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Gary Hirshberg

Gary Hirshberg

Posted: January 18, 2010 10:36 AM

Let's Price Carbon Now, for Business' Sake

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Now that Congressional action on healthcare appears to be concluding, it's time to attend to the other 500-pound gorilla in the Senate cloakroom: climate legislation.

The good news is that when it comes to global warming, the only thing the U.S. has more of than culpability is opportunity. The most serious problem our species has ever created, climate change is not just coming, it is here. Its scale and impacts are not just increasing, they're accelerating. Tipping points to irreparable damages are very close, and some may have been crossed already.

With global warming now startlingly evident, fossil fuel interests are shifting from scientific to economic diversions - modeling the economic harm that will purportedly result from controlling greenhouse gases (GHGs). But we've seen these scare tactics before. Removing lead from gasoline was going to bankrupt the oil companies. Requiring seatbelts would cripple auto sales. Acid rain, smog, and mercury controls would cause blackouts. Such claims weren't believable then, and they're not believable now.

Besides, Congress should be guided less by economic models and more by economic reality. The on-the-ground experience of companies already cutting GHG emissions illustrates the opportunity for our national economy.

Stonyfield Farm is a good example. We started calculating our carbon footprint in the early 1990s. With little more than our mission and elbow grease, our employees raced up the learning curve. Contrary to conventional wisdom about "low-hanging fruit," we found that our list of innovation opportunities grew rather than shrank. Even after over a decade of effort, recent accomplishments astonish: each cup of Stonyfield yogurt required 19% less energy than in 2007, saving more than $500,000 per year. Packaging innovations shed 600,000 pounds of plastic, saving $780,000. Transportation GHG emissions dropped 40% from 2006 to 2008, saving $2.5 million. Building a digester to treat our wastewater converted an environmental concern into a source of clean energy, saving another $500,000 over two years. Our Greener Cow project even discovered how to cut GHGs from cows 12% and boost Omega-3's 29%. More natural feed produces fewer cow burps, healthier cows, healthier milk, and healthier consumers - a classic "win-win-win." All of these efforts have created or saved jobs.

Stonyfield's experience isn't unique. Companies across the U.S. are finding cost savings and competitive advantage through efficiency. Nike reduced GHGs from its operations and travel by 18% from 1998 to 2005, despite an increase in square footage. Sun Microsystems reduced its U.S. GHG emissions 23% between 2002 and 2007. Gap Inc. sought to reduce its stores' energy use by 11% from 2003 to 2008, and cut it by 12% by 2007. Timberland has targeted a 50% reduction in absolute GHG emissions by 2010 from 2006 levels. Wal-Mart's new stores are expected to cut energy use by 30-50% and save five million gallons of water per year. Some big companies, like Dow and DuPont, have saved billions of dollars through efficiency since the early 1990s.

As good as these efforts are, they need to go broader and deeper throughout the entire economy if we are to keep the Earth's climate in check. That won't happen on its own, so Congress should hasten to impose a market price signal on U.S. heat-trapping emissions. If Congress can't get its act together promptly, then the U.S. Environmental Protection Agency needs to move ahead with regulating GHGs under the federal Clean Air Act.

It's also a critical time for the global economy. Successful companies and economies "retool" during downturns to boost future productivity. A wave of innovation and jobs in energy technologies is emerging. The resulting energy transition will likely echo or exceed the tectonic decentralizations we've already seen in computing and telephony. The investments that will lead this charge are already being made, but many other nations are already way ahead of us when it comes to aggressive energy and emissions reductions.

Washington's best contribution would be to "just say no" to fossil fuel interests by putting an appropriate price on carbon - right now. Then it should get out of the way of businesses that are striving to help our nation meet the opportunities of the 21st century. Morphing our energy system from its historical fossil focus to a new emphasis on efficiency, innovation, renewables, and distributed generation will provide innumerable new revenue sources and businesses, save money (and keep it closer to home), create millions of new jobs, enhance our global competitiveness, boost national security, and improve public health.

What on Earth are we waiting for? Let's get on with it.


Gary Hirshberg is CE-Yo of Stonyfield Farm, the world's leading organic yogurt company. Ken Colburn, who directs Stonyfield's environmental policy efforts, also contributed to this piece.