the greening of business or greenwashing?

[Autoplectic <autoplectic@xxxxxxxxx>]

<http://www.latimes.com/business/la-fi-warming12jun12,0,4292085.story>

A Shift to Green
Driven by profit and the opportunity to shape regulations, major
corporations are backing stronger measures to reduce global warming

By Miguel Bustillo
Times Staff Writer
June 12, 2005

American corporations are increasingly calling for action on global
warming, sensing a business opportunity in cutting greenhouse gases
while hoping to shape regulations they believe are inevitable.

Bucking the Bush administration's position that tougher rules would
harm the U.S. economy, Fortune 500 companies including General
Electric Co., Duke Energy Corp. and JPMorgan Chase & Co. in recent
months have championed stronger government measures to reduce
industrial releases of carbon dioxide, the main heat-trapping gas that
scientists have linked to rising temperatures and sea levels.

This shift in corporate thinking was on display at a congressional
hearing last week, where executives from large companies including
DuPont Co., United Technologies Corp. and Baxter International Inc.
described how they were getting an early start on reducing greenhouse
gas emissions — something they believe they would be required to do
sooner or later.

"People increasingly will believe that greenhouse gas emissions should
be reduced and that actions should begin today to prepare for that
eventuality," James Rogers, the chairman of power generator Cinergy
Corp., told the House Science Committee on Wednesday. Rogers now
advocates a national program to reduce greenhouse gas emissions.

The number of companies involved remains small, but it is growing,
particularly in the energy sector, and is emerging as a new dynamic in
the debate over the future of America's global warming policies. The
U.S., the world's largest emitter of greenhouse gases, was the only
major developed nation other than Australia to reject the Kyoto
Protocol, an international pact to cut emissions to about 5% below
1990 levels by 2012.

Although their rhetoric is rife with references to protecting planet
Earth, some of the corporations acknowledge that their newfound focus
on global warming is driven by opportunity for profit. Duke Energy
would like to build a new nuclear power plant, a type of electricity
generation that does not emit greenhouse gases, for instance, while GE
wants to expand sales of wind power turbines and pollution-control
equipment.

"We believe we can help improve the environment and make money doing
it," GE Chairman Jeffrey Immelt said last month in a speech at George
Washington University that attracted widespread notice. "We see that
green is green."

Many multinational companies, which already deal with carbon reduction
regulations in other parts of the world, believe it's only a matter of
time before they will be required in the U.S. Rather than resist the
inevitable, they want to help shape new regulations in a way that will
give them a competitive advantage.

In addition, some companies fear that in the absence of federal
action, many cities and states, which already are proposing their own
regulations, will create a hodgepodge of compliance standards across
the country.

Those concerns were amplified this month, when California Gov. Arnold
Schwarzenegger signed an executive order that pledges to reduce the
state's emissions by more than 80% in the next half-century.

"We don't need a patchwork of inconsistent state or local regulations
to complicate and increase the cost of compliance," Duke Energy
Chairman Paul Anderson said in an April speech to Charlotte, N.C.,
business leaders in which he surprised the electric power industry by
advocating a federal tax on the carbon content of fossil fuels. "Yet a
patchwork is exactly what we are getting, due to federal inaction."

Duke, which has announced plans to acquire Cinergy, formally proposed
the levy to President Bush's tax reform panel in April — an approach
that critics noted would penalize Duke far less than some competitors
in the electricity business that depend more on coal power.

Anderson later said that he did not think such a tax would be approved
while Bush was in office.

As more businesses express an openness to greenhouse gas regulations,
some politicians are attempting to seize the momentum. That is
reflected in a number of amendments to the sweeping energy bill being
considered by Congress that offers incentives to business.

Revised legislation by Sens. John McCain (R-Ariz.) and Joe Lieberman
(D-Conn.) to establish firm limits on carbon dioxide exhaust has added
hundreds of millions of dollars in subsidies for nuclear power and
other types of cleaner electricity sources. More companies have
expressed interest in the legislation since the subsidies were added,
but have stopped short of supporting it.

An amendment by Sen. Jeff Bingaman (D-N.M.) seeks to enact the
recommendations of the National Commission on Energy Policy, a
bipartisan panel of experts from business, government, environmental
groups and academia that recommended a less restrictive cap on
greenhouse gas emissions than the one proposed in the McCain-Lieberman
bill.

"Businesses don't like taxes, and they don't like uncertainty. Right
now, they face a future where they will be hit with some kind of
regulation on carbon, and a growing number of them are saying, if we
take some actions now perhaps we can avoid stronger actions later,"
said Sen. Thomas R. Carper (D-Del.) who has proposed legislation to
reduce carbon dioxide along with traditional smog-forming pollutants.

"There is more support for doing something than there was a year ago,"
Carper said. "Will there be enough to pass one of them? Anybody's
guess right now."

The Bush administration, which has pursued an energy policy that
heavily promotes fossil fuels, has shown few signs of altering its
position on climate change, however.

"Our position is very straightforward: We need to take all aggressive
actions within our capabilities, as long as they further our economic
growth," said Jim Connaughton, Bush's chief environmental advisor.

Most oil and gas companies, among the president's biggest political
benefactors, remain firmly opposed to toughening the administration's
existing policies, which promote only voluntary reductions of
greenhouse gases.

The American Petroleum Institute has been lobbying against the
recommendations of the National Commission on Energy Policy, which
also suggested a moderated "cap and trade" system in which companies
that reduced more than their share of greenhouse gases would obtain
credits they could sell to others.

A similar, less restricted market is already underway in Europe, where
a ton of carbon credits was recently valued at $25.

There is also far less momentum for global warming regulations in the
House than in the Senate, backers acknowledge, making passage of any
legislation unlikely.

"We're not there yet in the House, quite frankly. These businesses are
way ahead of us," said Rep. Sherwood L. Boehlert (R-N.Y.), who
supports a federal program to reduce greenhouse gases. The Bush
administration stance "happens to be wrong," he added, but he
expressed optimism that it could change as dissenting businesses
become more vocal.

Advisor Connaughton said that the Bush administration opposed hard
limits on greenhouse gas emissions because it believed that they would
drive up energy prices, forcing manufacturers out of the country and
costing hundreds of thousands of Americans their jobs.

He noted that more than 100 companies had pledged to reduce their
greenhouse gases under the administration's voluntary Climate Leaders
program, including IBM Corp., General Motors Corp. and Johnson &
Johnson.

To more and more companies, however, the status quo is not enough.

"American industry leaders are not calling for us to adopt Kyoto, but
they are growing increasingly impatient with the voluntary approach,"
said William K. Reilly, who served as head of the Environmental
Protection Agency under President George H.W. Bush and is co-chairman
of the National Commission on Energy Policy.

At the heart of the increase in corporate advocacy on global warming
is a belief that the U.S. is missing a golden opportunity to cash in
on the burgeoning worldwide response to the threat.

Some companies are concerned that the Bush administration's voluntary
programs are too weak to encourage expanded use of cleaner
technologies such as solar, wind and even nuclear power, compared with
the market-based regulations now required nearly everywhere else in
the developed world. Japan now leads the world in the development of
solar power cells, and Europe is the top producer of wind-power
machinery.

Some companies are also concerned that by failing to assert leadership
on global warming, the U.S. is allowing the European Union — and a
number of states around the country — to dictate how industries are
expected to conduct themselves around the world.

California has already passed a law to reduce car and truck emissions
of greenhouse gases, and a group of Northeastern states has begun
creating its own carbon trading market to cut smokestack exhaust.

The European Union has passed rules to produce 22% of its electricity
from renewable energy sources by 2010. Similar laws have been approved
by 18 American states, including California.

Other companies are concerned that global warming could affect
long-term supplies of natural resources they depend on.

"We think the science is pretty compelling, and it is appropriate to
take action now" to reduce global warming, said Helen Howes, vice
president for environment, health and safety at Exelon Corp., one of
the nation's largest utilities, which participated in the National
Commission on Energy Policy. "You have seen thawing in the Arctic,
issues of potential rising water levels. For us, because we have a lot
of nuclear plants that use a lot of cooling water, we are worried that
water supplies may not be as reliable in the future."

Though some corporations are willingly stepping forward with proposals
to tackle global warming, others are being dragged into the debate by
socially conscious shareholders.

Evangelical and environmental investor groups, as well as state
pension fund officials who together control more than $3 trillion in
assets, are pushing resolutions at shareholder meetings that seek to
compel companies to disclose their financial exposure to global
warming regulations.

The resolutions almost never win majority support. But in response to
the pressure, many companies are choosing to develop global warming
policies to head off continuing confrontations.

Some are even putting pressure on their corporate peers. JPMorgan
Chase recently announced that it would ask clients that are large
emitters of greenhouse gases to develop reduction plans, following
similar commitments by Citigroup Inc. and Bank of America Corp. .

"Two years ago, the concept of climate risk was something alien to
investors. That's certainly not the case today," said Mindy S. Lubber,
the president of Ceres, an organization that compels companies to
embrace environmental responsibility. "Investors are raising these
issues because they feel that they are affecting the value of
companies, and they are raising the issues en masse. It is a good
thing because it is promoting a dialogue and discussion."

-- 
"Life sure is weird but what else am I to know?" [Jason Pierce]