Steel industry voices opposition to utility-focused climate plan

The American Iron and Steel Institute has added its name to a list of energy-intensive and trade-sensitive industries that have detailed their objections to last-ditch efforts by Senate Democrats to focus climate legislation on power plants.

The group echoes other major industrial users of coal-based electricity in arguing that the price tag of a utility-focused carbon-pricing plan would be substantial if the utilities pass costs on to its customers.

“To avoid adverse impacts on U.S. industrial competitiveness and jobs, it is essential that climate legislation include provisions to offset these expected significant increases in energy costs that manufacturers, such as steel facilities, will face,” Thomas Gibson, the institute’s president and CEO, wrote to Senate Majority Leader Harry Reid (D-Nev.) on Thursday. “Unfortunately, an electric utility cap- and-trade approach is unlikely to include sufficient resources to address these substantial costs to energy-intensive manufacturers.”

The American Chemistry Council is among those also to voice their strong concerns about efforts by Reid and other Senate Democrats to fashion a utility-focused plan that could be part of a broader energy and climate strategy Reid plans to bring to the Senate floor this month.

Sen. Sherrod Brown (D-Ohio) is trying to include protection for steel and other manufacturing industries that are particularly key to the Midwest. This includes a border tariff against developing nations like China that do not enact similar carbon controls in order to protect jobs from being outsourced.

He has also talked about allowing the manufacturing sector the ability to “opt in” to a carbon-pricing program to allow more regulatory certainty and congressional help in curbing emissions that otherwise could be regulated by the Environmental Protection Agency.

Brown and nine other senators — in a letter in April this year — called for preemption of state and federal greenhouse gas regulations and federal research and development support for technologies that manufacturers can use to curb their emissions and energy use.