CNBC's Carbon Council Backs Cap and Trade
"We at Suntech Power, the largest global producer of crystalline silicon solar panels, can see how carbon policies -- of either Cap and Trade or carbon tax approaches -- will spur job growth around the world and offer climate protection at a net economic benefit. We believe that either a Cap and Trade or a carbon tax could help stimulate demand for solar if designed well.
But companies and investors can not and will not invest to the scale needed to rise to our challenge without some sort of policy certainty. Since a carbon tax is usually politically more challenging, we support the nearer-term certainty from cap and trade mechanisms. Even so, there are many design elements which could weaken demand for solar if not designed properly, such as the number and system of awarding allowances, and the standards and limitations on offsets."
Hans Wijers, CEO of AkzoNobel (The Netherlands)
"Within a range of possible trading schemes, Cap and Trade is the only one that is guaranteed to reduce emissions, as the amount of allowed emissions is 'capped.'
Setting the right cap is not simple but achievable. We do need a global price on CO2 that is high enough to accelerate the transition to a low carbon economy. The sooner the price mechanism is in place the better. The longer we wait the less affordable climate change mitigation will become. The perspective of a low-carbon, sustainable society does not need to be positioned as a risk to sustainable economic business success.
But let's turn it around and look at the bright side and position the journey to a low carbon economy as a paradigm shift, requiring a step change in technological development. W can create a society that will create many exciting, inspiring and challenging jobs."
Leo Apotheker, CEO, SAP (Germany)
"We as a global society must put a price tag on carbon to make 'green energy' a priority in today’s market. Associating a cost with carbon emissions creates a powerful mechanism to offer financial incentives for those who work toward and engage in a low-carbon economy.
Cap and Trade, taxing carbon, and subsidizing 'green energy' are all promising approaches that can be leveraged to ultimately urge societies to reduce emissions. For example, in Germany green energy subsidization has allowed for 14 percent of wind power and 4 percent of solar power to be supported through private investment.
A price on carbon will encourage innovative companies to continue to invest in and develop effective technology solutions to manage emissions.
At SAP we believe that technology is key to providing transparency and clarity into a company’s environmental footprint, and that it will also drive greater energy efficiency and resource productivity across all aspects of business. Stakeholders are increasingly demanding that businesses address sustainability holistically, from an economic, environmental, and social standpoint."
Mike Mack, CEO, Syngenta (Switzerland)
If we agree that cutting greenhouse gas emissions globally needs urgent action to counteract its effects on our climate, a Cap and Trade -- though still an imperfect mechanism -- may be today’s first-best option. However, we should not stop there and instead continue to look for improved or better alternatives.
But a Cap and Trade agreement is not the entire solution. Additional steps can be taken to mitigate emissions, simply by using existing materials, know-how and technology. While future innovation and research will help, and certainly governments should get behind them, we should look at the landscape around us and focus on what can be done today.
And agriculture needs to be part of that landscape. Globally, the sector adds one third of all man-made greenhouse gas emissions. But it also has the potential to significantly decrease the amount of carbon in the atmosphere. Farmers can adopt plant and soil management practices that will sequester carbon in the soil, such as switching to conservation tillage farming and simply stopping the conversion of natural habitats to arable lands which leads to a significant loss of biodiversity.
Incentives from a cap and trade mechanism would encourage these practices. Farmers could sell earned offsets from carbon sequestration to companies looking for ways to compensate for their own emissions. Since new carbon policies will likely result in overall rising energy costs, offset revenues to farmers will help ensure that solving the carbon challenge doesn’t further exacerbate a food security challenge.
Ultimately, addressing these challenges will require changing government policies, but also significant changes in mindsets and personal behavior. In the end, this will change the economic self-interest of companies and people around the world. With more than a third of the world population living and working on farms, we should not overestimate the enormity of this undertaking.
John Rowe, chairman and CEO, Exelon Corp.