WASHINGTON — Tax credits proposed by the Clinton administration to reduce greenhouse gas emissions contain some potential plums for plastics manufacturers, even as industry officials say they remain wary about other global warming initiatives.
Clinton's $6.3 billion plan includes $3.6 billion in tax credits, some for fuel-efficient cars and more energy-efficient buildings that could provide opportunities for plastics manufacturers, industry officials say.
The administration released information on the tax credits Jan. 31, but has yet to specify how it will implement other parts of the 1997 Kyoto agreement to reduce greenhouse gas emissions. That treaty still requires ratification by the Senate, and would require the United States to cut greenhouse gas emission 7 percent below 1990 levels in 10-14 years.
The plan would give consumers a $3,000 tax credit for buying cars with twice the average fuel efficiency in their class, and $4,000 for a car with triple that base fuel economy, starting in 2000.
``What we are looking at is bold, new initiatives, particularly in the transportation sector, to produce cars that get 80 miles per gallon,'' said Bob Carpenter, Washington manager of congressional affairs for Hoechst Corp., based in Warren, N.J.
That will require lighter materials and development of new kinds of plastics for applications such as the proton exchange membrane, part of the hydrogen fuel cell, he said.
But other plans to reduce greenhouse gas emissions could hurt plastics resin makers by making it more difficult to expand production of, for example, PET plants to handle Chrysler Corp.'s proposal to build plastic cars, Carpenter said.
That could shift plastic production overseas, said Paul Cicio, Washington-based global issues manager for Dow Chemical Co. of Midland, Mich.
``There is significant uncertainty about ... what will be required for producers of plastics and implications for production and consumption,'' he said.
The Clinton administration also proposed a significant increase in Environmental Protection Agency spending to fight global warming, from $89 million to $205 million. That is the largest single program increase in the EPA's budget, officials said.
The administration unveiled its fiscal 1999 budget proposal Feb. 2. The plan includes hefty increases for several other EPA programs of interest to plastics manufacturers, such as $75 million more to implement tougher new clean air rules and $8 million more to the agency's children's health initiative.
The budget does not include any funding for a program passed last year to speed food-packaging approval.
The Food and Drug Administration still supports the pre-market notification plan, but money was removed by Clinton budget officials in what amounts to a parliamentary maneuver, plastics industry officials said.
Budget officials historically have taken money from such programs in a bid to have them funded by industry fees, but the efforts almost always are defeated, industry officials said.