At the 9th Annual Wall Street Green Trading Summit (WSGTS) this past week there was much talk about pending climate change legislation; what will it look like and when will it pass?
On March 17th details from a new energy and climate bill emerged out of Washington just three days after Senators Kerry, Graham and Lieberman met behind closed doors to discuss how to handle the issue sometime this spring. The three Senators shared an 8-page outline of their plan in another closed-door meeting with industry groups that included the U.S. Chamber of Commerce, Edison Electric Institute and American Petroleum Institute.
Industry experts speaking at the WSGTS all agreed that the energy and power industry want legislation, especially something to pre-empt regulation from the EPA. This would give companies more flexibility to enact passed legislation. If the EPA is left to regulate industry it will do so via the Clean Air Act which may force companies to take actions that are cost prohibitive thus forcing some mid-sized and smaller companies out of business. For example, small to mid-sized coal-fired power plants will be forced to retrofit operations which could be extremely cost prohibitive affecting companies like Duke Energy Corporation (NYSE: DUK) and Dominion Resources Inc. (NYSE: D) as well as American Electric Power (NYSE: AEP). These three companies, among others, support climate change legislation but fear that if the EPA were to regulate the industry they would be forced to make changes in haste and push roughly a third of the energy capacity offline.
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