More U.S. companies are realizing that addressing climate change can be good for business. Opportunities to combine environmental concerns with profits exist in the investmenst sector, the energy market and the insurance industry.
 |
Already 330 celebrities, including George Clooney, have signed up to buy a Tesla Roadster, an electric car that goes from 0 to 60 mph (0 to 100 kph) in four seconds (Photo: Reuters) |
The involvement of businesses foreshadows changes in U.S. climate policy, and might develop the products and services needed to reduce the country’s greenhouse gas (GHG) emissions.
Nearly all companies surveyed by the Pew Center in 2006 believed that U.S. federal regulations on greenhouse gas emissions were inevitable. Some companies are already implementing measures to reduce GHG emissions. This would make them less vulnerable to compliance or clean-up costs once new laws get enacted.
Investments
According to the World Resources Institute, many U.S. companies are developing new products and services for a “carbon-constrained” economy. Among those are technologies that improve energy efficiency in electricity, buildings, and transportation. Billions of dollars are also being invested in the development of renewable energy. As part of its “ecoimagination” campaign General Electric will invest 1.5 billion dollars in developing cleaner technologies by 2010.
Energy
Participating in the World Wide Fund for Nature’s (WWF) PowerSwitch Challenge, some local energy suppliers, such as Austin Energy in Texas and FPL Group in Florida, have begun to either phase out their coal-generating capacity or move toward increasing the share of electricity generated by renewables by 20 percent.
Meanwhile the World Resources Institute reports that major corporations such as Starbucks, IBM, and Johnson & Johnson have already chosen renewable energy, because it lowers long-term operations costs and vulnerability to price fluctuations. Switching to “green” power also helps them to improve relationships with stakeholders and communities.
Insurance
Insurers in the United States are looking at ways to reduce the risks and amplify the opportunities of climate change. Allianz U.S. subsidiary Fireman’s Fund launched a first-of-its-kind “green” insurance coverage that gives price incentives to energy efficient commercial buildings.
Automobile Industry
The auto industry is anticipating more demand for hybrid and fuel-efficient cars. Sales of gas-electric hybrid cars, such as the Honda Civic, Toyota Prius, and Ford Escape, have increased several times since 2004.
U.S. car manufacturers, however, were slow off the mark and have lost market shares to Asian and European competitors with energy-efficient models. Exceptions are U.S.-built luxury hybrids or high-performance vehicles like the Tesla Roadster, an all-electric car that can go from 0 to 96 kilometers (0 to 60 miles) per hour in four seconds.
Biofuels
Another development in sustainable transport is the federal government’s promotion of the expansion of biofuel production, as a supplement or alternative to imported petroleum. An agriculture bill introduced in 2007 grants subsidies for corn farmers in the Midwest to promote the production of E85, an ethanol-gas mixture. The Renewable Fuel Standard under the Energy Policy Act of 2005 also mandates that a minimum of 4 billion gallons of renewable fuel must be used in the USA from 2006 on.
But biofuels are facing some criticism due to uncertainty about how more ethanol production would affect agriculture and environmental conditions. Hybrids and biofuels may serve as a bridge between petroleum-fuelled cars and more advanced and cleaner technology, such as hydrogen fuel cells.
Sources: Pew Center on Global Climate Change, The Earth Institute at Columbia University, World Resources Institute, Worldwatch Institute, New York Times, Green Car Congress
editor: Valdis Wish
latest update: April 21, 2009
Related Articles