Monday of this week, February 11, 2008, WisPolitics.com hosted Future of Midwest Energy Coping with Climate Change Conference in Madison, Wisconsin.   (Thanks Mary B. for telling me about it)

There was strong agreement that we need to do something about global warming.  Almost all had efficiency/conservation and renewable energy in their list of the top three tools to solve global warming.  Nuclear power was most often the third on lists.

Rep. Tammy Baldwin
I had the opportunity to ask Rep. Baldwin her thoughts on a phased-in, federal tax shift from income to non-renewable energy.  The gist of her answer was that cap & trade was the "cornerstone" of energy policy changes on the table in Washington although the House may use other tax strategies too.  Here's the beginning of her answer:

     "[A federal tax shift] definitely has some intellectual appeal to me and some of my colleagues, but I think it's pretty clear that congress is going much more forcefully in the direction of a mandatory, market-wide cap and trade program instead.  I think it's a fairly smaller minority that would look at a carbon tax as a stand-alone system.  Now, that does not mean that in the bill that we're going to be putting together on the House side that creates the cap and trade system that we wouldn't additionally use some tax strategies more in a pinpoint way than across the market."

Wiseye.org recorded all presentations and discussions at the event.  Here is the link (advance to about 33 min., 15 sec. to hear the federal tax shift question and Rep. Baldwin's answer)

Representative Baldwin serves on the Committee on Energy and Commerce and its subcommittees on Health; Energy and Air Quality; and the Environment and Hazardous Materials.

Rep. James Sensenbrenner
In contrast to Rep. Baldwin, Rep. Sensenbrenner stated (essentially) that CO2 Cap and Trade would be a bureaucratic mess.

Representative Sensenbrenner is chair of the House Committee on the Judiciary, and serves on the Committee on Science and Technology and the Select Committee on Energy Independence and Global Warming (Ranking Member).

CO2 Cap and Trade
I agree with Rep. Sensenbrenner.  Cap and Trade is very complex and based on experiences is Europe is risky for the economy.  For example, how exactly should a ton of carbon be priced?  What's the baseline for CO2 starting points?  Cap and Trade introduces a great deal of uncertainty into the market.  As Dave Parker, Senior Utility Analyst at Robert W. Baird & Co. said in the afternoon, "Wall Street hates uncertainty."  Sounds to me like another EXTERNAL COST of ineffective energy policy.