Sens. Joseph Lieberman (I-Conn.) and John Warner (R-Va.) introduced a bill Thursday that they project will reduce total U.S. greenhouse-gas emissions by nearly one-fifth by 2020.
The bill, called America's Climate Security Act, is aimed at keeping worldwide emissions below 500 parts per million at the end of the century, which would avoid a high risk of global warming, according to a United Nations Intergovernmental Panel on Climate Change report (see Can Technology Save the World?).
If passed, the act would set a cap on the emissions that companies can produce, and also would set up a system to enable the trading of emission allowances. The act, which the senators predicted would lower emissions "as much as" 19 percent below 2005 levels, also would allow companies to save and borrow emissions.
The bill is one of seven so-called "cap-and-trade" proposals that Congress is considering. (See a comparison chart from the Pew Center on Global Climate Change, which supports the bill.)
Steven Kline, a vice president at the Pacific Gas & Electric Co., one of the companies that presumably would be affected by the bill, called it "a solid starting point."
"America's Climate Security Act takes significant steps toward recognizing that a national program must balance the economic, technology and environmental challenges of combating climate change," he said.
Kline added the company looks forward to working with the senators and the rest of the Senate Environment and Public Works Committee to further refine the concepts to ensure the final bill is "environmentally effective, economically sustainable and both encourages and supports the rapid development and deployment of the most efficient, lowest-emitting technologies throughout the economy."
Environmentalists' reactions have been mixed.
The World Resources Institute, the Nature Conservancy and the Pew Center issued statements supporting the bill.
"This is the breakthrough we have been waiting for," said Pew Center President Eileen Claussen. "Sens. Lieberman and Warner have achieved something I thought impossible one year ago -- they have written a climate bill that has a very real chance of passage."
But the Union of Concerned Scientists and Friends of the Earth are among those that said the bill doesn't go far enough.
Friends of the Earth President Brent Blackwelder released a statement saying the bill "falls short of our responsibility as one of the world's largest global-warming emitters" and "does not achieve the reductions that science requires to avoid the catastrophic impacts of global warming."
Greentech investors said the proposal is another sign of growing support for reducing climate change.
"What I definitely see as being very clear now is a bipartisan effort to reducing climate change," said Rob Day, a principal at @Ventures who also writes Greentech Media's Cleantech Investing blog.
"The question is not longer 'if,' but is 'how' and 'when,'" He said. "When you have senators like Lieberman and Warner, who are pretty centrist, putting forth what seems to be a pretty serious effort here, you're getting close to a climate bill that has a real chance at passage. It really feels like we're at a critical junction point here."
While there are different ways to address the issue, the important thing is that climate change is addressed and that a policy is put in place, he said.
The fact that some utilities are asking for carbon policies shows the need for some regulatory certainty, Day said.
"It's not just important for us as investors, but increasingly important for utilities and those who are going to feel the impact of whatever does come out, because they need to plan," he said.
And while Day said he doesn't think this bill alone will be a tipping point for those considering investments in greentech, he called it part of the "general tailwind" toward making the energy playing field more even.
Policies that do that -- such as a carbon cap-and-trade system, carbon tax or other such measure -- will help make sure the right technologies have a chance to win in the marketplace, he said.
Still, others said the details could make a big difference.
"Cap–and-trade can be an effective tool, or it can mean very little," said Robert Wilder, CEO of WilderShares, which manages three energy indices.
Wilder pointed to Europe's initial cap-and-trade program, which he said set the cap too high and resulted in the devaluation of emissions permits. "The devil's in the details," he said.