The Pragmatist

by Katie Sosnowchik

green@work Magazine

July/August 2001

Eileen Claussen's career has spanned nearly three decades of government service, taking her from the U.S. Environmental Protection Agency all the way to the Department of State. Then, three years ago, her career took a decidedly different turn when she founded and became president of the Pew Center on Global Climate Change, an influential NGO that is actively engaging the private sector in efforts to halt global climate change. In this role, Claussen offers a unique perspective on the problems and possible solutions at hand--a viewpoint she willingly proffers with both a convincing candor and a common-sense attitude. Claussen is a self-described pragmatist who is now facing the diplomatic battle of a lifetime.


The Pragmatist

What began as a simple consulting project has propelled Claussen front and center into one of the world's most pressing environmental concerns, as well as one of its most hotly-debated challenges. The year was 1998, and Claussen had recently resigned her position as Assistant Secretary of State for Oceans and International Environmental and Scientific Affairs. She was asked by the Pew Charitable Trusts, a philanthropy with whom she had no previous relationship, to investigate the concept of a center that would bring a new scientific and cooperative approach to the debate on global warming.

"Pew asked me to work as a consultant to help them determine what needed to be done in climate change," Claussen recalled. "So I helped them work out a general program. When I was finished, they turned around and asked me if I wanted to just do it--which was perfect."

 

The Members

One of Claussen's first initiatives upon founding the Pew Center on Global Climate Change was to establish the Business Environment Leadership Council (BELC), a group of private sector companies worldwide that are responding to the challenges posed by climate change. In addition to agreeing to a joint statement of principles, the corporate members of the BELC serve in an advisory role, offering suggestions and input regarding the center's activities.

These corporations include various Fortune 500 companies and represent a diverse group of industries, including energy, chemicals, metal, consumer appliances and high technology. They do not contribute financially to the Pew Center, which is supported solely by contributions from charitable organizations.

Members of the BELC include the following:

ABB
Air Products and Chemicals
Alcoa
American Electric Power
Baxter International
Boeing
BP
California Portland Cement Co.
CH2M HILL
Cinergy Corp.
Cummins Inc.
DTE Energy
Deutsche Telekom
DuPont
Enron
Entergy
Georgia-Pacific
Holnam
IBM
Intel
Interface, Inc.
John Hancock Financial Services
Lockheed Martin
Maytag
Ontario Power Generation
PG&E Corp.
Rio Tinto
Rohm and Haas
Royal/Dutch Shell
Sunoco
Toyota
TransAlta Corp.
United Technologies
Weyerhaeuser
Whirlpool
Wisconsin Energy Corp.

Claussen was "off and running" in no time. Her progress was aided by her knowledge of the issues and the relationships she had formed while at the state department, as well as previous positions as a Special Assistant to the president, Senior Director for Global Environmental Affairs at the National Security Council and a number of positions at the U.S. Environmental Protection Agency (EPA).

The objective of the Pew Center on Global Climate Change is to educate the public and key policy-makers about the causes and potential consequences of climate change and to encourage the domestic and international community to reduce emissions of greenhouse gases. To accomplish this, Claussen explains that the center's activities are threefold:

  • to disseminate information regarding environmental impacts, economics and policy that is honest and believable
  • to communicate with and educate the public regarding global climate change issues; and
  • to advance solutions on an international basis by encouraging dialogue between the private and public sectors.

Claussen's first order of business was the establishment of the center's Business Environmental Leadership Council (BELC), a group of companies that have publicly acknowledged the threat of global climate change and have committed to taking action to address its consequences. The initial group of 13 companies has now grown to 36, with the three most recent additions announced in June.

Her insistence on engaging and recognizing the influence of the private sector has earned Claussen a reputation of being somewhat of a maverick in the NGO community, but she says she is convinced that solutions that do not make economic sense will eventually follow the declining path of the oceans, ecosystems, species and natural resources the Pew Center is trying to protect. In fact, the joint statement of the BELC states, "We believe that the response must be cost-effective, global and equitable, and also allow for economic growth based on free market principles."

Yet, while she readily acknowledges the importance of the private sector, she just as strongly advocates the need for collaboration and dialogue with both government and the NGO community to effectively formulate practical, reality-based solutions. She explained her assessment of the current state of affairs this way at a recent speech given to the Society of Environmental Professionals (SEP):

"Our government is weaker, NGOs are stronger and industry is more attuned to the environmental consequences of its actions. Looking at these trends, and coupling them with the ease of modern communications and the growth of the Internet, you start to see the outlines of a new approach to environmental policy making.

"Some have argued for greater self-policing by the private sector--based on the belief that it is in industry's best interests to deal aggressively and responsibly with these issues," she continued. "But I am talking about something different. I am talking about a governance model that requires a heightened level of interaction and cooperation among government, NGOs, industry and others--an approach that draws on everybody's strengths, interests and expertise to forge solutions that everybody can support."

 

The Principles

Each of the companies participating as members of the Pew Center's Business Environmental Leadership Council have agreed to the following joint statement of principles:

1. We accept the views of most scientists that enough is known about the science and environmental impacts of climate change for us to take actions to address its consequences.

2. Businesses can and should take concrete steps now in the U.S. and abroad to assess opportunities for emission reductions, establish and meet emission reduction objectives and invest in new, more efficient products, practices and technologies.

3. The Kyoto agreement represents a first step in the international process, but more must be done both to implement the market-based mechanisms that were adopted in principle in Kyoto and to more fully involve the rest of the world in the solution.

4. We can make significant progress in addressing climate change and sustaining economic growth in the United States by adopting reasonable policies, programs and transition strategies.

In the past few months, Claussen acknowledged that activity is heating up at the Pew Center. The debate over the Kyoto Protocol and the failure of negotiations regarding the treaty in The Hague last November, as well as the stance on global warming taken by the Bush administration, has led to increasing interest in the issue of global warming from all sectors. Where it will lead in the near future--including the talks in Bonn, Germany, in late July regarding the Kyoto agreement--remains somewhat uncertain, she admits. Yet Claussen's resolve is undeterred, and she will continue to champion the "recipe" she believes will eventually guarantee much-needed progress.

"What are the ingredients that will make these collaborations successful? Let me list a few," she concluded at the SEP conference. "First, we need a vision of where we are going and where we must go. Second, all the major stakeholders have to believe that the problem is real and needs to be addressed. Third, those who do good voluntarily shouldn't be penalized if doing good becomes mandatory down the line. Fourth, all the players have to be willing to take risks. Fifth, business has to put what it knows on the table, since the private sector generally has the most useful information. And last, but not least, NGOs have to buck the heat and say that compromise is acceptable."

In between phone calls, press briefings, speeches, testifying to congressional committees, meetings with staff members and visits with foreign ministers, Claussen took an time to talk to green@work about the ways in which the Pew Center is moving ahead on the issues.

Tell us about the pew center and what it hopes to achieve.

Claussen: We established the Pew Center in May 1998. The purpose at the time, and it hasn't really changed, was to be a rational voice trying to solve a real problem--and we view climate change as a real problem. It's important to us to find a solution. The times--and I think they haven't changed very much despite our best efforts--had most people in fairly polarized positions: either they thought there wasn't enough science, they thought it was too expensive to do something about it or they thought it was a problem we could do something about tomorrow. We don't have much time for people who are still questioning the basic science, because the science is there. We think there is a rational way to go about trying to solve the problem. That's our basic motivation.

Do you still encounter many companies and groups that question the science?

Claussen: Yes, that's why one of the most important things that I negotiated with the first members of the Business Environmental Leadership Council companies was a statement on the science. The one that we worked out says that there is enough science to take action. And we have stronger science now than we had then. These companies didn't object, and none of the subsequent companies who joined have had any objection at all. If the private sector can be there, I think it's rather silly that there are still some in the public sector that are questioning what is pretty obvious.

You say you want to be a rational voice. How do you do that?

Claussen: There are three parts to what we do. The first part has to do with putting information out there that is honest and believable; we saw that as a need in the very beginning. Back then there was a fair amount of analysis and a lot of studies, but they were all biased in one way or another, based on where the person who was doing the research was coming from. We felt the need to compile basic information on the science, on the economics, on international policy issues, on domestic policy issues and, more recently, on ways to go about solving the problem. And so we have a very ambitious set of programs--in three years we have produced 27 reports. We also have a book that will be coming out this summer. We don't write them in-house; we use outside authors--people who we think are experts in the field who could put out something straightforward. We spend a lot of time working with them to make it understandable, so there is a heavy involvement by staff here at the Pew Center, but essentially it's the work of an outside expert, usually in a university, who we think is really credible. The minimum distribution per report is about 4,000, and some are up to about 10,000 copies.

We also communicate a lot--whether it's advertising or giving tons of speeches. We also have a very active Web site and we give press briefings all the time.

Who is your audience?

Claussen: It's public and private, international and domestic. We take our reports to all the meetings we attend, and no matter how many we take, they disappear. We've had people from the most obscure countries saying, "We read your report and we're really interested in what you have to say." It's something that we do that's very important.

What are other goals of the center?

Claussen: Another thing we did was to try to find a group in the private sector that believed the science and were going to do something about their piece of the problem. In other words, companies that reduce their own emissions and be willing to be a constructive voice for public policy both internationally and domestically. As I said before, we started with 13, and we're now 36 and we're likely to continue to grow. These are big companies, many of which have targets for reducing their emissions that are actually quite astonishing in terms of how stringent they are.

How did you recruit those companies?

Claussen: I started off by getting in touch with people that I regulated in my past life and with whom I had some relationship. Today, it's mostly by invitation, although there are an increasing number of companies who come to us to start the dialogue. We're currently in conversations with about 10 additional companies.

 

Policymakers Guide
 

"The Basics of Climate Change: Straight Facts, Innovative Solutions"

This guide, produced by the Pew Center, provides a comprehensive overview of key climate change issues and focuses on six key areas. The guide, including regular updates, is available on-line at www.c2es.org.

" Science and Impacts
This section examines the growing scientific consensus that emissions of carbon dioxide and other greenhouse gases from human activities9from industrial processes to fossil fuel combustion to changes in land use9have clearly contributed to global warming.

" Economics
Many participants in the climate change debate have assessed the economic costs of taking various actions to address climate change, often with widely diverging results. This section includes an analysis of several commonly used models to determine how they work, what inputs and assumptions influence their output and what important elements are missing in an effort to provide new ideas regarding ³best practices² in the economic modeling of climate change policies.

" Business Solutions
This section provides a sampling of the wide array of approaches that members in the Pew Center¹s Business Environmental Leadership Council (BELC) are using to mitigate global climate change including greenhouse gases, energy solutions, waste management, transportation, carbon sequestration and offsets. It also examines how these companies are preparing for an international climate change agreement.

" State Activities Many states have successfully reduced greenhouse gas emissions without threatening their economy and are providing solutions to climate change that offer a wide array of benefits. Different states are taking different approaches, ranging from comprehensive cross-cutting programs to those focused more narrowly on energy, air pollution, agriculture, transportation, natural resources, education and other areas. This section provides some examples of state innovations.

" Congressional Activities The U.S. Congress plays a key role in determining how the United States responds to the challenge of global climate change. Federal legislation can guide efforts to reduce U.S. emissions of greenhouse gases cost effectively. International climate change agreements negotiated by the United States must be ratified by the U.S. Senate. Federal appropriations that can support or hinder efforts to curb U.S. emissions are enacted by Congress. Finally, Congress conducts hearings that focus attention on global climate change and shape the national debate over how best to address it. This section offers a brief review of recent congressional action on climate change as reflected in proposed legislation, appropriations measures and international negotiations.

" International
Climate change is, by its very nature, a global challenge that can be fully met only through the coordinated efforts of all nations. The earth¹s atmosphere is a global ³commons,² and the greenhouse gas emissions that accumulate in the atmosphere, contributing to climate change, have the same impact regardless of where they originate. This section explores what is needed to build an effective international agreement.

 

What do members commit to?

Claussen: They have to agree to a set of principles and then carry them out. So, in a very public way, they have to accept the science. They have to agree to inventory their emissions, look for targets of opportunity, set targets and then reduce their emissions. We've now got 16 companies that have already set targets; everybody else is in some stage of working on it. They have to agree to be a constructive participant internationally. They can't just talk the talk. They have to walk the walk.

Who at the BELC companies participates?

Claussen: It's really a mix. We hold meetings four times a year with sort of an executive committee that includes maybe 18 to 20 companies. These participants include some number of vice presidents and some who might be just below that, but who have, let's say, sole responsibility of a company for climate change and might report directly to the CEO. This week we are holding our first meeting for everyone to discuss policy and politics, and 34 are coming--we've got almost all the VPs coming as well as some of the others.

We do talk to the CEOs and some of the CEOs are very active. We've got 21 CEOs on the record concerning this issue. Their comments are posted on our Web site. I have conversations with CEOs some of the time, but others are less active. But we know that we can go them if we need to.

What attracts companies to the pew center?

Claussen: There's also the group of CEOs who, once they've hit 50 or 55 or whatever that stage is when they've made all the money they need to make--they start thinking more philosophically about the sort of footprint that they will leave. Some of the CEOs are our strongest supporters.

What are your expectations for this week's BELC meeting?

Claussen: This is a difficult time for everyone on the issue of climate change. Does Kyoto have a life or not? What's going to happen--or not happen--on the Hill and in what kind of a time frame? What exactly do we want either internationally or domestically? So, this meeting is a sort of policy and politics session where we hope to forge some consensus on where we are. And so we've got Senator Hagel coming for dinner; we've got people from the White House who manage the climate change process coming in; we've got the new Undersecretary of State coming--all to give their views. And then we have time set aside to talk through where we ought to be going and how we ought to get there.

Does your government experience provide you with a unique perspective for heading up an NGO?

Claussen: I think it does give me a somewhat different perspective than lots of people and, in the end, I think that's what makes this a unique place. When I was in the government in the early stages, I felt that it was the job of the government to get things done. Gradually, I've changed my view about how to get things done. That isn't to say that government doesn't have a strong role to play, because I think it does. But the fact is that government can't do things by itself and that's really where NGOs play a critical role. I think being an NGO with some business affiliation makes us an even richer group to deal with. That was one of the reasons why, when I started the center, the BELC was front-and-center. I didn't think--and I still don't think--that you can get anything done without some support from business.

You have referred to the term "environmental governance." What does that mean?

Claussen: It's how to get something done on an environmental level. Our politics are such that it requires government, NGOs and business working together. Is one more important than another, or could it be done with just two? Maybe, but I can't think of a single case where you haven't needed the third--or at least a portion of the third--to get something done.

Do you think NGOs are more powerful today?

Claussen: There are many more of them now, and I think they've changed over time, also. They're now like little mini-think-tank advocacy organizations. Could you get a bill passed on the environment without the support of some environmental NGOs? I don't think so. Could you do it without some support of business? I don't think so either. And if the government was totally opposed to it, you couldn't get it done either. So I think in the end you need some combination of all three--and I shouldn't leave out the broader public, because if there's no real public interest expressed on these matters, I'm not sure you can get anything done either.

Do you work with other NGOs on a regular basis?

Claussen: "Work with" is probably too strong a term. Do we talk to the NGOs on this issue all the time? Yes. Do we agree all the time? No. Do we have some of the same sort of ultimate objectives? Yes, but I think we often have very different ways to get there. Many NGOs are far more aggressive than we are. I often describe us as "practical." We try to be pragmatic, and we believe in incremental progress. You have to build on something. It doesn't happen overnight. You've got to keep moving in the right direction.

You advocate making incremental progress. Do you think this is something being considered by the parties involved in the Kyoto negotiations, especially at the meeting in Bonn?

Claussen: I think everybody now is trying to lower expectations for Bonn, which is really what they should have done for The Hague. The Japanese have signaled that they don't have to reach any decisions in Bonn, which means to me that the Europeans won't try to make any decisions either because, if they want Kyoto to enter into force, they need the Japanese. I can't imagine that any decisions will get made there.

Do you think the Kyoto Protocol, in its current framework, is going to happen?

Claussen: It's very hard to predict. It will only happen as an international treaty if the Japanese decide that they want it to happen because you need 55 countries representing 55 percent of developed country emissions for it to go into effect. So you need more than Europe--you basically need the Japanese. The signals from the Japanese have been that they're not willing to go without the U.S., and I don't see this administration moving forward with it. But it's possible that the Japanese may decide in October or November that, in fact, even though this administration isn't moving forward, maybe they should. So it's not impossible that Kyoto is the framework, but if not, then we had better figure out what the best substitute is. I think it would have at least some of the elements of Kyoto. I think it has to have mandatory commitments of some kind or another. I believe the things that work are performance-based standards with lots of flexibility in how you meet them as long as it's legitimate and you can be held accountable. Some of those things you would want in any international agreement, but you may, in fact, have to go back and create something that's a little different.

What is it going to take to see a change?

Claussen: During the Reagan administration, I worked on the Montreal Protocol. The administration's overall view at the time was that the U.S. should not do something unless there was an international agreement in place. And so when the government was sued by NRDC to take some action under a provision of the Clean Air Act, the response of the Reagan administration was, "We first need to negotiate an international treaty and then we'll play our part." And that's pretty much how it worked out: the Montreal Protocol was negotiated, the Senate ratified it, there was implementing legislation and the U.S. moved ahead and met its obligations.

In this case, it may be that it's going to work in reverse: it's going to take domestic legislation first for people in the administration to say, "My goodness! If Congress has passed some laws requiring us to do this, maybe we need everybody else." Maybe that's the way you back into an international agreement. I'm not sure that the current administration, at least, will try to do it in the same way as Montreal. And I think there's a lot of interest on the Hill in taking some action, and there's a very good chance, I think, that we get domestic legislation in the next 12 months--maybe not everything, but at least some sort. So it may just go the other way.

Does the public play a role?

Claussen: In all the polling, the public says it is in favor of taking action on this, and they even say that they're in favor of spending a little more to do so. It's not clear that they've made the connection between what they do and this problem. I'm not sure anyone has educated people on this very well. I can't tell you how many senators I've talked to from states in the middle of the country, in particular, who say, "I'm interested in this subject, but when I go out to my district or my state, no one ever raises it. So if I'm going to do something, it's all on my own and I have to be careful where I am on this." I think there's general public support, but not a whole lot of public pressure. But that aside, you now have a whole set of people, in the senate in particular--bipartisan--who say, "We have to do something about this." That's why I think we actually will see some legislation.

On-line Climate Resources

Pew Center on Global Climate Change
www.c2es.org

Intergovernmental Panel on Climate Change
www.ipcc.ch

National Oceanic and Atmospheric Administration
www.noaa.gov/climate.html

United Nations Framework Convention on Climate Change
www.unfccc.de

U.S. Department of Energy
www.energy.gov/world/sub/globalwarming.html

U.S. Department of State
www.state.gov/www/global/global_issues/climate/index.html

U.S. Environmental Protection Agency
www.epa.gov/globalwarming

United States National Assessment
www.nacc.usgcrp.gov

 

What's happening at the state level?

Claussen: There are many state energy offices that are very interested in moving this issue. There are some state environmental agencies, but for the most part the energy offices are further along. And that applies some amount of pressure. But what we don't have yet, for example, is a good bipartisan group of governors that are saying, "We've got to do something about this." They're not quite there yet. We have some governors who are doing great things, but we don't have enough of a group. But we're starting to see some of that and, as I said, I think we've got huge bipartisan interest in the Senate, and the beginnings of a group of moderates emerging in the House.

Does your work reach into those political arenas?

Claussen: In the last six months, I think we have visited about 130 congressional offices to talk about this. It's been totally bipartisan. It's even been some people who I wouldn't have thought would have much interest in this, but who actually do have significant interest. I think we're going to see a whole lot of bills being put on the table, and you're going to start to see some coalescing around that.

Is it possible to take politics out of the global climate issue?

Claussen: You can make a fair argument that things are sort of moving in that direction and, over time, they may get there. I think it's very slow if you don't have the right signals to the marketplace about where you have to go, and those are, in a sense, political signals. I don't think they've been given very clearly and, certainly, they haven't been heard by a lot of people, particularly in this country. Some of that is what needs to happen. The government is not going to tell you exactly how to make the transition because that's not something governments know how to do. The reality is that it is up to the private sector, but they need the right signals. They need to know that the investments they make today are going to have a fair chance of working out in the long-term, and those are signals that have to be set by governments. So there's really an important role here for governments.

Will businesses make significant commitments without those signals?

Claussen: Some of them are starting to. There's one company that always says, "I'm doing all this stuff, and I keep looking over my shoulder and hoping that there's someone behind me from the government. Not only are they not ahead of me, but I don't even see them in back of me." That's an uncomfortable place for businesses to be.

What specific kind of incentives could government put in place?

Claussen: I think you need a combination of carrots and sticks. You've got to have enough carrots to get the technology moving. You have to have some sticks so that people know that they have to do it. We need a combination where you don't have to be onerous in the beginning, but you've got to set things in motion. One of the problems is that we think we need something that's mandatory--that runs across the board. But mandatory doesn't mean stringent. It doesn't mean you have to try to do everything tomorrow. It just means that everybody has to start moving and doing something.

I think we need some kind of a limit on emissions. It doesn't have to be seven percent below 1990 levels when we're already 12 percent above them, which is sort of where we are, but you can at least start moving in some reasonable direction because we should be on a different path, not on a growing emissions path.

Does the Center originate any of the ideas for legislation?

Claussen: In a broad sense, yes. Probably the closest that we've gotten so far was a paper I did for the American Enterprise Institute. It talked about what we need to do to get on with the dialogue about global climate change. It has a lot of information on legislation. It talks about what steps you could take to get something done. We're also doing a set of policy briefs, which are short, five-page papers on items of interest to the Hill. One is going to be a domestic policy piece; another will be on a foreign bill because there are some possibilities for action on that.

Do you have any international organizations that are coming into the fold?

Claussen: It's interesting that you asked this. We have a certain number of companies in our business group that are headquartered outside of the U.S. But we've actually had a whole lot of people from two counties say, "Can't we have a Pew Center here?" Canada is one, and Australia is the other. In two weeks I'm going to Australia at the invitation of the environment minister and the business community there because they want some advice on whether they can set up a Pew Center--either a branch of us or their own version of the center. One of the things that's important, I think, is that we don't get our funding from our member companies. We simply agree that we want to work together. That's a different dynamic and, in fact, that's one of the issues in Australia. They don't have charitable foundations or a tax structure like ours, and they aren't sure how this kind of thing can be funded.

 

What accomplishments are you most proud of?

Claussen: First, putting together the BELC companies because I think they're a terrific and diverse group--almost all sectors represented, a lot of big players. Also being a voice that people want to listen to. When we started this, we entered a crowded field with plenty of voices out there. We decided we wanted to be one of the voices that people would turn to whether they were in the administration, whether they were people on the Hill or whether they were people in other countries. I think we have established ourselves as a place to go to for straight answers, reliable information and good guidance.

Moving Forward at Home and Abroad

The following text was excerpted from a paper Claussen submitted to the American Enterprise Institute. In it, Claussen addresses what she believes are the real hurdles on the domestic front for truly addressing climate change: serious and sustained effort across virtually every sector of the U.S. economy. "Ultimately, what the United States can deliver internationally hinges on what it can and is prepared to do at home," she writes. "For the United Statesand hence, the worldto effectively combat climate change, it is critical that our domestic and diplomatic strategies proceed in tandem."

U nfortunately, she noted, they have not.

 

Claussen offered the following ideas on what would constitute an effective domestic program to reduce greenhouse gas emissions.

"To effectively address climate change, we need to lower carbon intensity, become more energy efficient, promote carbon sequestration and find ways to limit emissions of non-CO2 gases. This will require fundamentally new technologies, as well as dramatic improvements in existing ones. These changes can be introduced over decades as we turn over our existing capital stocks and establish new infrastructure.

"Three decades of experience fighting pollution in the United States have taught us a great deal about what works best. In general, the most cost-effective approaches allow emitters flexibility to decide how best to meet a given, binding emissions limit; provide early direction so targets can be anticipated and factored into major capital and investment decisions; and employ market mechanisms, such as emissions trading, to achieve reductions where they cost least. To ease the transition from established ways of doing business, targets should be realistic and achievable. What is important is that they are strong enough to spur real action and to encourage investment in development of the technology and infrastructure needed to achieve the long-term objective.

"A good first step is to get our house in order by immediately requiring accurate measurement, tracking and reporting of greenhouse gas emissions. Public disclosure of the reported data, similar to what is required for certain pollutants under the federal Toxic Release Inventory (TRI) program, would encourage companies to hunt for ways to reduce their greenhouse emissions.

"There are other ways we can and should spur companies to act ahead of any mandatory requirements. One is for the government to enter into voluntary enforceable agreements with companies or sectors willing to commit to significant reductionseither in process emissions or those from the use of products they make (e.g., automobiles or washing machines). In exchange for its commitment, a company or sector should be guaranteed that it would not be bound by subsequent mandates for greenhouse gas controls over the same time period. A similar approach could encourage companies, particularly in the electric utility sector, to cut carbon emissions as they undertake air pollution reductions required by existing law--a more cost-effective way to achieve multiple environmental objectives.

"A good first step is to get our house in order by immediately requiring accurate measurement, tracking and reporting of greenhouse gas emissions."

"While such efforts can help get the United States on track, the long-term emission reductions needed can be achieved only with a far more comprehensiveand bindingstrategy. Alternative approaches should be closely studied, and the results publicly debated. But much of the analysis thus far suggests that a "cap-and-trade" systemwhich sets an overall cap on emissions and establishes a market in carbon creditscan provide the private sector the flexibility and incentive to achieve emission reductions at the least possible cost. As yet, no economic model can accurately account for factors (such as the rate of technological change) that are key to assessing the long-term costs and benefits of a serious climate strategy. However, the best analyses to date suggest that the costs are reasonable, particularly when weighed against the serious and significant costs of not acting.

"Ideally, a domestic climate strategy, particularly one employing emissions trading, would be coordinated with those of other countries under the aegis of a binding global framework. And this brings us back to the question of a constructive, credible U.S. position in the international negotiations set to resume in July in Bonn.

"In broad terms, an international climate agreement must meet three fundamental criteria if it is to be effective: it must be environmentally sound; it must be cost-effective; and it must be fair. To be environmentally sound, an agreement must ensure that emissions actually are reduced over time to levels that achieve safe, stable atmospheric concentrations of greenhouse gases. This, again, will require economically achievable binding targets. And any agreement should include a strong compliance mechanism to ensure that the targets are met.

"To be cost-effective, an agreement must allow nations to meet their targets flexibly and at the least possible cost. International emissions trading and other market-based mechanisms can help direct capital toward least-cost reductions. Other flexible approachessuch as allowing credit for sequestration of carbon in trees and soils and measuring all greenhouse gases, not just carbon dioxidealso can help achieve reductions where they are most cost-effective. While the Kyoto Protocol includes all these provisions, there is still no agreement on the rules for implementing them. Bad rulesfor instance, an arbitrary cap on the portion of a nation's target that could be met through emissions tradingcould drive up cost, with no environmental benefit.

"Fairness could prove the trickiest of the three criteria. An international agreement will not work unless, in time, it entails binding commitments by all major emitting countries. The Framework Convention, signed by Bush the elder and ratified by the U.S. Senate, rightly commits developed countries to taking the lead. And as a practical matter, developing countries will not (and as a matter of principle, they should not be asked to) make binding commitments until the developed countries demonstrate real progress in reducing their own emissions. Ultimately, the parties must decide whenand in what mannerdeveloping countries will be required to act. But for the moment, the best that can be hoped for is some formal acknowledgement by all parties that those issues will be squarely faced by a certain date.

"We stand at a critical juncture, and whether nations can agree on a common path forward depends heavily on decisions now being weighed at the White House. The United States bears a special responsibility here, because we account for roughly a quarter of global greenhouse gas emissions and also because our economy is the largest and most vibrant in the world. If the United States wishes to be a leader in this global effortrather than sit on the sidelines as other nations push ahead with the Kyoto Protocolit must come forward with a credible proposal that provides a basis for further negotiation. To be credible, though, the United States must demonstrate that it is prepared to back up commitments abroad with real action at home. This requires a comprehensive climate policy that moves us forward, in a coordinated fashion, on both the domestic and the international fronts. We must close the gap between what we promise and what we can deliver."

 

Copyright © 2001 green@Work. All Rights Reserved.