House poised to pass climate change bill

WASHINGTON (Reuters) - The House of Representatives is scheduled to vote on Friday on one of the most significant environmental bills in U.S. history -- a sprawling measure that aims to wean industry off of carbon-emitting fuels blamed for global warming.

Democratic leaders were working hard to ensure there were at least 218 votes in the 435-seat House to pass the legislation that is a high priority for President Barack Obama.

There was evidence they had made progress, as the legislation was scheduled for a debate and vote by the full House, a move that usually indicates supporters were confident they can secure the necessary votes.

House Speaker Nancy Pelosi, welcoming German Chancellor Angela Merkel to the Capitol, said she was hopeful the climate change bill would pass and she praised German leadership on combating global warming.

"Today hopefully we'll have a celebration of American leadership taking its rightful place with German leadership on this important issue," Pelosi said.

Obama adviser Valerie Jarrett said on Friday it was unclear if there were enough votes to pass the bill.

"We're working on it, the president was on the phone," Jarrett told CNBC. Obama also met at the White House on Thursday with some undecided Democrats.

"It's a job creator. It's going to help save millions of dollars, billions of dollars, for our economy and we don't know right now if we have the votes, so we're going to work up until the last moment," Jarrett said.

One House Democratic aide said leaders were still working in the hours leading up to the debate to shore up support "but expected to get there."

With House Republicans mostly opposed and warning it would hit recession-weary consumers in their pocketbooks with higher prices for energy and other everyday goods, supporters were attempting to counter those arguments.

Pelosi, Obama and others cited environmental benefits, job creation and even national security as the legislation attempts to move the country away from its dependence on foreign oil in favor of developing domestically produced alternative fuels such as wind and solar energy and possibly "clean coal.

The American Council for an Energy-Efficient Economy said, "Savings from reduced energy use will be reinvested locally, creating a multiplier effect that will generate economic activity and jobs."

At the core of the 1,200-page bill is a "cap and trade" plan designed to reduce emissions of carbon dioxide and other greenhouse gases by 17 percent by 2020 and 83 percent by 2050, from 2005 levels.

CHANGES DESIGNED TO WIN FARM-STATE SUPPORT

Big polluters, such as coal-fired utilities, oil refiners, steel, paper, cement and glass manufacturers and other companies would receive government permits to emit lower amounts of carbon dioxide each year. Companies that end up with more permits than they need could sell them to companies that had not managed to adequately reduce their harmful emissions.

Even if Obama and his fellow Democrats manage to pull off a victory this week, the legislation faces a difficult road in the Senate, where Republicans would have an easier time using procedural hurdles to block the bill.

But passage by the House this year would let Obama attend a December international conference on climate change with a major victory in hand. That conference aims to lay out a global approach to dealing with climate change over the next few decades.

In her quest to find enough votes for the bill, Pelosi has allowed several changes since it was approved in late May by the Energy and Commerce Committee. Those have included new protections for agricultural interests, resulting in House Agriculture Committee Chairman Collin Peterson announcing his support -- a move that could also win the support of about two dozen lawmakers from farm states.

Supporters of the bill received other breaks this week, including the release of a Congressional Budget Office analysis concluding the bill's impact on average households would be around $170 a year in higher costs -- far below the $3,100 or more Republicans have been warning.

Some will not be moved, however.

Representative Artur Davis, a Democrat who is considering running for governor of Alabama, told Reuters he would vote against the measure.

"The bill has been improved, but this is the wrong time," he said, noting the hard economic times and the lack of commitment from heavy-polluting countries like China and India to significantly reduce their emissions.

(Additional reporting by Susan Cornwell; editing by Mohammad Zargham)