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Transportation Allowances in the Climate Bill: A Tale of Two Modes

2:20 PM PDT on October 16, 2009

To understand why the climate change bill is a top priority
for urbanists, it's crucial to understand the emissions allowances that
the legislation distributes. The allowances essentially put the "trade"
in "cap-and-trade" --
whichever industry or state government holds them can benefit from
their monetary value or use them to emit pollution under the "cap."

Auto_Train_Loading_Auto.JPGA car drives onto Amtrak's Auto Train. (Photo: About.com)

The ideal for many clean transportation advocates remains the so-called "CLEAN TEA"
proposal, which would set aside 10 percent of total allowances for
states to use on transit, inter-city rail, freight rail, bike-ped
projects, or any number of other plans to reduce transport-based
emissions.

The climate bill approved by the House in June, however, gave a maximum of 1 percent of allowances to clean transportation.

So how did the auto industry fare? Car companies, which have enlisted
the Obama administration's support for a costly national transition to
electric vehicles, got 3 percent of allowances in the first several
years of the House bill to help fund production of "advanced automobiles."

Alliance
for Automobile Manufacturers spokesman Charles Territo said in an
interview that his group considered the House set-aside "fair."

"We
strongly believe that allowances or credits, in whatever form they take
... should go to the industry, particularly because we have such a big
role to play in reducing emissions," Territo said. "We're being asked
to shoulder a great deal of emissions [cuts]."

Carmakers are pushing for a slice of the climate pie on the state level as well.

In California, where officials are preparing to issue carbon credits to spur transportation emissions cuts, Toyota -- which was sued by California for not transitioning to cleaner cars -- said that it wants allowances otherwise slated for electric utilities.

“Any
societal benefit from the low-carbon-fuel
aspect of these vehicles, especially the generation of credits,
must accrue to the auto manufacturer, Toyota said in a public filing
with the California Public Utilities Commission, as first reported by
Bloomberg.

The
Senate has yet to settle on how many allowances it would set aside for
automakers, transit, and other modes of transport. How those chips fall
is "something we'll be paying close attention to," Territo said.
"Ultimately, it's important that credits be reallocated to the
industry, to continue to reinvest in new technologies."

The American Public Transportation Association's (APTA) statement
on the Senate bill does not directly reference allowances or the "CLEAN
TEA" bill, stating simply: "We strongly urge the Senate to provide
robust funding for transit and transportation investment in future
versions of the [climate bill]."

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