California's Cap-and-Trade Program is Alive and Well

This is the eighth installment in a series of posts on California's climate leadership. These posts address a wide range of related topics including economic benefits and renewable energy.

With unprecedented bipartisan support, California lawmakers have voted to extend the state's cap-and-trade program. This carbon pricing program is key to meeting California's ambitious carbon reduction targets. The plan puts a statewide cap on greenhouse gas emissions and allows companies to buy and sell pollution credits.

Sustainability Comparisons Between Rio 2016, the Sochi Winter Olympics and the Brazilian World Cup in 2014

The Rio Summer Olympics do not compare favorably to the Sochi Winter Olympics and the Brazilian World Cup in 2014. This is a damning indictment given that Russia's Sochi games were colossally corrupt. Sochi clearly illustrated that Putin's promise of green games was little more than a farce and an Olympic sized example of greenwashing.

There have been protests against the Rio games across Brazil but they are much smaller than the protests against the World Cup in 2014. At that time there was a popular outcry against an expensive sporting event while the country struggled with widespread poverty and inequality. The same criticisms are warranted in the case of the Rio games.

Sustainability at the Rio Olympics: More Green Promises More Green Lies

Olympic games are becoming increasingly environmentally sustainable, at least on paper. Once again this year's Olympic games are touted as being the greenest games ever. In fairness, making such a massive event environmentally sustainable is a truly herculean undertaking.

Over the last twenty years there have been a number of efforts designed to make the games more green. In 1996, the Olympic Charter was amended to recognize the environment as the third pillar of Olympism. This was followed by clearly defined policies associated in the IOC's Olympic Movement's Agenda 21.

Brazil's Corruption, Socioeconomic Woes and Political Intrigue Overshadow the Olympics

The scourge of corruption has embroiled Brazil in a morass of complex political intrigue. Brazil's economy has contracted by 3 percent this year and although the country is in a deep recession, it is still the world's fifth largest economy. Brazil's difficulties extend far beyond serious fiscal hardships, the nation is also rife with sexism, racism and human rights abuses.

In May of this year Brazil's President was suspended after holding office for less than six years. Despite pulling millions of people out of poverty, a majority of Brazilian senators voted to launch an impeachment trial against President Dilma Rousseff. She is the country's first female President and her government swore in 15 female ministers. Rousseff is a 68-year-old economist and she was removed amid allegations that she broke budget rules and manipulated economic data.

Agreement on a Pan-Canadian Carbon Pricing Scheme

It looks as though Prime Minister Justin Trudeau's Liberals are moving forward with a national carbon pricing scheme albeit adapted to regional circumstances. On Thursday March 3, 2016, Trudeau announced that the federal government along with all ten provinces have agreed to a "comprehensive and ambitious plan" to put a price on carbon.

Carbon pricing (which includes both cap and trade and a carbon tax) leverages the market to disincentivize emissions intensive activities by making them more expensive while incentivizing low carbon technologies. In effect carbon pricing integrates the true cost of carbon which is currently not reflected in the market. Carbon pricing is the best way to help governments reduce emissions while minimizing economic impacts.

Obama Proposes Oil Tax and Clean Energy Infrastructure Investments

President Obama has recently proposed an oil tax and a clean energy infrastructure investment plan that would create a “more integrated, sophisticated and sustainable transportation sector." The proposal is part of a budget request that calls for annual spending of $32 billion and it will be paid for with a $10 a barrel oil tax. The ten year 320 billion is designed to finance a 21st century clean energy infrastructure in the US. This includes annual spending of $20 billion for national transportation initiatives, $10 billion in for cities and states and $2.4 billion for green vehicle research.

Video - Companies Combating Climate Change (CDP Report)

In this video, Lord Adair Turner, Former Chairman of the Financial Services Authority, James Bevan, Chief Investment Officer at CCLA and Paul Simpson talk about the CDP report which ranks companies in terms of their climate performance. This report comes on the heels of Standard & Poor's Ratings Services which stated that climate change will hit countries' economic growth rates and public finances. Former U.S. Treasury Secretary Henry Paulson recently said that climate change is, "the single biggest risk that exists to the economy today."

The Best and the Worst Climate Performers (CDP)

In addition to ranking corporate leaders, the most recent CDP report lists the leading sectors in terms of climate performance. It reviews regional and national climate leaders and laggards. The report also singled out a few large corporations which refused to disclose their climate performance data. Performance leaders are those who received an "A" grade in the report.

According to the CDP, the sectors most represented in the 2014 Climate Performance Leaders Index are Information Technology, Financials, Consumer Staples, Consumer Discretionary and Industrials. Together these four sectors constitute 86 percent of the A list index.

According to the CDP's climate performance list, almost half of the leaders are based in Europe, with a further third located in either the US or Japan. More than a quarter of the Spanish and Belgian companies that took part in CDP’s climate change program were awarded an A rating. Other nations that performed well are Portugal, the Netherlands and South Korea.

By contrast, the laggards on climate performance are Canada, Switzerland, Australia and China.

Climate Action Enhances Profit by 9.6% (2014 CDP Report)

Engaging climate change is becoming almost synonymous with profitability. According to a new study, the more a company does to address climate change the more it appears to profit. This is a solid refutation of the conservative line the we simply cannot afford to manage climate change. It flies in the face of the false argument that we must chose between combating climate change and economic growth.

Companies from Apple to Zurich are showing climate leadership is not only a corporate responsibility it is also spawns a bevy of bottom line benefits. According to new research from CDP, companies that assume the responsibility to engage climate change outperform their peers. In fact, in the period between 2010 and 2014, companies that showed leadership through action to mitigate climate change outperformed the Bloomberg World Index by 9.6 percent.

Sustainability is Profitable According to the CDP's 2014 Climate Change Report

Some interesting insights came to light in the 2014 version of the annual CDP S&P 500 Climate Change Report. Overall the report suggests that companies in the S&P 500 are actively managing and planning for climate-change and the companies that do so are more profitable. The report indicates that for companies that are addressing climate change the return on equity was 18 percent higher than their peers and 67 percent higher than companies who do not disclose on climate change. The dividend yield for shareholders was 21 percent stronger then low ranking peers.

Further their results indicate that such efforts make them more stable with 50 percent lower volatility earnings over the past decade than low ranking peers.

As explained in the report, "Investors should take note that the debate has squarely moved from the moral to the material and should reward climate leaders with higher valuation multiples."

CDP Climate Disclosure Leaders List 2014

CDP Climate Performance Leaders List 2014

Event - 24 Reasons for Hope

This event calls each one of us to do our part to combat the climate crisis. We have to get beyond the dire scientific predictions warning us about rising seas and devastating drought. It is time for hope, time for us to realize that we have a choice to do something about the climate crisis. It is time for us to act. This movement encourages people to "dedicate a day for action." This can include anything from voting to marching to speaking out in your community.

The Merits of Carbon Pricing in B.C.

Although the ruling Conservative federal government has fought any mention of a national carbon tax, individual provinces like British Columbia (B.C.) are moving forward with their own initiatives.

B.C. enacted a carbon tax in 2008 that covers about 70 percent of fossil-fuel consumption. B.C.’s carbon tax is currently pegged at $30 a ton. It has helped the province’s per-capita emissions decline almost 10 percent from 2008 to 2010. B.C.'s carbon tax has also played an instrumental role in convincing the US states to embrace carbon pricing. B.C. forged an agreement with Washington, Oregon and California to create the Pacific Coast Action Plan on Climate and Energy. Their plan is to prioritize clean energy and innovation through a strong economic incentive provided by a carbon tax or form thereof. These jurisdictions collectively represent 53 million people, and an economic region with a combined GDP of $2.8-trillion — making it the world's fifth-largest economy.

Environmental Legislation in Ontario in the Wake of the Liberal Majority

A number of environmental bills have been stalled by the provincial election in Ontario and opposition from the Progressive Conservatives. The June 12 provincial elections saw Ontario dodge a bullet by resisting the Progressive Conservatives. Led by Kathleen Wynne the Liberals managed to win a majority. Wynne assumed the leadership of the Ontario Liberal Party in January 2013. She was more progressive and green focused than her scandal laden predecessor Dalton McGuinty. The leader of the Ontario NDP brought down the minority Liberal government due to her refusal to support the budget. While Tim Hudak and the Progressive Conservatives were predictably reluctant to support environmental legislation.

The US and China Working Together on Climate Change

The US and China have well earned reputations as the global leaders in greenhouse gas emissions so the fact that the two nations are working together to combat climate change is very significant. Together their combined emissions account for around 40 percent of the world’s greenhouse gases. However, the leaders of both nations are making prodigious strides in efforts to reduce their footprints.

In addition to its global leadership in utility scale renewable energy projects, China has a stated goal of installing 8 gigawatts of distributed solar generation in 2014. The Chinese government has also set stringent restrictions on diesel emissions with the aim of eliminating trucks that produce significant amounts of things like nitrogen oxide and carbon monoxide. Perhaps the most significant action taken by China involves its pledge to cut carbon pollution.

The Implications of Curbing US Power Plant Emissions

The new rules curbing power plant emissions in the U.S. will have far reaching impacts both domestically and around the world. Curbing emissions from power plants is part of President Obama’s Climate Action Plan which he announced in 2013. Last September, the Environmental Protection Agency (EPA) released proposed standards to curb U.S. greenhouse gas (GHG) from new power plants. On June 2nd of this year, the EPA announced it will restrict emissions including carbon, nitrogen oxides, and sulfur dioxide by more than 25 percent by 2030 from all power plants. The EPA guidelines also include plans to prepare the U.S. for the effects of climate change, including strengthening roads, bridges and shorelines.

To circumvent the obstinacy of Republicans, the President is using his executive authority and putting forward the new rules under the Clean Air Act. The historic announcement will reduce carbon pollution from power plants by almost one third (30 percent) from 2005 levels by 2030. Even more significantly, they may spur global action that enables us to secure a binding climate treaty in 2015.

Video - The White House's Climate Assessment Explained

Referencing the White House's Climate Assessment, Dr. John Holdren, President Obama's Science Advisor, says that climate change "is not a distant threat, it is affecting the American people already."

Depending on where you are in the US, summers are longer and hotter, we are seeing more wildfires and allergies as well as heatwaves, extreme precipitation events, storm surges, draught and other impacts on agriculture. To learn more about President Obama's climate action place click here.

Webinar - California Cap and Trade Program: Everything Businesses Need to Know

The one hour complimentary webinar on California's Cap and Trade Program will take place on Wednesday, June 4, 2014 at 2pm EDT. It will provide an in-depth look at how California's carbon market works and show you what you need to know to craft a cogent compliance strategy.

As part of California’s Assembly Bill 32, the California cap-and-trade program seeks to reduce greenhouse gas emissions to 1990 levels. By placing a hard cap on emissions and setting up a market based mechanism, California has placed a price on carbon emissions covered by the program.

Companies covered by the cap-and-trade program must purchase California Carbon Allowances (CCAs) to cover their emissions of carbon dioxide equivalent (CO2e). Companies can also use offset credits as a lower cost alternative to CCAs for compliance.

Video - Why a Carbon Tax May be the Best Way to Reduce CO2

In this video Judd Legam, editor of ThinkProgress explains how a carbon tax works. This effort is of great importance in light of the current concentration of carbon dioxide in the earth's atmosphere which now exceeds 400 parts per million which is causing big changes in global temperatures, which means big changes in climate: more droughts, more wildfires, more extreme weather, more crop failure, and all of the other effects of global warming. According to Legam, the simplest solution is a carbon tax.