WisBusiness: Regional cap-and-trade proposal remains contentious

By Brian E. Clark

Though they might have had a few reservations, most of the 29 members on the Governor’s Global Warming Task Force found the suggestions to cut carbon dioxide (C02) emissions acceptable.

But three representatives, all from industry, dissented in the final vote.

GM didn’t like the tough California-style tailpipe gas restrictions.

And two members of the panel – representing the Wisconsin Paper Council and Ariens, a Brillion lawn mower and snowblower manufacturer – said they found the regional cap-and-trade proposal unworkable and too expensive.

Moreover, they said a regional plan is unnecessary because Congress may pass a national cap-and-trade plan to reduce C02 emissions.

Since the votes were cast late last month, Gov. Jim Doyle has pushed forward with a Midwest plan, which could kick in as early as 2012 and possibly be linked to the Canadian province of Manitoba. He wants it, in large part, to put pressure on Congress.

Lee Sensenbrenner, a spokesman for Doyle, acknowledged that a national cap-and-trade system – which would set a limit for C02 emissions and then create a market to allow companies to sell conservation credits – would be better.

“Our first hope is a federal plan to deal with climate change and greenhouse gases,” he said. “It’s important that the national government move forward.

“But in the meantime, the Midwest Governors’ Association is trying to advance the idea and help push a national program,” he said.

“The sooner we can get something in place, the greater impact we could have,” he said.

“The changes we make today can have the biggest payoff down the road,” added Sensenbrenner, who said a cap-and-trade system would reward companies that make investments to reduce emissions.

But Todd Swanson, a corporate vice president with Ariens, remains unimpressed.

“For starters, the economics are questionable,” he said. “There also are a lot of specifics we don’t know and aren’t comfortable with.

“It may eventually become the law of the land, but our concern is how it would work on a regional level,” he added. “It needs to be done on a national or international level with a level playing field for it to be successful and fair.”

Swanson said he is also concerned that Wisconsin would end up being punished under a cap-and-trade system.

“We have a heavy concentration of manufacturing here and this would be like unilateral disarmament,” he said. “It could leave us at a huge disadvantage, especially at a time when many of our industries are already under a lot of pressure and closing down plants all over the state.”

Todd Stuart, executive director of the Wisconsin Industrial Energy Group, said he, too, fears that additional environmental restrictions will force companies to shut down factories.

“And if they end up moving their plants to China, which is opening a coal-fired power plant about every day and spewing out tons of C02, does that help the global climate?” he asked. “That seems counterproductive to me.”

Peter Taglia, staff scientist with the Clean Wisconsin environmental group, said he understands that many industries worry that a cap-and-trade system of any kind would be expensive.

But while all the other policies suggested by the task force are helpful, he said a cap-and-trade system could bring about some of the greatest CO2 reductions with the goal of stabilizing emissions at 2005 levels and then reducing them 22 percent by 2022 and 75 percent by 2050.

He said the proposal would stimulate conservation and push companies to do more to generate energy by using biomass.

“Another option was a carbon tax,” he said. “But the cap-and-trade system is more palatable. And frankly, the costs of not dealing with global warming, in terms of human health and changes to the climate, are great, too.”