we are going to pay for a gallon of gasoline next spring. It is concerns me greatly to know that we may see gas prices as high as $4.00 per gallon 

when summer blends are mixed in. 

In our continued negotiations with the other participants, I hope we raise the 

question, ′′how do we build a global consensus to implement an environmental protection plan that not only does no harm but actually builds our global economy?′′ 

I believe that sustaining our planet and avoiding catastrophic global climate change 

are not separate from a successful global economy model, they are actually mutually 

dependent. 

I hope that through the next phase of negotiations we can build a consensus that 

helps grow our domestic renewable and alternative energy programs and allows us 

to create new jobs producing the products and fuel that our planet needs to sustain 

10 

growth. I hope we can strengthen our global energy trade and investment in cutting 

edge technology. Ultimately, I also hope that the developing world is willing to join 

us in these efforts because, as we have seen, when the cost of compliance is high, 

developing economies simply sustain growth in exchange for mitigating the effects 

of climate change. 

Mr. Chairman, we cannot avoid indicators that point out that global demand for 

energy is going to increase regardless of our efforts to cap and control carbon. Global 

energy demand growth has been projected at 50-60 percent due to improved living 

standards and population growth in developing countries. ERCOT, the Electric Reliability Council of Texas, has said that unless new generation capacity is built in 

Texas, we will not have enough electricity to ensure reliability within the next 5- 

10 years. In addition, the fossil fuel market is a global market and we cannot operate as a protectionist society that is only looking to sustain our growing demand 

while our economy is struggling--we must also work to seek out new sources of domestic energy to provide the production that fits the growing demand within this 

global market. 

Mr. Connaughton, I hope that the United States can take the lead in these negotiations and make a real global impact. By leading the way, we can create a platform that is not only measurable, reportable, and verifiable but is also transparent, 

predictable, and spreads compliance evenly across the participants. I hope that we 

can do this while at the same time boosting our lagging domestic economy by providing the products that sustain growth at home and in the developing world. 

With that Mr. Chairman, I yield back. 

Mr. BOUCHER. Thank you very much, Mr. Burgess. The gentleman from Texas, Mr. Gonzalez, is recognized for 3 minutes. 

Mr. GONZALEZ. Waive opening. 

Mr. BOUCHER. The gentleman waives his opening statement. The 

gentleman from Washington State, Mr. Inslee, if he is here. The 

gentlelady from Wisconsin, Ms. Baldwin, is recognized for 3 minutes. 

OPENING STATEMENT OF HON. TAMMY BALDWIN, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF WISCONSIN 

Ms. BALDWIN. Thank you, Mr. Chairman. The attention focused 

on the issue of climate change has clearly reached a new level. We 

are no longer questioning whether we should act but rather how 

and when we will act, and as participants in the U.N. climate 

change conference arrived in Bali the answers were clear. We must 

act now with firm, bold, and decisive actions that push the envelope and provide us with a road map for repairing the damage we 

have done to our planet. I am continuously struck by the efforts to 

combat climate change in our country whether through environmental advocacy, private sector initiatives or local, state, and regional agreements. These programs demonstrate America’s commitment and drive to be stewards of our environment. But I often 

wonder is the rest of the world aware of most of these efforts. Do 

they know that there is a movement here in America to reduce 

greenhouse gas emissions, increase our energy efficiency, and protect our planet for generations to come. 

Unfortunately, I believe too often what the international community hears is how our Administration has done everything in its 

power to stifle the debate on climate change through sidelining 

science, editing government reports out of EPA or NASA or refusing to back firm goals for reducing emissions. It is clear that not 

only do we lack a strong national strategy for addressing climate 

change but also that we are missing the leadership that is comVerDate Nov 24 2008 15:56 Apr 02, 2009 Jkt 037690 PO 00000 Frm 00016 Fmt 6633 Sfmt 6633 C:\DOCUMENTS AND SETTINGS\CWELLS1\110-80 SCOM1 PsN: JIMC
11 

mitted to set one in place, and herein lies the problem with the 

agreement reached in Bali. Our Administration sent representatives poised as our nation’s voice to lead the talks in Bali, and rather than uniting around a policy that reflects the views of Americans, one that demonstrates a finite commitment to addressing climate change, the agreement reached shows how our leaders can 

water down, avoid, and delay our actions to reduce greenhouse gas 

emissions. 

The perception of the United States through the eyes of our 

international friends has taken a hit. Criticism has been widespread and the calls for true leadership from our country have been 

loud and clear. As one participant put it during the debate, the 

international community looks to us for leadership but if we are 

not going to do so, we must move out of the way. Mr. Chairman, 

the climate in Bali and the rest of the world may be changing for 

the better but the forecast here in Washington for the next year appears to be politics as usual. Our Administration had the opportunity to catch the momentum and bring our nation up to speed, 

and I just hope that by the time the temperature changes it won’t 

be too late for us to take action. Thank you, and I yield back the 

balance of my time. 

Mr. BOUCHER. Thank you very much, Ms. Baldwin. The gentleman from Indiana, Mr. Buyer. The gentleman waives his opening statement. The gentleman from Oklahoma, Mr. Sullivan is recognized. Mr. Sullivan also waives his statement. The gentleman 

from North Carolina, the Vice-Chairman of the subcommittee, the 

gentleman from North Carolina, Mr. Butterfield, is recognized for 

3 minutes. 

OPENING STATEMENT OF HON. G.K. BUTTERFIELD, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NORTH 

CAROLINA 

Mr. BUTTERFIELD. Thank you very much, Mr. Chairman, for convening this important hearing today, and I thank the witness for 

coming forward today with his very important testimony. I appreciate the witness’ willingness to come today to speak to us about 

the Administration’s perspective on the recent U.N. climate change 

conference in Bali, but I must admit that I am mystified to some 

extent about how concise or inconcise the written testimony that 

has been provided to us appears to be. Most of the members of 

Congress were not able to participate in the conference and so I am 

looking forward to hearing the testimony today and hopefully we 

can be provided more details than have been forthcoming. 

We have all heard the phrase, Mr. Chairman, about kicking the 

can down the road. Well, I am worried that if we don’t take immediate action on this subject there won’t be much of a can to kick 

anymore or even a road for that matter. Thankfully, parties were 

able to agree upon a framework while continuing discussions by 

way of the Ad-Hoc Working Group that will meet at least 4 times 

this year, and it is my sincere hope that the U.S. will have something more substantive to contribute in April than an innocuous 

agreement or technology transfer with other nations. And the world 

in 8 months will witness the Olympics. They will be in China, the 

country that now holds the distinction of being by some estimation 

12 

the world’s largest emitter of greenhouse gases. China’s capital, 

which is the City of Beijing, is currently attempting at this late 

hour to reduce its crippling level of smog and pollution so athletes 

traveling there will be able to compete without covering their faces. 

I am not sure if the Chinese will get things under control by then 

but the point is that this country, the United States, cannot chastise the Chinese for their chronically bad pollution levels because 

we are in no better position than they are to throw accusations. 

Since the beginning of this Administration, it has consistently undermined world bodies that were put in place to facilitate order 

and compromise on some of the world’s most pressing concerns. My 

point is that these actions continue to undermine our historically 

strong position to negotiate in good faith with the rest of the world. 

With 1 more year left of this Administration, I am not sure what 

the Administration has to gain by continuing this line. Cynicism 

has become so evident that the delegates moved the goal post a little and decided that negotiations should have agreed upon by December of 2009, not really enough time for whatever the new Administration has in place but enough time to move past the inaction that has crippled us to this point. 

I would like to hear more from the witness about 2 principal concerns that I have as a member from a coastal state who will undoubtedly be the first to bear the brunt of whatever adverse effects 

of climate change this country experiences. Mr. Chairman, I have 

run out of time. I am going to reserve the remainder of my statement. I will include it in the record, and I will ask the appropriate 

questions at the appropriate time. Thank you. 

[The prepared statement of Mr. Butterfield follows:] 

STATEMENT OF HON. G.K. BUTTERFIELD

Good morning Mr. Connaughton, Happy New Year. I appreciate you coming to 

speak to us about the Administration’s perspective on the recent United Nations Climate Change Conference in Bali but I must admit I am mystified about how concise 

your written testimony you provided this Committee was. It is my hope that you 

will speak to us in greater detail since most Members of Congress were not able 

to visit the Conference. I’m not so sure how Happy 2008 will end up being if your 

boss, the President, decides to maintain the status quo instead of being the Decider 

as he would have us believe him to be. We’ve all heard of the phrase, ′′kick the can 

down the road′′, well, I’m worried if we don’t take immediate action, there won’t be 

much of a can to kick anymore. Or a road for that matter. Thankfully, parties were 

able to agree upon a framework for continuing discussions via an Ad Hoc working 

group that will meet at least four times this year and it is my sincere hope that 

the US will have something more substantive to contribute in April than an innocuous agreement on technology transfer with other nations. 

The world in eight months will witness the Olympics in China, the country that 

now holds the distinction of being, by some scientist’s estimation, the world largest 

emitter of green house gases. China’s capital city, Beijing, is currently attempting 

at this late hour to reduce its crippling level of smog and pollution so athletes traveling there will be able to compete without masks covering their faces! I’m not sure 

if the Chinese will get things under control by then but the point is that this country, the United States of America, cannot chastise the Chinese for their chronically 

bad pollution levels because we’re in no better position than they are to throw accusations. Since the beginning of this administration, it has consistently undermined 

world bodies that were put in place to facilitate order and compromise on some of 

the world’s most pressing concerns. My point Mr. Connaughton is that these actions 

continue to undermine our historically strong position to negotiate in good faith 

with the rest of the world. With one more year left, I’m not sure what the Administration has to gain by continuing down this line. Cynicism has become so evident 

that the UNFCCC delegates moved the goal posts a little and decided that negotiaVerDate Nov 24 2008 15:56 Apr 02, 2009 Jkt 037690 PO 00000 Frm 00018 Fmt 6633 Sfmt 6633 C:\DOCUMENTS AND SETTINGS\CWELLS1\110-80 SCOM1 PsN: JIMC
13 

tions should agreed upon by December of 2009. Not really enough time for whatever 

new Administration is in place but enough time to move past the inaction that has 

crippled negotiations up to this point. 

I would like to hear more from you about two principle concerns that I have as 

a Member of Congress from North Carolina, a coastal state that will undoubtedly 

be the first to bear the brunt of whatever adverse affects of climate change this 

country experiences. North Carolina has already had more than it’s fair share of 

hurricanes and other acts of God that have left some municipalities like Princeville 

in my District, still recovering from Hurricane Floyd. It has been almost nine years 

since September 16th, 1999, when Floyd ravaged huge swaths of eastern North 

Carolina killing 52 people in its path. North Carolina has been fortunate since then 

but other Atlantic and Gulf coast states have not been so lucky. I do not mean to 

suggest that the rash of hurricanes we have recently experienced are somehow directly related to ongoing climate change but I am stating that coastal states and 

cities, including here in the Chesapeake Bay region with well over 16 million people, 

should be very concerned about global warming. Despite current restoration efforts, 

the Chesapeake Bay is still one of the most sensitive ecosystems in the US and 

there is no plan in place to address potential rising of sea levels or a significant 

plan to restore the marshes and wetlands in Florida, Louisiana or North Carolina 

for that matter. My second concern deals with the Administration’s plan to help developing nations deal with adaptation to an ever changing world that has already 

seen significant impacts from global warming. There are a plethora of anecdotal observations as well as empirical data that clearly states that Africa, Asia and the 

Caribbean will be the first to suffer the ravages of global warming despite being the 

lowest greenhouse gas contributors. Since the US has been the world’s largest emitter of GHG’s for the past 100 plus years, we have a unique role to play in helping 

mitigate the changes and assist with the deployment of affordable environmentally 

sound technologies and sustainable forest management and degradation procedures 

to help these countries cope. We are intimately tied to these developing nations 

given our high level of contribution to this radically changing environment. 

Congress and the President recently passed a bold and innovative Energy bill this 

past December and I look forward to working together to utilize the momentum 

we’ve generated to do greater things in 2008. Eight years of inaction have cost us 

dearly but I pledge my support in creating an atmosphere where we can work together for the good of our children and grandchildren. We must not continue to kick 

this can down the road, thank you. 

Mr. BOUCHER. Thank you very much, Mr. Butterfield. The ranking member of the full committee, the gentleman from Texas, Mr. 

Barton, is recognized for 5 minutes. 

OPENING STATEMENT OF HON. JOE BARTON, A 

REPRESENTATIVE IN CONGRESS FROM THE STATE OF TEXAS 

Mr. BARTON. Thank you, Mr. Chairman. It is good to have this 

subcommittee back in action. It started off with a flurry early in 

the first session and then along around the summer time it kind 

of went into hibernation so we are glad to have you back on the 

front lines here. I want to welcome some people today. I want to 

first welcome our new ranking member, Mr. Upton. Mr. Upton has 

been on the committee for quite a number of years. He has made 

his major contribution as the past subcommittee chairman, ranking 

member of the Telecommunications Subcommittee, but he has 

switched over to Energy and Air Quality with the departure of 

former Speaker, Mr. Hastert. He has got big shoes to fill. Mr. 

Hastert and Mr. Hall, who is another ranking member of the 

Science Committee, and way back when one of the former chairman, myself. I started out as the chairman of this subcommittee 

so I am very, very happy to have nominated Mr. Upton to this position. 

I also want to welcome Mr. Connaughton. He and I have had an 

ongoing relationship and a number of discussions for I don’t know 

14 

how many years but a fair number. He just got back from Bali. We 

are going to hear his insights, but I think it is safe to say of all 

the people in the world Jim Connaughton is one of the most knowledgeable on the issue that you got on the hearing schedule today 

which is global warming and climate change. We have had a lot of 

hearings about this issue in the last several years. I am still not 

convinced that the science and the economics of the issue are settled. I know a lot of people want to move on and look at solutions 

but I don’t think we can have a very good chance to develop an optimal solution if we really don’t understand the problem, and a 

very large number of skeptics still out there about what causes climate change and what mankind can do about it. 

I hope some of your hearings this spring touch on that. As I have 

said before, when we get ready to consider legislation I have 4 

issues or goals, I guess, that I want to try to meet. I do want to 

keep electricity affordable and plentiful in America. I also want to 

keep our transportation sector viable. It is interesting to know that 

in the euphoria over passing a CAFE increase at the Detroit auto 

show this week our manufacturers said that legislation, if implemented, is going to raise the price of an American vehicle approximately $6,000 per car. I want you to tell me how that helps our 

economy when the price of automobiles goes up $6,000 per vehicle. 

I want to keep our natural gas prices as affordable as possible because many, many Americans heat their homes with natural gas, 

cook their meals, and we still have an industry that uses natural 

gas as a raw material. 

And obviously I want to protect American jobs. We can have the 

most perfect climate change bill in the world, and it is not going 

to do us a lot of good if we raise the unemployment rate 5 or 10 

points to do that. You indicated that you want to introduce a capand-trade bill sometime this spring, Mr. Chairman. I hope we can 

dissuade you from that position. The great experiment in Europe 

with cap-and-trade so far is an absolute failure. There is no other 

way to put it. The prices their economies are paying are going up 

and their emissions are going up too. Now their apologists say that 

it is just because they don’t have it just right, but I predict that 

no matter how much they tinker with it when you are trying to 

cap-and-trade something as ubiquitous as CO2, most of which is not 

man-made, it is folly. It is an impossible situation. 

So hopefully you will also really get into the details of just exactly what a cap-and-trade program would look like here in America. I also want to make a point that a number of other people have 

made. We are in a global economy now. We are the world’s largest 

economy but if we do some things that are very draconian on our 

emissions here in the United States, and really all it does is cost 

us jobs, I am very skeptical that the rest of the world is going to 

follow suit. There is no nation in the world in the last thousand 

years that when faced with a choice of poverty or a better standard 

of living for their population has chosen poverty, and it is absolutely ludicrous in my opinion for us to ask China and India and 

Brazil and Mexico and all the developing world to adopt some of 

these very, very stringent controls on CO2 when if they do that it 

is an absolute recipe for making sure that their people don’t move 

forward and have a better standard of living. 

15 

We made that choice beginning in the late 1800s and all through 

the 1900s as we electrified America, put in our transportation system, created an economy literally based on the automobile, and the 

result has been the highest standard of living the world has ever 

known, so it is silly for us to ask the rest of the world to not move 

forward as we have moved forward in the last 125 years. So, Mr. 

Chairman, I am glad to have this subcommittee back in action. I 

do think climate change is a real issue. I do think to the extent 

that we can do things that make economic sense and environmental sense we should try to move forward, but I do not believe 

that we should just jump off the cliff in the name of political correctness. And with that, Mr. Chairman, I very, very respectfully 

yield back to you. 

Mr. BOUCHER. Well, thank you very much, Mr. Barton, and very 

respectfully let me say that we were really not in hibernation. During the course of the last 6 months we were intensely focused on 

drafting and passing the 2007 energy security legislation, and as 

the gentleman knows I differ with his characterization of the European cap-and-trade program but these will all be matters we discuss during the course of this year. The gentleman from Utah, Mr. 

Matheson, is recognized for 3 minutes. Mr. Matheson waives. The 

gentleman from Louisiana, Mr. Melancon, do you care to make an 

opening statement? The gentleman waives. Are there other members seeking to make an opening statement? Apparently not. 

Mr. Connaughton, we are delighted to have you with us this 

morning. I said some introductory words about you. Let me commend you for your successful efforts during the Bali conference. I 

think all of us were impressed with the skill with which you and 

your partners representing the United States advanced our position. Congratulations on the agreement which was concluded during that conference, and we look forward to your description of it 

and a statement of your intentions with regard to your leadership 

of the U.S. negotiation efforts between now and the Copenhagen 

conference which will occur in 2009. Without objection, your statement will be made part of the record, and we welcome your oral 

presentation. 

STATEMENT OF JAMES L. CONNAUGHTON, CHAIRMAN, WHITE 

HOUSE COUNCIL ON ENVIRONMENTAL QUALITY 

Mr. CONNAUGHTON. Thank you, Mr. Chairman, and I am very 

pleased to be here in front of this committee, and particularly this 

point in time after a very constructive last year in setting the stage 

for what I think will be a fairly important conversation here in the 

United States as well as globally on next steps. And we are pleased 

that you are helping to lead this effort, Mr. Chairman, particularly 

with Fred Upton at your side as the new ranking member. I think 

it is a powerful combination. I was also pleased to see Chairman 

Dingell here. I am sorry he had to leave for the moment. I hope 

we see him a little bit later. And also to have ranking Chairman 

Barton as well. It is nice to see the group of 4 focused on this issue 

in the way that it deserves. 

Members of the committee, the Bali Action Plan, which you have 

now heard about, also known as the Bali road map, was in fact a 

major achievement adopted by more than 190 countries which is no 

16 

small order who are the parties to the United Nations Framework 

Convention on Climate Change. This document, which reflects my 

testimony, is a 4-page, highly detailed negotiation guide for how we 

will develop a comprehensive new post-2012 climate change arrangement, and we want to try to do that by 2009. Our 3 negotiating objectives going in were to launch negotiations, which had 

not taken place for 10 years, to be sure that we had a comprehensive set of negotiations, including participation by major developing 

countries as a critical condition well recognized in a bipartisan way 

here in the United States, and to do so rapidly by 2009 so there 

is time to prepare for its implementation which would start in 

2012. All 3 of those objectives were met. 

Also included as part of my testimony were the actual presentations that I and others gave in Bali outlining the steps that the 

United States is taking and will be taking with respect to our contribution both domestically and internationally, and if you have not 

taken a look at those I would encourage the members to thumb 

through those materials. It is 70 pages of quite substantial discussion. The United States is committed to working with other nations 

to agree on a global outcome, and it is important that that global 

outcome is both environmentally effective to do the job and economically sustainable, which means it should do the job smart. 

Only an arrangement that meets both of these objectives can win 

public support. To be environmentally effective a new approach 

must be truly global and has to involve measurable, reportable, 

and verifiable actions by the world’s largest producers of greenhouse gas emissions, that is developed and developing countries 

alike. 

The basic truth is this. Without substantial participation by 

major developing economies greenhouse gas emissions will continue 

to rise rapidly over the next 50 years even if the U.S. and other 

developed countries cut their emissions to zero. We are in this together. To be economically sustainable our actions must uphold the 

hopes of people everywhere for economic growth, energy security, 

and an improved quality of life. Lowering the cost of emissions is 

critical to that equation but that will require speeding up the development and the deployment of technologies that will fundamentally improve the way we produce and consume energy. These include the capture and storage of carbon emitted from coal power 

plants, more affordable nuclear, and gigawatt scale renewable 

power, bio-fuel, electric, natural gas, hydrogen, and other clean alternatives to petroleum, and of course greater efficiency. In the absence of technology advances and cost reduction advances in these 

areas reducing global emissions on the scale necessary will be impossible without significantly sacrificing economic growth globally 

and then the social consequences that come from that sacrifice. 

Last May President Bush announced that the U.S. would work 

closely with other Major Economies to contribute to a new global 

agreement under the U.N. Framework Convention on Climate 

Change. I would note that this initiative has now received broad 

international support as a contributing, as a supportive effort to 

achieve the Bali road map. This includes the G–8 leaders, the AsiaPacific Economic Cooperation leaders, so these are the 20 plus 

leaders of the Asia-Pacific rim, and even U.N. Secretary General 

17 

Ban Ki-moon. The U.S. has hosted the first meeting in late September that brought together 17 Major Economies accounting for 

more than 80 percent of the world’s economic output, energy use 

and greenhouse gas emissions. 

Now guided the consensus in Bali the Major Economies plan to 

meet again at the end of January for a series of meetings that will 

discuss a work program that can advance the key elements of Bali. 

In our view, such a work program should include a discussion of 

a long-term global emission reduction goal, national plans that include mid-term goals backed by nationally appropriate mix of strategies, regulations, incentives, and public-private partnerships. We 

need all the tools in the tool kit. Cooperative technology and other 

actions in key sectors, we need to focus especially on fossil power 

generation, personal transportation, and sustainable forest management because together they represent more than 80 percent of 

future greenhouse gases. 

We need to focus on innovative financing mechanisms importantly coupled with the elimination of tariff and non-tariff barriers 

for the clean energy goods and services that that would finance, 

and then an approved emissions accounting system to verify our 

progress and then ways to help countries adapt to climate change 

and gain access to technology, and that is important particularly 

for developing countries. In addition, we think it is going to be important to discuss ways of structuring a post-2012 arrangement in 

a way that will encourage rather than deter actions by the major 

developing and developed countries so we need to do it in a way 

that incorporates positive, not punitive ways to insure accountability. This issue is big. It does cover really all economic activity 

and so we need a constructive way to create the framework. 

We hope that these discussions can produce tangible outcomes 

that can be endorsed at a Major Economies leaders meeting that 

the President has called for later this year. This would fulfill the 

G–8 pledge last year for the Major Economies to make a detailed 

contribution to the U.N. negotiations. Now I just want to give a 

couple examples of what we are doing from the U.S. perspective already that are tangibly contributing to this next conversation. So 

first, and let us look at the international level, last year the U.S. 

joined with some key developing countries, helped to forge a global 

legally binding agreement to accelerate the phase-out of 

hydrofluorocarbons under the Montreal Protocol. These are also potent greenhouse gases. This was an agreement that China and 

India joined. They were developing countries but they joined in the 

legally binding agreement that would reduce greenhouse gases by 

at least 3 billion metric tons which would probably meet or exceed 

what the Kyoto Protocol might achieve by 2012 so just to give you 

a sense of the scale of a sector-based agreement. 

Here at home this committee knows better than any committee 

because of the hard work they did last year in just 1 year to provide legislation that President Bush was pleased to sign that mandates substantial mid-term requirements and objectives for vehicle 

fuel efficiency, for renewable fuels, for appliance efficiency, lighting 

efficiency, and the efficiency and renewable fuel use of government 

operations, 5 brand new mid-term mandates with hard objectives. 

Other countries are looking very closely at what we did this year 

18 

to see how that might apply—they might apply similar approaches 

in their countries. This law is mandatory. This law is binding. And 

this law will produce some of the large emission cuts in our nation’s history. 

I was pleased to hear Chairman Dingell’s estimate of more than 

10 billion metric tons I conservatively estimated at 6 but let us just 

say it is big. It is very big in terms of the greenhouse gas benefits 

of that legislation. The U.S. is also working with other countries to 

establish a new, multi-lateral financing mechanism that is going to 

help accelerate the use of cleaner, lower carbon technologies and 

infrastructure. Importantly, this Congress and this committee have 

created similar tools for use in America so we are accelerating the 

deployment of these technologies here at home and now we want 

to come up with financing mechanisms to help sell good clean 

American technology overseas. 

The U.S. and the EU, who are often seen as disparate on this 

subject have jointly proposed in the World Trade Organization the 

rapid elimination of the tariff and non-tariff trade barriers that impede investment in clean technologies and services. There is absolutely no reason why we are charging tariffs on each other for 

these goods and services that are very important to reduce greenhouse gas emissions. Removing such barriers would not only lower 

the cost of cutting emissions, they would increase our 2-way clean 

technology trade by up to 14 percent per year. That is a lot of good 

old-fashioned American know how finding its way into the global 

market place. And then along with Japan the U.S. will continue its 

massive investment, nearly $18 billion since 2001, in the technology research development and deployment effort. The U.S. and 

Japan account for most global spending in this area. We encourage 

other countries to step up their efforts. 

Finally, deforestation, a subject that has been somewhat overlooked, accounts for roughly 20 percent of global emissions. The 

U.S. is enhancing its efforts to work cooperatively internationally 

to help other countries find ways to sustainably manage their forests the way we do here in America, and we are providing some 

good measurement tools to enable that as well. I look forward to 

a very aggressive year of activity. If we want to reach final agreement in 2009 the work we do this year is critical because moving 

from the domestic discussion to a Major Economies discussion to a 

190-nation discussion requires a lot of work so we look forward to 

working constructively with this committee on that. Thank you. 

[The prepared statement of Mr. Connaughton follows:] 

19 


47819.024
20 


47819.025
21 


47819.026
22 


47819.027
23 


47819.028
24 


47819.029
25 


47819.030
26 


47819.031
27 


47819.032
28 


47819.033
29 

THE WHITE HOUSE 

OFFICE OF THE PRESS SECRETARY

FOR IMMEDIATE RELEASE SEPTEMBER 28, 2007 

REMARKS BY THE PRESIDENT 

AT MAJOR ECONOMIES MEETING ON 

ENERGY SECURITY AND CLIMATE CHANGE 

U.S. DEPARTMENT OF STATE

10:09 A.M. EDT 

THE PRESIDENT: Good morning. Thank you. Welcome to the State Department. 

I’m honored to address this historic meeting on energy security and climate change. 

And I appreciate you all being here. 

Energy security and climate change are two of the great challenges of our time. 

The United States takes these challenges seriously. The world’s response will help 

shape the future of the global economy and the condition of our environment for future generations. The nations in this room have special responsibilities. We represent the world’s major economies, we are major users of energy, and we have the 

resources and knowledge base to develop clean energy technologies. 

Our guiding principle is clear: We must lead the world to produce fewer greenhouse gas emissions, and we must do it in a way that does not undermine economic 

growth or prevent nations from delivering greater prosperity for their people. We 

know this can be done. Last year America grew our economy while also reducing 

greenhouse gases. Several other nations have made similar strides. 

This progress points us in the right direction, but we’ve got to do more. So before 

this year’s G8 summit, I announced that the United States will work with other nations to establish a new international approach to energy security and climate 

change. Today’s meeting is an important step in this process. With the work we 

begin today, we can agree on a new approach that will reduce greenhouse gas emissions, strengthen energy security, encourage economic growth and sustainable development,and advance negotiations under the United Nations Framework Convention on Climate Change. (Applause.) 

I thank the State Department for hosting this event. I appreciate members of my 

Cabinet who have joined us today. I thank Jim Connaughton, who is the Chairman 

of the Council on Environmental Quality, for being here. I appreciate you being the 

personal representative of this, and I hope you’re doing -- I hope you think he’s 

doing a fine job. (Applause.) 

I welcome Minister Rachmat, the Minister of Environment of Indonesia, who is 

the Chairman of the upcoming U.N. climate meeting in December. I welcome Mr. 

de Boer, who is the Executive Secretary of the United Nations Framework Convention on Climate Change. I welcome all the ministers and delegates who are here. 

We really appreciate you coming. I thank the ambassadors for joining this august 

group. I thank members of the Congress who have taken time to come by: Congressman Ed Markey of Massachusetts and Congressman Bart Gordon of Tennessee. I 

appreciate you taking time to come by and participate in these meetings. 

Every day energy brings countless benefits to our people. Energy powers new hospitals and schools so we can live longer and more productive lives. Energy transforms the way we produce food, so we can feed our growing populations. Energy enables us to travel and communicate across great distances, so we can expand trade 

and prosperity. Energy sustains the world’s most advanced economies, which makes 

it possible for us to devote resources to fighting hunger and disease and poverty 

around the globe. 

In this new century, the need for energy will only grow. Much of this increased 

demand will come from the developing world, where nations will need more energy 

to build critical infrastructure and grow their economies, improve the lives of their 

people. Overall, the demand for energy is expected to rise by more than 50 percent 

by 2030. 

This growing demand for energy is a sign of a vibrant, global economy. Yet it also 

possesses -- poses serious challenges, and one of them, of course, is energy security. 

Right now much of the world’s energy comes from oil, and much of the oil comes 

from unstable regions and rogue states. This dependence leaves the global economy 

30 

vulnerable to supply shocks and shortages and manipulation, and to extremists and 

terrorists who could cause great disruptions of oil shipments. 

Another challenge is climate change. Our understanding of climate change has 

come a long way. A report issued earlier this year by the U.N. Intergovernmental 

Panel on Climate Change concluded both that global temperatures are rising and 

that this is caused largely by human activities. When we burn fossil fuels we release 

greenhouse gases into the atmosphere, and the concentration of greenhouse gases 

has increased substantially. 

For many years those who worried about climate change and those who worried 

about energy security were on opposite ends of the debate. It was said that we faced 

a choice between protecting the environment and producing enough energy. Today 

we know better. These challenges share a common solution: technology. By developing new low-emission technologies, we can meet the growing demand for energy 

and at the same time reduce air pollution and greenhouse gas emissions. As a result, our nations have an opportunity to leave the debates of the past behind, and 

reach a consensus on the way forward. And that’s our purpose today. 

No one country has all the answers, including mine. The best way to tackle this 

problem is to think creatively and to learn from other’s experiences and to come together on a way to achieve the objectives we share. Together, our nations will pave 

the way for a new international approach on greenhouse gas emissions. 

This new approach must involve all the world’s largest producers of greenhouse 

gas emissions, including developed and developing nations. We will set a long-term 

goal for reducing global greenhouse gas emissions. By setting this goal, we acknowledge there is a problem. And by setting this goal, we commit ourselves to doing 

something about it. 

By next summer, we will convene a meeting of heads of state to finalize the goal 

and other elements of this approach, including a strong and transparent system for 

measuring our progress toward meeting the goal we set. This will require concerted 

effort by all our nations. Only by doing the necessary work this year will it be possible to reach a global consensus at the U.N. in 2009. 

Each nation will design its own separate strategies for making progress toward 

achieving this long-term goal. These strategies will reflect each country’s different 

energy resources, different stages of development, and different economic needs. 

There are many policy tools that nations can use, including a variety of market 

mechanisms, to create incentives for companies and consumers to invest in new lowemission energy sources. We will also form working groups with leaders of different 

sectors of our economies, which will discuss ways of sharing technology and best 

practices. 

Each nation must decide for itself the right mix of tools and technologies to 

achieve results that are measurable and environmentally effective. While our strategies may be differentiated, we share a common responsibility to reduce greenhouse 

gas emissions while keeping our economies growing. 

The key to this effort will be the advance of clean energy technologies. Since I 

became President, the United States government has invested nearly $18 billion to 

research, develop and promote clean and efficient energy technologies. The private 

sector here in our country has responded with significant investments, ranging from 

corporate research and development to venture capital. Our investments in research 

and technology are bringing the world closer to a remarkable breakthrough -- an 

age of clean energy where we can power our growing economies and improve the 

lives of our people and be responsible stewards of the earth the Almighty trusted 

to our care. 

The age of clean energy requires transforming the way we produce electricity. 

Electric power plants that burn coal are the world’s leading cause of greenhouse gas 

emissions. The world’s supply of coal is secure and abundant. And our challenge is 

take advantage of it while maintaining our commitment to the environment. One 

promising solution is advanced clean coal technology. The future of this technology 

will allow us to trap and store carbon emissions and air pollutants produced by 

burning coal. Since 2001 the United States has invested more than $2.5 billion to 

research and develop clean coal. And in partnership with other nations and the private sector we’re moving closer to a historic achievement -- producing energy from 

the world’s first zero-emissions coal-fired plant. 

We also need to take advantage of clean safe nuclear power. Nuclear power is the 

one existing source of energy that can generate massive amounts of electricity without causing any air pollution or greenhouse gas emissions. Without the world’s 439 

nuclear power plants, there would be nearly 2 billion additional tons of carbon dioxide in the atmosphere each year. And by expanding the use of nuclear power, we 

can reduce greenhouse gas emissions even more. 

31 

The United States is working to reduce barriers to new nuclear power plants in 

our country without compromising safety. Just last week, a company applied for approval to build the first new nuclear reactor in my country since the since the 1970s. 

As we build new reactors here in the United States, we’re also working to bring the 

benefits of nuclear energy to other countries. 

My administration established a new initiative called the Global Nuclear Energy 

Partnership. This partnership will work with nations with advanced civilian nuclear 

energy programs, such as France and Japan and China and Russia. Together we 

will help developing nations obtain secure, cost-effective and proliferation-resistant 

nuclear power, so they can have a reliable source of zero-emissions energy. 

We’ll also need to expand our use of two other promising sources of zero-emissions 

energy, and that’s wind and solar power. Wind power is becoming cost-effective in 

many parts of America. We’ve increased wind energy production by more than 300 

percent. We also launched the Solar America Initiative to lower the cost of solar 

power, so we can make -- help make this technology competitive, as well. Taken together, low-carbon technologies like wind and solar power have the potential to one 

day provide up to 20 percent of America’s electricity. 

The age of clean energy also requires transforming the way we fuel our cars and 

trucks. Almost all our vehicles run on gasoline or diesel fuel. This means we produce 

greenhouse gas emissions whenever we get behind the wheel. Transportation accounts for about 20 percent of the world’s greenhouse gas emissions every year. To 

reduce these emissions we must reduce our dependence on oil. So America is investing in new, clean alternatives. We’re investing millions of dollars to develop the next 

generation of sustainable biofuels like cellulosic ethanol, which means we’ll use everything from wood chips to grasses to agricultural waste to make ethanol. 

We’re offering tax credits to encourage Americans to drive fuel-efficient hybrid vehicles. We’re working to develop next-generation plug-in hybrids that will be able 

to travel nearly 40 miles without using a drop of gasoline. And your automobile 

doesn’t have to look like a golf cart. (Laughter.) 

We’re on track to meet our pledge of investing $1.2 billion to develop advanced 

hydrogen-powered vehicles that emit pure water instead of exhaust fumes. We’re 

also taking steps to make sure these technologies reach the market. We’ve asked 

Congress to set a new mandatory -- I repeat, mandatory -- fuel standard that requires 35 billion gallons of renewable and other alternative fuels in 2017, and to 

reform fuel economy standards for cars the same way we did for light trucks. Together these two steps will help us cut America’s consumption of gasoline by 20 percent in 10 years. It’s an initiative I’ve called 20-in-10. 

Ushering in the age of clean energy is an historic undertaking. We take it seriously here in the United States. Achieving this vision will require major investment 

in innovation by all our nations. Today the United States and Japan fund most of 

the research and development for clean energy technologies. Meeting the objectives 

we share and the goal we’re going to set will require all the nations in this hall 

to increase their clean energy research and development investments. 

We must also work to make these technologies more widely available, especially 

in the developing world. So today I propose that we join together to create a new 

international clean technology fund. This fund will be supported by contributions 

from governments from around the world, and it will help finance clean energy 

projects in the developing world. I’ve asked Treasury Secretary Hank Paulson to coordinate this effort, and he plans to begin exploratory discussions with your countries over the next several months. 

At the same time, we also must promote global free trade in energy technology. 

The most immediate and effective action we can take is to eliminate tariff and nontariff barriers on clean energy goods and services. 

As we work to transform the way we produce energy, we must also address another major factor in climate change, which is deforestation. The world’s forests help 

reduce the amount of greenhouse gases in the atmosphere by storing carbon dioxide. 

But when our forests disappear, the concentration of greenhouse gas levels rise in 

the atmosphere. Scientists estimate that nearly 20 percent of the world’s greenhouse 

gas admissions [sic] are attributable to deforestation. 

We’re partnering with other nations to promote forest conservation and management across the world. We welcome new commitments from Australia, Brazil, with 

China and Indonesia. The United States remains committed to initiatives such as 

the Congo Basin Forest Partnership and the Asian Forest Partnership. We will continue our efforts through the Tropical Forest Conservation Act, which helps developing nations redirect debt payments toward forest conservation programs. So far 

my administration has concluded 12 agreements, concluding [sic] up to 50 million 

acres of forest lands. 

32 

America’s efforts also include an $87-million initiative to help developing nations 

stop illegal logging. These efforts will help developing nations save their forests, and 

combat a major source of greenhouse gas emissions. 

The United States is also taking steps to protect forests in our own country. It’s 

one thing to help others; we got to make sure we do a good job here at home -- and 

we are. Since 2001, we’ve provided more than $3 billion to restore our forests and 

protect them against catastrophic fires as part of a Healthy Forest Initiative. In 

partnership with our farmers and ranchers, we’re providing tens of billions of dollars in incentives for conservation. We’re promoting sustainable public and private 

land-management policies. By taking these steps, we’ve helped increase the amount 

of carbon storage in our forests, and we’ve helped safeguard a national treasure for 

generations to come. 

What I’m telling you is, is that we’ve got a strategy; we’ve got a comprehensive 

approach. And we look forward to working with our Congress to make sure that 

comprehensive approach is effective. And we look forward to working with you as 

a part of this global effort to do our duty. 

And we’ve done this kind of work before. And we have confidence in the success 

of our efforts. Twenty years ago nations finalized an agreement called the Montreal 

Protocol to phase-out substances that were depleting the ozone layer. Since then, 

we have made great strides to repair the damage. Just last week, developed and 

developing nations reached consensus on speeding up the recovery of the ozone layer 

by accelerating the phase-out of these harmful substances. This accelerated phase 

out will bring larger benefits because they’ll dramatically reduce greenhouse gas 

emissions. 

We have seen what happens when we come together to work for a common cause, 

and we can do it again. And that’s what I’m here to urge you. The United States 

will do our part. We take this issue seriously. And we look forward to bringing a 

spirit of cooperation and commitment to our efforts to confront the challenges of energy security and climate change. By working together, we will set wise and effective policies. That’s what I’m interested in, effective policies. I want to get the job 

done. We’ve identified a problem, let’s go solve it together. 

We will harness the power of technology. There is a way forward that will enable 

us to grow our economies and protect the environment, and that’s called technology. 

We’ll meet our energy needs. We’ll be good stewards of this environment. Achieving 

these goals will require a sustained effort over many decades. This problem isn’t 

going to be solved overnight. Yet years from now our children are going to look back 

at the choices we make today, at this deciding moment: It will be a moment when 

we choose to expand prosperity instead of accepting stagnation; it will be a moment 

when we turn the tide against greenhouse gas emissions instead of allowing the 

problem to grow; it will be a moment when we rejected the predictions of despair 

and set a course of a more hopeful future. 

The moment is now, and I appreciate you attending this meeting. And we look 

forward to working with you. May God bless you all. (Applause.) 

END 10:29 A.M. EDT 

Mr. BOUCHER. Thank you very much, Mr. Connaughton, and we 

look forward very much to our working in collaboration with you. 

Do you have any sense of when in 2009 that final meeting in Copenhagen is likely to take place? 

Mr. CONNAUGHTON. It will occur in December. Typically it is 

some time in December. 

Mr. BOUCHER. And that date has been set? 

Mr. CONNAUGHTON. I don’t think they have got a—well, actually 

the date has been set but I don’t know specifically what it is. 

Mr. BOUCHER. So you have now almost 2 full years within which 

to carry forward the negotiations pursuant to the Bali road map? 

Mr. CONNAUGHTON. That is correct. The first big meeting occurs 

again in December in Poland this year, and then the next big one 

will be in December in Copenhagen. 

Mr. BOUCHER. In the fall of last year your office convened on behalf of the President a Major Economies meeting here in WashVerDate Nov 24 2008 15:56 Apr 02, 2009 Jkt 037690 PO 00000 Frm 00038 Fmt 6633 Sfmt 6633 C:\DOCUMENTS AND SETTINGS\CWELLS1\110-80 SCOM1 PsN: JIMC
33 

ington to which you invited I think it was the 12 largest emitting 

nations in the world, and I think you intend to have further meetings of that group over time. Describe, if you will, the way that 

that process of major economy nations which the United States is 

directing will coincide with the Framework Convention meetings 

under the Bali road map. They are happening at about the same 

time. Do you view them as being in competition or do you view 

them as being complimentary one of the other? 

Mr. CONNAUGHTON. The intention of the meetings is actually to 

be strongly in support of the broader discussion that will occur 

under the U.N. so it goes beyond complimentary. It is targeted at 

the specific subjects that the large economies really need to grapple 

with. We are the big emitters, and those who are the big emitters 

with the biggest technology challenges should be getting together 

early and fast to see how we can advance this discussion and bring 

that to the broader U.N. grouping. It is actually about 17 countries 

depending on how you treat the EU but as it happens those 17 account for most of what needs to be done. 

The Bali road map, which is 4 pages long, has many, many elements. I highlighted about 6 core elements the Major Economies 

will probably focus on, and then there will be a whole series of 

other conversations in the U.N. process so this is a subset of that. 

Mr. BOUCHER. Well, thank you very much. I personally think 

that you are taking the right step in this Major Economies meeting 

because to the extent you can have the developed world come to 

some agreement about how it will govern emissions in terms of 

their own emissions and also interact with developing countries 

that should be helpful to the overall Bali process. As you noted in 

your testimony, the Bali Action Plan contemplates action being 

taken in order to prevent tropical rain forest deforestation and deforestation in other regions in the developing world, and the plan 

basically says that it would encourage incentives being provided toward that objective. 

Do you have any thoughts today about what kinds of incentives 

would be appropriate within that context realizing that the Administration does not have a formal position with regard to any specific 

legislation at this point? Assuming that we come forward with a 

mandatory control methodology relying perhaps on cap-and-trade, 

would the allowance of the purchase of credits or offsets for tropical 

rain forest and deforestation efforts be one such incentive? 

Mr. CONNAUGHTON. First, in terms of incentives the United 

States is actually one of the leading countries already with the 

Tropical Forest Conservation Act which provided several hundred 

million dollars of incentives through debt relief for some of the 

most important tropical forest conservation areas. Let us focus on 

tropical forests. But those are critical to climate change discussion. 

We also through USAID do a lot of direct incentive payments for 

sustainable forest management and a significant amount of money 

flows through that program. We also are contributing under the 

President’s initiative against illegal logging to one aspect of the deforestation issue and that is illegal harvest of timber and providing 

enforcement and money to enhance enforcement capacity and that 

really hurts our guys because our guys sustainably manage, put 

34 

the effort in, and then they are out competed in the global market 

place by those that don’t. 

One other highlight that is currently underway is the 2 other 

root causes of deforestation are taking down forests for energy to 

burn wood like we used to in the 1800s. That is an issue of providing resources for access to more affordable energy services. That 

is the solution, and we are doing a lot of work with countries on 

that. The other is taking down forests for agriculture, and the answer to that actually is access to energy to do more productive and 

modern agricultural activities and to clean water, so we have a lot 

underway and we want to expand that effort. We have proposed 

some new financing through the World Bank to a forest partnership fund and of course our NGOs are putting a lot of money into 

this. 

I say all of that, Mr. Chairman, with respect to the offset issue 

in terms of cap-and-trade. We do not have a formal Administration 

position on this so I will just give you my reflections, which is it 

does create some challenges because it is very, very difficult to 

know that you are getting what you are paying for. And so what 

we have done in Bali is we have committed to doing a series of 

pilot projects to see if we can bring integrity to that kind of a financing tool and the international community agrees that we need 

that pilot testing first before we start making commitments of this 

type. The second issue that we have concerns with, Mr. Chairman, 

is if you are going to increase the cost of electricity to someone on 

a fixed income or if you are going to increase the price at the pump 

for someone that is using gasoline to get to work, we think that it 

is politically a little bit more understandable to see that money 

going into buying technology that is going to solve the problem 

rather than paying for forest projects overseas, so I would just suggest that if we are going to move toward further pricing of carbon, 

we should keep our eye on the ball and focus it on the technologies 

that we need and then use the economy to get those technologies 

broader in the global marketplace. 

Mr. BOUCHER. Thank you. We will have further discussions 

about that. 

Mr. CONNAUGHTON. I know we will. 

Mr. BOUCHER. I do have some contrasting views which I will 

withhold for the moment. My final question to you is this. Will it 

be helpful to you as you carry forward the U.S. position in negotiations over the coming 2 years if the Congress passes legislation 

that sets targets and announces what is expected in terms of 

greenhouse gas reductions across this entire economy. That target 

setting exercise will be as we have described the product of a broad 

consultation. Once it passes and is presented to the President hopefully to be signed into law later this year it would be a set of commitments that the United States really could keep, something that 

would enjoy reasonably broad support across our society, otherwise, 

we won’t be successful in passing the bill at the outset. 

And so is that exercise helpful to you? If we are able to put those 

targets into law, does that strengthen your ability to make firm 

commitments in terms of what the United States will be able to advance and adhere to in terms of international negotiations? 

35 

Mr. CONNAUGHTON. Mr. Chairman, when the history is written, 

I think one of the challenges of Kyoto was that it put the cart before the horse. International negotiators set domestic policy in an 

international negotiation. What you have just asked is very consistent with what the President has suggested that what we need 

is actually a domestically defined set of objectives and then bring 

that to the international conversation, and that is a core part of the 

Major Economies process how to frame up what we would like to 

see in domestic commitments. Now this committee broadly had already made a major contribution in that respect because you did 

announce 5 new objectives that are backed up by 5 major new programs. That is something most of the other countries have not done 

yet in the sectors where this Congress is active. 

So ultimately international acceptance by the United States is 

going to turn on a bipartisan and across Pennsylvania Avenue 

agreements on what we think this outcome should be. 

Mr. BOUCHER. Well, thank you very much, Mr. Connaughton. 

Your views and mine on that issue are completely in accord. Let 

me just finally compliment you on the role that you are playing 

and the success that you are achieving in re-involving the United 

States internationally and playing a leading role in doing that. I 

think that was very important for us to do and in my view you 

have done it well. The gentleman from Michigan, Mr. Upton, is recognized for 5 minutes. 

Mr. UPTON. Thank you, Mr. Chairman. And again, Mr. 

Connaughton, thanks very much for your testimony. As we hit on 

here earlier as part of your testimony the Congress did act in a 

number of processes that really induced emissions, lighting, fuels, 

automobiles, et cetera. What kind of reaction did you get from the 

folks in Bali that in fact we have actually done something that perhaps they have not? I have not traveled extensively around the 

world hardly at all, and I look and see what we have done. I don’t 

think any nation is as close as we are whether it be Europe or 

other places around the world as it looks to real changes in the 

way that we consume energy down the road in terms of legislative 

language. What type of credit did we get because that was bill was 

pretty close to fruition. In fact, that is one of the reasons why the 

congressional representation was so low was because we were literally in the midst of debating that legislation on the House floor 

but they knew that it was coming. What type of credit did we get 

for that? 

Mr. CONNAUGHTON. In terms of Bali itself the bill was agreed as 

we were wrapping up so it was swallowed by the last minute skirmishing around the agreement. I would observe though that we 

made a substantial presentation on what was coming to a very 

large session of NGOs and other countries, and to a person what 

happens is when we present a total U.S. effort at the Federal, 

state, and local level people are amazed because of the 

misperception in the media. As Congresswoman Baldwin points 

out, I think, Congresswoman, it is a lack of awareness that is bigger. It is not lack of action. It is a lack of awareness. I would suggest probably many of us don’t have a keen sense of what Europe 

is actually doing or what Japan is actually doing either. We need 

much more understanding of what we are actually doing because 

36 

when we presented the CAFE piece and we presented the fuels 

piece no country on CAFE or on fuels is as aggressive as we are 

under alternative fuels. The lighting piece, there are only a couple 

countries that have looked at lighting the way that we just did, and 

so now this is inspiring, some focus thinking by their countries. 

So again this bipartisan agreement, when the United States 

comes together bipartisan agreement it has a big effect globally, 

and I think you will see the repercussions of that this year. I need 

to also observe those, not just the regulatory side, the work that 

was done in the ’05 energy bill. When we talk about $35 billion of 

loan guarantees other countries aren’t doing that so that makes 

them think, hey, maybe that is a tool we can look at. When we talk 

about $2 billion of incentives for the purpose of highly fuel efficient 

vehicles again other countries are not doing that at the scale we 

are doing it. So it is not just the regulatory side, it is the incentive 

side and the technology investment side that is going to have that 

influence so we need to again continue to put that comprehensive 

package together. 

Mr. UPTON. This week the German steel industry is on record 

warning of huge job losses if the European Commission went ahead 

with the current schedule that they have got. In fact, they actually 

indicate that there could be as many as 50,000 jobs that leave Germany. The Financial Times earlier this week had a quote I think 

from the new French Prime Minister Sarkozy who said that it 

could unfairly penalize France and pose a real threat to the European industry if these targets continue to be mandated. When you 

look at that angle of it all of a sudden Europe is beginning to wake 

up to see what those changes are going to be not going ahead with 

some of the changes that we have already done, lighting, automobiles, et cetera, and then you take a peek at what China and 

India are also not doing, how do you see all these pieces coming 

together or apart? 

Mr. CONNAUGHTON. I think one of the most important issues for 

this committee to explore this year and for all the members to become pretty savvy in is this concept of what is called leakage, leakage of jobs, leakage of emissions, so there are many strategies we 

can employ that produce technology and new jobs in America so 

there are many that work that way so that is good. But if we are 

not careful in the design of our policy, we can end up driving up 

electricity prices, driving up gas prices, and moving manufacturing 

overseas so you not only lose the jobs but the emissions go up overseas so you don’t get the environmental outcome either so you just 

need to be thoughtful in your policy design to be sure not to create 

that kind of a consequence. 

Now one way you do that is get China and India in particular 

sectors to make similar commitments. I will give you a hard example of that. Through the Asia-Pacific Partnership we got the aluminum sector together, the Chinese and the Indian aluminum sectors, committing to similar objectives with our aluminum guys and 

the Japanese aluminum guys on very specific time lines for reducing the greenhouse gas emissions. They are equally and jointly 

shared. 

Mr. UPTON. So they are the same. 

37 

Mr. CONNAUGHTON. They are the same, so you are not talking 

about them coming in later, you are not talking about them doing 

less in the aluminum sector. They are committed to doing the same 

thing. Now that is where we need to go. 

Mr. UPTON. Thank you. 

Mr. BOUCHER. Thank you very much, Mr. Upton. The gentleman 

from Georgia, Mr. Barrow, is recognized for a total of 8 minutes. 

Mr. BARROW. Thank you, Mr. Chairman. Thank you, Chairman 

Connaughton, for being here today. I want to talk carbon sequestration with you for a little bit because it is important to a lot of 

the big emitters in the area that I have the privilege of representing. But at the outset I can’t help but observe we want to digest what it is you have to say. We want to digest what it is you 

have to offer, but I will note that the digestion process begins with 

chewing and there is very little to chew on in your written statement. There is a lot to chew on in your extemporaneous opening 

statement though, and so I would like to offer and invite you in the 

future to help us get going on this process by giving us more to 

chew on in your prepared statement than you gave us here opening 

here today. 

Now on the subject of carbon sequestration, I know that there 

are a lot of technical issues and I know that there are a lot of legal 

issues. Folks in my part of the country don’t want the Floridian aquifer to be turned into one great big old carbonated water deposit. 

We want to get the carbon out of our water, our ground water, for 

example. I understand that at Bali there was some talk about trying to bring international science and resources to bear on actually 

studying the technical and the legal issues involved with the notion 

or the idea that we can take all this carbon out of the coal that 

we are going to use and stick that in the ground somewhere and 

store it safely. I also understand that there was some objection 

from some of the developing countries to going down this path and 

as a result the idea was essentially, if I am understanding correctly, that this notion is going to be shelved until the next COP 

meeting some time toward the end of this year, December of 2008. 

My question to you is in two parts. First, is this Administration 

committed to an international study that brings all the best science 

and scientists to bear on the issue of the technical and legal issues 

surrounding carbon sequestration in geological formations or not? 

Mr. CONNAUGHTON. Yes. 

Mr. BARROW. What can we expect to get done about that in the 

last year of this Administration’s term in office? 

Mr. CONNAUGHTON. Let me outline that for you, Congressman. 

Let me briefly make an aside with respect to my testimony. No offense was intended, please. The Bali Action Plan is 4 full pages. 

It is the statement of administration policy because we agreed to 

it, and in fact reading it from end to end is probably the most important thing we could be doing right now and understanding, so 

please know that was my intention. 

Mr. BARROW. Well, in your Power Point presentation I just find 

two very brief, which is incorporated by reference in your testimony, two brief references to the subject of carbon sequestration 

and no explanation of what we want and what we plan to do in 

the last year of this Administration’s term. 

38 

Mr. CONNAUGHTON. Well, let me map this out. First, it is probably the single most important thing we need to be doing because 

as we go forward the use of coal to make power will account for 

more than 50 percent of global emissions and so if we don’t find 

a pathway with respect to this source—— 

Mr. BARROW. We already know how important it is. What does 

this Administration hope to do before it leaves office? 

Mr. CONNAUGHTON. So, one, we have a full plan that will run 

over the course of the next 10 years or so of the research, the demonstration, and then the policy so it will help the deployment to do 

large scale demonstration projects for all the components that carbon capture and storage possible. 

Mr. BARROW. A 10-year plan is going to last longer than the next 

two administrations. 

Mr. CONNAUGHTON. Well, actually what we have done, Congressman, is we have requested and gotten mostly from the Congress 

the budgets necessary to build the world’s first zero emission coalfired plant known as the FutureGen Project. The President’s budgets have requested and we have received from the Congress tax 

credit authority to the tune of $1.8 billion this year and next 

year—— 

Mr. BARROW. Back to the subject of my question though which 

is an international study of the technical and legal issues involved 

with sequestering carbon in geological formations as a solution as 

a part of the overall picture. 

Mr. CONNAUGHTON. Five years ago, Congressman, the U.S. 

launched what was called the Carbon Sequestration Leadership 

Forum, and that forum was set up to specifically engage those 

issues, and in fact a lot of work has been done in that forum on 

that broader range of issues, policy type issues and design issues 

that you discussed. What we have done since then is we are now 

turning that into our domestic policy that is backed up by both the 

effort in EPA and the other agencies on the legal side, backed up 

by the Treasury on the—— 

Mr. BARROW. What is that policy, and what is it going to accomplish by the end of this year? 

Mr. CONNAUGHTON. By the end of this year, we will be underway 

with project planning and design to actually break ground on the 

FutureGen project. 

Mr. BARROW. Back to the study though—the subject of my questioning is the need for an international study to ascertain what 

really are the technical issues and the legal issues involved with 

the whole notion of sticking this stuff in the ground and building 

a zero emitting plant is a good idea of going around the problem. 

My question is what are we going to do about the carbon we are 

taking out of coal that burns to make energy. 

Mr. CONNAUGHTON. On the specific issue of the study MIT has 

produced a state of the art study that the rest of the globe has been 

working with. The Department of Energy has produced its own 

road map and plan with respect to this. The Electric Power Research Institute of America has also conducted their own evaluation of this. What we are doing now is bringing that to the international community to see if we can then develop a joint road map 

that will build on the work that the U.S. has now pulled together. 

39 

So on that specific issue it is our intention this year to get agreement among the Major Economies, especially the coal-using countries to a joint effort, but not just a study, Congressman, a joint 

effort and a joint commitment to put the resources necessary to 

begin to build the demonstrations that will make this possible and 

to do it as fast as we can. It goes beyond just a study. 

Mr. BARROW. Are you telling me we already understand the technical and legal liability issues well enough to be able to actually 

try and implement a program of carbon sequestration in geological 

formations? Do you think we can do that by the end of this year? 

Mr. CONNAUGHTON. I am telling you, Congressman, that we have 

identified a lot of the issues and we have done a lot of evaluation 

of those issues. 

Mr. BARROW. I have identified an issue. We have identified the 

issue of the technical problems of sticking it under ground and 

storing it hopefully for a long time and getting into other things we 

don’t want to get into. That is an issue, and what the legal liability 

issues are if it doesn’t work out. I mean is Georgia Power and the 

Southern Company going to be liable to get the carbon out of water 

that they put into the ground if they are trying to follow your road 

map and your plan for storing this stuff underground? Where are 

we on that track? 

Mr. CONNAUGHTON. Specifically on that track with respect to the 

FutureGen Project, we have already set up the legal regime and 

that is going to be put in place to make that project happen as a 

research plan and then the Environmental Protection Agency is 

working on the regulations, Congressman, to do what you just described more broadly. 

Mr. BARROW. What legal regime are you talking about, Mr. 

Chairman? 

Mr. CONNAUGHTON. I am sorry? 

Mr. BARROW. What legal regime, what are the steps that have 

been taken to create a legal regime for dealing with the issues of 

geologically stored carbon that leaks into other things? 

Mr. CONNAUGHTON. There is a team in the executive branch that 

is working through the regulatory design and needs to be sure to 

address the liability issues and the regulatory issues associated 

with those practices. 

Mr. BARROW. Seven minutes into my 8-minute period of questioning, my question now is what is that team going to produce for 

us by the end of this year? 

Mr. CONNAUGHTON. They are working on the very specific recommendations for policy that can be effectuated without need for 

congressional action and policy that may require congressional action to make these projects—— 

Mr. BARROW. By the end of this year they are going to be able 

to tell us what they think Congress has to address and what Congress doesn’t have to address? 

Mr. CONNAUGHTON. A lot of that has been identified already, 

Congressman, and now we are working on specific recommendations. 

Mr. BARROW. Not in this Power Point presentation, which is 

what I am asking for. Can you tell us that by the end of this 

month, for example, we will have a full and comprehensive report 

40 

on the issues that have been identified by this study group on the 

subject of carbon sequestration and geological formations? 

Mr. CONNAUGHTON. I would be more than happy to provide you 

with the materials that have been prepared by DOE to date, by 

EAP to date, by MIT to date, and by the Electric Power Research 

Institute. I think you will find—— 

Mr. BARROW. How about the working study of this Administration? 

Mr. CONNAUGHTON. I am sorry? 

Mr. BARROW. How about the study group of this Administration? 

Mr. CONNAUGHTON. We have DOE work, and we have EPA work 

on this. I am happy to share that with you. 

Mr. BARROW. I have your assurance on that by the end of this 

month? 

Mr. CONNAUGHTON. Absolutely. 

Mr. BARROW. I am through. 

Mr. CONNAUGHTON. I welcome your engagement on it, Congressman. 

Mr. BARROW. Thank you, sir. 

Mr. CONNAUGHTON. It is critical. 

Mr. BOUCHER. Thank you very much, Mr. Barrow. The gentleman from Texas, Mr. Barton, is recognized for 5 minutes. 

Mr. BARTON. Thank you, Mr. Chairman. My friend from Georgia’s questions just kind of highlight some of the Alice in Wonderland aspects of this debate. The more questions he asks the more 

CO2 he created. The more Mr. Connaughton tried to answer the 

questions, the more he created, the very thing that we are trying 

to sequester. I guess my first point, Mr. Connaughton, just to kind 

of set the ground rules, what is the most prevalent greenhouse gas 

in the world? 

Mr. CONNAUGHTON. Total volume, it is CO2. Mr. BARTON. I thought water vapor was classified as a greenhouse gas, H2O. Am I wrong on that? 

Mr. CONNAUGHTON. It is a greenhouse gas. It is a forcing agent 

so you don’t think of water vapor as a gas, but, yes, that is the 

most prevalent. That is the most prevalent forcing agent, yes. 

Mr. BARTON. Pure chemical, clinical terminology, water vapor is 

in fact, I think, over 90 percent of the greenhouse gases in the 

world, is that correct? 

Mr. CONNAUGHTON. I believe you are correct. 

Mr. BARTON. Okay. Does the Bush Administration have a proposal to regulate H2O? 

Mr. CONNAUGHTON. No, we do not. 

Mr. BARTON. What is the relative volume of water vapor in the 

atmosphere as compared to CO2? 

Mr. CONNAUGHTON. I don’t have those technical answers, Mr. 

Chairman. 

Mr. BARTON. Just give an approximation, kind of a back of the 

envelope estimate. You know it. 

Mr. CONNAUGHTON. Actually I don’t have the specific ratios in 

my head. I would be happy to—— 

Mr. BARTON. Isn’t it like 1 to 1,000, something like that? How 

far off would I be on that? It is not anywhere close to 1 to 1, is 

it? 

41 

Mr. CONNAUGHTON. It is not. I think the issue, Mr. Chairman, 

as we look at this is the question of the—we measure these forcing 

agents in parts per million, and we are talking about additions or 

subtractions at the margin. I think the question that the scientists 

are exploring is whether the changes at the margin are of consequence in the overall climate balance. And so that is where the 

scientists are really focused so when you are talking about there 

is a lot of natural CO2 in the atmosphere, there is a lot of natural 

methane in the atmosphere, a lot of the natural water vapor in the 

atmosphere, then the question we ask ourselves is even if we had 

a tiny bit more from humans can that effect the balance. 

Mr. BARTON. We are talking about orders of magnitude of thousands or tens of thousands. I mean to me it is a little bit hard to 

accept from an engineering standpoint, we are talking about regulating man-made CO2 when the elephant in the room is God-made 

H2O vapor. I mean nobody is talking about regulating H2O vapor, 

water vapor, because you can’t do it and you don’t want to do it. 

Even in the famous U.N. studies in their little table of what causes 

warming or cooling their big variable, their big forcing agent, I 

think is the term you used is H2O, is cloud formation, which they 

don’t accurately know how to model and are just now beginning to 

understand, and yet again my good friend from Georgia rightfully 

so because his constituents are worried about the legal liability of 

carbon sequestration, CO2 sequestration, that is such a minor part 

of the overall total global forcing agent that it is—I mean if you 

did any kind of a rational engineering analysis it wouldn’t even be 

a variable or if it would, it would be such a minor variable that 

it would be de minimus. 

Let me ask another question. The cap-and-trade system in Europe, has it resulted in emissions going down, staying the same or 

going up? 

Mr. CONNAUGHTON. We actually don’t have the data from Europe 

yet for the last 2 years. The U.S. is way out in front of other countries in our ability to get our data out so I couldn’t speak specifically to that. We have data through 2005 which shows a trend line 

in Europe of increasing emissions slightly higher than the U.S. 

2005, that is the first year of their emissions training program. 

Mr. BARTON. Wouldn’t you think if the cap-and-trade program 

were really successful that their emissions rate would be going 

down? I mean the trend should be down, not up. Isn’t it kind of 

contradictory that the trend seems to be the opposite of what the 

proponents hoped it would be? 

Mr. CONNAUGHTON. Well, there are 2 features to that. One is 

their emissions training system only applies to power plants and 

industrial sources. It doesn’t apply to the rest of the economy. Secondly, they brought aboard all the eastern European economies 

which are heavily fossil fuel dependent but they didn’t originally 

have caps of any kind, and so—or consequential ones, I guess is 

probably the fair way to say it, and so their current program was 

quite limited to begin with anyway. There were also some design 

issues with that program that many people have highlighted in my 

view not the least of which is how much the European industries 

are buying compliance by investing in efficiency projects overseas, 

so that allows emissions to increase in Europe. Theoretically they 

42 

decrease in China but we have at least some examples, we don’t 

have good studies on this, but some examples that appears to be 

creating an incentive in China for entities to increase their emissions in order to be paid to decrease them and we want to avoid 

that. 

Mr. BARTON. My time has expired, and the Chairman has been 

very gracious. Thank you, Mr. Chairman, and, thank you, Mr. 

Connaughton, for your service to the country. 

Mr. BOUCHER. Thank you very much, Mr. Barton. The gentleman 

from Pennsylvania, Mr. Doyle, is recognized for 5 minutes. 

Mr. DOYLE. Thank you, Mr. Chairman. Well, after just listening 

to my good friend from Texas speak, and he is my friend, this 

shows you how tough this debate is going to be. Some people on 

this panel don’t even believe this is a problem and that we should 

be regulating water vapor so it is a tough challenge. I have a couple questions. I don’t think there is anything more important to our 

national security and our economic security than extricating us 

from petroleum, and it seems to me that in the process if we can 

do that and develop alternative energy sources, increase some of 

our nuclear capacity here, learn how to burn coal cleaner, we can 

kill two birds with one stone. We can address greenhouse gases, 

and we can start putting our country on a path to energy independence, which I think is very, very important for our future. 

When you look at all the most troubled parts of the world the 

people leading those countries are sitting under a bunch of petroleum that we still have to have and as a result we get ourselves 

mixed up in a lot of foreign policy debacles we shouldn’t be in. Having said that, when President Kennedy decided we were going to 

put a man on the moon, and we didn’t know how to do that at the 

time, one of the things he did do was he marshaled the resources 

of this country, he doubled the Nassau budget several times, and 

something that was thought to maybe take decades was done in 

less than 10 years. 

One of the most frustrating things for me as a member of this 

committee and someone who has been in Congress 14 years now 

is to watch energy secretary after energy secretary, it doesn’t matter what the Administration is, through the Clinton Administration, through the Bush Administration, sit before this committee on 

budget time and tell us how they don’t need any more money and 

watching them take programs that rob Peter to pay Paul, whatever 

the program de jour is that year, and then that seems to fade 

aside. Fuel cells was big, and then we get near commercialization 

and we pull the plug on them and we are funding FutureGen. 

FutureGen is now the big thing we want to talk about and what 

comes next. Where is the commitment on this Administration and 

hopefully future administrations to finally put our money where 

our mouth is and put the dollars necessary so that instead of these 

different constituencies, you know, the battle we hear from the alternative energy people is don’t put money into clean coal, you are 

stealing money that could go into renewables. 

It is always people see the pie as just constant and that their 

slice of the pie is going to get smaller if we move into these other 

fields. We have to do all of this. We have to do all of this. We have 

to burn coal clean. We have to increase nuclear. We have to bring 

43 

alternative energy sources into the market. We have to commercialize these things. Carbon sequestration, we can’t wait 10 years 

for a study. We need to be able to deploy that technology in this 

country in the next few years. We need to make it a national emergency. It has to get done, and we have to marshal the best and 

brightest minds in our country and say if we can spend $10 billion 

a month in that black hole called Iraq, we certainly can start 

spending some money in the United States of America to extricate 

this country from this addiction we have to petroleum which is absolutely crushing our kids and grandkids and give them a worse 

quality of life than we enjoy today if we don’t start doing something 

about it. 

I have yet to see an administration on Democrat or Republican 

that is serious about tackling this problem. Can we expect next 

year when the Secretary of Energy and when this Administration 

starts to put their budget together a real commitment in terms of 

dollars and resources in the Department of Energy and other agencies that shows a true commitment to the American people and the 

rest of the world that the United States is serious about two 

things, getting us off petroleum in the near future, and at the same 

time curbing greenhouse gases, and as an added bonus to that creating new industries in this country where we will start to export 

that technology to other countries to help them also comply to cut 

their carbon emissions? What can we expect next year from the Administration in terms of an energy budget request in these other 

agencies? 

Mr. CONNAUGHTON. Well, first, as a general matter with the possible exception of your comments on Iraq, I just need to say I agree 

and the President strongly agrees with your perspective and the 

passion you are bringing to this. I would also note I think you may 

be selling your own committee short, Congressman, the bill you 

just passed was a major step forward and actually unrivaled if you 

look around the world in terms of putting in place the pieces to set 

that in place. Now we came up a little bit short of the broader approach the President called for in the State of the Union last year 

but we can continue to work on that because I think you have been 

doing great work in Pennsylvania about looking for all the opportunities for replacing petroleum, not just focusing on a particular one, 

and so I think that is where we need to take the conversation next. 

In terms of the—— 

Mr. DOYLE. Our bill was a baby step, not a big step. It was a 

baby step. It was a step in the right direction but it is miniscule 

in terms of what we need to do to make ourselves independent on 

energy for the future and at the same time cut greenhouse gases. 

We need to do 100 times more than what we are doing right now 

for our own good. Forget the rest of the world. For the good of the 

United States of America, we need to do a lot more than we are 

doing. 

Mr. CONNAUGHTON. And let me agree with you especially in light 

of what it takes to really cut greenhouse gases and displace petroleum in the way you have described. Secondly and importantly, and 

this goes back to questions that Congressman Barrow was asking 

as well, on replacing petroleum we have good tools now from the 

Congress. We have good budget aspects from the Congress that are 

44 

going to enable us to move beyond just studying and begin to start 

demonstrating. We are already deploying the resources to build 3 

of the world’s—among the world’s first major cellulosic ethanol production plants, and the venture capital folks are coming in behind 

that and we have to go there because that is low greenhouse gas 

profile and really sustainable. 

We now need to do the same thing on coal and capture and storage of coal, and again move beyond just the research and that is 

important. Don’t get me wrong there. But get the big plants built, 

get the commercial scale capture experiments done, get the commercial scale sequestration experiments done so we can show the 

thing works and then in the legal liability regime that people will 

invest against and we are committed to this. 

Mr. DOYLE. The Chairman has been very generous with my time 

and I appreciate it. I would just say, Chairman, whatever you are 

thinking of doing multiply it times 10 and cut the time in half. 

Thank you, Mr. Chairman. 

Mr. BOUCHER. Thank you very much, Mr. Doyle. The gentleman 

from Arizona, Mr. Shadegg, is recognized for 5 minutes. 

Mr. SHADEGG. Thank you, Mr. Chairman. You caught me a little 

bit by surprise. I thought there were others ahead of me. I am 

fighting a cold, and I apologize for that. Mr. Connaughton, I want 

to thank you for your service to the country. We bumped into each 

other in China last summer, and I know you were working on these 

issues then. In your testimony you mentioned that there are several existing programs that are promoting energy efficiency and environmental quality that have led to reduction in greenhouse gas 

emissions here already. This committee and this Congress appear 

to be hell bent on a major policy change, specifically a cap-andtrade system. 

I have concerns about a cap-and-trade system. I have concerns 

that a cap-and-trade system would be so confusing the American 

people will not understand it. They will not understand why the 

cost of goods is going up, and they will be frustrated if they learn 

at a later point in time that the cost of goods and services went 

up but greenhouse gas emissions did not go down. And Mr. Barton 

pointed out that at least in Europe as a result of some problems 

in the implementation of their cap-and-trade system greenhouse 

gas emissions in fact have not gone down. I am familiar with stories about producers in Europe who are going outside of Europe, 

moving the production, for example, of cement from France to Algeria outside the European cap-and-trade structure. 

I guess I have a broad question for you. I largely agree with my 

colleague from Pennsylvania about the need to move forward on efficiency, and I am concerned that if we do a radical policy change 

in the nature of cap-and-trade, we could spend a lot of energy trying to implement that without in fact reducing greenhouse gases 

and at the same time doing substantial damage to the economy. I 

do agree that we need to get off of oil. I completely agree with my 

colleague from Pennsylvania with regard to our dependence on oil 

from people who hate us, which not only puts us into a difficult 

economic situation but has us funding our enemies, and I think 

with the war on terror and the commitment of radical Islam to destroy us that is a serious policy mistake in itself. 

45 

My broad question to you is do you think that we need to move 

as quickly as this committee is talking about towards a cap-andtrade program? If so, are there things you would caution us to do 

or not do? How do you feel about a carbon tax instead? Is it more 

transparent? Would it be easier to implement, and are there other 

things that can promote efficiency or reduce our reliance on foreign 

law that you would recommend? 

Mr. CONNAUGHTON. Thank you, Congressman. You have asked 

many, many questions so let me see if I can address them. 

Mr. SHADEGG. I wanted to get them all in. I have a cold so I don’t 

have to talk again. 

Mr. CONNAUGHTON. Let me see if I can address them as a package. As I indicated at the beginning, we have a portfolio of strategies that includes regulations, some of the new ones, which by the 

way are market based, the CAFE piece and the fuels piece, used 

as something alike. You know, it is a cap with a flexible trading 

system involved in it. We have technology mandates like we did for 

efficiency of appliances. We have good old-fashioned incentives and 

those are very powerful to opening up markets where the marginal 

cost is just within reach. And so the challenge for us as we get into 

this year is taking stock of what we have got where the Congress 

has already declared goals, and then seeing what more we might 

need, and we should be looking at the full range of options for that. 

Some suggest tax, some say incentives. Some say cap-and-trade. 

Some say technology mandate. Some say let the sectors come up 

with a compact and commit to it and hold them to it and come back 

at them if they don’t make it. 

So there are a variety of approaches, and I have seen them all 

work. I have seen all of them also designed badly and fail so we 

are at the point where we need to be that specific and that goes 

to the heart of your questions. cap-and-trade can be a very powerful tool when focused, used correctly, and depending on the market. 

We did it on SO2 because there was 500 power plants, 1 pollutant 

with a very specific objective in mind with a known technology. It 

was ready to be deployed. CO2 is different. When it comes to coal 

we do not have the technology available to us today where it can 

be—liability can be established, warranties can be given. You are 

going to be able to make sure the lights stay on and you are not 

going to drive up electricity costs for the poor and people on fixed 

incomes. 

The Congress is debating LIHEAP today, and our goal can’t be 

to raise costs of electricity and gasoline on those least able to afford 

it. So those become critical factors in this discussion and debate, 

and again this committee has the capacity to be the most thoughtful in addressing those very important questions. And as I indicated there is the leakage issue. The leakage issue that if you drive 

up, for example, if your policy drives up natural gas prices further 

that means even less good high-paying American jobs in commodity 

chemical manufacturing and in fertilizer manufacturing. Right now 

we have become, I am told, we are now going to import our fertilizer for the first time. What sense does that make? It is an area 

where we are otherwise competitive but because of high and fluctuating natural gas prices we are now importing. So that is what 

we want to just focus on, but I am hopeful that the Chairman in 

46 

his effort this year will distill out these specific issues and then we 

can begin and then look at policy designs on the facts and on the 

economic analysis, and like we did on CAFE and like we did on 

fuels find some common ground that addresses these issues. 

Mr. SHADEGG. I hope we will continue to work with you and get 

your advice as we go forward. Thank you. 

Mr. BOUCHER. Thank you very much, Mr. Shadegg. The gentleman from Texas, Mr. Gonzalez, is recognized for 8 minutes. 

Mr. GONZALEZ. Thank you very much, Mr. Chairman. Welcome 

and thank you for your service. A couple of observations before I 

get to the particular question, and the first one is, and see if you 

agree, because I think our concern is to do this and do it in a way 

that it doesn’t in any way jeopardize our economic well-being. But 

it has to be acknowledged, and I think we have to be honest as 

elected officials and those that serve in the Administration such as 

yourself that it is going to cost more, and that means it is going 

to cost more to each and every citizen, and we need to prepare 

them for that. And somehow we have to convince them, of course, 

that it is an investment now that will serve us well in the future. 

Now do you agree that we should be up front telling the consumer of America that it is going to cost them more when it comes 

to energy in the future, and not—we have costs already that are 

skyrocketing in certain areas but just what we presently have and 

with the technology that is going to be employed that is going to 

add cost, do we not need to be honest with the consumer that they 

are going to have to make their contribution in the way of higher 

cost? 

Mr. CONNAUGHTON. I think there are 3 dimensions to that question, Congressman. 

Mr. GONZALEZ. And could you be as brief as possible because that 

is my observation and I want to get—— 

Mr. CONNAUGHTON. There are some investments that will pay for 

themselves over time, and that is the efficiency discussion and we 

have the tools for that. There are some investments where if we 

are controlling for air pollution where we can quantify health benefits and also get greenhouse gas reduction from that. You can actually show there is a net benefit so the cost is worth the investment. 

There is then the uncertainty zone where you are asking for more 

cost and we just need to be smart about what those costs are and 

make sure we are tailoring them to deliver something that we 

think will be good, and so that is my answer to all 3. 

Mr. GONZALEZ. And I understand, and all 3 equate to greater 

cost. It is just how we invest it. I just want to make sure that we 

are finally asking our constituents which is the hardest thing in 

the world to make their own specific contribution by way of greater 

cost, and it is a very difficult thing for an elected official. The next 

thing is I know that there have been certain individuals that observed when we are dealing with the developing nations that we 

understand their concerns and the fact that they can look to the 

United States experience and figure, hey, how did you guys get 

there, how did your Major Economies get there? You are blocking 

us off from the same practices in which you engage to attain that 

wonderful lifestyle that you enjoy today. 

47 

I think that is a terrible way of looking at it, and we have to provide developing nations with alternatives to the traditional ways 

that many economies arrived to where they are today, otherwise, 

we would say, well, we will let you have 100 years of slavery. Or 

we can just, as a matter of fact, job waiver, we will give you 50, 

60, 70 years of that. Sweatshops, well, we will give you, I don’t 

know, maybe a half century or longer maybe of that. And then of 

course you can pollute your air and your water and figure a solution later. I think that is a really dangerous thing to do. I think 

we have to relate to exactly where they are coming from and such, 

and I think you have pointed out in your testimony, I am not selling it short, and I am not saying that you are not obviously cognizant of that consideration, I am just afraid that many individuals, especially elected officials, are simply saying, well, look how 

we got there, how can we be asking that of developing countries. 

Well, very easily. I think they can learn through our own mistakes. But my central question, and we are going to have enough 

time, because I am really concerned and I am not real sure if I 

have the latest information, but I know that we became parties to 

this Bali road map or whatever it is but we have also been talking 

about the Major Economies coming together. Do we still have something set up in Hawaii at the end of the month? 

Mr. CONNAUGHTON. Yes, we do. 

Mr. GONZALEZ. All right. And it looks like there is going to be 

full participation by the European Union. We don’t have any problem with any of these Major Economies participating? 

Mr. CONNAUGHTON. No. Actually the leader’s representatives, 

people like me, who are direct reports to their leaders, that is how 

seriously this is being taken and that is good. 

Mr. GONZALEZ. Okay. Now those are obviously the developed 

economies, the Major Economies, the major emitters, whatever we 

want to call ourselves. Do we have a counterpart with the developing nations having their own pre-Bali road map meetings? 

Mr. CONNAUGHTON. We do not in this particular setting. There 

is something called the G–77, which is all the developing countries 

combined but that actually is beginning to show 2 aspects. There 

are the major developing countries who are big energy users and 

emitters, and then there is everybody else. And Bali began to show 

that, which is the China, India, Brazil, South Africa, Mexico, they 

are in a slightly different place because they are big contributors 

to greenhouse gases and they are now part of this discussion with 

us. 

Mr. GONZALEZ. And of course what we are doing there in Hawaii 

and such is not viewed as counterproductive or subverting or something in addition to or a side show, but wouldn’t you say that whatever decision is reached in that particular setting is really what we 

probably would be taking to the meetings that are set up because 

we are still trying to figure out what our domestic bottom line is, 

right, and so then we have to get all our major emitters to figure 

out what their basic bottom line before we really get to the negotiating table with all of the parties. 

My only concern is all the stakeholders aren’t there, and maybe 

it is all right to have all these preliminary meetings that precede 

whatever is going to happen when all stakeholders are there, but 

48 

is there any danger that those that are not part of this major 

emitters, Major Economies meetings since they are not there to engage us because I am so not sure that we are going to get off our 

bottom line once we establish it in that setting and we go to the 

major meeting. Now if I am a stakeholder, we are all stakeholders 

developed and developing, but I am not included in the developing 

where you guys are establishing your bottom line, I am not so sure 

I am so crazy when you come to our big meeting and you are telling me this our bottom line, I never had anything to say about your 

bottom line. Is there any danger in what I have just proposed? 

Mr. CONNAUGHTON. That is always a concern. The same is true 

when any sub-group of this committee begins to try to work something out and brings it to the broader committee, so we are trying 

to organize this in a way that we did a lot of preparatory work, we 

did a lot of briefing of everybody on what we are trying to achieve 

when we were in Bali. There is now greater acceptance that this 

was a useful tool recognizing that whatever the output of this has 

to be brought back to everybody, and so the U.N. process will start 

in April so we will have a couple meetings in advance of that and 

bring our ideas to that. We will have a couple after that first U.N. 

meeting and then hopefully the leaders will be able to get their 

heads together around this so that in plenty of time for polling at 

the end of this year, there will be 3 or 4 or 5 months where we 

can have even the broader stakeholder discussion. 

Surely, Congressman, you can agree starting on a few of these 

with the countries that are most responsible is probably a good 

step, and you can also understand having a room filled with 190 

people as an initial opening place for the conversation is a little bit 

tricky. But that is what we did with Bali. We had 190 nations giving a big outline of what we need to do. Now we can break it into 

its parts and get the countries that have a role in those parts 

bringing some real concrete ideas forward. We are trying to be 

quite constructive. 

Mr. GONZALEZ. But even in Bali wouldn’t you admit that towards 

the end there if the United States had made its own adjustments 

to the outcries and concerns of developing nations more than anyone else we probably wouldn’t be where we are today with the road 

map. My last observation, with 15 seconds, you said something 

about we should understand even with our subcommittee structure 

and our committee structure and in the full Congress I trust the 

Bali road map and what you all are going to do doesn’t exactly follow that model because we don’t. And again I just want to say 

thank you for your service and your testimony today. 

Mr. BOUCHER. Thank you very much, Mr. Gonzalez. The gentleman from Oregon, Mr. Walden, is recognized for 5 minutes. 

Mr. WALDEN. Thank you very much, Mr. Chairman. I want to 

thank Mr. Connaughton for his work for the country and for the 

President and appreciate your testimony today. I want to follow up 

on a couple of points you made just to make sure I heard them correctly that with the $35 billion in loan guarantees the U.S. has put 

forward we lead the world, is that correct? 

Mr. CONNAUGHTON. Yes. That is a substantial backing of the investments necessary to get low carbon technologies. 

49 

Mr. WALDEN. And then you said $2 billion in incentives for highly fuel efficient vehicles. That is also leading the world in that 

area? 

Mr. CONNAUGHTON. We are among the leaders. Germany and a 

couple of other countries are right up there with us but just a few 

of us. 

Mr. WALDEN. And do they have the same clean air requirements 

in Europe and Germany that we have here? I mean they have been 

out front with diesel for a long time. Hasn’t that had health implications? 

Mr. CONNAUGHTON. Actually right now our clean air requirements for diesels is more stringent than Europe’s. Because they are 

so heavily invested in diesel, they have been a little more forgiving 

on their clean air for the sake of fuel efficiency. 

Mr. WALDEN. And has that had a health impact? 

Mr. CONNAUGHTON. Yes, it has had a negative health impact. 

Our diesel-related illnesses and deaths are in the thousands. 

Theirs are in the tens or hundreds of thousands. 

Mr. WALDEN. Deaths as a result of diesel burning vehicles. 

Mr. CONNAUGHTON. Or hospitalizations. Yes. 

Mr. WALDEN. All right. When you talk about forest issues, I 

know you raised those, and you have been very aggressive at the 

international problem, one of the issues I know is out there is the 

use of palm oil for bio-fuels. Now Mr. Doyle talked about we needed, I think he said a 10 fold increase in whatever it is we are doing 

now in half the time. Now we just passed a very aggressive increase in bio-fuels. Is that the most aggressive in the world? 

Mr. CONNAUGHTON. It is. It is. In fact, Europe has a stated goal 

that is less aggressive and they are having trouble getting the programs in place to meet it. 

Mr. WALDEN. And isn’t the EU presently evaluating restricting 

the source of inputs for their bio-fuels program because they are 

discovering not all bio-fuels are as environmentally friendly as others, and in fact they are working on regulations as we speak to 

limit or prohibit the use of palm oil because in many countries 

aren’t they ripping out their forests to produce palm oil? 

Mr. CONNAUGHTON. Actually EU is headed down the road to a 

very aggressive regulation of alternative fuels, and by the way 

some of that is based on then misplaced facts and information 

which remains a challenge in terms of on the issue of palm oil 

there are a few very bad examples that overwhelm the potential 

ability of palm oil to be done well, and what is happening is I think 

the EU is taking a classic approach. They are abandoning the entire thing for the sake of a problem that could otherwise be well 

regulated. 

Mr. WALDEN. And is that an area that we need to focus on now 

that we have this enormous bio-fuels mandate in statute? Do we 

need to set up some side boards around that? I know in the energy 

bill one of the things I was frustrated about, and I voted for it, was 

the fact that if you produce alternative fuels from woody bio-mass 

they count towards renewable fuels portfolio standard unless, unbelievably unless that woody bio-mass comes off of Federal land. 

Can you explain the scientific reason why woody bio-mass that 

comes off Federal land should not be considered a bio-fuel but if it 

50 

comes off private lands it does count? Is there any difference in 

that woody bio-mass? 

Mr. CONNAUGHTON. There is no difference. And, Congressman, 

one of the core concerns that we as the Administration have is the 

endeavor to try to cherry pick and narrow down on all of these alternatives because the fact is the scale that we have to achieve is 

so big that we need to find ways to properly regulate but effectively 

get many alternatives out there based on performance, not based 

on preference. 

Mr. WALDEN. Unfortunately, I have less than a minute left. One 

of the other real problems in the energy bill and that I hear a lot 

from my state and people who are very concerned about moving 

forward with sustainable growth and renewable energy development is the short-term nature of the production tax credit. Now I 

personally believe we ought to extend it out a minimum of 5 years 

so that investors can make wise decisions into the future and get 

in the cues and get the turbines and whatever else they have to 

get, access to the grid, whatever, takes many years. Can you speak 

to the Administration’s position on a longer term extension of the 

production tax credit? 

Mr. CONNAUGHTON. We will not react to specific legislation so let 

me just deal with the issue generally which is the short-term nature of the production tax credit is why we are not seeing enough 

expansion of manufacturing capacity so we end up buying a lot of 

our products from overseas because of the boom and bust cycle of 

the production tax credit. And so whether you redesign that policy 

or develop a different one, we should be focused on our own manufacturing capacity so we can scale up renewables to the gigawatt 

scale—— 

Mr. WALDEN. And create the jobs here. So we could do the manufacturing jobs here, produce the various components for renewable 

energy development in our country ought to be done here. 

Mr. CONNAUGHTON. And lower the cost. Right now the price of 

solar and wind is going up, not down. That is not what we all 

wanted. We wanted it to go down. 

Mr. WALDEN. Thank you, Mr. Chairman, for being generous with 

the time. Mr. Connaughton, thanks for your hard work and your 

testimony today. 

Mr. BOUCHER. Thank you very much, Mr. Walden. The gentleman from Washington State, Mr. Inslee, is recognized for 5 minutes. 

Mr. INSLEE. Thank you. Mr. Connaughton, the last time we were 

together was at I think the Schwarze Pumpe coal plant which may 

be Europe’s first coal sequestration plant if things go well for them. 

And we were excited by that because that technology works. It 

could be of benefit but the only reason it will ever be implemented 

is if we have some economic incentive for it to be implemented 

leading us to conclude we need a cap-and-trade system to create an 

economic incentive for that and a whole host of technologies to be 

implemented. So I would like to ask you if the President will sign 

a cap-and-trade piece of legislation passed by this Congress this 

year. 

Mr. CONNAUGHTON. As you know, Congressman, we don’t comment on specific pieces of legislation that haven’t been proposed yet 

51 

but we have been, as you know, willing to be constructively engaged in this conversation. I would observe when it comes to incentives there are positive and negative incentives. We employ both. 

And when it comes to carbon capture and storage because the technology is not yet available, I think most of the emphasis is going 

to have to be on the positive incentive side because of the ease with 

which we can fuel switch in America out of coal to natural gas and 

other sources, and so that creates its own basket of problems so I 

just want to be sure as we work on this together that we are 

thoughtful about that unintended consequence. 

Mr. INSLEE. Are you going to encourage the President to address 

the issue of a cap-and-trade system in the State of the Union 

speech, and the reason I suggest that would be helpful is that 

when we went to the moon Kennedy went and urged us to go to 

the moon. We need presidential leadership on this. Will you be suggesting to the President that he address the parameters of the capand-trade system that could help us in this challenge? 

Mr. CONNAUGHTON. One, we don’t comment on State of the 

Union, and my advice and counsel to the President is between me 

and the President. I would observe that we are very focused on the 

next steps after last year’s energy bill. I would observe that we do 

see a lot of common ground on advancing the carbon capture and 

storage agenda and doing that appropriately. We see a lot of common ground on making sure we are on the ball on the alternatives 

to petroleum so I think you will see dedicated action from us on 

those issues among others. Nuclear is critical too. I know we have 

a little bit of difference there. But these are all critical. We need 

action on all these fronts, not just a single front. 

Mr. INSLEE. So do you believe that we can design a cap-and-trade 

system that will inhibit CO2 emissions and help grow our technological response to this? Do you believe we can do that? 

Mr. CONNAUGHTON. I don’t know yet. 

Mr. INSLEE. And what could we do to help you get over that hurdle to help us develop momentum for a cap-and-trade system because presidential leadership is important in this and presidential 

inertia could also be a drag on our ability to move this legislation. 

What can we do to help the Administration clarify its position because I think clarity in telling us that this is within something of 

the realm that the President could sign would be helpful for us 

moving forward. What could we do to help you get over that hurdle? 

Mr. CONNAUGHTON. Well, I think first it is going to be important 

that this committee in particular, and I’m glad the Chairman has 

started so quickly with this set of discussions, is to do a stock taking in what we have got and then tailor what more we need to 

that. I haven’t seen that occur yet. That is going to be very important. One thing of concern we would have is the idea of putting a 

mandate on top of a mandate and so we want to make sure that 

we have got a regulatory system working in close harmonization 

with our incentives, the positive incentives, with also the private 

sector initiative, and so that is just going to take a little bit of 

thought, and if we do that we can simplify. 

52 

Right now what we see in the Senate are a number of proposals 

that are highly complicated and highly constituent interest group 

focused and I think that is not a recipe for success. 

Mr. INSLEE. Well, let me ask you this. It is clear, it is absolutely 

clear, if you disagree tell me but I think it is absolutely clear that 

for coal sequestration technology ever to be implemented because 

it will involve some work, some cost, some investment, there will 

have to be some economic incentive for its deployment. Now that 

can be a positive incentive or it can be a negative incentive. 

Mr. CONNAUGHTON. I agree with that. 

Mr. INSLEE. You agree with that. 

Mr. CONNAUGHTON. It has to be positive. We need an incentive. 

How we structure it matters but we need an incentive. 

Mr. INSLEE. It is certainly my belief, I think most economists 

who evaluate it, is that there has to be some disincentive for putting CO2 in the air to make carbon sequestration through coal technology economically viable. Do you agree with that assessment? 

Mr. CONNAUGHTON. No. I think we are mixing 2 different pieces. 

An incentive, whether it is structured as a positive or negative one 

generically will drive more investment toward lower CO2, but when 

you are looking specifically at the issue of coal and capture and 

storage because of the opportunity to substitute something else or 

because the opportunity just to shut down operations and move 

your manufacturing and demand some place else, you could actually delay the desire to make the investment necessary to prove 

carbon capture and storage because it is not proven yet. So step 1 

is you got to prove the technology, get the liability regime in place, 

and get the cost within reach, then some of these other deployment 

strategies, whether it is on the positive or negative side become effective. That is what we did with SO2. There was a very dedicated 

period of developing the technology before the system of positive 

and negative incentives were put in place so we have to sequence 

it. 

And actually the Chairman I think in some of his white papers 

has done some thoughtful discussion of that, and I think that is 

where we got some constructive ground, and again happy to engage 

daily as need be just to make sure we are getting to the bottom 

line on some of these questions. 

Mr. BOUCHER. Thank you very much, Mr. Inslee and Mr. 

Connaughton. The gentleman from Texas, former chairman of this 

subcommittee, Mr. Hall, is recognized for 5 minutes. 

Mr. HALL. Thank you, Mr. Chairman. I have noted concern on 

both sides here about different aspects here. I think the gentleman 

from San Antonio, Mr. Gonzalez, was concerned about the cost, and 

there is a good follow-up question there, I am concerned about who 

pays, and I don’t know how much discussion took place on that little bitty island down there. There was 185 nations there and 

10,000 or 11,000 people, a little place no bigger than Delaware. 

How much concern there was for who paid or how much talk there 

was for who paid. It is something they don’t want to talk about. 

And then the gentleman from Washington wanted to know, and it 

is a good question, of what is the incentive for use of coal. 

I don’t know. I would ask you that question but I think you 

would probably agree with me the incentive is that there is a lot 

53 

of it and it is in the right place. I understand we have more usable 

coal than just about anybody. Is that close to being correct? 

Mr. CONNAUGHTON. That is correct. The United States and a 

handful of other countries have lots of reserves of coal. 

Mr. HALL. Well, you call that agreement a road map, and I guess 

it is a road map just to guide them somewhere around 2012. That 

gives me some concern too, that figure does. At my age, George 

Burns said he didn’t buy green bananas. I don’t know if I can wait 

until 2012 or not, but I do have children and grandchildren so I 

am interested in that. But I just wondered on a road map the 

building of the road is extensive. That is a major expense but there 

are a lot of other expenses to it. There are overpasses. There are 

grade separations, I think, engineers call them. There are detour 

signs. There are bridges, and I hope in this road map they got a 

lot of caution signs. You see a good many of those on roads and 

new roads. I hope they have some bad bridge ahead signs and a 

lot of stop signs. 

Somebody came along with a lot of no right turn signs in Washington. I don’t know about left turns or who goes left or who goes 

right, but this is a situation that really ought to concern every one 

of us and our children, and the people we have to go home to to 

talk to, and we ought to be honest enough to talk to them about 

the cost and, by gosh, who pays. I want to ask you how different 

is this framework from the framework that they limped away from 

at the Kyoto meeting. 

Mr. CONNAUGHTON. Well, actually fortunately, Congressman, 

this framework is a step forward. The intensity of what you heard 

reported out of Bali before we reached final agreement was really 

about whether we would fall back to the flawed approach of Kyoto 

or step forward to constructive engagement especially with the 

major developing countries, and that was a big battle in Bali. Fortunately, we did come together recognizing that we have to move 

on this together if it is going to work and that the major developing 

countries have to take actions too if this is going to work, and now 

we have to open up our eyes consistent with your caution point. 

There are many, many difficult issues that we have to confront to 

take this seriously in particular with the developing countries because of the aspirations to lift their people out of poverty and energy is essential to that. 

Mr. HALL. How far down the road who pays to get to the point 

to where—and I am not among those who say that there is nothing 

to it. I think it is good common sense and logic to pursue it and 

to seek the technology and try to take care of the fossil fuels that 

has taken care of us for so many years or find technology to make 

a cleaner place for the people that will be here after we are all 

gone, but I think we need to talk about the cost and we need to 

have some way of paying that cost, and we may have some level 

of place to decide whether or not we are pouring that cost into 

something that won’t ever come back to us, ever come to us. We 

are not assured that it is going to. 

So that is the reason we study and the reason you are being kind 

enough, and the President sent one of his finest men down there 

to work out something with these folks and you are trying to do 

it. I recognize that but we need to—I guess I may ask you what 

54 

do you see as a role for the Major Economies meeting in the AsiaPacific Partnership and the U.N. process. Do you want to address 

that just briefly because I have a lot more things I really want to 

say. 

Mr. CONNAUGHTON. Just the Major Economies we hope to focus 

on 5 or 6 elements of this much bigger Bali road map that relate 

to those of us who use a lot of energy and a lot of greenhouse gases. 

Can we agree to a long-term goal, can we find some key sectors like 

fossil power generation, alternatives to petroleum, forestry, a few 

others, where we can do joint work, set joint objectives and actually 

commit ourselves to achieve those objectives, and then come up 

with some broader and more innovative ways of financing goods 

and services and removing the trade barriers to those goods and 

services so countries will actually use the technology we have got. 

Right now we put up obstacles to that, and that is just nutty, and 

we can stop that this year if the leaders agreed on it. 

Instead, parochial interests get in the way so there are some very 

specific things we can achieve there, and then you asked about the 

Asia-Pacific Partnership, and I appreciate that because we started 

that 3 years ago, and it is actually working. We have India and 

China in key sectors making specific commitments and holding 

themselves accountable to meeting those commitments. We negotiated it in 6 months. This private sector is working well with the 

government people. You don’t hear about it because nobody is complaining. Now I think the Congress didn’t help this year that we 

have got some restrictions on the funding for that when it is going 

to deliver a 2-way trade in clean energy, goods and services in key 

sectors, so we hope to work with this committee and maybe you can 

help us persuade the appropriators that this very low cost taxpayer 

funded activity is going to yield massive dividends in getting cooperative action with the countries that we got to find that cooperative action. 

Mr. BOUCHER. Thank you very much, Mr. Hall and Mr. 

Connaughton. 

Mr. HALL. I wasn’t really through, Mr. Chairman. 

Mr. BOUCHER. Well, Mr. Hall, the time unfortunately has expired. The gentlelady from Wisconsin is recognized for 5 minutes. 

Ms. BALDWIN. Thank you, Mr. Chairman. Thank you also, Mr. 

Chairman. My questions I think follow in an interesting way although I ask them from a different perspective. You were talking 

about some of the crux of the battles that were being fought and 

negotiations that were occurring in Bali, and many had an interest 

in seeing more specific targets and specific goals rather than a 

more generalized road map, and especially in light of the urgency 

that many people view this situation globally and here in the 

United States. And with the sort of foundation for a lot of the discussions being the U.N.’s intergovernmental panel on climate 

change, and their cited recommendations that we need to cut emissions by reaching specific targets of 25 percent to 40 percent for developed nations by 2020 and the credibility of that report with over 

600 participating scientists around the world. 

So the European Union obviously came to Bali. Other government delegations came to Bali wanting to officially recognize these 

findings, and yet the United States opposed having that specific 

55 

scientific data a part of the agreement coming out of Bali and in 

fact you have to dig really hard. There is a footnote, and that footnote references the IPCC document in order to even find the reference that I just made of those strong and urgent recommendations. I am wondering if the Administration’s decision to really obscure these IPCC findings and specific targets and goals if that decision was based on other scientific data or whether it was a nonscientific negotiating position, and then I want to probe a little further of when do we get to the specifics and the targets whether it 

is through the Honolulu discussions or the ones in December of 

2008, but please first tell me if this was a scientific driven negotiating position or other considerations. 

Mr. CONNAUGHTON. Very briefly on that, the work group 3 report 

which is on mitigation strategies in the overall science summary effort and these reports summarize the state of the science. The report that we were dealing with has 177 different scenarios, the different scientific economists produced around the world, and so 

there is a band width of scenarios for how we can stabilize emissions and meet our goals. And so what happened is some participants wanted to pick one of the scenarios at the only path that we 

could pursue and our objection, and by this way this isn’t just the 

U.S., it was many, many companies, not just U.S. 

Ms. BALDWIN. I understand that. I understand that. 

Mr. CONNAUGHTON. Was that actually we were given a wide 

range of scenarios and I think those would be good for this community to explore. The U.S. has produced its own set of scenarios 

which were included in those and so it all turns on your curve for 

slowing, stopping, and then coming down what that curb looks like 

depending on your policy choices. If we could do 100 percent nuclear by 2030, hey, we are in great shape, but is that really feasible. And then you have other scenarios where how could you get 

renewable up to 20 percent, and what does that mean, and so you 

have to see what your policy path is before you can pick that curve. 

What was happening is the EU was trying to pre-judge that discussion and nobody came to Bali prepared to debate picking the 

one most extreme scenario when there is actually a range that are 

within the range of responsibility, and so that is really where we 

wanted to take the conversation. 

Ms. BALDWIN. Well, I read their bargaining position as a little— 

just recognizing the urgent need to reduce emissions between 25 

and 40 percent for developed nations by 2020 doesn’t commit to one 

of those 176 particular paths. It is basically one of the headlines 

from that particular report, but let us move on. You are about to 

convene, I think it is next month you said in Honolulu? 

Mr. CONNAUGHTON. The end of this month, 2 weeks. 

Ms. BALDWIN. Two weeks. The largest emitters will gather 

there—what are the specific goals for that conference? Will we see 

any targets, specific targets, specific goals for emissions reductions 

emerging from that particular conference? 

Mr. CONNAUGHTON. You will not see specifics out of this first 

meeting of several meetings leading to a leaders gathering later 

this year so the time to look for the outputs of this will be at the 

time of the leaders gathering. 

Ms. BALDWIN. And when and where is that? 

56 

Mr. CONNAUGHTON. We are working on that right now but as 

soon as we know, we will let you know. But I do want to let you 

know it is being debated and discussed though. We do want to see 

if we can get consensus on a long-term goal for reducing emissions. 

We do want to at least put in place the architecture for some sector 

agreements and some key benchmarks for real performance in key 

sectors, and we do want to see each nation come forward with a 

series of mid-term goals. Now I think the developed countries will 

be more likely to have that in place by the end of this year. I think 

for some of the developing countries it is just harder for them. They 

don’t have a domestic process to produce mid-term goals yet, and 

we want to see how we can encourage that. 

Ms. BALDWIN. Well, in terms of sector benchmarks, give me an 

example of what you would like to see, whether it is the leaders 

meeting in Honolulu, but we are looking, we are desperate for some 

specific targets and specific goals rather than generalized. 

Mr. CONNAUGHTON. Let me give you an example of a big sector 

relatively low on the priority list but it is a big sector, aluminum. 

Through the Asia-Pacific Partnership, we have international agreement now to cut fluorocarbons, which is 1,000 times more potent 

than CO2, by 80 percent from aluminum manufacturing globally. 

They are going to reduce their emissions by a third by 2010, and 

then a 10 percent reduction in average smelting energy usage so 

these have very specific benchmarks for the global industry and 

then the programs—— 

Ms. BALDWIN. How many sectors do you think you might be able 

to tackle in the near frame? 

Mr. CONNAUGHTON. This will be the question. I mean that is the 

question. I am hopeful we will at least get 6 top tier ones, which 

is fossil power, alternative fuels, forestry, nuclear efficiency, and 

renewables, and then maybe a couple of industry specific sectors. 

The big ones are steel, cement, aluminum. Maybe I am leaving one 

off. And so if you take that basket, Congresswoman, you are capturing a lot of global activity and emissions. And then if you can 

create different—look at your technology pathways we can create 

a more tailored set of commitments. We think that is an approach 

that will be more attractive to India and China. Why? Because they 

have done it with us this way. When you talk about going after 

their entire economy they sort of put up the walls, and they are 

even more adamant against the broader discussion in Bali than 

other countries. 

So we think this approach can draw forward the sectors because 

then you have done the math, and then it is technological feasibility, it is your investment cycles. It is just easier to figure out 

when you are breaking it into its smaller parts. 

Mr. BOUCHER. Thank you very much, Mr. Connaughton and Ms. 

Baldwin. The gentleman from Massachusetts, Mr. Markey, has 

joined us and is recognized for 5 minutes. 

Mr. MARKEY. Thank you, Mr. Chairman, very much. Welcome, 

Mr. Connaughton. I think that 2008 is the year for us to take bold 

action to deal with this urgent problem of global warming. I think 

we should build on the energy bill’s success and this year pass a 

mandatory cap-and-trade bill that reduces greenhouse gases by 80 

percent by 2050, and we should do that here domestically. InterVerDate Nov 24 2008 15:56 Apr 02, 2009 Jkt 037690 PO 00000 Frm 00062 Fmt 6633 Sfmt 6633 C:\DOCUMENTS AND SETTINGS\CWELLS1\110-80 SCOM1 PsN: JIMC
57 

nationally, I think we have to move from aspirational goals which 

can turn into procrastinational goals and reach an agreement internationally using the best science in order to insure that there are 

global targets that are going to be met by countries around the 

world led by the United States. 

My first question to you, Mr. Connaughton, is do CO2 emissions 

pose a danger to public health and welfare? 

Mr. CONNAUGHTON. CO2 emissions contribute to the warming of 

the atmosphere and there is a lot of studies about the positive and 

negative consequences of that and I would not want to get into particular conclusions because when you read the IPCC reports you 

have manifold conclusions so I just defer to the scientists on that. 

Mr. MARKEY. So you haven’t reached a conclusion yet as to 

whether or not CO2 is a danger to the public health and welfare? 

Mr. CONNAUGHTON. With the exception of very high localized 

concentrations in terms of its present effects on health and the environment we are seeing observed effects when it comes to sea ice 

melt. You can then attribute to the extent that sea ice is on land 

that contributes to sea level rise and right now it is accelerating 

the rise. 

Mr. MARKEY. Is that a danger to the public health and welfare? 

Mr. CONNAUGHTON. There are a lot of studies doing forward projections as to whether and the extent to which that could be, and 

again there is a wide body of literature on that. 

Mr. MARKEY. So your Administration has spent billions of dollars 

trying to get an answer to that question? 

Mr. CONNAUGHTON. That is correct. 

Mr. MARKEY. And it is touted to be aiming towards the conclusion, and it just seems to me since the other industrialized countries in the world have all reached a conclusion that CO2 is a danger to public health and welfare, that it would help if this Administration reached that conclusion because that would then make it 

easier for us to reach the decisions as to what we should do about 

it. When can we expect a decision from the Bush Administration 

on the question of whether or not CO2 is a danger to the public 

health and welfare? 

Mr. CONNAUGHTON. You are speaking specifically, I think, to the 

Clean Air Act determination that was remanded by the Supreme 

Court to the EPA. That is in the hands of the EPA administrator. 

He is in the process of developing both our rules to implement the 

recent energy bill and taking a look at the process by which he will 

be making that determination one way or the other. I don’t actually 

know his calendar. 

Mr. MARKEY. The EPA was tasked in the Supreme Court decision in April of 2007 to make that decision and it is a decision that 

is made separate from the energy bill. It is a specific question because obviously once the EPA makes that decision, once the Bush 

Administration makes that decision it not only triggers action on 

cars but also on stationary sources, on factories, on utilities, so it 

is important to know when the Bush Administration will be making that decision. And the longer we wait on that decision is the 

longer it then takes to begin to put into place the solutions to that 

set of problems that are identified. Can you give us any idea as to 

when those decisions will be made? 

58 

Mr. CONNAUGHTON. Specifically on the endangerment finding, I 

can’t yet because we are now going back—that was one of the 

issues that came up in the context of the development of the regulatory package we were working on, not as an alternative to congressional passage of the bill last year and so we didn’t—the President was dedicated to getting these policies through and we were 

delighted that Congress was able to act so quickly, and so now as 

a result we have to take on board what we just got from the energy 

bill and then put that in the context of what we were working on 

with the original rulemaking. 

Mr. MARKEY. I do understand that. 

Mr. CONNAUGHTON. So it has proven to be an interesting place 

for lawyers and scientists to engage, and I wish I could tell you 

specifically but I really don’t know when that will be made. 

Mr. MARKEY. It is a separate question though. And finally the 

Treasury Department recently announced its intention to establish 

a multi-million dollar multi-lateral fund for transfer of clean technology to developing countries. Why given that initiative did the 

United States simultaneously oppose strengthening international 

technology transfer mechanisms in the U.N. negotiations in Bali? 

Mr. CONNAUGHTON. Those are 2 different issues. The fund that 

we are working on we hope to provide you details on soon is our 

thinking. We have to get other countries to subscribe to—reach 

agreement on that is aimed at getting the best of today’s technologies out into the marketplace on a much, much greater scale. 

The technology transfer discussion, those are 2 interesting words 

which in the U.N. context bring with them many different interpretations, one of which on the part of some developing countries, is 

that U.S. technology innovators should give up their intellectual 

property and their right to make any profit off of their innovation, 

and of course most of us understand the dramatic negative consequences if we were to agree to that as a matter of international 

commitment. 

It is our view that innovators are entitled to a reasonable return 

on their innovation, and what we want to do then is facilitate the 

cost-effective purchase of that while protecting those rights. 

Mr. MARKEY. We are discussing a specific fund at Bali and it just 

seems to me that was a great opportunity for the United States to 

be a leader. The Treasury Department had made a statement and 

I just think it was a real opportunity for the United States. 

Mr. CONNAUGHTON. Those are 2 different issues. We weren’t 

talking about—those are 2 different issues. There is a lot of support and interest in the major fund that we are going to be creating 

hopefully with your support because it will only work if we have 

congressional support. The tech transfer issue was more one of a 

matter of policy and principle, not a matter of funds, and so I want 

to be clear that those are 2 different discussions. 

Mr. MARKEY. Thank you, Mr. Connaughton, and thank you, Mr. 

Chairman. 

Mr. BOUCHER. Thank you very much, Mr. Markey. And, Mr. 

Connaughton, thanks to you also for a very enlightening 21⁄2-hour 

conversation. We will look forward to your return to this subcommittee in the future as we consult further on the work that lies 

ahead for us and for you on climate change during the course of 

59 

this year. That being said, there being no further business to come 

before us at this time, the subcommittee is adjourned. 

[Whereupon, at 12:25 p.m., the subcommittee was adjourned.] 

[Material submitted for inclusion in the record follows:] 

60 


47819.034
61 


47819.035
62 


47819.036
63 


47819.037
64 


47819.038
65 


47819.039
66 


47819.040
67 


47819.041
68 


47819.042
69 


47819.043
70 


47819.044
71 


47819.045
72 


47819.046
73 


47819.047
74 


47819.048
75 


47819.049
76 


47819.050
77 


47819.051
78 


47819.052
79 


47819.053
80 


47819.054
81 


47819.055
82 


47819.056
83 


47819.057
84 


47819.058
85 


47819.059
86 


47819.060
87 


47819.061
88 


47819.062
89 


47819.063
90 


47819.064
91 


47819.065
92 


47819.066
93 


47819.067
94 


47819.068
95 


47819.069
96 


47819.070
97 


47819.071
98 


47819.072
99 


47819.073
100 


47819.074
101 


47819.075
102 


47819.076
103 


47819.077
104 


47819.078
105 


47819.079
106 


47819.080
107 


47819.081
108 


47819.082
109 


47819.083
110 


47819.084
111 


47819.085
112 


47819.086
113 


47819.087
114 


47819.088
115 


47819.089
116 


47819.090
117 


47819.091
118 


47819.092
119 


47819.093
120 


47819.094
121 


47819.095
122 


47819.096
123 


47819.001
124 


47819.002
125 


47819.003
126 


47819.004
127 


47819.005
128 


47819.006
129 


47819.007
130 


47819.008
131 


47819.009
132 

Æ 


47819.010