Senators John Kerry and Barbara Boxer introduced the Senate version of cap-and-trade bill to reduce the nation's emission of national greenhouse gases (GHG). This 821-page climate change bill, titled the "Clean Energy Jobs and American Power Act," aggressively seeks to reduce GHG emissions below 2005 levels as follows: 3 percent by 2012; 20 percent by 2020; 42 percent by 2030; and 83 percent by 2050. To meet these goals, both this bill and the Waxman-Markey bill in the House will require large industrial GHG emitters to obtain emission allowances or emission credits for each ton of GHG that they directly emit and/or that is found in the fossil fuels they produce or distribute.

Depending on a facility's industry-sector, the effective date for capping GHG will be phased in between 2012 and 2016. The bill also proposes to both allocate emission allowance and set up a program to provide market stability by allowing EPA to auction allowances (with a statutory ceiling price) to covered sources. It also allows the purchase or creation of carbon offsets but proposes to limit the amount of available offsets both annually and by industry sector. Finally, unlike the Waxman-Markey bill that assigned statutory oversight to specific agencies, this bill leaves that decision to the discretion of the President. Despite Congress' current focus on healthcare, Senator Kerry stated that he is confident that this cap-and-trade bill could be voted on in time for the Kyoto II climate negotiations in Copenhagen in December. One interesting tidbit is that this bill uses the euphemism "Pollution Reduction and Investment System" to rename and reframe the cap-and-trade aspects of the bill.