Carbon Pollution Standards Make Sense for Business
By Steve Schueth
On Monday, President Obama proposed the biggest action we have seen in years to fight global warming. The EPA is setting the first-ever limits on carbon pollution from existing coal-fired power plants—the single largest source of global warming pollution in America. The New York Times is calling this the biggest action on climate ever by a U.S. president.
In light of this fact, and the fact that First Affirmative strongly supports this action, the following opinion piece (Op Ed) has been submitted to several news outlets in Colorado.
Climate change is impacting economic growth in Colorado, the United States, and around the globe. This week, the Environmental Protection Agency (EPA) released groundbreaking standards designed to reduce carbon pollution from existing power plants. These standards will provide Colorado an opportunity to build on its successes in scaling clean energy. This is not only an important step in reducing greenhouse gas emissions, but also an opportunity to catalyze renewable energy for cleaner air and economic growth.
Well designed and properly implemented carbon pollution standards should serve to accelerate a shift toward renewable energy and a lower carbon economy. My firm, Colorado-based First Affirmative Financial Network, has joined nearly 50 investors managing $800 billion in assets in a letter supporting the creation of these regulations and calling on states like Colorado to work with the EPA to reduce carbon emissions.
Opponents of the new standards express concerns about increased electricity prices and new costs that they believe will hurt the economy and jobs. Our experience in Colorado is just the opposite. The Colorado Renewable Energy Standard has helped build renewable energy generation equivalent to the output of two nuclear power plants while employing over 20,000 people. Colorado is now home to both the 10th largest solar photovoltaic market and the 10th largest wind market in the U.S. The new standards will facilitate and strengthen the creation of new and innovative industries.
The benefits of transitioning to renewable energy sources extend beyond good economics. Reducing carbon emissions will improve the health and quality of life for future generations. Renewable energy from solar panels, wind turbines, and rechargeable batteries also conserves precious water resources, an important consideration for Colorado.
Investors seek long-term policies that can stimulate investments in clean-energy technologies and limit the risks of climate change. First Affirmative was one of the nearly 300 investors managing, in aggregate, an excess of $20 trillion that signed the 2011 Global Investor Statement on Climate Change, which stated, in part: “Private sector investment will only flow at the scale and pace necessary if it is supported by clear, credible, and long-term domestic and international policy frameworks that shift the balance in favor of low-carbon investment opportunities.”
First Affirmative joined with over 750 businesses—including Apple, General Motors, and Nike—to publicly express support for action on climate change, signing a Climate Declaration. Instead of viewing these standards as a drag on the economy, the business and investment community view them as creating economic opportunities and encouraging innovation. Companies in Colorado are leading the charge, with REI, Ikea, and Whole Foods investing in solar panels on store roofs, and Vestas, a wind turbine manufacturer, adding local jobs to meet increasing demand for their products.
The Carbon Pollution Standards can offer enormous investment opportunities which investors and business executives should consider. They also offer investors what they crave most: certainty. Standards for power plants should send long-term market signals to drive greater investment in low-carbon electricity and help spur the transition to a clean energy economy.
We are in the midst of a shift in our thinking regarding climate change—and the business risks and opportunities it holds. Carbon Pollution Standards, properly implemented, are an essential ingredient to this transformation and can provide significant opportunities and benefits to consumers, companies, and governments now and for generations to come.
Mention of specific companies or securities should not be considered a recommendation to buy or sell that security. Past performance is no guarantee of future results.
Steve Schueth is President of First Affirmative Financial Network, LLC, based in Colorado Springs, Colorado, with an office in Boulder, Colorado. First Affirmative is a member of the Investor Network on Climate Risk and a Certified Benefit Corporation.
Posted: June 5, 2014