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Business Voice for the Environment
Environmental Entrepreneurs Update
April 29, 2008
This Environmental Entrepreneurs (E2) newsletter is sent to all E2 members and friends of E2.
Articles in this Issue:

Will the 110th Congress Address Climate Change? - Senate to begin debate in June
Development of E2's Rocky Mountain Chapter - Update on events
Massachusetts Fights for Alternatives to Toxics - Bill would benefit businesses that use safer alternatives
Robert Redford Joins E2 for Discussion on Western Water - Tools for better water management highlighted
Congressman Markey Speaks in Boston - Global warming legislation on the national, regional and international arenas
NRDC Launches Environmental Digital Newsroom - Free online service to download video, order tapes, arrange satellite feeds
California Court Invalidates Federal Water Diversion Plan - Delta water problems have hurt fish and threaten drinking water
American West Heating Nearly Twice as Fast as Rest of World - Availability of water threatened
NRDC's Earth Day Report on NYC is Mixed - Public school is among top-rated green spots in the city
E.O. Wilson Event for New York Membership - Pulitzer Prize-winner chats with environmental writer
New York Forces for Nature Benefit - Local leadership and efforts recognized
Calendar of Events - E2 events in California, New York, New England and the Rocky Mountains

Will the 110th Congress Address Climate Change?


California’s adoption of comprehensive climate legislation in August 2006 started a sea change in U.S. climate policy by the states. As the Senate starts debate in June, we will learn whether Congress has the same sense of urgency. (Cartoon courtesy of Tom Toles and the Washington Post, originally published on September 1, 2006.)

The U.S. Senate will take up debate on the Lieberman-Warner Climate Security Act (S. 2191) in June. In this article, we will look at the prospects for passing comprehensive legislation for addressing climate change and what the key issues will be for members of Congress.

The 110th Congress (2007-2008) is both remarkably better on climate issues than the previous Congress and remarkably slow compared to what is needed. Congress has never had a serious debate on either the House or Senate floor. The Senate was famous for a hearing conducted by Senator James Inhofe (R-OK) that questioned whether the science linking human activity and climate change was real, where he stated that global warming was the "greatest hoax ever perpetrated on the American people" (see Jan 2005 speech).

The 110th Congress began with a commitment by both Senate and House leadership to bring climate legislation to the floor. Since that time, they have worked under the assumption that the scientific debate is over - climate change is happening and human activity is the cause. The debate instead has centered on how to reduce greenhouse gases (GHG) in a manner that provides an economic advantage to the U.S. A variety of bills have been introduced (see NRDC guide to legislation), but the main activity centers on Lieberman-Warner, (see S.2191 summary and Global Warming overview).

The Lieberman-Warner bill would:

  • Establish a declining cap on 86% of the sources of greenhouse gas emissions,

  • Reduce emissions by 18 - 25% by 2020,

  • Reduce emissions by 62 - 66% by 2050, and

  • Grow the auctioning of allowances to 100% by 2030.
According to a study just released by the U.S. Energy Information Administration, the official economic forecaster of the U.S. Energy Department, U.S. economic growth would be virtually identical to growth in the absence of S. 2191 (see press release by Senator Lieberman).
E2 Will Argue for Immediate Action

An E2 delegation will be meeting with members of Congress on May 13 and 14 for our sixth annual trip to Washington, DC . Our goal will be to explain the economic benefits of immediate action and the economic risks of further delay. Key points include:
  • Act before Fall 2009 . On November 30, 2009, the 15th United Nations "Conference Of the Parties" (COP15) will meet in Denmark to establish an ambitious global climate agreement for the period beginning in 2012 when the first commitment period under the Kyoto Protocol expires. Passage of a strong United States climate bill before that meeting will position this country to play a role in setting the rules of the world’s climate regime of the future. Moreover, studies have shown that a prompt start will mean a smoother transition to a low-carbon future and lower costs overall (see NRDC’s David Donger’s testimony to Congress).

  • Uncertainty is harming business. Most companies view climate policies and limits on emissions as inevitable. However, until the issue is resolved, businesses have a difficult time making long-term investment decisions. The current situation slows down U.S. investments while encouraging investments overseas where the policies are known and the rules are predictable.

  • Climate policy will spur innovation and economic development. Setting a price on GHG emissions will send a much-needed market signal to business that encourages innovation. We’ve seen industry rise to the challenge repeatedly by improving technology and reducing costs. As E2 examined in our 2007 cleantech report: "How Public Policy Has Stimulated Private Investment," cleantech venture capital investment is now the third-largest and fastest-growing category of venture investment in the U.S. A cap on carbon emissions will further accelerate that trend.

  • Business as usual is too expensive. While Congress is concerned with the economic changes resulting from a cap on carbon, legislators should also be concerned with rising costs and availability of energy under business-as-usual policies. Transportation fuel pricing is completely dependent on the price of crude oil, and electricity pricing is dependent on the price of natural gas and coal. What will the prices of gasoline and electricity be in 2020 without viable competitors to fossil fuels, such as electricity from renewable sources and transportation fuels made from non-food biomass feedstocks (see " Replacing Gasoline with Biofuels ")?
States Lead the Way
Twenty-five states have established renewable electricity programs. States have provided leadership while Congress has failed to act. As Congressional activity increases, Congress needs to work in partnership with the states and not pre-empt their rights. (Information provided by Union of Concerned Scientists )

While Congress has been slow to respond, the states have been active. State activity includes:
  • Renewable energy standards - in place in 25 states and the District of Columbia.

  • Energy efficiency policies that enable utilities to prioritize efficiency over new generation.

  • Automobile tailpipe emission standards enabled by California legislation in 2002 and supported by 15 other states. The Bush Administration currently blocks implementation of the standard, but the three frontrunning presidential candidates have all expressed their intentions to allow the standard to proceed.

  • An economy-wide emissions cap in California (AB 32) and activity in ten other states that are establishing caps on portions of their economy’s emissions. The most recent is Colorado (see Colorado Climate Action Plan).

Clearly the activity level for climate legislation has increased remarkably since former Vice President Al Gore’s call to action in 2005. The Regional Greenhouse Gas Initiative, the California Global Warming Solutions Act of 2006 and the change in Congressional leadership in 2007 are all moving us in the right direction. Despite this activity, it is very unlikely that Congress will pass a law in 2008. In fact, President Bush, while acknowledging the role of human activity in climate change, recently reaffirmed his plan to pursue voluntary measures that would not start to reduce of emissions until 2025 (see President puts forward global warming plan weaker than Presidential Candidates, Companies and Congress).

The states that have taken unilateral action have all done so because it is in their best economic interests. Yet Congress is having a hard time reaching that same conclusion.

Sense of Urgency

The most important message for E2 to deliver is that we must act immediately for the sake of both the economy and the environment. While there are members of Congress who understand the environmental urgency of addressing climate change, we need to reinforce the economic urgency of having a climate policy and being a part of international climate efforts.

In crafting the legislation, Congress must deal with difficult issues including the following:

  1. State Pre-emption. Some members of Congress want to take away the long-standing ability of states to regulate GHG emissions from vehicles. In a separate issue, some members want to take away states’ abilities to create their own emissions cap and carbon credit auction once there is a federal cap.

    There is no reason to take away the right of states to regulate their own vehicle emissions to a higher standard. States have successfully reduced vehicle emissions for more than 30 years under the provisions of the Clean Air Act that allow states to either adopt a common standard based on California’s or to use the Federal standard.

    State-level leadership is currently the driving force in GHG reductions in this country. Congress should do nothing to discourage states from implementing their goals and achieving carbon emissions reductions. There is no need for Congress to remove states’ rights. If Congress comes up with an attractive, equivalent program, states will voluntarily adopt the Federal program since it will be much more cost-effective to be part of a larger, Federal market.

  2. Cost containment. Cost containment mechanisms are important to smooth out price swings while the market develops and to deal with shortages of carbon credits resulting from supply disruptions or extreme weather conditions. Some in Congress have proposed "safety valves" which prevent the price of carbon from rising above a pre-determined price. E2 prefers market mechanisms such as banking and borrowing emissions (i.e. agreeing to additional reductions next year in exchange for additional emissions this year) because they provide flexibility without violating the overall cap on emissions.

  3. Allocation method. The Lieberman-Warner bill contains a complicated set of formulas for determining how rights to emit carbon are assigned and/or sold and who benefits from the value of those rights. E2’s goals are to (1) ensure that the value of the emission rights are used to further the goals of the legislation and do not become a source of windfall profits for companies, and (2) that the allocation drives innovation in each sector and does not allow one sector to avoid innovation by paying another sector to reduce its emissions.

    Unfortunately, the allocation methods in the Lieberman-Warner bill are like "ear-marks" - they provide specific assistance to various industries and constituencies. Each state has a different mix of businesses and needs, and finding an overall solution that will satisfy each region and industry will be difficult. One Senator told us the allocation system in the bill was the "mother of all ear-marks."

  4. What about China? Another question is whether the U.S. should act independently from China . According to the Energy Foundation , the U.S. is responsible for 27.5% of all carbon dioxide in the atmosphere since 1750. Comparatively, China is responsible for 8.2% (although annual emissions are now roughly the same for both countries). In many areas, China is ahead of U.S. Federal policy. For example, China has a national target of 15% renewable energy by 2020. At the end of 2007, China had already met its 2010 goal. By contrast, the U.S. Congress failed to pass a renewable energy bill last year. Similarly, last year, Congress passed rules requiring automakers to increase the fuel economy of their car fleet to average 35 miles per gallon by 2020, whereas China requires 36 miles per gallon by 2008.

    We will have far greater influence on China ’s climate policies if the United States passes a strong climate bill. The U.S. has an obligation to act first and lead since we historically put most of the carbon into the atmosphere. But beyond our obligation, delay only makes our inevitable reductions more expensive since we will have to cut faster if we start later. In addition, China could become an important market for U.S. clean energy innovations. As U.S. innovation from climate policies takes hold, we will develop the technology that China will need to reduce their energy demands and avoid expensive carbon emissions in the future. If U.S. companies develop the technology first, we will have a competitive advantage. Waiting for China can only add risk.

  5. Role of coal. Coal is the fuel used to produce over 50% of the electricity in the U.S. and is a major constituency factor in more than half of states. To pass Congress, a climate bill will need to define a way for coal to compete in the future through the capture of emissions and the permanent storage of the greenhouse gases produced.

Senate Strategy

The Senate will vote in the coming weeks on bringing S.2191 to the floor. We expect enough senators will vote to begin the amendment process. After that, there will be a series of floor amendments - some that will weaken the bill and states’ rights (i.e. pre-emption on state caps or on auto emissions), and some that will strengthen the bill (i.e. increasing emissions reduction to 80%). If the overall bill is not weakened, it will be brought to a vote. If not, the bill will be deferred, as Senator Barbara Boxer (D-CA) has vowed to pull the bill from the floor if it is significantly weakened.

If S.2191 is brought to a final vote, it will first need the votes of 60 senators to close debate. At this point, it is unclear if a bill that is strong enough for us to support would also have 60 senators who would vote to close debate.

While the target date to bring the bill to the floor is June 2, that date could slip. The Senate is preparing for its most significant effort - ever - on the issue of climate change.

Business is Leading

The debate on climate change has advanced from science to economics. When E2 first started working on a climate change bill in Congress in 2003, we spent much of our time discussing  the environmental impacts of global warming with legislators. That is no longer necessary. Now we must clearly articulate how a mandatory cap on emissions will provide economic benefits to the country, as well as how to minimize the negative impacts. Last year, a group of U.S. businesses and Environmental groups - including NRDC - established the U.S. Climate Action Partnership. The group, including many of the largest U.S. corporations has "come together to call on the federal government to quickly enact strong national legislation to require significant reductions of greenhouse gas emissions."

An analysis by McKinsey & Company demonstrated that the costs of reducing carbon a bout 50% from current levels by 2030 are approximately equivalent to the savings that would be derived from an aggressive use of energy efficiency.

Summary

As the debate on climate change policy heats up in Congress, E2 will be building support for our four key points:

  • Act before Fall 2009 - Make sure the U.S. is a welcome international player in the decision on international policy for 2012 and beyond.

  • Uncertainty is harming business - U.S. businesses cannot make intelligent long-term decisions without knowing the rules. Consequently, more investment is moving overseas.

  • Climate change policy will spur innovation and economic development - U.S. entrepreneurs can invent the New Energy Economy if Congress guarantees a market for low-carbon energy and energy efficiency.

  • Business as usual is too expensive - Energy costs will continue to rise until we create alternatives to fossil fuels.
The good news is that activity at the state level is accelerating. E2 is very active through our chapter efforts in New England , New York , the Northwest and the Rocky Mountains, and the E2 Climate Campaign in California . The knowledge that has been gained in the states can be leveraged nationally if Congress chooses to make climate policy a national priority and candidates for Congress and President chose to include it in their political agenda.


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Development of E2's Rocky Mountain Chapter


With the efforts of Chapter Leaders Andrew Currie and David Readerman, the E2 Rocky Mountain Chapter is off and running. The first meetings held in July 2007 attracted members and harvested momentum, leading to substantial chapter development set to occur in 2008.

Members and prospects will gather on May 1 in Boulder, Colorado, to participate in the first EcoSalon in the Rocky Mountain Chapter. The EcoSalon will feature Bruce Barcott, author of The Last Flight of the Scarlet Macaw, and Jacob Scherr, Senior Attorney and Program Director for NRDC’s International Program. Together, they will explore the tension between conservation and development, and discuss how our businesses, companies in which we invest, and those with which we work when we travel can set the gold standard in developing countries.

We are working to expand our network in Colorado and expect several of the EcoSalon attendees to join E2 and help our local efforts. Our thanks go to Andrew and David for making the EcoSalon possible, and for their longtime leadership in E2. If you are interested in helping in Colorado, please write to E2RockyMountains@gmail.com.


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Massachusetts Fights for Alternatives to Toxics


For the past several years, a broad coalition of groups have promoted Massachusetts state legislation that would establish a pragmatic, gradual approach to reducing health impacts from many toxic chemicals we are exposed to in everyday life. In late January 2008, the Massachusetts Senate unanimously passed the Safer Alternatives Bill (S-2481) with the support of E2. (See more on E2’s support for an earlier version of the bill.) As the bill moves to the House, E2 and others championing the bill met with Speaker DiMasi’s policy adviser, Judy Laster, to garner the Speaker’s support. E2 emphasized the opportunities for businesses that develop new materials and processes that economically meet market demands using less toxic and non-toxic alternatives.


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Robert Redford Joins E2 for Discussion on Western Water


 
 
From left: NRDC Board Member and environmentalist Robert Redford; California Assembly Member Mike Feuer; Senior Policy Analyst Ronnie Cohen of NRDC’s Western Water Project; Director Barry Nelson of NRDC’s Western Water Project; and California Assembly Member John Laird.

On April 22, E2 members and friends were treated to an EcoSalon featuring NRDC Board Member and environmentalist Robert Redford, titled "Western Water: A Crisis Unfolding." Mr. Redford was joined by Barry Nelson and Ronnie Cohen of NRDC’s Western Water Project, and California Assembly Members John Laird and Mike Feuer, in a discussion about water issues in the West and in California and ideas for better water management. Mr. Redford led the evening’s program by describing what shaped his environmentalism, and how questions around water management in the context of urban development were informed by his special fondness for the landscapes of the American West.

Barry and Ronnie provided a comprehensive exploration of the challenges water managers and users face today, as well as the tools at hand that will allow for the modernization of our management of this scarce resource that scientists say will be further damaged by the effects of global warming. In California, the governor has invited legislation to reduce per-capita urban water use 20 percent by 2020. AB 2175, a bill that Assembly Members Laird and Feuer have co-authored, does just that by establishing numeric water savings targets for urban and agricultural water use. The Assembly Members gave an overview of the provisions of the bill and addressed members’ questions on its specifics. E2 members in California who would still like to sign our letter supporting AB 2175 should contact April Mo, E2 Program Coordinator, at amo@nrdc.org or (415) 875-6100.


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Congressman Markey Speaks in Boston


 
 
From left: E2 New England Chapter Leader Berl Hartman, Representative Edward Markey (D-MA), NRDC Climate Center Deputy Director Dan Lashof, and E2 New England Chapter Leader Dave Miller.

On April 11, Congressman Edward Markey (D-MA), Chairman of the House Select Committee on Energy Independence & Global Warming, and Dan Lashof, Deputy Director of NRDC’s Climate Center, spoke at an E2 luncheon in Boston entitled, "Global Warming: Turning Words Into Action." Dan provided an overview of current climate efforts at the regional, national and international arenas. Rep. Markey shared his perspective on Washington’s response to global warming and the growing momentum for real solutions.

Both speakers cited several examples from last year to illustrate the significant directional shift in addressing global warming, including the pivotal court decision in Massachusetts vs. EPA - where the Supreme Court declared that EPA has the authority to regulate CO2 under the Clean Air Act - and the advancement of two landmark bills in Congress. The first, the Energy Independence and Security Act of 2007 (H.R. 6), is a broad set of policies that would improve vehicle fuel economy and promote energy efficiency and clean energy. The second bill, the Lieberman-Warner Climate Security Act of 2007 (S. 2191), which is expected to be debated in the Senate in June, would establish an economy-wide cap-and-trade program and other measures to stabilize and then reduce global warming pollution. Rep. Markey is determined to work with House members in the coming year on a companion bill to Lieberman-Warner. E2 thanks Mintz Levin for generously hosting this event.


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NRDC News

NRDC Launches Environmental Digital Newsroom

NRDC has launched a new video service that will make it easier for broadcast and Internet journalists covering environmental stories to acquire high-quality video in time to meet their deadlines. The "digital newsroom" is a website offering broadcast-quality b-roll that will help journalists illustrate stories on the environment. The digital newsroom is organized by story topics, such as "global warming pollution and solutions" and "polar bears."

In addition to hard-to-find footage of elusive wildlife, remote landscapes and clean technology solutions, it features soundbites from NRDC experts, press releases and other background materials to help broadcast journalists cover environmental stories on tight deadlines. Technical support is available 24/7 from Mediaseed, a division of Medialink, which is hosting the service for NRDC. All assets are available for unrestricted use and free of charge to registered journalists. The digital newsroom is on the Web at nrdc.mediaseed.tv/ . It can also be accessed from the news section of the NRDC website. Congratulations to Craig Noble and his colleagues in NRDC’s media department on the launch of this service.


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California Court Invalidates Federal Water Diversion Plan

In a ruling that comes in the wake of federal fisheries managers’ unprecedented decision to cancel this year’s salmon fishing season, a federal judge in California has invalidated a water plan that would have allowed more pumping from the San Francisco Bay Delta at the expense of five species of protected salmon and steelhead trout. In his opinion, Judge Oliver W. Wanger relied on the National Marine Fisheries Services’ (NMFS) own finding that diverting water from the bay-delta was killing huge numbers of salmon. That finding is "inconsistent, if not irreconcilable" with the agency’s opinion that the project operations did not jeopardize the survival of the fish. The judge also faults NMFS for failing to analyze the effects of global warming on the fish. The court scheduled a conference on April 25 for the parties to address developing interim remedies to protect the fish. Senior Attorney Kate Poole is NRDC’s lead on this case. To read more about this case, including a list of all plaintiffs, and background on the water and fish population issues in California, see NRDC’s press release.


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American West Heating Nearly Twice as Fast as Rest of World

NRDC and the Rocky Mountain Climate Organization (RMCO) have released a report, "Warming in the West" that finds the American West is heating up more rapidly than the rest of the world. The report analyzes federal temperature data from Arizona, California, Colorado, Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington and Wyoming. For the five-year period 2003-2007 the average temperature in the Colorado River Basin, which stretches from Wyoming to Mexico, was 2.2 degrees Fahrenheit hotter than the historical average for the 20th Century. The temperature rise was more than twice the global average increase of 1.0 degree during the same period. The average temperature increased 1.7 degrees in the entire 11-state western region.

This news is especially bad for some of the nation’s fastest growing cities, which receive water from the drought-stricken Colorado River. The Colorado River Basin is in the throes of a record drought, with climate scientists predicting even more and drier droughts in the future. To date, the governors of Arizona, California, Montana, New Mexico, Oregon, Utah and Washington have signed the Western Climate Initiative (WCI), an agreement to reduce global warming pollution through a market-based system, such as cap-and-trade. The WCI calls for states to reduce their global warming emissions 15 percent below 2005 levels by 2020.

Theo Spencer, a Senior Project Manager in NRDC’s Climate Center, was a co-author of this report.


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NRDC's Earth Day Report on NYC is Mixed

This year’s Earth Day (April 22) marks the 38th anniversary of the beginning of the modern environmental movement in 1970. To commemorate Earth Day, NRDC has released its second annual "New York City Green Apples, Bad Apples" report, identifying the City’s top five environmental bright spots and five environmental trouble spots over the past year. Click to download the report. In the coming year, NRDC’s New York Urban team will continue to work hard to address not only the bad apple issues that are highlighted, but also other important environmental challenges in order to safeguard New Yorkers and our natural resources.


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E.O. Wilson Event for New York Membership

At an April 24 NRDC event anonymously funded by two NRDC members, Harvard Professor E.O. Wilson gave an onstage interview with The New Yorker staff writer Elizabeth Kolbert. More than 1,000 guests attended the event, which was open to the public, free of charge. After the crowd watched NRDC’s "Laws of Nature" video, President Frances Beinecke introduced the speakers. Wilson, a two-time Pulitzer winner, has often been called the "father" of biodiversity. Kolbert, herself an NRDC Member and OnEarth contributor, is well-known for her series of New Yorker articles on climate change. Kolbert asked Wilson about species preservation, climate change and a host of other topics before moderating questions from the audience. At the end of the program, Wilson and Kolbert received a standing ovation from the crowd.


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New York Forces for Nature Benefit

 
From left: NRDC Chairman Dan Tishman; NYC Mayor Michael Bloomberg; NRDC President Frances Beinecke; Chairman of Bank of America Ken Lewis; NRDC Executive Director Peter Lehner
 
NRDC’s 10th annual Forces for Nature Benefit was held April 1 at Cipriani in New York City. The evening honored the environmental commitments of Mayor Michael Bloomberg and Kenneth Lewis, head of Bank of America. Mayor Bloomberg said, "This is a great honor - and while problems like global warming clearly need global actions, those of us in city government, I think, can and must take a leading role." NRDC Chair Dan Tishman celebrated the accomplishment of Bank of America’s new sustainable skyscraper: "The Bank of America building will be one of the greenest high rises on Earth. It will be a net zero emitter of global warming pollution and by maximizing the use of daylight and efficient technology, it will use 50 percent less energy than comparable buildings." The event was also the greenest Forces for Nature gala ever and featured a seasonal and organic vegetarian menu, locally sourced flowers, no plastic water bottles, the use of 100-percent post-consumer paper for the invitations and program, organic tote bags for the guests and the offsetting of emissions associated with guest travel. The event raised over $1.5 million to support NRDC’s work.


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