Proponents of Clear Skies say that the early compliance incentives in this bill will spur major upgrades to both plant outputs and pollution controls. Consequently, air will be cleaner, faster than it would under current regulations.   Moreover, Clear Skies lets the marketplace work, giving the industry the freedom to come up with innovative solutions.   All these measures combined will make our energy production more secure at the same time it makes our environment safer.

Opponents say this is just more energy largess dressed up to look like environmental policy.   The new emission standards would allow more total pollution.   Plus it doesn't even address carbon dioxide.   Clear Skies also stretches the time frame for compliance another 15 years.   Perhaps most distressing, it provides no relief to the people who live within breathing range of current over-polluters who could simply buy the extra allowances they need to keep polluting.

This legislation, introduced by Senator Jim Inhofe (R-OK) in the Senate and Representative Joe Barton (R-TX) in the House, is a Bush administration initiative to amend the Clean Air Act of 1977.   The changes primarily affect power plants, although any facility that generates its own power could be included in the new regulations.   Power plants account for 67% of the sulfur dioxide, 25% of the nitrogen oxides, 33% of the mercury, and 40% of the carbon dioxide emitted into our air.

One thing the Clear Skies Act does is reform New Source Reviews (NSR) law.   NSRs were written into the Clean Air Act to ensure that, as older power plants modernized, they also improved air quality standards.   Any upgrade involving over 20% of the plant had to include scrubber technology that met more stringent emission standards.   Consequently, some companies kept their investments low to avoid costly pollution control upgrades.

During the 1990s, the EPA became more aggressive with these regulations and at the turn of the century, they had over 100 plants under investigation or charged with violations.   Since taking office, the Bush administration has relaxed restrictions and reclassified former modernization activities as routine maintenance activities.   They also decided not to pursue the pending lawsuits and investigations.   As a result, 15 states and numerous cities are suing the EPA.

Instead of penalties, through Clear Skies, the Bush administration hopes to offer incentives for plants to undertake more aggressive modernization.   Furthermore, rather than dictate what measures must be taken, this Act allows companies to manage their own responsibilities through a system of limits and allowances that is called a "cap and trade" program.

Qualifying power-generating organizations are given pollution allowances.   "The Administrator shall allocate annual allowances for an affected unit."   These limits cap the amount of sulfur dioxide, nitrogen oxide and mercury that a plant may emit.   There is no provision for carbon dioxide.

A company can transfer or trade these allowances from one unit to another.   For example, an efficient plant in one part of the state may come in well below its allotted emissions.   It can then transfer its unneeded allowance to a sister plant elsewhere that is emitting more than its allotment.   As long as a company doesn't exceed its total allotments, there are no penalties.   Also, if a company has an excess one year, it can use the leftover allotments in future years.   It's the power equivalent of rollover minutes.

Overall, this bill is designed to encourage the production of new energy that's cost-efficient and environmentally friendly.   There are also certain exclusions for power plants that are seen as necessary to the reliability of an area.   As it's written, this bill does not limit a state's ability to pass and enforce stricter regulations on plants within its borders.   However, it does limit a state's leverage with its neighbors.