U.S. Climate Action Partnership, Representing a Group of Businesses and Environmentalists Agree to Act on Climate Change

The Washington Post reports that: “An influential group of large U.S. corporations and environmental organizations have forged a detailed blueprint for limiting greenhouse gases in the hope of shaping and pushing forward climate change legislation this year.” Staff writer for the Post, Steven Mufson explains that: “The U.S. Climate Action Partnership says its ability to reach consensus is a crucial step forward since its 32 members include corporate giants such as General Electric, Conoco Phillips, Duke Energy, DuPont and General Motors as well as the Environmental Defense Fund and World Resources Institute. Mufson adds details to the groups intentions: “Their plan for a cap-and-trade system calls for a 42 percent cut in emissions by 2030 from 2005 levels, limits on emissions from petroleum products and natural gas, rich incentives for the first few coal plants to capture and sequester carbon dioxide emissions, and a carbon market board to examine offsets and contain costs.” Mufson adds that: “The plan would also require any coal plant permitted after Jan. 1, 2015, to emit no more than half the carbon dioxide emissions now considered normal and require any newly permitted plant today to have the ability to be retrofitted to meet that standard.” A chief executive for General Electric, Jeffrey R. Immelt, contends that: “The fact that we got this coalition to coalesce around a set of choices I think is impressive... Most businesses prefer to make investments with certainty about what regulations are going to be in place." Critical assessments of legislating climate controls have mostly centered on fears that a weak economy would contribute to the inability of companies to handle more expenses; however, Charles Holliday, Chairman of DuPont supports climate friendly legislation and as Mufson reports, DuPont “would likely boost spending on thin film solar panels and some biofuel projects if a bill established incentives for non-carbon energy sources.” The U.S. Climate Action Partnership had initiated a program of similar intentions in 2007, “but, as Mufson explains: “at that time members could not agree on key specifics. Environmental Defense Fund president, Fred Krupp explained that currently agreed to plan is “more aggressive than what we called for two years ago." Mufson adds that the current plan establishes: “A cap-and-trade system (which) establishes a limit on carbon emissions, then allows companies to buy and sell allowances in order to meet the targets. Climate Action Partnership's proposal would allow companies to offset a limited amount of their own emissions by reducing emissions in developing countries. However,” Mufson explains, “elements of the plan designed to win corporate support will likely face criticism from some supporters of cap-and-trade. Whereas many economists and environmentalists support auctioning all emission allowances, Climate Action Partnership says its blueprint gives a significant number allowances away free to companies currently releasing carbon dioxide. The free allowances would be phased out.” Mufson also believes that: “Some lawmakers might also balk at a proposal to subsidize a limited number of coal plants designed to capture carbon dioxide emissions. The subsidies could cost as much as $540 million a year for a 1,000 megawatt plant.” In describing the U.S.CAP as being broad, Mufson points out that: “many corporate executives and economists remain skeptical. Last week, Exxon Mobil chief executive Rex Tillerson called cap-and-trade a "stealth tax" and instead endorsed a tax on carbon emissions that he said would be more transparent and predictable.” Former Clinton undersecretary of commerce, Rob Shapiro contends that: "Cap and trade introduces enormous volatility in the price of permits,” leading Shapiro to conclude that: "cap and trade is so complex that it allows a lot of mechanisms for gaming the system." Mufson adds that: ...” there is widespread support for a cap-and-trade system among leading Democrats and Obama nominees. House Energy and Commerce Committee Chairman Henry A. Waxman (D-Calif.), who will hold a hearing on the business group's blueprint today, is eager to pass a cap-and-trade bill.” Drew Hamill, speaking on behalf of Nancy Pelosi, The speaker of the House, stated: "We will move forward as fast as we can recognizing that we'll need considerable bipartisan consensus given the size of the issue ... It's a huge issue. It's going to take time to get everyone on the same page." He said Pelosi had not set any target date for the legislation, adding only that "it's not something you start out of the gate with." Mufson reported: “In one sign of the difficulty of keeping a coalition together, the National Wildlife Federation withdrew from Climate Action Partnership rather than endorse its blueprint. In a statement yesterday, the group called Climate Action Partnership "a welcome, strong force for action," but said that it would independently try to "enact a cap-and-invest bill that measures up to what scientists say is needed and makes bold investments in a clean energy economy."