updated 4/15/2005 2:53:48 PM ET 2005-04-15T18:53:48

Mandatory limits on all U.S. emissions of carbon dioxide and other “greenhouse” gases would not significantly affect average economic growth rates across the country through 2025, the government says.

That finding by the Energy Information Administration, an independent arm of the Energy Department, runs counter to President Bush’s repeated pronouncements that limits on carbon dioxide and other gases that warm the atmosphere like a greenhouse would seriously harm the U.S. economy.

Bush has proposed ways of slowing the growth rate in U.S.-produced greenhouse gases and methods to reduce emissions of methane internationally. But he rejected U.S. participation in the Kyoto international treaty negotiated by the Clinton administration — a pact which seeks to mandate reductions in emissions.

Study tied to proposal
Sen. Jeff Bingaman, D-N.M., asked the EIA to study the possible effects of a proposal from the National Commission on Energy Policy. The commission’s proposed cap would affect energy-related emissions of carbon dioxide, methane emissions from coal mines and several other gases related to global warming.

William Reilly, the commission co-chairman and former head of the Environmental Protection Agency under the first President Bush, said it was an old argument that the economy could not withstand greenhouse gas reductions. He said both his commission and the EIA have now shown otherwise.

“This is a reassuring set of conclusions,” he said.

$78 annual household cost
EIA estimated that the cost to each U.S. household of using a market-based approach to limit greenhouse gases would be $78 per year, from 2006 to 2025. That would reduce the gross domestic product in 2025 by about one-tenth of 1 percent, it said.

The commission also had recommended a 36 percent increase in the average fuel economy for cars and light-duty trucks between 2010 and 2015 and doubling to $3 billion a year the budget for federal energy research and development. In addition, it called for new tax incentives for gasifying coal and building nuclear plants.

Adding those measures to the greenhouse gas plan, EIA estimated, would reduce the nation’s gross domestic product in 2025 by about four-tenths of 1 percent.

The full report is online at www.eia.doe.gov/oiaf/servicerpt/bingaman.

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