A group of influential U.S. corporations, including top oil and gas and power companies, Thursday joined environmental organizations to offer a detailed blueprint for the incoming Obama administration that, among other things, calls for a cap-and-trade system to cut 2005 greenhouse gas (GHG) emissions levels 42% by 2030 and 80% by 2050.
The U.S. Climate Action Partnership (USCAP), whose 32 members include BP America Inc., ConocoPhillips, Shell Oil Co., FPL Group, Duke Energy, NRG Energy, PG&E Corp., PNM Resources and Exelon Corp., unveiled its lengthy policy recommendations in “A Blueprint for Legislative Action.” The blueprint, said the partnership, could be used to develop legislation to create “an environmentally effective and economically sustainable national climate protection program.”
USCAP’s plan, crafted over a two-year period by 26 corporations and five environmental organizations, “echoes the sense of urgency that President-elect Obama has articulated regarding the need for a cap” on GHG emissions, the group said.
“The economic crisis and growing concern over global warming place America at a crossroads,” said Shell Oil Co. President Marvin Odum. “We must invest now in a greener economy. But to do that, American businesses need the regulatory certainty of a sound climate change policy. If the diverse alliance of businesses and NGOs [nongovernmental organizations] that comprise USCAP can agree on a policy, surely Congress can pass an effective climate change bill. Never before have our economy, our energy supply and our environment depended more on the creation a smart, workable solution.”
Expanding on USCAP’s 2007 Call for Action, the blueprint includes an aggressive emissions reduction schedule, details the scope of coverage for the cap-and-trade program and recommends how to include as much of the U.S. economy under the cap as administratively and politically feasible. Among other things, legislation advocated by the blueprint would:
Critics of cap-and-trade plans argue that it’s not the time to impose new costs in a weak economy. ExxonMobil is not a member of USCAP, and last week CEO Rex Tillerson called proposed GHG cap-and-trade systems “pretty scary when you think about the enormous bureaucracy that will have to be created” (see Daily GPI, Jan. 9). USCAP members beg to differ.
“The sooner we act to address climate change the better for our environment and our economy,” said Duke Energy CEO Jim Rogers. “Some suggest now is not the time to address climate change due to the economy. I think 2009 is exactly the right time to act…”
NRG Energy CEO David Crane said “the power sector, currently the biggest contributor to global warming, has the potential to become a major part of its solution through the large-scale demonstration and deployment of clean energy technologies. But it all starts with a system that provides businesses incentives to deploy clean technologies while imposing increasing costs on those who continue to emit tons of greenhouse gases into the earth’s atmosphere.”
The blueprint, said Crane, would “create both the incentive and the ability for all of us to make the right choices for our businesses, our economy, and our planet.”
Exelon CEO John Rowe noted that the blueprint “contains strong provisions to protect the economy by allowing ample use of emissions offsets for compliance and by creating an offset and allowance reserve to prevent unsustainable high compliance costs.” Du Pont Chairman Charles Holliday said his company likely would increase spending on thin film solar panels and biofuel projects if legislation were enacted to establish incentives for noncarbon energy sources.
Every year of delay in controlling emissions “increases the risk of unavoidable consequences that could necessitate even steeper greenhouse gas reductions in the future, at substantially greater economic cost and social disruption,” USCAP said.
“Even in the midst of economic turmoil, climate change remains the defining issue of our generation,” said FPL Group CEO Lewis Hay III. “We have a rare opportunity to enact legislation this year that puts a price on carbon dioxide and drives the country toward clean-energy solutions. In many ways we’ve already mortgaged our children’s future. Let’s not foreclose on it entirely through inaction on climate change.”
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