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By Lloyd McGraw on Apr 19, 2010 with 8 responses

USW Weighs in on Climate/Energy Reform Letter

The USW would like to ensure that climate/energy reform will not harm American industry.

United Steelworkers (USW) international president, Leo W. Gerard proclaimed the union’s support for ten senators pushing Congress to ensure that any proposed comprehensive climate and energy bill will adequately protect the American manufacturing industry from international competitors.

“The USW has long believed that ensuring a clean and prosperous planet for our children and rebuilding the American economy can and should go hand in hand,” Gerard said. “To accomplish this, we must ensure that any energy and climate bill recognize the unique position of manufacturing industries and provide them the incentives and assistance necessary to lead America into the clean energy future.”

On April 15, ten senators, led by Sherrod Brown (D-Ohio) issued a letter to the  Senators John Kerry (D-Massachusetts), Lindsey Graham (R-South Carolina) and Joe Lieberman (I-Connecticut) authors of a highly anticipated climate/energy reform bill.  In the letter, the Senators suggested specific provisions designed to insulate American manufacturers from competitive disadvantages  resulting from dramatic climate/energy reform.

According to Gerard, “The senators’ letter touches on many issues critical to the success of an energy and climate bill. Among these is the need for a comprehensive anti-leakage package that consists of output-based allocations to energy-intensive, trade-exposed manufacturers backed up by an automatically-triggered border adjustment applied to products from countries that have not made the same commitment to reducing carbon emissions as the U.S.”

Unless border adjustments are activated, the USW would like to see pricing measures remain in effect until a binding international agreement is reached which would place international competitors on equal footing with American companies complying with new legislation.

The USW president added, “Still, these leakage provisions cannot fully meet the needs of manufacturers to retool and institute new, cleaner processes. This is why there is a critical need for these companies to obtain access to the capital necessary to make these improvements. Further, these investments will only take place if manufacturers can be confident of a market for their products, so it is crucial that wherever possible preferences be put in place to ensure domestic sourcing of clean energy products and the components that go into them.

“With the comprehensive program laid out by Senator Brown and the other senators, the dream of a clean energy economy developed and built in America by American workers can become a reality. We strongly urge Senators Kerry, Graham, and Lieberman to include these proposals in their bill and to fund them fully. Only through a comprehensive and fully-funded manufacturing program can an energy and climate bill be a success.”

Aside from praising Brown, the USW lauded the senators who joined in supporting the letter including Sens., Carl Levin (D-Michigan), Arlen Specter (D-Pennsylvania), Claire McCaskill (D-Missouri), Debbie Stabenow (D-Michigan), Robert Casey (D-Pennsylvania), Mark Warner (D-Virginia), Kay Hagan (D-North Carolina), Evan Bayh (D-Indiana) and Robert Byrd (D-West Virginia).

The United Steelworkers represents 850,000 workers in metals, mining, pulp and paper, rubber, chemicals, glass, auto supply, and the energy-producing industries forming the largest industrial union in North America.

  1. By Kit P on April 19, 2010 at 6:29 pm

    It has been a number years since I
    looked at American steel industry but they are very frugal when comes
    to using energy by world standards. Maybe some other countries have
    also improved since then.

     

    One of the problem with paying to
    reduce ghg emission is that countries like Russia and China who are
    dismal at efficient production of steel and electricity, they have a
    larger potential for improvement just to get where we are.

     

    The best way to mitigate AGW is to keep
    production jobs in the US and other counties that set the standard.

     

    Wait for it!

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  2. By paul-n on April 19, 2010 at 11:29 pm

    For once I agree with you Kit!

    Not only is the American (and Canadian, Australian and German) steel industry very energy efficient, the electricity they use is also produced very efficiently.  Steel in China and India has neither of these efficiencies (yet).

    The thing that worries me is a statment like this;

    Among these is the need for a comprehensive anti-leakage package that consists of output-based allocations to energy-intensive, trade-exposed manufacturers backed up by an automatically-triggered border adjustment applied to products from countries that have not made the same commitment to reducing carbon emissions as the U.S.”

    Now, while I agree with goal, this method sounds like a regulatory maze waiting to happen, which is then open to manipulations and loopholes.  

    This is why I think a carbon tax, with no exemptions, is better – all imports must account for their carbon content, or they don;t get imported.  The Chinese have been reluctant to open their books on their actual emissions and the like, but the potential of being shut of of the US may change their minds.

    And, why should we pay for them to improve their energy efficiency, when we have it right here?  No one paid our mills to improve, that happened by a painful, darwinian process.  Our industry has paid it’s dues, we should not have to pay them for the industry of other countries too.

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  3. By russ on April 20, 2010 at 4:09 am

    Efficiencies between a new private steel mill (EAF based) in İndia and mills in the US are probably similar. Management in İndia uses the US mills like (Nucor) as a guideline and push specific consumption figures very hard – there is very big money involved. Government owned units like SAİL (Steel Authority of İndia) are different and very inefficient with very high manpower.

    Where İndia and China have the advantage is in very lax environmental controls – in İndia they can and do get with anything. The measures to control emissions are expensive. They have a lot of say in government policies – managing to get them tailored to suit their own needs.

    Another area where the new mills anywhere have a distinct advantage is in being more capable of making the higher value added grades, thicknesses and widths of steel. There are new grades developed all the time for specific uses which command a premium price. Anyone operating a 10 year old mill has a rough row to hoe! Upgrades have to be constant to stay with the market. You constantly have to qualify your products for manufacturers to be on their supplier list. 

    İn the US many EAF operations mainly make construction grade or reinforcing steel – these are the lowest grades and always have very tight margins. 

     

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  4. By CEA on April 21, 2010 at 11:02 am

    Cap and trade may not be the silver bullet to climate change that many policy makers believe. True, by increasing the costs of polluting sources of energy, more expensive energy sources become viable (oil sands, renewables, etc). But what this ultimately does is put the strain on consumers who will most likely be hit be increased energy bills. Perhaps a better approach to encourage renewables would be a feed in tariff system where standards are put forth to be achieved by state and federal levels.
    Want to learn more about balanced energy for America? Visit http://www.consumerenergyalliance.org to get involved, discover CEA’s mission and sign up for our informative newsletter.

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  5. By paul-n on April 21, 2010 at 6:10 pm

    So, CEA, how does a feed in tariff, meaning paying higher prices for renewable electricity, not result in those higher prices being passed on to consumers?  Do you expect the electricity utilities to just eat that cost, out of goodwill?

    And how does a feed in tariff for electricity, help to do anything to reduce oil consumption, or provide alternative transport fuels to oil?

    You are correct that cap and trade is not a silver bullet, far better is a plain and simple carbon tax, possibly with an additional import tax on oil.  That may not be good for many of the companies that you represent, but since your goal is a “balanced” energy supply, that can ONLY mean extensive use of renewable electricity, and oil(gasoline) substitutes/conservation, since what we have today is a very “unbalanced” energy supply – over 80% of it is fossil fuels.  I would think 50/50 FF and non-FF would be called “balanced” but I can;t see any indication of such goal on your website.  Looks like your goal is to foster business as usual for the energy companies, and users you represent.

     

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  6. By Kit P on April 21, 2010 at 7:10 pm

    “Looks like your goal is to foster
    business as usual for the energy companies, and users you represent.”

     

    First what is wrong with that?

     

    Second, PaulN you wrong about your
    evaluation of CEA. After reading their position paper it sure look
    like CEA supports ‘all of the above’ strategy.

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  7. By paul-n on April 22, 2010 at 1:59 am

    Kit, there is nothing actually wrong with that, but that is not what they are saying.

    They have given no definition of what balanced is – I’ll bet that if the government took that to mean 50/50, they would not accept or support that.

    Of their board of advisors is more than half of the 25 are from the oil and gas industry, and many of the remainder represent major energy users, like the American Trucking Association, airlines, fertiliser mfrs. etc.  There is a sole representative each from wind, and biofuel companies, though these are from specific companies, and not the industry bodies.  But the most glaring omission is that there is no one person there to represent “consumers”, it is all industry.

    I have no problem with an industry group that labels itself as an industry group.  I do have a problem with an industry group calling itself a “consumer alliance”, when consumers have no representation whatsoever.

    And, of course, there are statements like this;

     Increasing government funding for energy education and additional research and development related 

      to both conventional and alternative energy resources to complement private sector investment 

    resources.

    Another lobby group calling for more government money.  I support R&D, and even (accountable) government funding of such, but is more really needed for “conventional” energy?  

    Given their trucking representation, would be interesting to see what their support would be like for government funding of rail electrification, and subsequent encouragement of moving freight by rail instead of road.

    And, this is the second time they have put a blatant plug for themselves here, though I will concede that if the moderators have allowed it then we are stuck with it.

     

     

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  8. By Kit P on April 22, 2010 at 8:10 am

    “Kit, there is nothing actually wrong
    with that”

    So what they said is okay but what you
    infer they is not? I think PaulN the problems is what you infer.

     

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