Congress is back on the climate-change warpath, with draft legislation introduced yesterday. That already has environmentalists howling that the proposals are too weak, while conservatives cringe at what they see as a wrecking ball headed for the economy.

Can’t cap that (AP)

But this latest kerfulffle about climate politics may be much ado about not too much.

When it comes to reducing greenhouse-gas emissions from automobiles, one of the biggest sources, any climate-change legislation will do less than the market (and Congress itself) has already done.

That’s the finding from a new study by the Congressional Budget Office. It found that legislation that would put a pricetag on carbon emissions would do little to reduce emissions from cars and trucks on U.S. highways, the source of about 20% of U.S. emissions. That means that other sectors, particularly electricity generation, would have to pick up the slack if the overall economy is to seriously shave emissions.

Even a carbon pricetag of $28 a ton—which is a lot higher than carbon currently costs in the U.S., and a little less than what it costs in Europe—would only raise gasoline prices by 25 cents a gallon four years from now, the CBO says.

For drivers who’ve already seen gasoline prices double in the last two years, a 25-cent increase is a drop in the bucket and probably wouldn’t lead to many additional changes in the way people drive, the CBO concludes. Even with pump prices (and crude oil) slipping a bit now, 25 cents remains a pretty tiny slice. When gasoline spiked from about $2 a gallon to around $4 a gallon, demand for gasoline fell—but it didn’t collapse. In any event, the CBO says, new fuel-economy standards passed in late 2007 will do more to spur more fuel-efficient vehicles in coming decades than any carbon pricetag that comes out of Congress.

What about a much higher price for carbon emissions? Probably not much help either. The CBO says even draconian emissions-reduction plans that would price carbon at nearly $200 a ton would still add less than $2 to a gallon of gas. That would keep American gasoline cheaper than gas is in Europe today, where the car is still alive and well.