The Heat Is Online

USCAP Firms Found Funding Skeptic Groups

Green -- Up to a Point

Despite their eco-rhetoric, some USCAP members are supporting efforts to undermine restrictions on carbon dioxide emissions

When 10 of the largest U.S. corporations and four environmental groups joined forces last January to lobby for federal regulations to restrict greenhouse-gas emissions, it was seen as a watershed in corporate environmentalism. The U.S. Climate Action Partnership (USCAP), comprising 27 companies from General Electric to General Motors, won praise from enviros by endorsing cuts10% to 30% of heat-trapping emissions within 15 years and 60% to 80% by 2050to avert some of the severest consequences of global warming.

Behind the scenes, however, several companies that belong to USCAP are simultaneously supporting efforts and organizations that oppose mandatory cuts in greenhouse gases or promote policies that would make the USCAP reductions nearly impossible to meet. "Many of these companies want the image of being green but are putting their money on the other side of the issue," says Frank O'Donnell, president of Washington-based Clean Air Watch.

Divided Loyalties

Three high-profile USCAP membersGeneral Electric, Caterpillar (CAT), and Alcoa (AA)also sit on the board of the Center for Energy & Economic Development (CEED), an Alexandria (Va.) group formed in 1992 that opposes regulations on greenhouse-gas emissions. In April, 2007, CEED's board unanimously signed a position paper that, in part, described as "draconian" one federal climate bill that would require a 65% reduction in emissions by 2050.

GE says it agrees with CEED that coal must play a key role in the future energy mix and that it is pursuing ways to burn coal more cleanly. Caterpillar says it agrees with CEED on most issues, except in some areas of climate policy. Alcoa says it will examine its membership in CEED and likely withdraw. "It does not reconcile with what we're doing under USCAP," says Alcoa spokesman Kevin Lowery.

Duke Energy (DUK), which supplies power to more than 4 million Americans and is the country's No. 3 emitter of greenhouse gases, seems similarly conflicted. At the USCAP launch a year ago, Duke CEO James E. Rogers endorsed the coalition's aims. "The science of climate warming is clear," he said. "We must act now." Seven months later, Duke joined Americans for Balanced Energy Choices (ABEC), a group hatched by CEED in 2000 that advocates expanded coal use. ABEC has tripled its budget this year, to $35 million, and is mounting campaigns to support construction of coal plants in several states. In Kansas, ABEC staffers recently stumped for a new coal plant after a state regulator denied the plant's air permit because of global warming concerns, a first in the U.S.

A Deeper Hole?

More coal-fired power plants would make USCAP's proposals almost impossible to achieveparticularly its near-term goal of a 10% to 30% cut in 15 years. Burning coal for electricity is already the nation's largest source of greenhouse-gas emissions, and the process of capturing and burying carbon dioxide, long hailed as the best solution to the problem, is at least a decade or two from widespread adoption. "If you're serious about stopping climate change, you don't dig the hole deeper by building new coal-fired power plants," says Bruce Nilles, director of the Sierra Club's coal program.

Duke, which itself is building two coal plants, says it needs to balance environmental concerns with growing demand for affordable energy. "We need to talk about how to build a bridge to a low-carbon world without adversely impacting certain groups of people in this country," says Rogers.

Green Efforts Mocked

Other business groups are also stepping up opposition to global warming regulations. At the end of 2007, the U.S. Chamber of Commerce launched a television commercial that lampooned carbon reductions, depicting a family sleeping in full winter garb, a man cooking eggs over candles, and people jogging to work in business suits, while the narrator intoned: "Climate legislation being considered by Congress could make it too expensive to heat our homes, power our lives, and drive our cars." Eight USCAP membersChrysler, Deere (DE), Dow Chemical (DOW), Duke Energy, GE, PepsiCo (PEP), PNM Resources, and Siemens (SI)sit on the Chamber's 113-member board. According to William Kovacs, the Chamber's vice-president of environment, technology, and regulatory affairs, nobody argued to change the Chamber's environmental policy.

The ad campaign hit a nerve at Environmental Defense, one of the groups that helped launch USCAP. David Yarnold, executive vice-president of Environmental Defense and a communications coordinator for USCAP, dashed off a letter to the companies in question. "As a member of the board of the Chamber, I urge you to use your influence to bring the organization to a more productive position on this issue," he wrote. But the Chamber's Kovacs says he hasn't felt any pressure since. In fact, he says, the Chamber just launched a new ad to coincide with the Feb. 20-22 U.N. climate meeting in Monaco. The ad points at the carbon-spewing travel undertaken by all of the international organizations that meet routinely to discuss global warming.

How much longer will USCAP's true believers allow some members to play both sides? "We don't want to give members a free pass," says David Hawkins, director of the climate center at Natural Resources Defense Council, which belongs to USCAP: "We do expect them to exert pressure on other organizations."