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San Jose, CR

CARBON POLITICS IN THE US

September 28, 2011

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Social and cultural change

Litigation

Obama “clean energy” agenda

Regional carbon markets

Voluntary initiatives

CARBON REDUCTION DRIVERS

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Massachusetts v. EPA: 12 states sued EPA to force it regulate GHGs as air

pollutants

Supreme Court ordered EPA to determine if GHGs endanger public health and welfare

“Endangerment finding” issued in December 2009

EPA begins permitting requirements in January 2011

EPA GREENHOUSE GAS REGULATIONS

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Unparalleled investment and attention

Scrutiny of fossil fuel subsidies

“Win the Future” campaign 80% renewable energy by 2035

Increased investment in innovation

Tapping private capital markets

Better Building Initiative

OBAMA “CLEAN ENERGY” AGENDA

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Chicago Climate Exchange

California cap-and-trade program

Regional Greenhouse Gas Initiative (RGGI) – 10 Northeast & Mid-Atlantic states

Western Climate Initiative (WCI) 6 states and 4 Canadian provinces

Arizona withdrew in February 2011

REGIONAL CARBON MARKETS

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Economic downturn

Growing political opposition Climate skeptics have rebounded

2010 elections ensured GHG regulation difficult

Conflicting signals from government

Recent Obama Administration decisions September 27 delayed release of CAFÉ standards

Ozone rule withdrawn

CHALLENGES

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Significant shift since 2010 Republican victory

2012 elections will determine future of GHG regulations in the U.S.

Job creation will be #1 issue

Republicans currently hold upper hand

CURRENT POLITICAL ENVIRONMENT

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New focus on “austerity measures” and spending cuts

Rigorous oversight from House Republicans

Need to tie energy legislation to jobs and energy security

ENERGY POLICY ENVIRONMENT

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30% Investment Tax Credit

Treasury Grant Program – Section 1603

DOE Loan Guarantee Program

Solyndra

RENEWABLE ENERGY INCENTIVES