Climate change legislation in hot seat

President Obama will summon Democrats on the House Energy and Commerce Committee to the White House on Tuesday to try to break the impasse on the climate change bill, one of his highest priorities.

Committee Democrats have split on the particulars of the massive bill as various constituencies, from nuclear utilities to farm groups, try to tweak or substantively alter a draft sponsored by Reps. Henry Waxman (D-Calif.) and Edward Markey (D-Mass.).

Though climate change is proving to be a headache for Democratic leaders, it has been a boon to K Street. The inter- ests watching the bill extend beyond traditional power players in the energy industry. More than 80 new registrations have been submitted to the Senate Office of Public Records since the start of the year for lobbying on climate issues, including from such disparate interests as Coca-Cola and JPMorgan Chase.

{mosads}Markey’s Energy and Environment subcommittee was scheduled to begin consideration of the bill this week, which means a chairman’s mark would have to be released soon to meet the requirement that gives members 36 hours to review legislation.

But the start of the markup had already been pushed back once, and some energy lobbyists said it may be again, given the disagreements on the bill. Others, though, said the legislative abilities of Waxman’s staff should not be underestimated, nor should the persuasive powers of a popular president.

Coal producers were lobbying to ease the severity of emissions reductions required in the near term under Waxman-Markey. “We need some assurance that the timeframe for the caps will be harmonized with the availability of the technology,” said Luke Popovich, a spokesman for the National Mining Association.

The bill calls for emissions to be reduced by 20 percent by 2020, but critics say that’s too much, too soon given the absence of a way to remove carbon dioxide from coal economically. Obama’s target was less ambitious, at a 14 percent reduction.

Meanwhile, nuclear energy lobbyists were pressing for additional support to revive the industry, including being counted as a “renewable” energy resource and being afforded broader federal financial support beyond an existing $18 billion federal loan guarantee program to support the long-awaited “nuclear renaissance.” In addition to its cap-and-trade provisions, the bill would require utilities to get 25 percent of their power from renewable energy sources like wind and solar power.

{mospagebreak}{mosads}Members from the Southeast and large utilities like Southern Co. have argued the standard would force the region to buy power elsewhere, given the area’s alleged lack of renewable resources. That means higher electricity costs in an area that is among the most impoverished in the nation.

House Majority Whip James Clyburn (D-S.C.) in particular has called for broader nuclear support in the bill, including counting nuclear power as a renewable resource.

Oil refiners have a whole list of concerns, starting with a requirement they produce a more climate-friendly fuel. Refiners also want 5 percent of the emissions allowances distributed to the industry to be given out free. Electric utilities are seeking a 40 percent free allocation allotment.

Also on Capitol Hill, Senate Democrats  aim to finish a housing bill as early as Tuesday that would support loan modifications as well as grant additional authority to the Federal Deposit Insurance Corporation (FDIC).

The bill is widely supported, although a group of investors has recently geared up to fight a specific provision. They argue that a “safe harbor” provision that protects loan servicers who modify loans is burdensome on the investors in those mortgages. Still, banking industry sources did not expect the provision to be changed significantly. A similar measure passed the House in March.

After the housing bill, the Senate will move as early as mid-week to a bill
reining in the credit card industry. Sens. Chris Dodd (D-Conn.) and Richard Shelby (R-Ala.) are continuing to work on a compromise bill. Dodd passed a bill through the Banking Committee on a mostly party-line vote. Sen. Tim Johnson (D-S.D.) opposed the measure.

Obama threw his support behind efforts to beef up regulations of the industry, and Dodd and Shelby are hoping to strike a compromise in the next few days.

The House is slated to begin debate on Wednesday on a bill to combat predatory lending practices. The bill, sponsored by Democratic Reps. Brad Miller (N.C.), Mel Watt (N.C.) and Barney Frank (Mass.), could come up for a vote on Thursday.

The bill would set new federal standards that a mortgage lender must retain 5 percent of the economic risk of the loan, instead of passing along the entire value of the mortgage to another party.

Frank and others have repeatedly expressed an interest in clamping down on the securitization process, whereby lenders sometimes do not retain any of the initial risk.