Business and carbon

Prepared to put a price on emissions

The coal-fired Plant Scherer power plant in Juliette, Ga., is the nation's single largest source of carbon pollution, which most scientists say contributes to climate change. Major U.S. corporations, including oil companies, are incorporating a price on carbon pollution into their long-term financial plans.

Published: Sunday, December 8, 2013 at 1:00 a.m.
Last Modified: Friday, December 6, 2013 at 12:37 p.m.

Dozens of the nation's largest corporations, including the five major oil companies, are preparing for the day when carbon pollution is taxed as a way to control climate change.

The question is: Where is Congress on the issue?

Unfortunately, the answer is that -- on our energy future as on so many crucial issues -- Congress has stalled out.

Maybe the realization that major U.S. corporations are assessing the realistic future costs of climate change will jump-start congressional action. It's long overdue.

The news that oil giants ExxonMobil, ConocoPhillips, Chevron, BP and Shell -- as well as Walmart, Microsoft, General Electric and more than 20 other companies -- are incorporating a price on carbon pollution into their long-term financial plans was revealed in a study by the environmental data company CDP. The New York Times' Coral Davenport reported on the CDP analysis last week.

Many economists have long concluded that putting a price on carbon pollution -- that is, the emissions from burning oil, gas and coal -- is the simplest and most effective way to fight man-made climate change.

How a carbon tax works

Here's how it works: If an industry pays a tax on its carbon emissions, Davenport noted, "the costs will be passed on to consumers in higher prices for gasoline and electricity. Those high prices are expected to drive the market away from fossil fuels like oil and coal, and toward low-carbon renewable sources of energy."

Revenue generated by the tax, in turn, could be directed to research and development of alternative energy sources such as solar and wind power.

Congress has tried before to enact a carbon price, but the efforts failed -- largely because the oil and gas industry financed lobbying campaigns against them.

In 1994, Al Gore, who was vice president at the time, led a failed effort to pass a climate change bill that would have effectively taxed carbon pollution.

In 2009, President Obama pushed a bipartisan "cap and trade" bill that would have required companies whose carbon emissions exceeded set levels to buy emission rights from others who polluted less. That failed, too, when critics condemned the complex process as just a back-door tax.

Climate-change legislation has gone nowhere since then, but the energy and corporate landscape has changed significantly in recent years.

Because of the "fracking" process, the United States is now among the world's largest producers of natural gas, which creates less carbon pollution than oil or gas.

And, the Times' Davenport reported, "ExxonMobil is now the nation's biggest natural gas producer, meaning that it will stand to profit in a future in which a price is placed on carbon emissions."

Alan Jeffers, an ExxonMobil spokesman, told Davenport that his company "would support a carbon tax if it was paired with an equal cut elsewhere in the tax code" -- the same policy that Gore endorsed almost 20 years ago.

Kochs opposed

Not all U.S. corporations are jumping on the carbon-tax bandwagon. Koch Industries, a conglomerate owned by ultra-conservative brothers Charles and David Koch, is gearing up its continuing, aggressive campaign against any tax or price on carbon. The Kochs, whose company includes oil refiners and the paper-goods manufacturer Georgia-Pacific, are major supporters of tea party political causes.

Congress, at some point, might have to choose between the Kochs and much of the rest of corporate America -- all of whom have been generous contributors to lawmakers' political campaigns.

Let's hope that the effects of carbon pollution on the health and well-being of current and future generations of average citizens also receive some consideration.

This story appeared in print on page A16


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