The Pennsylvania Public Utility Commission (PUC) appointed Thomas A. Leach to a two-year term on its Consumers Advisory...
Climate Change: The Heat Is On
- Entergy The first major company to adopt such a limit committed in 2001 to stabilizing its GHG emissions at 2000 levels through 2005. Pursuant to this goal, Entergy has financed 34 internal emission-reducing projects, and it expects more than 1 million tons of CO2-equivalent reductions by 2005. Entergy also has completed or initiated 11 external offset projects, resulting in another 650,000 tons of CO2 equivalent reductions by 2005.
- DTE. It aims to reduce its emissions by five percent from 1999 levels by 2005.
- American Electric Power. The company has committed to capping its CO2 emissions at the average of 1998-2001 levels and to reduce or offset its emissions by a cumulative 10 percent over the period 2003-2006.
- Cinergy. Committed to reducing its GHG emissions to an average of five percent below 2000 levels from 2010 to 2012. The company has announced that it will spend $21 million between 2004 and 2010 on projects to reduce or offset its emissions. Environmental Defense is providing oversight to Cinergy in its initiative.
- The FPL Group. The latest company to announce a voluntary emission reduction goal has pledged to reduce its GHG emissions 18 percent per kilowatt-hour from 2001 to 2008.
The above examples do not include a range of other climate-friendly activities companies are implementing, including commitments to renewable energy and demand-side management programs. Indeed, many companies implementing such activities could be doing more to quantify and take credit for the sizable emission reductions resulting from such activities.
Several utilities also are exploring the growing international emissions trading market. These utilities have several motivations, including learning-by-doing, shaping future policies, and obtaining what may be valuable future rights at what are, for now, very low prices. Many utilities have undertaken bilateral trades. Entergy, for example, purchased and retired allowances from Denmark's climate program in 2001. In addition, 25 utilities have invested in PowerTree, an initiative that will fund carbon sequestration projects in the United States and distribute the rights to the sequestration to the investor-members.
Finally, a number of utilities are examining possible membership in the Chicago Climate Exchange (CCX). Through the CCX, companies that commit to a particular schedule of GHG emissions reductions can participate in a voluntary international emissions trading exchange in which credits will be available for compliance purposes. The baseline for a CCX member's emissions target is the member's average annual emissions during 1998 to 2003. Each member commits to reducing its emissions 1 percent below its baseline during 2003, 2 percent below its baseline during 2004, 3 percent below its baseline during 2005, and 4 percent below its baseline in 2006. Companies with declining emissions could be in a position to make money in the Exchange. For now, one utility-American Electric Power-has joined DuPont, Waste Management Inc., Ford Motor Co., Motorola, IBM, International Paper, and a number of other major corporations in launching the CCX.
Irrespective of the current status of climate-change politics in Washington, D.C., utilities face increasing pressure from other sources to demonstrate their readiness for the risks and potential opportunities of future greenhouse regulation. As shown above,