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Benefits of Cutting Emissions
By Michael Northrop
Monday, February 28, 2005; Page A17
Even as the Kyoto climate protocol becomes a binding international treaty, an astonishing number of otherwise savvy policymakers continue to think that incentives and programs to cut greenhouse gas emissions will cost too much, hamper competition and stifle economic growth. While such reasoning has kept the United States from mounting any serious response to global warming, others have not waited for political leadership to point the way. In fact, businesses and several governments have moved ahead, often aggressively, to constrain carbon dioxide releases, mostly by using energy more efficiently. In doing so, they are reaping enhanced profitability and robust growth.
For example, six companies -- IBM, DuPont, BT (British Telecom), Alcan, NorskeCanada and Bayer -- have each reduced emissions by at least 60 percent since the early 1990s, collectively saving more than $4 billion in the process. Numerous other smart companies, such as Alcoa, 3M, Kodak, United Technologies, Lafarge, Shell and BP, have also far exceeded the smaller reductions envisaged under Kyoto and have saved large sums by using energy more efficiently.
National economies are enjoying the benefits of reduced carbon emissions as well. British Prime Minister Tony Blair recently told the Economist that between 1990 and 2002 Britain trimmed emissions 15 percent, while boosting its economy 36 percent.
International corporations were among the earliest leaders in reduction efforts. DuPont, for example, began an ambitious carbon dioxide and energy reduction program 10 years ago that today has brought greenhouse gas emissions down 70 percent; in the same period, production increased almost 30 percent.
These carbon-reduction and energy-efficiency measures have produced significant financial benefits for DuPont. In addition to cumulative energy savings of more than $2 billion, renewable energy saves $10 million annually over fossil fuels. DuPont also hopes to realize $40 million in coming years from trading carbon emissions credits. To underscore its commitment to this new commodities market, the company became a charter member of the Chicago Climate Exchange, a pilot program for greenhouse gas emission reduction and trading.
France-based Lafarge, the world's largest cement manufacturer, typically produced over 80 million tons of CO 2 a year before setting a reduction target of 20 percent by 2010. (By comparison, all of Switzerland produced 45 million metric tons of carbon equivalent in 1995.) Through manufacturing modifications, however, Lafarge has lowered emissions of greenhouse gases nearly 11 percent from 1990 levels. At the same time, Lafarge is realizing significant cost savings and strengthening its future competitiveness. This company's example has led to a working group of the world's leading cement manufacturers intent on curbing emissions from one of the biggest sources of CO 2 .
Among national examples of carbon dioxide reduction, Britain is one of the best. In addition to cutting its greenhouse gas emissions from 1990 levels, it aims to produce 10 percent of its energy needs from renewable sources, primarily wind, by 2010. And it hopes to raise this to 20 percent by 2020. The cost of this transition has been insignificant.
Britain's lowered emissions and improved economic growth can be attributed in part to an impressive decrease of 42 percent in CO 2 emissions intensity -- the amount of fossil fuel energy required per unit of gross domestic product. By 2050 Britain projects a 60 percent reduction in CO 2 emissions at an annual cost of only 0.01 percent of GDP growth. During the same period, officials expect national wealth to triple.
Cities are also finding ways to lower emissions and save money. Toronto has decreased greenhouse gas releases from municipal facilities by 40 percent and is saving $2.7 million annually through energy efficiency improvements. In addition, the city earns $1.5 million annually by selling electricity generated from methane gas captured at three municipal landfills.
These businesses and governments are only a handful of the entities that have realized impressive benefits from initiatives to curb carbon dioxide emissions. Hundreds of companies and national and local governments have to various degrees begun to see similar results from their efforts.
Such impressive results, though, are not enough. Only serious, across-the-board federal and international policies and programs will solve the problem of global warming. Unfortunately, concerted action is unlikely to occur as long as administration officials and some members of Congress continue to use worn-out arguments against limiting carbon dioxide releases, even as hundreds of multinational corporations and smaller businesses are proving them wrong. Meanwhile, these individual initiatives offer valuable insights and lessons for the path ahead.
The writer directs the global sustainable development grant-making program at the Rockefeller Brothers Fund.
