Global environmental challenges
Tom Rand, P.Eng., Ph.D., is Cleantech Lead Advisor at MaRS Disovery District and author of Kick the Fossil Fuel Habit. Any views expressed are his own.
Curious about new financial innovations to accelerate the global transition to a low-carbon economy, I attended the recent United Nations Environment Program Finance Initiative (UNEP FI) summit in Washington, D.C. This was a gathering of big money and those who shape its flows – pension funds, insurance companies, policy wonks and political negotiators.
Not surprisingly, I found nothing mind-blowing.
Our intentions are good, but we move – as always – incrementally. Catastrophic climate change still doesn’t fit our spreadsheets. Pension funds still rely on voluntary principles of risk avoidance.
But hats off to Paul Abberley, CEO of Aviva Investors out of London, England, for the best idea of the conference. Abberley wants to translate, directly, the good intentions of pension contributors into the fiduciary duty of investment managers.
Becky Kelley directs the Climate and Clean Energy Agenda at the Washington Environmental Council. Any opinions expressed are her own.
We could smell the sweet winds of change all the way up in Washington State last week, when California adopted final rules to implement a cap and trade program to reduce climate pollution across its economy, beginning in 2013.
from James Pethokoukis:
Looks like Tea Party America has busted a cap in cap-and-tax. Following sweeping Republican election victories, President Barack Obama has conceded his cap-and-trade plan to cut carbon emissions is dead for the foreseeable future. “I think there are a lot of Republicans that ran against the energy bill that passed in the House last year, Obama said at a Nov. 3 press conference. "And so it’s doubtful that you could get the votes to pass that through the House this year or next year or the year after.”
Yet Obama added that cap-and-trade “was just one way of skinning the cat.” You see, the president has a plan B: Let the Environmental Protection Agency work its magic on American business. The EPA would begin regulating pollution from large factories and power providers starting in January. Now Obama acted like the agency has no choice. “The EPA is under a court order that says greenhouse gases are a pollutant that fall under their jurisdiction,” he added.
– Liz Logan is a partner in PricewaterhouseCoopers’ Sustainability and Climate Change practice and leads the company’s efforts as adviser to the Carbon Disclosure Project. Doug Kangos is a PwC partner who focuses on assisting companies respond to demands of greenhouse gas emissions and sustainability reporting. Any views expressed here are their own. –
Carbon reporting by U.S.-based companies today has broad similarities to financial reporting before the enactment of the Securities and Exchange Act of 1934. Just as market forces and regulation evolved then, so too now are we seeing a similar trend.
– Valerie Volcovici is a Washington, DC-based journalist for Point Carbon, a Thomson Reuters company that provides news and intelligence on environmental and energy markets. Any views expressed here are her own. —
from The Great Debate:
-- John Kemp is a Reuters market analyst. The views expressed are his own --
Efforts to implement cap-and-trade programs at state level are faltering, just as policymakers in Washington are struggling to generate enough support to put in place a comprehensive national system.
Recent setbacks in California and Arizona point to growing headwinds against the policy. As cap-and-trade loses momentum and becomes embroiled in bigger political disputes about the size and role of government, opponents are becoming emboldened to try to block the policy completely.
from James Pethokoukis:
As usual, Joel Kotkin nicely encapsulates the problem at hand:
Now the question is whether the president can refocus on jobs. This will take, among other things, backing off the economically ruinous climate change agenda. Even the most gullible economic development officials are beginning to realize that "green jobs" are no panacea. In fact, as evident in Spain, Germany and even Denmark, over-tough green legislation can destroy the productive capacity of the most enlightened industries. Similarly in green strongholds like California and Oregon, the mounting climate change jihad could slow and even explode the incipient recovery by imposing ever more draconian regulation on businesses that can choose to migrate to less onerous locales.
There are some hopeful signs of Obama's repositioning. His recent moves embracing nuclear power and off-shore oil drilling, however inadequate, show that he's at least trying to triangulate between the green purists and the unreconstructed despoilers. Some sort of moderated energy legislation--there's no way to get the more radical House version through the Senate--would reassure businesses and the public that the president has jobs as his No. 1 priority.
Asher Miller is executive director of think tank Post Carbon Institute. Any opinion expressed here is his own.
It should come as no surprise to anyone paying attention to the politics of climate legislation to hear Senator Lindsey Graham pronounce, “the cap-and-trade bills in the House and Senate are dead.” The truth is that they’ve been dead for quite some time. It’s just that now we finally have the coroner’s official report.
from The Great Debate:
-- John Kemp is a Reuters columnist. The views expressed are his own --
California is set to auction all or almost all allowances under its emissions trading programme, and rebate up to 75 percent of the proceeds to households through a lump sum payment or reductions in income and sales taxes.
The proposals, contained in a draft recommendation from the Economic and Allocation Advisory Committee (EAAC) to the California Air Resources Board (CARB), are in sharp contrast to the proposed federal programme, stalled in Congress, which would give away most permits to utilities and other energy intensive industries.
Since California's proposed programme is one of the most advanced, and would be the largest and most comprehensive in the country, with links to other states through the Western Climate Initiative (WCI), the decision gives significant impetus to proponents of the cap and refund approach, now emerging as a credible alternative in Congress.
ADVISORY COMMITTEE MANDATE
California's Global Warming Solutions Act 2006 (AB 32) requires the state to reduce its greenhouse gas emissions back to 1990 levels by 2020. CARB has developed a "Scoping Plan" detailing how the state will achieve this using a mix of direct regulations and an over-arching cap and trade programme.
In May 2009, CARB established an Advisory Committee, consisting of technical experts, to make recommendations on two key elements: (a) how to put allowances into circulation (via auctions, free distributions, or some combination of the two); and (b) how to allocate free allowances or the revenues from permit auctions.
John Kemp is a Reuters columnist. The views expressed are his own.
President Barack Obama read the last rites for national cap and trade in 2010 on Feb. 2, while senior Democrats in the House of Representatives prepared to put a stake through its heart to ensure the Environmental Protection Agency does not try to resurrect it unilaterally without congressional approval.
Obama finally bowed to the inevitable and admitted cap and trade might need to be separated from a more popular green jobs bill in the Senate, a shift that would effectively end prospects for cap and trade in 2010.