WASHINGTON (Reuters) - A compromise U.S. climate change bill would give electric utilities up to $100 billion in bonus carbon pollution permits, if they capture and store their greenhouse gas emissions, a key Democratic lawmaker said on Thursday.
The legislation would also allow U.S. companies to offset up to 2 billion tons of their emissions by funding green projects in the United States and in other countries, said Rep. Rick Boucher, who is involved in the negotiations over the bill.
The bonuses for utilities would be on top of the pollution permits they would get for free -- 35 percent of all the free permits to U.S. firms and about 90 percent of the emissions permits they will initially need -- Boucher said.
House Energy and Commerce Committee Chairman Henry Waxman told reporters his panel will debate and approve the controversial climate change bill next week. If that prediction proves accurate, it would clear the way for a debate and vote by the full House, probably by August, according to aides.
The legislation faces a more uncertain future in the Senate this year.
Waxman and other Democrats were still negotiating some provisions, including whether oil refineries would get any free emissions permits.
Under the Democrats' compromise bill, the free emissions permits for electric utilities would begin to phase out in 2026. By 2030, 100 percent of pollution permits would have to be bought by the utilities, Boucher said.
"We are creating a 100-year solution to carbon, but we create a transition to protect the consumers," said Representative Edward Markey, one of the authors of the bill.
Boucher, who had sought a 100 percent giveaway of permits, pledged to support the compromise. But he said he still had several concerns, which he hoped would be addressed, including the target of a 17 percent reduction in overall greenhouse gas emissions by 2020, from 2005 levels. He said 14 percent would be "more appropriate."
Boucher also said the phase-out period for utilities' free permits was too short.
Republicans on the committee say they are opposed to any "cap and trade" system to control carbon dioxide emissions, which are associated with more violent weather patterns, melting Arctic ice and threats to animal and plant species. They argue it will be too harmful to the U.S. economy.
(Reporting by Richard Cowan and Tom Doggett; Editing by Walter Bagley)
