Representatives from six Midwest states and one Canadian province completed a plan today to reduce greenhouse gas emissions.
The advisory group recommends a cap-and-trade program that calls for close to 20 percent reduction of greenhouse gas emissions by 2020, and 80 percent reduction by 2050.
Under the plan, most of the permits to emit carbon dioxide will be allocated to utilities and industry for a small fee at first. But they'll gradually be shifted to an auction, where the price is expected to go up over time. After 18 years, all the permits will have to be acquired by auction.
When the advisory group was set up, the president was George W. Bush, who made it clear he was not interested in government action on climate change. Now, Congress is moving quickly to present President Barack Obama with a plan, which he pushed strongly during his campaign.
Members of the Midwestern group, with representatives from Minnesota, Wisconsin, Illinois, Iowa, Kansas, Michigan and Manitoba, all said they think a national plan is a better way to go. But they wanted a regional plan to influence the national debate. Some members say the Midwest has special needs that Washington might overlook.
"Our region is coal-dependent, and has a lot of heavy industry, and so could be affected disproportionately compared to other areas like the Pacific Northwest," said Roy Thilly, CEO of WPPI Energy, a Wisconsin utility. "So it's important that the Midwest do a good job in influencing the structure of a cap and trade program so that it mitigates the costs to consumers while at the same time achieving the environmental objectives."
Environmental groups pushed for even more aggressive goals, but compromised. Henry Henderson of the Natural Resources Defense Council says his group supported an auction for permits from the very beginning, arguing that the money could be used to help homeowners deal with higher energy costs, and to invest in weatherization and other energy-efficiency programs.
But in the give-and-take of the advisory group meetings, Henderson says he came to recognize the needs of industry too.
"There are parts of heavy industry in the Midwest, including the coal generators, who need to invest to clean up their emissions," he said. "They need to have the resources to do that, and we have an understanding of this from this intense discussion."
That willingness to bend has been a hallmark of the process, according to Jesse Heier, a staff member for the Midwestern Governors Association.
"Everybody is approaching it from a very pragmatic and results-oriented perspective," he said. "They realized this is a problem, and if we continue to fight with each other, we're not going to solve that problem. And I think folks realized that the Midwest has a lot to lose or a lot to gain."
Heier says the fact that no one held out or disagreed with the plan should send a strong signal to Washington.
The document is considered a draft at this point -- more economic models are being run to determine the economic impact to households and various industries.
But representatives of the governors who served on the advisory committee have drafted a letter to be sent to Capitol Hill as early as Wednesday. Governors from the six states and the premier of Manitoba will be asked to sign the letter.
Bill Grant of the Izaak Walton League emphasized the urgency of the plan.
"Things are moving quickly on the Hill, and something that comes a day late won't have much of an impact, so everyone is not wanting to miss an opportunity," he said.