Magazine

How Business Is Taking Global Warming Seriously


Although "Global warming" (Cover Story, Aug. 16) overstates the certainty of the science involved and unfairly describes reputable climatologists with serious doubts as "naysayers," it nonetheless makes clear that private industry is already taking considerable steps toward a cleaner, more efficient energy future without coercion from politically driven Washington mandates.

As discomfiting as the reality may be to some, we simply will not be in a position to drastically reduce our dependence on fossil fuels for at least the next 15 to 20 years. Insisting this isn't so and enacting command-and-control legislation would only force U.S. companies to unilaterally disarm in the face of unprecedented global economic competition. Moreover, it would impede the future economic growth that will make additional environmental improvements possible.

U.S. scientists, engineers, and manufacturers have managed to improve America's energy efficiency by 46% in the past three decades. If left to their own devices, they will continue to move our economy and environment ahead in the 21st century.

Mark Whitenton

Vice-President, Resources & Environmental Policy

National Association of Manufacturers

Washington, D.C.

Your article makes a powerful case for action by government and big business but doesn't mention small business, which now constitutes one-half of the economy. As such, small business consumes one-half of all energy used for commercial and industrial purposes. One-third to one-half of all the energy consumed by small business is wasted through inefficiency. Small businesses can profit immensely by making investments in energy efficiency.

Unlike the exotic future technologies being proposed for big business -- "clean coal," carbon sequestration, hydrogen powered cars, etc. -- small-business energy efficiency can be achieved through available technologies. Restaurants, for example, can increase profits by investing in energy-efficient commercial refrigerators and freezers that cut energy use almost in half.

But most small-business owners lack the money, information, and time to exercise their options for energy efficiency. What's needed is a mechanism that makes those options as easy as falling off a log. One such mechanism exists: On Bill Financing (OBF), which is a utility-based method that provides no-cost financing for energy efficiency upgrades through the monthly power bill that small businesses pay. Three successful OBF programs are now operating in New England.

Byron Kennard

Executive Director Center for Small Business & the Environment

Washington, D.C.

Many major U.S.-based corporations are laggards on the issue, behind their competitors in Europe and Japan. Indeed, there are still many executives in major U.S. corporations in the automotive and oil industries who have yet to recognize that their attitudes and inaction on global warming are short-sighted and strategically unwise as well as socially irresponsible. Perhaps your cover article and editorial will help them to see the future and their interests and responsibilities more clearly.

Thomas L. Brewer

Associate Professor

Georgetown University

McDonough School of Business

Washington, D.C.

We've witnessed firsthand the determined work of companies that take global warming seriously. Just a few months ago, we helped 25 energy companies, representing about 30% of the utility industry, launch the PowerTree Carbon Co., a multimillion-dollar carbon sequestration initiative that will reforest six projects in the lower Mississippi Alluvial Valley in Louisiana, Mississippi, and Arkansas with enough hardwood trees to eventually capture more than 2 million tons of carbon dioxide from the atmosphere.

The benefits: Over a 100-year period, each acre of new forest will absorb about 400 tons of carbon dioxide, which plants pull from the air to convert to energy for growth. Under reforestation programs, carbon can be sequestered at approximately one-tenth the cost of reducing emissions through technological solutions, such as smokestack scrubbers.

Lawrence Selzer

President and CEO

Conservation Fund

Arlington, Va.

I would like to emphasize the role of agriculture in global warming. Climate change could not only have negative impacts on crop yields and the availability of water for irrigation, but it could also increase soil erosion, air and water pollution, pests and diseases, and ultimately create disruptions in the safety and security of the world's food supply.

But agriculture is also an industry that has great potential for positively affecting climate change. Opportunities exist for the development and commercialization of agricultural technologies that mitigate greenhouse gas emissions, such as anaerobic digestion of manure, as well as practices that can sequester atmospheric carbon in the soils, such as reduced tillage. Many of these practices have additional benefits, such as soil conservation, improved fertility, and value-added products. In addition, agricultural biomass can be used to displace a variety of fossil-fuel-based energy products, such as plastics. That keeps American energy dollars at home and creates new value-added products to benefit farmers.

Chad Kruger

Director of Outreach

Climate Friendly Farming

Wenatchee, Wash.

The unspoken consensus in much of the energy community is that you cannot address global warming without substantial additions of nuclear energy. Efficiency improvements have lowered operating costs to those below coal-burning. We're ready for advanced nuclear plants, already being built overseas. It's in all our best interests to help make nuclear power one of the central, zero-emissions energy sources of the coming decades.

William H. Miller

Professor

Nuclear Science & Engineering Institute

University of Missouri

Columbia, Mo.

Investors, particularly long-term institutional investors, have begun to work together to demand a response to warming commensurate with the risks it poses. While companies such as Cinergy Corp. (CIN) and American Electric Power Co. (AEP) are rightly lauded for taking steps to reduce their carbon emissions, they did so in large part because the Coalition for Environmentally Responsible Economics (CERES), the Carbon Disclosure Project, the Interfaith Center on Corporate Responsibility, and others organized trillions of dollars of investor capital to pressure management to take action.

Shareholder resolutions on the legal and financial risks associated with warming are being brought and supported by increasingly well-organized institutional investors -- and are receiving a larger share of votes than anyone thought possible just three years ago. Foundations are playing a dual role. As large shareholders themselves, they're filing resolutions, voting their proxies, helping to organize other institutional investors, and meeting directly with management. And foundation grants are helping to shape corporate response to warming -- such as informing management about risks. The message to managers? You can no longer count on the silent support of large investors when it comes to global warming.

Lance E. Lindblom

President and CEO

Nathan Cummings Foundation

New York


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