American Power Act (Kerry-Lieberman)

On May 12th, Senators John Kerry and Joe Lieberman introduced “The American Power Act” which calls for a 17 percent reduction in greenhouse gas emissions (GHG) from 2005 levels by 2020, 42 percent by 2030, and 83 percent by 2050.  Under the Kerry-Lieberman proposal, transportation emissions would be regulated under a national carbon cap, and producers and importers of gasoline and diesel would be forced to buy emissions allowances at a fixed price.  The bill directs an average of 7.3% of the allowances a year (maximum of $6.25 billion a year) for states and regions to develop and implement GHG reduction targets, plans and “clean transportation” projects.  Similar language was included in House-adopted federal climate/energy bill, H.R. 2454 (Waxman-Markey), and in the bill that came out of the Senate Environment and Public Works Committee earlier this year spearheaded by Senator Boxer.

Section 1711: “Greenhouse Gas Emission Reductions through Transportation Efficiency”

(Part II: Transportation Efficiency — pages 211-252)

Targets and Strategies

• Requires EPA in consultation with DOT to establish and update GHG reduction targets and baselines specifically for surface transportation for national, State, and regional levels
• Shall be based on emission and travel demand modeling
• Include inventory of GHG emissions for all surface modes of transport
• Apply to all modes of transport addressed in RTP
• Targets and strategies must be selected through scenario analysis, including transportation investment and management strategies that reduce GHG emissions over the life of the plan (bill includes TDM strategies, transit infrastructure, pricing programs, bike/ped, changes to land use regulations to support infill and mixed use

MPOs and States

• Within two years of enactment, Metropolitan Planning Organizations (MPO) must include GHG reduction targets, and strategies to meet those targets in consultation with State air agencies (note: states must collaborate with State and local housing, economic development, land use agencies, MPOs, transportation and air quality agencies)
• For large MPOs (population greater than 200,000), targets and strategies shall be integrated and consistent with Regional Transportation Plans (RTP) and Transportation Improvement Programs (TIP)
• Small MPOs (population less than 200,000) may voluntarily develop targets and strategies
• For States, targets and strategies shall be integrated and consistent with Statewide Transportation Plans (STP) and Statewide TIPs
• MPOs shall demonstrate progress in reducing GHG emissions to help achieve State targets
• States shall demonstrate progress in reducing GHG emissions to help achieve National targets

Models / Methods

• Requires EPA and DOT to regulate the standardizing of emission models and methodologies, and update methods for data collection, that assess GHG reduction strategies to achieve targets
• Requires DOT to regulate the improvement of travel demand models, and transportation planning requirements used to develop and assess progress toward State and regional GHG reduction targets
• Allows EPA and DOT to regulate the use of existing models and methodologies that are considered to reflect the best practicable approach for assessing actual and projected GHG emissions from transportation plans and projects
• Requires EPA and DOT to publish regulations within 18-months of enactment

Scenario Planning

• Targets and strategies within RTP and STP must be developed through scenario planning, which combines various transport and land use strategies to estimate how each scenario performs in meeting GHG reduction based on growth factors
• Scenario planning may include the creation of scenarios to generate involvement of the general public, and the discussion of values and trade-offs pertaining to growth

Monitoring and Accountability

• Every six years EPA and DOT must check progress toward achieving target attributable to vehicle efficiency, fuels, VMT, changes in consumer demand/use, and management of transportation systems
• Failure to comply with the integration and assessment of GHG reduction targets and strategies within RTPs will not impact certification of RTPs (note: incentive-based approach to MPO and state sustainable transportation and planning)

Transportation Infrastructure and Efficiency Allowances – pages 258; 505-507

• Purpose of which is to increase the safety, effectiveness and efficiency of the transportation infrastructure of the United States.
• Of the emission allowances established for each of the years 2013 to 2034, the Administrator (EPA) shall:

1. Auction one-third [ ≤ $2.5 billion] for the Highway Trust Fund consistent with transportation efficiency planning promoting the safety, effectiveness, and efficiency of transportation in the United States.
2. Allocate one-third [ ≤ $1.875 billion] for TIGER (Transportation Investment Generating Economic Recovery) Discretionary Grant Program for capital investment in surface transportation projects.
3. Allocate one-third [ ≤ $1.875 billion] for State and MPO planning allocations and performance awards.

Section 1712: “Investing in Transportation Greenhouse Gas Emission Reduction Programs”

(Part II: Transportation Efficiency —pages 252-258)

• Requirements for allowances received
  • May be used only to fund strategies that demonstrate a reduction in GHG emissions that is sustainable over the life of the applicable transportation plan.
  • Federal share of the costs of a project shall be 80 percent
  • Must be consistent with existing design, procurement, and construction guidelines establish by DOT

• USDOT will administer grants to States and MPOs for developing and updating transportation GHG reduction strategies and targets (note: required for large MPOs, voluntary for small MPOs).
  • Allocation for Planning — 10% of program grants can be distributed to MPOs (note: none for states) for implementing plans and supporting the development/updating of targets and strategies to reduce transportation GHG emissions (formula based on MPOs population compared to others).
  • Performance Awards – After planning grants have been allocated, remaining 90% of program funds will be available for States and MPOs.  USDOT is to establish criteria, including:  reduction in total and per capita GHG emissions, cost-effectiveness, comparison to historical emissions (based on previous five years), increased mobility for disadvantaged population, other innovative approaches including health and consumer fuel savings.

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