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U.S. Business Actions to Address Climate Change: Case Studies of Five Industry Sectors


Marcus D. King

Report Shows U.S. Companies Moving Forward with Carbon Reductions

WASHINGTON, D.C., Nov. 8, 2004 - A new report by the Sustainable Energy Institute and Numark Associates finds that many U.S. corporations are moving ahead with greenhouse gas (GHG) reduction programs in the absence of federal requirements to do so and despite the U.S. staying out of the Kyoto Protocol.

The independent study, titled U.S. Business Actions to Address Climate Change: Case Studies of Five Industry Sectors, details actions of five U.S. industry sectors to address emissions of carbon dioxide and other GHGs contributing to global warming. The report is being published by GreenBiz.com and is available by Clicking Here.

According to the report, these company actions are driven by a combination of:

• Increased corporate focus on sustainability, deriving from anticipated benefit in both
  public image and profitability;
• Shareholder pressure on businesses to provide a more aggressive response to climate
  change and disclose GHG emissions reduction activities, as well as the financial risks
   they are exposed to from climate change;
• Pressure from insurers to address climate change and disclose GHG
  emissions reduction activities;
• Recent state-level regulations mandating GHG reductions; and
• State lawsuits against highly carbon-emitting power companies.

The report examines GHG reduction efforts in five U.S. industry sectors -- aluminum, chemicals, electric power, forestry and paper, and pharmaceuticals. Within those sectors the report provides in-depth case studies of the actions of seven individual companies -- Alcoa, DuPont, AEP, Entergy, FPL Group, International Paper and Pfizer.

“U.S. companies and state regulators are clearly getting out in front of the federal government in addressing climate change,” said Neil J. Numark, Chairman of the SEI Board. “U.S. industry increasingly recognizes that we are moving towards carbon constraints in this country. Many prefer this be done in a uniform way at the national level, not through the patchwork of state regulations that's now emerging. Otherwise they'll face continuing regulatory uncertainty, which inhibits the ability to commit to large capital investments.”

The report states that some electric power companies now support a national “cap-and-trade” program for carbon, as a component of a multi-pollutant legislative plan for the power sector that would control carbon together with sulfur dioxide, nitrogen oxides and mercury.

The report also cites the preference of multinational companies for a global program on GHG emissions that allows international trading of allowances, over an approach in which the U.S. goes it alone.

SEI will hold a series of roundtables in Washington, D.C. entitled “Next Steps Post-Kyoto: U.S. Options,” from January through March 2005. U.S. business actions to address climate change will be part of that discussion. Click here for more information.

Numark Associates is a Washington, DC-based energy and environmental consulting firm specializing in nuclear energy, non-proliferation and cleanup matters; climate change policy and emissions trading systems; regulatory and government affairs; and energy policy and politics. For more information visit www.numarkassoc.com.

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