McCain believes a climate and energy policy should:
- Be built on scientifically-sound, realistic and mandatory emission reduction targets and timetables
- Utilize a market-based cap and trade system
- Include mechanisms to minimize costs and work effectively with other markets
- Spur the development and deployment of advanced technology
- Encourage and assist international efforts to solve the problem
John McCain has recently called for an end to the ban on new offshore oil drilling platforms as a way to ease the high fuel prices and energy problems that are partly to blame for wrecking the national economy. Although this decision marks a shift from the environmental position he took in 2000, McCain understands that as the economic and environmental situations change in America, American leaders need to adapt their thinking and adopt new strategies.
McCain believes local municipalities and states, not the federal government, should be in charge of making the environmental decisions that affect them -- especially when it comes to drilling for oil off their coastlines. Such decisions would allow for direct public input and give individual citizens the opportunity to make their voices heard.
Lost in all the controversy over his offshore drilling proposal are McCain's calls for alternative fuel research and tax incentive proposals for those who implement or use alternate forms of energy or fuel.
Nuclear Power
As a way to reduce carbon dioxide emissions and compensate for the increase in electric energy consumption that will inevitably occur, McCain has also called for increasing the number of nuclear-powered energy plants.
John McCain's Cap and Trade Policy
McCain's energy and climate change plan will have as its foundation a market-based system to curb greenhouse gas (GHG) emissions, mobilize innovative technologies, and strengthen the economy. He also will work with the international community to secure energy for the future and create more opportunities for American industries.
A climate cap and trade mechanism would set a limit on greenhouse gas emissions and allow individuals and/or organizations to buy and sell rights to emit gas emissions. This plan is similar to the successful acid rain trading program of the early 1990s, and has as its key feature a mechanism that allows the market to decide and encourage the lowest-cost compliance options.
A cap-and-trade system spurs competition for alternatives to carbon-based fuels. Permits equal to the cap on greenhouse gas emissions are issued under the system, and if market participants invent, improve, or acquire a way to reduce their emissions, their permits can be sold for cash. As a profit motive, the cap-and-trade system motivates and coordinates the efforts of venture capitalists, corporate planners, entrepreneurs, and environmentalists toward the common goal of reducing emissions.
The cap and trade system would encompass electric power, transportation fuels and commercial and industrial businesses, which are responsible for nearly 90 percent of all emissions. Under McCain's plan small businesses would be exempt. Initially, participants would be allowed to either make their own greenhouse gas reductions or purchase "offsets" –- financial instruments representing a reduction, avoidance, or sequestration of greenhouse gas emissions practiced by other activities, such as agriculture –- to cover 100 percent of their required reductions. Offsets would only be available through a program dedicated to ensure that all offset greenhouse gas emission reductions are real, measured and verifiable. The fraction of emission reductions permitted via offsets would decline over time.
Timetables and Targets
- 2012: Return Emissions To 2005 Levels (18 Percent Above 1990 Levels)
- 2020: Return Emissions To 1990 Levels (15 Percent Below 2005 Levels)
- 2030: 22 Percent Below 1990 Levels (34 Percent Below 2005 Levels)
- 2050: 60 Percent Below 1990 Levels (66 Percent Below 2005 Levels)
To support the cap-and-trade system, McCain will reform federal government research funding in an effort to reach the program’s emissions reduction goals and emphasize the commercialization of low-carbon technologies.
First, emissions permits will be auctioned to support the development of new technologies. Part of the proceeds from the auctions will be used to support a wide range of research and commercialization aimed at capturing and sequestering carbon emissions, harnessing nuclear power and developing new types of environmentally-friendly batteries. Auction proceeds also will be used to support a Green Innovation Financing and Transfer (GIFT) program designed to spur commercialization.
Streamlining the process for deploying and implementing new and innovative technology is important, but there also needs to be more accountability from the federal government to meet goals and deadlines. Once developed and inspected, McCain would provide incentives for the rapid assimilation of these new technologies into the global marketplace.
Growing a Rapid and Clean Economy
Instituting alternative energy solutions should help, not hurt the nation's economy, according to McCain, and therefore he plans to use a portion of the auction proceeds to ensure the shift doesn't financially burden America's low-income families. To do this, he will require companies holding emission permits to find and implement the lowest-cost emission reduction programs if they want to sell them.
