The Case for Early Action Pew Center Early Action Conference September 13-14, 1999

1. The Case for Early ActionPew Center Early Action Conference September 13-14, 1999 Dale Landgren Asst. Vice President, Business Planning

2. •Wisconsin Electric does not support the Kyoto Protocol•However, Wisconsin Electric does support policies to stabilize and ultimately reduce carbon•Support for Credit For Early Action does not and should not be tied to support for the policies to control carbon

3. Wisconsin Electric’s Position • It is appropriate, at a minimum, to explore and expand low- and no-cost strategies to reduce, avoid, or sequester greenhouse gas emissions. • Credit for early action acts an insurance policy where there is zero cost for the premium in the event greenhouse gas reductions are not required.

4. Benefits of Early Action Credit • Assurance of credit creates incentives for: • companies like WE to continue to pursue reduction activities • other industries to take steps to reduce GHG emissions from their operations • innovators to develop technologies such as clean coal, next-generation renewables and carbon storage. • Establishing GHG reduction policies sooner rather than later is key for the electric utility industry: supports an integrated approach. • International Emissions Trading market development would be accelerated and enhanced.

5. Necessary Components of an Early Credit Program • Credit for 1605(b) and USIJI. • Clear and consistent standards that prohibit double counting. • Allowancefor third party verification. • Provisions that address leakage. • A simple mechanism to account for changes of ownership and new participants. • Annual award of credits. • Equitable treatment of forest carbon sequestration projects, and expansion to include all public lands, soil carbon and other non-forest biotic sequestration projects.

6. Nuclear Should Be Included In Credit For Early Action • We cannot limit increases in atmospheric concentrations of these gases unless nuclear power is part of the supply mix. • Unresolved issues of nuclear waste management and plant relicensing will force nuclear power plants across the U.S. to be shut down in the near term. • Plant license renewal and new advanced nuclear technology must be included in climate change discussions and remain viable options for the future.

8. WE’s Voluntary Initiatives • Energy for Tomorrow program • Rio Bravo carbon sequestration project • Decin repowering project • Climate Challenge

9. Potential Least Cost Strategy • Portfolio of carbon reduction options • Step change in cost • Missed cost opportunities

10. H.R. 2221

11.  Flexibility Emissions considered Cost