The American Power Act - First Read (cont.) Title IV - Protecting American Manufacturing Jobs and Preventing Carbon Leakage
From Tracy L Weiss, GT Phoenix. Thanks and Welcome To Tracy!
As its name suggests, Title IV addresses job protection and growth. Subtitle A of Title IV focuses on job protection. Specifically, it establishes the Emission Allowance Rebate Program to rebate emission allowances to eligible industrial sectors. Theoretically, this will compensate these sectors for costs incurred as a result of compliance with the Power Act's emission caps. Also, Subtitle A empowers the President to establish an International Reserve Allowance Program, which will require specified foreign entities to buy carbon allowances to help counterbalance the costs incurred by U.S. companies. The success of this industrial policy depends on EPA's ability to establish effective guidelines to both meaningfully measure emissions and manage the rebate program, as well as the Federal government's ability to monitor, implement, and enforce the International Reserve Allowance program, which at least facially raises significant WTO/free trade concerns.
Subtitle B focuses on clean energy technology and jobs as a means to both protect and grow U.S. job opportunities. Theoretically, increasing government funding for America's "clean energy" (non-fossil fuel) technology might generate jobs and reduce dependency on foreign energy sources. Even if this theory proves to be true (and the initial data creates some grounds for uncertainty), with the exception of the Clean Vehicle Technology Fund, which shall receive monies from the auction of emission allowances, the other proposed clean energy technology and jobs policies "shall be appropriated" without specifying the anticipated amount or source of funds. As a result, the cost-benefit analysis of these proposed reforms is hard to predict.
Between the proposed rebates, tax incentives, and program creation, the Power Act seems likely to prove very expensive. More information is necessary to determine if the benefits warrant the expense.
