June 7, 2011
Pew Center Contact: Rebecca Matulka, (703) 516-4146
Survey Says … Low-Carbon Innovation Vital for Future Growth
Pew Center survey of industry leaders focuses on strategies for low-carbon innovation
Washington, D.C. – Over the next two decades, low-carbon innovation will become more important for business and U.S. economic growth, according to a survey conducted by the Pew Center on Global Climate Change of largely Fortune 500 companies with a demonstrated commitment to addressing climate and energy issues. Conducted in late 2010, the survey is designed to gauge business strategies for low-carbon innovation with a focus on how companies perceive the associated risks and uncertainties.
The survey, part of a larger Pew Center study to be released in October 2011, explored best practices among industry leaders. Thirty-five companies, ranging in size from $600 million to $285 billion in annual revenues and with an average annual R&D expenditure of $1.4 billion, participated in the survey.
“Leading businesses are investing today with an eye toward a future low-carbon economy. They are focusing more on researching, developing and bringing low-carbon solutions to market,” said Judi Greenwald, Vice President of Innovative Solutions at the Pew Center on Global Climate Change. “The competitive edge of U.S. companies, and the strength of the U.S. economy, depend on more companies employing this same foresight and ingenuity.”
This survey is one element of a study on the most effective methods used by companies to develop and bring low-carbon solutions to market. Other key findings of the survey include:
- Long-term, transparent climate and energy policies are critical to establishing a business environment that will allow for greater certainty for decision-making and investment in low-carbon innovations. Nearly half of the companies surveyed think putting a price on carbon is the most important action the U.S. government can take to advance low-carbon innovation.
- Financial growth is the biggest driver for bringing low-carbon innovations to market, allowing companies to position themselves competitively in the marketplace. Other reasons for focusing on low-carbon innovation include anticipating or shaping regulatory changes, being a leader in emerging technologies or markets, and meeting consumer demand.
- The most significant uncertainty in low-carbon innovation is policy as it relates to regulatory changes and tax/subsidy changes.
- Public policy plays a strong role in deciding which country has the best business climate for domestic low-carbon innovation.
The survey results will be combined with insights from three workshops, four in-depth case studies, and other supporting research for the report Business of Innovating: Bringing Low-Carbon Solutions to Market, which will be released at a conference in Atlanta on Oct. 25-26, 2011. The survey and forthcoming report are being funded with a grant from Hewlett-Packard.
For more information on the low-carbon innovation project, visit www.c2es.org/business-innovation.
For more information about global climate change and the activities of the Pew Center, visit www.c2es.org.
The Pew Center was established in May 1998 as a non-profit, non-partisan, and independent organization dedicated to providing credible information, straight answers, and innovative solutions in the effort to address global climate change. The Pew Center is led by Eileen Claussen, the former U.S. Assistant Secretary of State for Oceans and International Environmental and Scientific Affairs.
Pew Center Vice President for Innovative Solutions Judi Greenwald spoke at a National Journal event about advancing solutions toward vehicle fuel efficiency. Other speakers at the May 25, 2011, forum were Sen. Lamar Alexander (R-TN), Sen. Ron Wyden (D-OR), Deputy Assistant to the President for Energy and Climate Change Heather Zichal, ANGA-AGA Joint Collaborative on Transportation Executive Director Dr. Kathryn Clay, Edison Electric Institute President Thomas Kuhn, and Association of Global Automakers President and Chief Executive Officer Michael Stanton.
On May 25, 2011 Sustainability 24 will unite leading thinkers, Non Governmental Organizations, business high performers and sustainability service providers enabling them to share fresh ideas, innovations and thought-provoking concepts associated with the adoption of wider sustainability practices throughout business. During the 24 hour event business and local government leaders will demonstrate how they have embedded sustainability their organizations and governments, not only to drive efficiencies and cost savings, but also to drive differentiation in their markets through innovation.
Meg Crawford, a Markets and Business Strategy Fellow, will participate on the panel Sustainability and Carbon Performance Management: Understanding Performance Levers to Drive Sustainability Success. During this presentation you will hear how Sustainability Performance Management processes can help meet both strategic business and stakeholder objectives. Join leading figures for live Q&A to learn how measuring the value of sustainability initiatives, and carbon management, is imperative to driving the sustainability agenda.
Testimony of Elliot Diringer
Vice President for International Strategies
Pew Center on Global Climate Change
Subcommittee on Oversight and Investigations
Committee on Foreign Affairs
U.S. House of Representatives
May 25, 2011
Hearing on “UN Climate Talks and Power Politics – It’s Not About the Temperature”
Mr. Chairman, Ranking Member Carnahan, and members of the Committee, thank you for the opportunity to testify on the critical issues confronting the United States and other nations in the effort to address global climate change. My name is Elliot Diringer, and I am Vice President for International Strategies at the Pew Center on Global Climate Change.
The Pew Center is an independent non-profit, non-partisan organization dedicated to advancing practical and effective policies and actions to address global climate change. Our work is informed by our Business Environmental Leadership Council (BELC), a group of 46 major companies, most in the Fortune 500, that work with the Center on climate change risks, challenges, and solutions.
Mr. Chairman, climate change poses a serious long-term threat to our nation’s resources, our economic well-being, and our national security. While action to address climate change must begin at home, this is a quintessentially global challenge, which therefore requires a global solution. I would like to focus my testimony today on three topics: 1) the status of the international climate negotiations, and the objectives that should guide U.S. climate diplomacy; 2) the policies being implemented in other countries – including our major trading partners – to reduce greenhouse gas emissions; and 3) the environmental, economic and security rationales for stronger climate action.
My principal points are as follows:
- The past two years have seen the emergence of a more realistic and balanced approach in the international climate negotiations, thanks in large measure to the efforts of U.S. negotiators. The United States must remain fully engaged in the talks with the aim of strengthening multilateral support and transparency, thereby promoting action while laying the groundwork for a future binding agreement.
- A growing number of countries are pursuing policies that help reduce greenhouse gas emissions. Many see the challenge as an important opportunity as well. Some of our major trading partners are moving aggressively to grow their clean energy technology industries, which create domestic jobs and high-value exports. Without stronger policies creating similar incentives here, the United States risks falling further behind in the rapidly expanding clean energy market.
- U.S. inaction on climate change exposes our nation to real and rising risks. The longer we delay action, the harder it will be to avert the worst consequences of warming, the higher the cost of coping with those that can not be avoided, and the further we fall behind in the clean energy race. Taking steps now to expand clean energy and reduce greenhouse gas emissions is squarely in our strong national interest.
Moving the Negotiations Forward
Multilateral regimes do not generally spring forth fully formed – rather, they evolve over time. The international climate effort is no different. It began with the 1992 United Nations Framework Convention on Climate Change (UNFCCC), which was signed by the President George H. W. Bush and unanimously ratified by the U.S. Senate. The UNFCCC, now ratified by 195 parties, established a long-term objective of preventing “dangerous anthropogenic intereference with the climate system” and a framework within which countries can work together to achieve it. To be certain, countries’ positions in the climate negotiations are heavily conditioned by their respective national interests. But underlying the Framework Convention is a clear recognition that countries share a common interest in averting dangerous climate change. And a fundamental principle of the Convention is that while our respective responsibilities are differentiated, depending on nations’ circumstances, we all share a common responsibility for meeting this common challenge.
Since the signing of the Framework Convention, the climate regime has evolved in fits and starts. While the Convention is largely voluntary in nature, countries resolved shortly after its entry into force that stronger action was needed, and initiated a new round of negotiations aimed at establishing binding emission targets for developed countries. This led in 1997 to the Kyoto Protocol. Although the United States chose not to participate, Kyoto entered into force in 2005, and most other industrialized countries are on track to meeting their obligations. For many countries, the principal aim since 2005 has been to extend this legally-binding regime through a second round of targets. But many of the countries with targets have made clear that they will not assume new binding obligations without commensurate commitments by the United States and the major developing economies. Through this prolonged stalemate, the negotiations were stuck in a mode of binding-or-nothing, and consequently produced virtually nothing.
Over the past two years, however, we have seen the emergence of a more realistic, more balanced and more constructive approach, in large measure through the efforts of the United States. Many viewed the Copenhagen summit in 2009 as a major failure because they had hoped – unrealistically – that it would produce a binding agreement. In our view, the Copenhagen Accord, negotiated personally by President Obama and other world leaders, represented genuine progress. Among other things, the Accord set an aspirational goal of limiting global temperature increase to 2 degrees Celsius; set goals for mobilizing financial support to help developing countries reduce emissions, preserve forests, and adapt to climate change; and established the broad parameters of a system to ensure transparency and accountability. What’s more, it provided for mitigation pledges from both developed and developing countries. As a result, for the first time ever, all of the world’s major economies – including China and India – have now made explicit pledges to reduce or limit their greenhouse gas emissions.
In the chaotic final hours in Copenhagen, the Accord was not formally adopted by the UNFCCC Conference of the Parties. However, at the 16th Conference of the Parties last year in Cancún, parties adopted a package of decisions incorporating the essential elements of the Copenhagen Accord into the UNFCCC framework, and taking initial steps to implement them. The Cancún Agreements represent the most tangible progress within the UNFCCC negotiations in nearly a decade. First, they memorialize the pledges taken under the Copenhagen Accord by more than 80 countries accounting for more than 80 percent of global emissions. Second, the Agreements establish the fundamentals of a stronger support system for developing countries, and a stronger transparency system enabling countries to verify whether others are fulfilling their pledges.
The Agreements also reflect a more flexible and realistic framework for enshrining countries’ actions. Unlike the Kyoto Protocol, which allows only one type of commitment (a binding emissions target with a prescribed, common base year), the Agreements allow for a diversity of approaches. In the case of developed countries, pledges take the form of economy-wide emission targets, but with flexibility on base year and accounting. Developing countries have even broader discretion in defining their “nationally appropriate mitigation actions.” China and India, for instance, have pledged reductions in emissions intensity (emissions per unit of GDP), while Brazil, South Africa, Mexico and the Republic of Korea have pledged to reduce emissions below “business as usual.” This more realistic and balanced approach reflected in the Cancún Agreements, as well as the movement toward greater transparency for all major economies, are direct consequences of U.S. engagement and leadership in the climate negotiations.
It is important to emphasize that the pledges countries have made at this stage are voluntary in nature. We continue to believe that the global response to climate change should ultimately be enshrined in fair, effective and binding commitments among all of the world’s major economies. Countries will deliver their strongest possible efforts only if they are confident that others are also contributing their fair share, and this confidence is best maintained through mutual and binding commitments. We also recognize, however, that it will be a number of years before the United States, China and other key countries are prepared to assume binding commitments. Under these circumstances, we believe the United States must remain fully engaged in the climate negotiations with the aim of strengthening the UNFCCC as a means of delivering support and transparency, thereby promoting near-term action while laying the groundwork for a future legal agreement.
At the 17th Conference of the Parties later this year in Durban, we believe the aim should be further progress on the operational issues addressed in the Cancún Agreements, including the launch of a new Green Climate Fund to support developing country efforts and significant progress in strengthening transparency through new “measurement, reporting and verification” practices; and a clear declaration by parties of their intent to work toward legally binding outcomes. This outcome would build on the achievements of the past two years and continue the incremental progress needed to strengthen confidence in the regime and among parties.
Efforts in Other Countries
While international agreements and commitments are critical to our success in addressing global climate change, a more important measure of efforts to date are the policies and actions countries are undertaking domestically. A growing number of countries are developing or implementing policies contributing in one way or another to reducing greenhouse gas emissions. Many see the challenge as an important opportunity as well. A number of our major trading partners are moving aggressively to grow their clean energy technology industries, which create domestic jobs and high-value exports. Without stronger policies creating similar incentives here, the United States risks falling further behind our competitors in the rapidly expanding clean energy market.
The European Union is a clear leader in the development, manufacture, and deployment of clean technologies. The EU has set mandatory targets to reduce greenhouse gas emissions 20 percent below 1990 levels, and to increase renewables to 20 percent of its energy mix, by 2020. The centerpiece of EU climate policy is the Emissions Trading System (ETS) launched in 2005, which regulates carbon dioxide emissions (CO2) in the power and major industrial sectors generating about half of the EU’s CO2 emissions. Having overcome the early complications typical of a new compliance market, the system is set to expand in 2012 to cover other gases and the aviation sector. Europe’s clean energy investments, the world’s largest, doubled from 2009 to 2010, reaching nearly $81 billion. From 2004, the year before the ETS began, through 2008, the year before the global financial crisis, the European Union reduced its emissions 4.1 percent, while its GDP grew 9.8 percent.
China also has taken major steps towards increasing its manufacture and use of clean energy technologies. Under the Cancún Agreements, China pledged that by 2020 it will reduce the CO2 intensity of its economy 40 to 45 percent below 2005 levels; increase the share of non-fossil fuels in primary energy consumption to 15 percent by 2020; and increase forest coverage by 40 million hectares and forest stock volume by 1.3 billion cubic meters. These targets are reflected in domestic policy as well. Additional policies include: a national target for renewables to provide 15 percent of primary energy by 2020, with specific targets for wind, solar, biomass, and hydropower; feed-in tariffs for onshore wind power; and proposed fuel efficiency standards requiring urban cars and light trucks to achieve an average of 36.9 miles per gallon by 2015. The 12th Five-Year Plan adopted by the Chinese leadership in March devotes considerable attention to energy and climate, establishing a series of targets and policies for 2011-2015. These include a suite of policies to promote innovation in new strategic and emerging technologies, including nuclear, solar, wind, biomass, and hybrid and electric vehicles. The plan also includes a goal to "gradually establish a carbon trade market."
To be certain, China continues to build coal-fired power plants as well, and its emissions continue to rise. A recent analysis by the Lawrence Berkeley National Laboratory projects that on the present path China’s emissions will peak between 2030 and 2035. But the climate and energy provisions of the new Five-Year Plan show how China is moving forward with domestic policies in line with the pledge it offered in Copenhagen and formalized in the Cancún Agreements. Many of the policies also are clearly calculated to help ensure that China – which recently surpassed the United States and other countries to become the leading manufacturer of wind turbines and solar panels – retains a strong competitive edge going forward.
Other major developing countries are also stepping up their efforts to limit emissions growth and transition to cleaner energy. India, which pledged to reduce its emissions intensity (excluding the agricultural sector) 20 to 25 percent below 2005 levels by 2020, is pursuing a range of policies under its 2008 National Action Plan on Climate Change, including: a renewable energy target; a feed-in tariff for renewable energy; a market-based system of tradable energy savings certificates in industrial sectors; and a coal levy generating finance for clean energy research and innovation. Brazil and Indonesia have set goals to reduce deforestation. South Africa has set national renewable energy and energy efficiency targets and established a renewable energy feed-in tariff. Meanwhile, the governments of Mexico and South Korea have proposed establishing emissions trading systems.
While the global picture is uneven, these examples demonstrate a growing will among countries to undertake a wide variety of measures to promote clean energy and to reduce greenhouse gas emissions.
Addressing Climate Change is in Our National Interest
Earlier I emphasized that all nations share a common interest in averting dangerous climate change. It is important to understand why stronger efforts to address climate change and pursue clean energy are in our direct national interest as well. There are many reasons, whether from an environmental, national security or economic perspective.
The scientific and environmental rationale for lowering our greenhouse gas emissions is clear and compelling. As again underscored two weeks ago in America’s Climate Choices, a report produced by the U.S. National Academy of Sciences at the request of Congress, “Climate change is occurring, is very likely caused by human activities, and poses significant risks for a broad range of human and natural systems.” On these fundamental points, there is very strong consensus within the scientific community.
Due largely to the combustion of fossil fuels, atmospheric concentrations of carbon dioxide are at their highest level in at least 800,000 years. Over the last century, average global temperatures rose more than 1 degree Fahrenheit and in some places, including parts of the United States, temperatures rose more than 4 degrees. If greenhouse gas emissions continue to grow, average global temperatures are projected to reach 2.0°F to 11.5°F (1.1°C to 6.4°C) above pre-industrial levels by 2100, with warming in the U.S. expected to be even higher.
We are already witnessing the impacts of climate change here in the United States; the widespread flooding now inflicting communities along the Mississippi River vividly illustrates how vulnerable we are to the rising risks associated with climate change. Most of North America is experiencing increasing numbers of unusually warm days and nights and a decreasing number of unusually cool ones. At the same time, droughts are occurring more frequently while snowpacks are melting earlier in the year. Sea-level rise of 8 inches or more has been recorded in some coastal areas of the country. Continued warming will mean further sea-level rise, elevating storm surges and gradually inundating low-lying coastal areas along all U.S. coastlines; increased frequency and severity of extreme weather events; increased risk of droughts and floods; significant threats to ecosystems and biodiversity; and increased public health risks. Beyond such readily foreseeable impacts, the longer warming persists and the greater its magnitude, the greater the risk of abrupt or catastrophic changes in the global climate.
Actions to reduce the risks of climate change by lowering greenhouse gas emissions have other environmental co-benefits as well. Lower-carbon technologies such as natural gas and renewable energy also emit less of other pollutants including nitrogen dioxide, particulates, sulfur dioxide, lead, carbon monoxide, mercury, and other hazardous pollutants that have a wide range of harmful health effects, from asthma to cancer and premature death. Past regulatory efforts to reduce these pollutants have proven highly successful and cost-effective. The Office of Management and Budget (OMB) found that from 1992 to 2002 “major rules” enacted under the Clean Air Act produced benefits of between $145 billion and $218 billion a year, far exceeding the annual costs $22 billion to $25 billion. A study by researchers at MIT found total annual benefits rising from $50 billion in 1975 to $400 billion in 2000. We can expand these benefits by moving towards cleaner energy sources.
America’s military leaders recognize that climate change also poses increasing risks to our national security and new demands on our military resources. According to the Pentagon’s latest Quadrennial Defense Review, climate change may act as “an accelerant of instability or conflict, placing a burden to respond on civilian institutions and militaries around the world.”
Indeed, climate change will be a threat multiplier, further destabilizing regions of the world already burdened with countless other problems. Chronic drought, rising seas, extreme weather and other climate impacts could undermine weak governments, induce mass migrations, and trigger or heighten resource competition, contributing to social instability and, potentially, armed conflict. Rising seas could displace as many as 30 million people in Bangladesh, creating additional tensions on the Indian subcontinent. Receding glaciers could leave millions across Asia facing chronic water shortages. A distinguished group of retired three- and four-star U.S. military officers warns that drought, thirst, and hunger are already exacerbating the conflicts and humanitarian disasters in Darfur and Somalia, and climate change portends more situations like these.
Within the past year, devastating floods in Pakistan have strained the resources and stability of a key U.S. ally in the battle against international terrorism, and an intense drought and heat wave has diminished food production in Eastern Europe and Central Asia, causing a spike in global wheat prices. Yemen, where the CIA says Al Qaeda is of greatest concern today, is running out of groundwater for its under-employed population. While these events cannot be directly attributed to climate change, scientists are very clear that these types of events will occur more frequently in a warming world.
Other security issues are arising closer to home. The Arctic has long been a place where defense issues were minimized because the waterways were largely frozen over year-round. With warming now occurring there at twice the average global rate, the Arctic Ocean is opening to military and civilian transportation, and the potential security implications are already apparent. Receding sea ice is creating increased competition over territory and resources in a region where the United States is currently unprepared to address potential military situations.
Protecting our nation’s security necessarily involves being prepared to deal with an uncertain future. Indeed, planning under uncertainty is business as usual for the defense community. The fact that military and security experts are increasingly concerned about the risks associated with climate change should serve as an important wake-up call to us all.
Finally, addressing climate change is very much in our economic interest. The United States is the world’s leading manufacturer, producing 21 percent of global output while supporting 18.6 million domestic jobs. Yet in the growing clean energy sector, we risk falling further behind our competitors because the demand for these goods is not as strong at home as it is overseas.
China and other countries are investing heavily in clean energy technologies, positioning themselves to compete in a growing global market projected to reach $106 billion to $230 billion a year in 2020, and as much as $424 billion a year in 2030. In order for the United States to develop a successful, profitable, and competitive clean energy sector, companies need clear regulatory frameworks ensuring a strong domestic market for these goods.
The recent experience of the U.S. auto industry provides an instructive case study. While the technology in our cars has advanced significantly in the last two decades, the typical new vehicle today consumes gasoline at about the same rate as one produced in the late 1980s. But with gas prices again rising, consumers are increasingly turning to more fuel-efficient vehicles. Spurred by fuel economy standards enacted in 2007, American automakers have been ready to meet their customers’ needs. U.S. automakers reported strong sales and combined profits of nearly $5.9 billion in the first quarter of 2011, and all three cited higher sales of fuel-efficient vehicles as a contributing factor. Last year, the Smart car was the only conventional car available in the United States with a fuel economy rating of 40 miles per gallon or better. Today there are nine, and three of them – the Cruze, Elantra, and Focus – were among the 10 top-selling vehicles last month. All three are made in the United States.
Unfortunately , similar examples in the clean energy field must be found outside the United States. In Germany, for instance, renewable energy policies helped boost jobs in the renewable energy sector from 160,000 in 2004 to 370,000 in 2010.The German government credits this dramatic growth in clean energy jobs as a major factor in its relatively fast recovery from the 2008 recession. Germany’s renewable energy sector is projected to employ about 450,000 to 580,000 workers by 2020, and between 500,000 and 600,000 in 2030.
By contrast, U.S. clean energy manufacturers are increasingly finding their biggest growth opportunities overseas. First Solar, Inc., of Arizona, the world’s second largest solar manufacturer, plans to build a 2,000-megawatt solar photovoltaic power plant in China – the largest planned project of its kind in the world. While First Solar will also add new manufacturing jobs at its U.S. facilities, at least 71 percent of its planned growth is outside the United States. U.S. firms remain among the world’s top innovators. But if our clean energy firms are to invest and create jobs at home, and compete effectively overseas, we must provide the regulatory certainty that creates strong, sustained demand for their goods here in the United States. Doing so will strengthen our economy while protecting the United States against the risks of climate change.
Mr. Chairman, U.S. inaction on climate change exposes our nation to real and rising risks. The longer we delay action, the harder it will be to avert the worst consequences of warming, the higher the cost of coping with those that can not be avoided, and the further we fall behind other countries in the clean energy race. Taking steps now to expand clean energy and reduce greenhouse gas emissions is quite clearly in our strong national interest.
As the world’s largest economy, leading innovator, and largest cumulative emitter, the United States also has a responsibility to the international community. Thanks to U.S. efforts, the global climate effort now appears headed on a more reasonable course. Our ability to continue to shape that effort in the years ahead depends heavily on a demonstrated commitment to address climate change here at home.
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This post also appeared in the National Journal Energy & Environment Experts blog in response to a question about oil use and the future of electric vehicles.
Whether or not electric vehicles (EVs) take off will ultimately depend on consumer acceptance of new technology. But public policy and technological progress are just as important, as we highlight in our new report on the transportation sector.
Indeed, electric drive vehicles powered by batteries or hydrogen fuel cells could revolutionize transportation in the United States, saving considerable amounts of oil while also reducing the sector’s impact on our global climate. And the EVs on the market now are off to a great start, winning national and international awards.
Nearly all major automakers are planning to introduce these vehicles in the coming years, and I applaud automakers like Ford that have committed to building alternative drivetrains in significant number for the long haul. Companies like Ford understand climate change and the need to reduce our impact on our global environment while not sacrificing our mobility. For EVs to achieve that goal, we need policies like a clean energy standard that aim to decarbonize our electrical grid. I’m sure Ford is also investing in this space because they see a market opportunity.
The private sector has invested billions of dollars in developing, manufacturing, promoting, and distributing EVs in the last decade. From a map on our website, you can see that policymakers across the country are supporting EVs because they want their region to benefit from this burgeoning market.
Policymakers should rely on private capital as much as possible to build out the EV charging infrastructure so we can balance the desire to support alternative vehicles while also tackling our nation’s budget deficit. To that end, we should coordinate policy related to EV purchase and home charging nationwide so private players can enter new markets more easily. The most efficient way to “refuel” these vehicles is not yet clear, and we should use policy to help provide the foundation to let the market work.
Another element that is critical to the success of these vehicles is its most expensive component – the battery. Not only do we need aggressive R&D to develop batteries with much higher energy density, we also need to figure out what to do with these batteries at the vehicle’s end-of-life. About 80 percent of the battery’s capacity is still usable at this point, resulting in the largest untapped resource in this space today.
If we achieve the right mix of policy, technological progress, and consumer acceptance, there’s little reason to doubt that alternative vehicles will have a significant impact on the car market in this decade. It appears that it will be tough to kill the electric car this time.
Eileen Claussen is President
Ambitious Commitment Would Result in Cumulative 30 Percent Decrease in the Company's Emissions Since 2004, and Includes New Corporate Real Estate Portfolio Goal of 20 Percent LEED(R)-Certified Space
CHARLOTTE, N.C., May 18, 2011 -- Bank of America today announced an ambitious new goal to reduce its absolute greenhouse gas (GHG) emissions by 15 percent from 2011 to 2015, based on its 2010 baseline. This goal spans all of the company's global operations in more than 40 countries and builds on its previous GHG reduction of 18 percent between 2004 and 2009, which had focused on legacy Bank of America operations in the U.S.
Through the Environmental Protection Agency's Climate Leaders program, Bank of America was one of the first global financial institutions to announce GHG emissions reduction targets in 2004, and the first to publicly report out on exceeding those goals within the commitment period.
Today, factoring in the addition of Countrywide and Merrill Lynch, the new target represents an overall global reduction in aggregate GHG emissions of more than 30 percent from the 2004 baseline. This is equal to annual emissions of more than 700,000 metric tons CO2-equivalent or said another way, equal to eliminating the annual GHG emissions from more than 124,000 passenger vehicles.
"Reducing our emissions not only lessens the environmental impact of our global operations, but enhances our efficiency and delivers tremendous value for our company and shareholders," said Global Technology and Operations Executive and Bank of America Environmental Council Chair Catherine P. Bessant. "Continuing to achieve a GHG reduction of this magnitude requires fundamental changes spanning our entire organization, from our global real estate portfolio to the individual workspaces our employees occupy."
Like most companies, the vast majority (90 percent) of Bank of America's GHG emissions derives from energy consumption. To accomplish its GHG goal, Bank of America will focus on lowering its energy consumption by:
- Expanding and enhancing energy management systems and technology.
- Increasing computing efficiency in data centers and desktop/laptop computers.
- Improving overall equipment efficiency in areas such as HVAC and lighting.
- Optimizing office space.
- Identifying and implementing emerging technologies as they become commercially available and/or viable.
- Educating employees on how they can modify their behaviors to support the goal.
Leaders in LEED(R) certification
To further advance its GHG reduction goals, Bank of America also announced today that 20 percent of its corporate workplace real estate portfolio will be certified under the U.S. Green Building Council's LEED(R) (Leadership in Energy and Environmental Design) rating system by 2015. Currently 11 percent of the company's workplace portfolio, 13.2 million square feet, is comprised of LEED-certified space. LEED-certified space will include new construction, core and shell construction, commercial interiors, retail spaces and the operations and maintenance of existing buildings.
"Bank of America is an industry and corporate leader in applying LEED to achieve improvement to their global corporate footprint," said Rick Fedrizzi, president, CEO and founding chair of the U.S. Green Building Council (USGBC). "The company has systematically leveraged every aspect of green building practices throughout their entire workplace building stock to help them standardize their energy efficiency and achieve their carbon reduction goals."
Additionally, the company recognizes the important role that employees have in contributing to the company's comprehensive GHG emissions reduction goals. By instituting robust employee programs, the company is better able to achieve this specific goal, as well as reduce its overall indirect GHG emissions.
Through a comprehensive employee educational program, and a partnership with the Pew Center on Global Climate Change, the company is providing training, education and resources to help employees find ways to save energy and money, while reducing waste, improving their workplace and communities, and engaging with their teammates in market-specific opportunities. Employee training sessions in 2011 will focus on overall energy conservation, sustainable transportation, LEED building enhancements and recycling.
Under the company's Hybrid Vehicle Reimbursement program, eligible U.S.-based employees can receive up to a $3,000 reimbursement toward the purchase of a new hybrid, highway-capable electric or compressed natural gas vehicle. Initially launched in 2007, more than 3,800 employees have replaced conventionally powered vehicles which, on average, doubled their fuel economy and prevented the release of nearly 4,000 tons of annual CO2 emissions from employee commuting.
Third party partners
Bank of America also engages leading, independent partners like the Pew Center on Global Climate Change, Carbon Disclosure Project (CDP) and Ceres, throughout the entire lifecycle of its emissions and other environmental goal setting, benchmarking and reporting. To track its progress on this and other environmental commitments, the company continues to complete CDP's comprehensive annual carbon survey, adhere to Global Reporting Initiative sustainability reporting standards, and submit its GHG emissions data for independent, third-party review.
"As a global company, Bank of America is to be congratulated for its past achievements and impressive new goal, as well as demonstrating how effective management of their emissions and environmental footprint makes both business and environmental sense. It is clear that the effective management of these issues has a direct impact on a company's ability to compete and grow," said Paul Simpson, chief executive officer, Carbon Disclosure Project, a global, independent, not-for-profit organization that monitors and encourages company disclosure on carbon dioxide emissions. "They have made significant progress in engaging suppliers, employees and leadership on climate change and this announcement speaks to their long-term commitment."
About Bank of America's Environmental Commitment
Understanding the important role it plays in helping clients and communities address climate change, Bank of America continues to establish itself as an environmental leader in the financial services sector. In 2007, Bank of America embarked on a 10-year, $20 billion business initiative to address climate change through lending, investments, capital markets activity, philanthropy, and its own operations. Delivering $12.1 billion in four years to hundreds of clients in 45 states, the District of Columbia, Canada and markets across Asia, Europe and Latin America, Bank of America is focused on reducing its environmental footprint while aligning its global financial products and services to help advance energy efficiency and low-carbon energy markets, including wind, solar, biomass, other emerging technologies. For more information about Bank of America's environmental commitment, visit www.bankofamerica.com/environment.
SOURCE: Bank of America
Reporters May Contact:
Britney Sheehan, Bank of America, 1.206.358.7563
May 17, 2011
Pew Center Contact: Tom Steinfeldt, 703-516-4146
The Climate Registry Contact: Alex Carr, 778-340-8837
Association of Climate Change Officers Contact: Daniel Kreeger, 202-496-7390
The Climate Registry, Pew Center on Global Climate Change and the Association of Climate Change Officers Announce Partnership with the U.S. Environmental Protection Agency to Jointly Administer New National Climate Awards Program
Washington, DC – Today The Climate Registry (The Registry), the Pew Center on Global Climate Change (Pew Center) and the Association of Climate Change Officers (ACCO) announced that they will jointly sponsor a new national awards program with the U.S. Environmental Protection Agency (EPA) to recognize exemplary corporate, organizational and individual leadership in response to climate change.
By showcasing voluntary action on climate and energy under a unified banner, EPA, The Registry, Pew Center and ACCO are sending a strong signal that innovative and sustained leadership in greenhouse gas emissions (GHG) management will be recognized in the United States.
"The co-sponsorship of this new recognition opportunity reflects EPA’s commitment to reducing greenhouse gas emissions (GHGs) and recognizing leadership on climate change," said EPA Assistant Administrator Gina McCarthy. "We are pleased to be partnering with three non-profit organizations that have demonstrated expertise in GHG emissions management."
An event to honor award recipients will be held in early 2012. Specific award categories will include:
- Sustained Excellence in Public Reporting –Recognizing companies that continually raise the bar in the area of public disclosure of GHG emissions data. This would include regular public reporting and verification of corporate GHG inventories, GHG goal setting and achievement of GHG emissions reductions.
- Supply Chain Leadership –Recognizing companies that have their own comprehensive GHG inventories and emissions reduction goals and can demonstrate that they are at the leading edge of managing carbon in their supply chain.
- Organizational Leadership –Recognizing companies that have “mainstreamed” climate change across their operations and can demonstrate that they factor climate change into their business decisions.
- Individual Leadership –Recognizing individuals exemplifying extraordinary leadership in leading their organizations’ response to climate change and/or affecting the responses of other organizations.
These award categories provide a legacy for EPA’s Climate Leaders program, which provided support to private sector corporations who voluntarily set and achieved greenhouse gas reduction targets, and ACCO’s Climate Leadership Awards, which recognized exemplary leadership by organizations in industry, government, academia and the non-profit community.
“Corporate leadership is essential to advancing climate and energy solutions,” said Eileen Claussen, President of the Pew Center on Global Climate Change. “In growing numbers, companies and their employees are working tirelessly in pursuit of cost-effective solutions that reduce carbon and benefit consumers. Recognizing these great accomplishments serves to motivate and accelerate efforts throughout the business community toward a cleaner, more efficient energy future."
“The Climate Registry is delighted to partner with EPA, the Pew Center and ACCO on this important program, which will build on the work of Climate Leaders as well as our own carbon management program,” said Denise Sheehan, Executive Director of The Climate Registry. “Together we look forward to continuing to provide the tools, resources and recognition that organizations need to take their climate and carbon leadership to the next level.”
"Amongst ACCO’s primary missions is bringing together climate executives from across sectors to collaborate and establish best practices," said Daniel Kreeger, ACCO's Executive Director. "We look forward to undertaking such a timely and important effort with our partners - The Climate Registry and the Pew Center - who have been on the cutting edge of climate response, and of course EPA, whose Climate Protection Awards inspired ACCO’s 2010 Climate Leadership Awards program and whose Climate Leaders program has been so instrumental in driving climate response."
More information is available online at www.epa.gov/climateleaders. Additional information on the award categories and nomination process will be made publicly available in the next few weeks.
About The Climate Registry
The Climate Registry provides organizations with the tools and resources to help them calculate, verify, report and manage their GHG emissions in a publicly transparent and credible way. The Registry was established in 2007 as a 501 (c)(3) by US states and Canadian provinces and today is governed by a Board of Directors comprised of senior officials from 41 US states, the District of Columbia, 13 Canadian provinces and territories, six Mexican states and four Native Sovereign Nations. The Registry is a membership organization with more than 430 members who use The Registry’s services measure and manage their emissions and share best practices with a community of members. For more information see www.theclimateregistry.org.
About the Pew Center on Global Climate Change
The Pew Center on Global Climate Change (“Pew Center”; www.c2es.org) is a 501(c)(3) organization that operates under the legal umbrella Strategies for the Global Environment. Formed in 1998, the Pew Center is an internationally recognized pragmatic voice offering credible information and analysis, straight answers, and innovative solutions in the effort to address global climate change. In a highly polarized, controversial and politicized arena, the Pew Center provides a non-partisan forum for constructive engagement between business leaders, policy makers, scientists, and other experts.
About the Association of Climate Change Officers
The Association of Climate Change Officers is a 501(c)(6) non-profit membership organization for executives and officials worldwide in industry, government, academia and the non-profit community. ACCO’s mission is to advance the knowledge and skills of those dedicated to developing and directing climate change strategies in the public and private sectors, and to establish a flexible and robust forum for collaboration between climate change officers. For more information about ACCO, please visit www.ACCOonline.org.
Changing Planet is a three-part series of town hall events intended to encourage student learning and dialogue about climate change by gathering scientists, thought leaders, business people, and university students to discuss the facts of climate science, the dynamics of its impact and to brainstorm solutions. The series is prodiced in partnership between NBC Learn (the educational arm of NBC News), the National Science Foundation (NSF), and Discover magazine.
The first town hall event, Changing Planet: The Impact on Lives and Values, was hosted at Yale University and moderated by NBC News Special Correspondent Tom Brokaw. The discussion explored themes of human health, national security, economic opportunity and competitiveness, moral or religious values, environmental justice, and what climate change means for youth. The panelists were Linda Fisher, Dupont’s chief sustainability officer; Rajendra Pachauri, director of the Yale Climate and Energy Institute and a Nobel Prize laureate; Billy Parish, founder and coordinator of the youth-oriented Energy Action Coalition; and Katherine Hayhoe, associate professor in the Department of Geosciences at Texas Tech University and an expert on the intersection between Christian fundamentalism and climate change.
A second Changing Planet: Clean Energy, Green Jobs and Global Competition town hall was hosted at George Washington University on April 12, and focused on the economic advantages of climate change solutions, including clean energy policies and technologies and creation of market green jobs. Tim Juliani, Director of Corporate Engagement, was a panelist and provided our perspective on the clean energy debate. Other panelists included: Ken Zweibel, a professor at GWU, Phaedra Ellis-Lamkins (head of Green for All), and Chris Busch (director of Policy and Programs at the Apollo Alliance). NBC News reporter Anne Thompson moderated this event.
Read Discover Magazine's story on Building a Green-Collar Economy with a full transcript of the Changing Planet: Clean Energy, Green Jobs and Global Competition town hall.
The third town hall will be held at Arizona State University in the fall of 2011, and its suggested focus will be “Keeping It Fresh: Our Water Future,” impacts of how communities are adapting, or preparing to adapt to, changing availability of fresh water..
In addition to the Changing Planet town halls, NBC Learn and NSF worked together to produce a series of 12 online video reports looking at the impact of climate change in various locations around the world. From Bermuda’s tropical seas to the Arctic Ocean, each story follows scientists in the field who are studying the dramatic impacts of rising temperatures in the air, in the water, and on land. The series is narrated by Anne Thompson, Chief Environmental Affairs Correspondent for NBC News. Watch the full video series here.
First there was the warning about a construction moratorium – all new major stationary sources would come to an immediate halt because of EPA’s new source review requirements for greenhouse gas emissions (GHGs). Soon after the alarm went out about the approaching regulatory “train wreck” that would result from a series of EPA rules impacting electric utilities. A large number of power plants would shut down, the reliability of our energy supply would be sacrificed, and consumers would face skyrocketing costs.
There was only one problem with these warnings – they were made before anybody knew what the actual regulations would require. Now that EPA has issued several of these rules, it is useful to revisit these doomsday scenarios and see if the reality of the proposals matches the rhetoric before the fact.
At the moment, our attention is riveted by the events unfolding at a nuclear power plant in Japan. Over the past year or so, major accidents have befallen just about all of our major sources of energy: from the Gulf oil spill, to the natural gas explosion in California, to the accidents in coal mines in Chile and West Virginia, and now to the partial meltdown of the Fukushima Dai-ichi nuclear reactor. We have been reminded that harnessing energy to meet human needs is essential, but that it entails risks. The risks of different energy sources differ in size and kind, but none of them are risk-free.