Senator Kerry says US climate bill will be launched "very, very soon"

Senator John Kerry yesterday shrugged off the twin threat to the draft US climate bill presented by the loss of a key Republican backer and the catastrophic oil spill in the Gulf of Mexico, insisting the legislation would be unveiled "very, very soon".

Speaking at a green jobs conference, the Senator, who has led the development of the draft bill alongside independent Senator and Republican Lindsey Graham, said that the bill was on the verge of being launched and would command support from a "unique coalition", including many of the energy companies and carbon intensive firms covered by the proposed bill.

He also fuelled optimism that Republican Senator Lindsey Graham would restore his support for the bill after dramatically abandoning the bi-partisan group working on the legislation in protest at perceived Democrat attempts to push the bill down the Senate's agenda in behind controversial immigration reforms.

Kerry told reporters that Graham "is standing by the work product and he is standing by the bill", adding that the legislation would also have the public support of the chief executives at some of America's largest and most carbon intensive businesses.

In his speech, Kerry also attempted to reassure consumers that the financial impact of the bill would be kept to a minimum with two thirds of every dollar raised through the proposed pollution permit scheme used to help counter any resulting rise in energy bills.

The remaining third of the revenue will be initially used on energy efficiency and low carbon infrastructure projects, although Kerry said the proportion of funds diverted to such projects would fall over time to a point where all of the revenue is recycled back to consumers.

He also revealed some fresh details about the bill, confirming that carbon intensive non-utility industries such as steel, chemicals and paper will be exempted from the proposed cap-and-trade scheme until 2016. In addition, he confirmed that proposals to convert heavy trucks to run on natural gas put forward by Texas oil tycoon T Boone Pickens would also be supported in the bill.

However, even assuming that Kerry can win back the support of Senator Graham, the fight to pass the bill has become yet more daunting in the past week as the Deepwater Horizon oil spill has entrenched the divide between Democrats and Republicans over energy policy.