Via Ben Muse, I see this Reuters summary of the trade aspects of the U.S. House draft carbon legislation:
INDUSTRY REBATES/TRADE
Authorizes U.S. companies in industries that use a lot of energy to receive "rebates" to compensate for additional costs of cap and trade. If rebates are not sufficient, the president would have the power to establish a "border adjustment" program, possibly tariffs on goods from countries that do not take action on cutting greenhouse gases.
Hopefully there is a large team of trade lawyers somewhere trying to keep all this consistent with WTO rules!
ADDED: More details at the Huffington Post:
Preserving domestic competiveness. The draft adopts the Inslee-Doyle proposal for transitional rebates to certain energy-intensive manufacturing facilities making basic commodity products that are subject to strong international competition. The goal is to counter pressures to shift production, jobs, and emissions to countries that do not have carbon emission reduction programs. Rebates cover both direct and indirect (e.g., electricity-related) emissions and are based on a formula based on an industry benchmark emission rate and facility-specific output data.
International reserve allowances. A second provision addresses international competition concerns. Not later than 2017, the President is to report to Congress on the impact of the "Inslee-Doyle" program on specified energy-intensive. If negative impacts are found on these industries, then starting in 2019 U.S. importers of competing products must purchase special allowances to cover the emissions associated with their imports. Products from least developed countries and countries responsible for less than a half percent of world GHG emissions are exempted.
