Some national business organizations have hammered the Environmental Protection Agency (EPA) for proposing new rules on carbon pollution from existing power plants, cutting carbon emissions by 30 percent by 2030, using 2005 levels as a baseline. What planet are they on?
It’s ludicrous to pretend that climate change isn’t happening, or that it won’t affect every industry. It’s beyond comprehension that large business advocacy organizations, including the US Chamber of Commerce, think that our government should stand by and do nothing, while climate-related disasters in 2012 caused more than $139 billion in damages, while U.S. taxpayers shelled out $96 billion in climate-related damages in 2012 alone, or while sea levels rise 6.6 feet by 2100 — enough to swamp Miami.
Let’s be clear: the costs from carbon pollution will be terrible for business. Climate change poses tremendous risks -- insurance premiums will skyrocket, electricity prices will soar, jobs will be lost, food and transportation costs will dramatically rise, and taxes will likely increase in order to pay for needed infrastructure upgrades.
That’s why business organizations like ours, and many of America’s largest companies, including Johnson & Johnson, Apple, Exelon and Intel, reject the notion that EPA’s rules will destroy the American economy. National Grid US president Tom King noted recently, “I am strongly encouraged by EPA’s efforts to reduce CO2 emissions through sensible and practical regulation.”
This is no minority view. Polling released this week by the American Sustainable Business Council (ASBC) found that 64 percent of small business owners — a plurality of whom were Republicans — believe government regulation is needed to reduce carbon emissions from power plants. This is important because, as the same poll shows, about 1 in 5 small business owners said climate change has already harmed their operations.
For these and other smaller companies, anticipating and innovating are crucial for success. Why would business people ignore those principles when addressing climate change?
Perhaps climate skeptics fail to see that the EPA’s proposal will define a market for solutions, not dictate what the solutions are. Perhaps they are unaware that the standards provide for flexibility on the part of governors, or that carbon reductions will enhance this nation’s international credibility and competitiveness. Entrepreneurial activity and private sector capital follows closely in response to government action to address climate change.
Under this plan, states would have extensive options to choose how they meet these standards -- and businesses, including utilities, will have time to adapt. EPA’s goals take into account each state’s unique and current energy mix. This is a smart approach that recognizes the dynamic nature of the market and the power of businesses to innovate.
Electricity generation accounts for a third of all US greenhouse gas emissions, more than any other economic sector. Coal plants are the worst offenders of all: in 2012, coal energy was responsible for nearly a quarter of all greenhouse gas emissions in the U.S. The 100 dirtiest power plants in this country are responsible for 3.2 percent of global CO2 emissions - and all but two are coal-fired plants (PDF). Cutting these emissions is crucial, but there are multiple paths to accomplish that.
A state like Kansas, which had as many as 4,000 jobs supported by wind energy in 2013, could invest in more wind power. Arizona, which led insolar energy per capita in 2012, could continue its rapid growth. The same could go for Washington state, the leader in hydropower. And states that want to join regional cap-and-trade systems can do so. EPA’s proposal will let states set their own course to meeting these standards.
Smart business people know that clear market signals and regulatory certainty drive investment. EPA’s carbon rules will lead to greater profit and prosperity, boosting economic growth and creating jobs. So when you hear someone say we can’t afford to take action on climate change, remember: The costliest thing we can do is nothing. Inaction is not how successful businesses operate.
What the EPA and many business leaders understand is that failure to address climate change is what will cause the most economic pain. It’s time to tackle climate change before it costs our people, businesses and nation even more.