Senator Jeff Bingaman, who chairs the Energy and Natural Resources Committee, told reporters yesterday that he doesn't think the initial cap and trade bill will include 100 percent auctions of carbon permits. Kevin Drum is displeased:
There are loads of special interests who hate the idea of a 100% auction, of course. But once you start giving away permits, you'll never stop. It is, plain and simple, a massive giveaway to existing power plants, and as the Europeans learned, it makes a mockery of any serious cap-and-trade plan.This all sounds very wonky, but it's a hill to die for if you care about reducing greenhouse gases. Without a 100% auction, cap-and-trade is a bad joke.
Details here. This is also one reason many environmental advocates prefer a carbon tax: You can do a lot of complicated things to cap and trade legislation that kill the impact of the bill. A carbon tax is harder -- though still not impossible -- to muck with.
