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American Clean Energy and Security Act of 2009: Title IV: Transitioning to a Clean Energy Economy

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On June 26, 2009 the House of Representatives passed the American Clean Energy and Security Act (ACES) of 2009, a combined energy and climate bill representing our first real chance for a national carbon reduction plan in the United States. The bill combines standards and incentives to promote clean energy and energy efficiency technologies with a firm cap on greenhouse gas emissions. The Alliance will continue to work to obtain Senate passage of strong climate legislation.

Title IV: Transitioning to a Clean Energy Economy

Subtitle A: Ensuring Real Reductions in Industrial Emissions

Sec. 401 ("subpart 2): Promoting International Reductions in Industrial Emissions

In order to combat ‘carbon leakage’ (viz. the US increasing its imports to avoid the extra cost on greenhouse gas emissions, effectively exporting its carbon), this provision would make it the policy of the United States to negotiate equitable greenhouse gas emission reduction agreements with other nations. In the instances when no such agreement is reached, the US would establish an 'international reserve allowance' program which would set prices equal to the allowance price in the US, and foreign exporters for goods in that sector would have to submit allowances for their exports, meant to cover the difference in costs of production resulting from the cost of allowances. The number of allowances needed to be submitted per export for each sector would vary depending on the estimated competitive imbalance, considering also subsidies given to industry to ease the pain of GHG reduction schemes in both the US and the exporting country.

The requirement would not come into effect if at least 85% of imports in a given sector were manufactured or produced in countries that:

  • Are party to an international GHG reduction agreement the US is party to, and that have reduction requirements at least as stringent as the US’ requirements (based on 'equitable reductions');
  • Are party to a multi- or bilateral GHG reduction agreement with the US; or
  • Has an energy or GHG intensity that’s less than that in the US for that industrial sector.

Countries the UN has identified as the least developed of the developing countries are exempt, as are any countries making up less than 0.5% of global GHG emissions and less than 5% of US imports in a given sector.

The President is allowed to propose a different way to minimize these competitive imbalances if he or she doesn’t believe that this strategy will be successful or sufficient, as long as Congress agrees.

The President would be required to make the initial determination of which sectors would be included in this international allowance program by January 1, 2018. The program would take effect no earlier than January 1, 2020.

Subtitle B: Green Jobs and Worker Transition

Part 1: Green Jobs

Sec. 421: Clean Energy Curriculum Development Grants

This section directs DOE, in collaboration with the Department of Labor (DOL) and the Department of Education, to award competitive grants to develop, implement, and disseminate programs of study that are focused on emerging careers and jobs in renewable and clean energy, energy efficiency, climate change mitigation, and climate change adaptation. Entities eligible to receive this funding are partnerships involving local educational agencies, technical education schools, postsecondary institutions, or representatives of the community including business, labor organizations, and industry that have experience in clean energy. Priority will be given to applicants that utilize innovative learning techniques and applicants that focus on low performing students and other students of "special populations," such as those who have disabilities, are from economically disadvantaged families, have a limited English proficiency, or are single parents.

Sec. 422: Increased Funding for Energy Worker Training Program
Funding for the Energy Worker Training Program as authorized in the Worker Investment Act of 1998 is increased from $125,000,000 to $150,000,000.

Sec. 423: Development of Information and Resources Clearinghouse for Vocational Education and Job Training in Renewable Energy Sectors
This section sets up an internet-based clearinghouse (information center) to aid career and technical education and job training programs for the renewable energy sectors.  This clearinghouse would emphasize programs that cater to high-demand middle-skill, trades, manufacturing, contracting, and consulting careers.  The clearinghouse would contain information regarding solar energy systems, wind energy systems, energy transmission systems, geothermal systems of energy and heating, and energy efficiency technical training, and the information would come from businesses, organizations, institutions of higher education, and community colleges which are all involved in the renewable energy sector.  

Part 2: Climate Change Worker Adjustment Assistance

Sec. 425: Petitions, Eligibility Requirements, and Determinations

A group of workers, unions, employers, and state employment agencies can petition the DOL and the governor of a given state for certification of eligibility to apply for adjustment assistance. A group of workers is eligible to apply for assistance if it is employed in energy producing and transforming industries, rail and pipeline transportation, energy-intensive manufacturing industries, or consumer goods manufacturing, or if the DOL determines that the group is adversely affected by full or partial unemployment as a result of the cap-and-trade program. The DOL will provide adjustment allowances, training, and benefits to these groups.

Sec. 426: Program Benefits

Adversely affected workers certified as eligible under this program can receive allowance payments if they become fully or partially unemployed - or if notice of their unemployment was given to them - on or after the date of their certification and within a period of 2 years. Payments will be equal to 70 percent of the average weekly wage of the certified worker for each week of a worker’s unemployment, not to exceed the state average wage. An adversely affected worker is also eligible to receive 80 percent of the monthly premium that a worker’s employer had been providing prior to termination, for the worker’s use in obtaining or maintaining health insurance. An eligible worker can receive payments for up to three years.

To remain eligible for the payments, a worker must be enrolled in a career counseling and training program that is approved by the Department of Labor, unless DOL determines that such a program is not feasible or appropriate for the worker. DOL shall provide states with funds each fiscal year to run worker training programs for adversely affected workers, which may include coursework at an accredited college or university and on-the-job training. DOL must also provide relocation allowances (up to $1,500) for workers that must relocate to regain employment, and a one-time job search allowance (up to $1,500) for those no longer eligible for a climate change adjustment allowance.

Sec. 427: General Provisions

This section specifies that the program will be run by states in coordination with the Department of Labor, or by DOL if there is a state does not enter into agreement. The states must report to DOL the outcomes of the program, including the percentage of adversely affected workers taking part in the program that become employed and the earnings of those workers.

This section also specifies some of the industries whose workers are eligible to receive climate change worker adjustment assistance. Those industries include, but are not limited to, the coal mining industry, oil and gas extraction, electricity power generation, transmission and distribution, natural gas distribution, rail transportation, pipeline transportation

The climate change worker adjustment assistance program is to be funded by the auction of 0.5 percent of emissions allowances in years 2012-2021, and by the auction of 1 percent of emissions allowances in years 2022-2050.

Subtitle C: Consumer Assistance

Sec. 431: Energy Refund Program (424)

This section amends the Social Security Act to include an “Energy Refund Program,” under which eligible low-income households are provided cash payments as reimbursement for the estimated loss from the American Clean Energy and Security Act of 2009.    Households are eligible for the Energy Refund Program if their gross income is less than 150% of the poverty line.  The amount to be reimbursed to each household shall be estimated every year by the Energy Information Administration and will be paid out on a monthly basis.

Sec. 432: Modification of Earned Income Credit Amount for Individuals with No Qualifying Children

This section would increase credit and phase-out percentage for individuals with no children, as well as adjust for inflation in the Internal Revenue Code of 1986. 

Sec. 433: Protection of Social Security and Medicare Trust Funds

This section allows for transfers into the HI Trust Fund by the Secretary of Treasury according to sums as determined by the Chief Actuary of the Social Security Administration on account of changes in benefit costs and changes in tax revenue attributed to the provisions of the American Clean Energy and Security Act of 2009.