Underwriters Laboratories has been around for over 100 years and is extremely well respected by both manufacturers and consumers.  Recently they added a new division called UL Environment.  ULE has a goal of reducing world CO2e emissions by a billion tons a year by focusing on the life cycle of building materials.
By establishing this goal, they not only realize the importance of reducing GHGs, but they also know that by focusing on the building industry they can make a huge impact.

ULE joins a list of well-respected organizations that realize we must significantly reduce worldwide GHG emissions.  By conducting Life Cycle Assessments on key products we can better understand where reductions and efficiencies can be made with the least amount of impact on our economy.

We applaud ULE for their efforts and look forward to learning more about their Sustainability Product Certification.

The US Chamber of Commerce, an organization representing thousands of American businesses, has started litigation to sue the EPA for continuing with its GHG emissions reporting requirement, claiming that the regulation is too burdensome on small companies.  Similar to its stance against the federal moratorium on offshore drilling in the Gulf, the Chamber argues that the EPA is prioritizing regulation over job creation, which is a huge faux pas in our country’s poor economy.
The US Chamber of Commerce represents thousands of businesses throughout the US.  So—assumedly—the Chamber’s decision to start litigation must be a reflection of the opinions of its members. But is that really the case? Do American companies really want to fall behind the EU’s and China’s environmental monitoring standards, a decision that could severely impact business opportunities in the future?
Is your company part of the US Chamber of Commerce? Let us know if you agree or disagree with the Chamber’s proposed legal actions against the EPA!

Globally, the first six months of 2010 have been declared the hottest on record. Greenland lost a glacier the size of Manhattan. Russia is suffering the worst drought since they began taking records 130 years ago.  China has too much rain and millions are suffering from flooding. On the other side of the world, Chile has experienced record cold temperatures.

La Nina weather pattern may explain some of this crazy weather.  But how do you explain the broken record?  For the past decade most countries around the world admitted that the climate change we are experiencing is a result of excessive greenhouse gas created by man. Most of them have started to cut back their emissions.

The question remains; what sort of weather-related catastrophe has to happen before the U.S. takes action?

If you read our blog on a regular basis you’ve seen us write about the “Carrot and the Stick” in relation to greenhouse gas (GHG) regulation from the government. We saw the demise of the senate bill to address GHGs through a cap-and-reduce (a.k.a., cap-and-trade or cap-and-tax) program, most recently known as the American Power Act. When it comes to difficult decisions, congress does not have the ability to lead. That is fine. As someone I know well says, “you have to lead, follow or get out of the way.” Congress just got out of the way. We predict they will follow next.

For the past several years while congress has failed to pass comprehensive legislation to combat climate change, the EPA has been pushing carbon reduction every step of the way. First, they had GHGs classified as pollutants under the Clean Air Act. At the start of 2010 they asked big emitters to start measuring their CO2e levels. Along the way the EPA has even withstood legal questions about their ability to regulate GHGs.  Now that lawmakers have failed to act do you think the EPA will sit back and do nothing?

The older members of congress remember that back in 1991 cap and trade was originally proposed by Republicans as a way to stop the EPA from directly regulating acid rain-producing SOx and NOx. (That first experiment in cap and reduce worked so well that the Europeans adopted a similar system to abide by the Kyoto Protocol.) History has a way of repeating it’s self and we predict that within the next six months the EPA will introduce a laundry list of GHG regulations that will have even the staunchest climate denier pleading for a cap-and-reduce bill.

So if you think cap-and-reduce legislation is dead, think again.  There is a sleeping giant that is about to wake up.

The European Union has made some surprising allowances for dirty power plants.  Proposed legislation states that coal-powered plants that contribute to acid rain are allowed to stay in operation without modification as long as they are shut down by the end of 2023.  While some industrial plants will be required to install advanced pollution-control technologies and reduce emissions by 2012, the use of large combustion plants will be allowed until 2020.
Despite these exceptions for coal plants, the legislation is expected to overall make alternative energy sources cheaper than fossil fuel use.  Maybe this is possible because the EU relies on coal for only 13% of its power, whereas the US gets over 50% of its energy from coal power plants.  While retrofitting coal plants to be more environmentally friendly may seem to be the greenest option, forcing the elimination of these plants by 2024 in the EU is a sure sign of future use of alternative energy sources.  This, in turn, spurs investment in green energy now, leading to more infrastructure and money for renewable sources. Even though these unregulated coal plants can emit thousands of tons of CO2e and cause harm the environment through acid rain, at least the damage is short-lived.  Perhaps this approach is better than the US’s mentality of upgrading coal-powered plants and, therefore, continuing our reliance on dirty sources for the majority of our energy.

US energy secretary Steven Chu recently announced $980 million in public and private investments for carbon capture and storage projects. The projects, located in Texas, Illinois and Louisiana, will hopefully be prototypes for future carbon capture and storage in certain industries, like methane and ethanol plants; the government has a goal of 5-10 working operations by 2016. The three projects will divert up to 6.5 million metric tons CO2 from the atmosphere.  This a small fraction of the 5.8 billion metric tons CO2e emitted in the US every year, but the potential for more cost-effective methods in the future makes carbon capture and storage a possible option for reducing industrial emissions.
The projects will use technologies that force the collected CO2 into confined spaces such as saline reservoirs and oil fields in which the gas may help move previously unreachable oil to the surface.  The pressure and depth of these storage areas, as well as secure capstones, prevent the CO2 from reaching the atmosphere.  Although these projects do make manufacturing less cost and energy efficient, the government hopes that the net reduction on CO2 emissions will make it worthwhile.
A similar project was recently declared a success in France, where over 120,000 metric tons CO2 were stored in a depleted natural gas reservoir, so maybe the government’s high expectations for industry-based carbon sequestration are not unwarranted.

During the Climate Summit in Copenhagen last year, India and China walked out of negotiations. There has been international tension over who is responsible for the majority of emissions reductions: industrialized nations who emitted the majority of GHGs in the first place, or developing countries that have the ability to switch over to environmentally-conscious technology as it is introduced.
India’s emissions have increased 58% from 1994-2007, a huge jump caused by increased transportation, energy production and industrial activity. And although India remains one of the lowest emitters per capita – at 25% the amount emitted by American citizens – an increase in 650 million tons CO2e every year is not something to ignore.

China, which now outranks the US in total CO2e emitted, has allegedly been taking steps to mitigate emissions. Reports state that China will impose a low but increasing carbon tax on industry in 2012, and the government plans to decrease carbon intensity, or amount of carbon emitted per unit of economic activity, by 40-45% by 2020. The government has also supported a Clean Development Mechanism that will pay farmers for biogas produced by biodigesters.  The initiative could potentially affect 195 million Chinese homes.
But who should really be investing in these reductions? A Washington Post interactive graph shows growth in total and per capita emissions since 1960 among major contributors to green house gas emissions. Although the total emissions are impressive for countries like India, it is really those who rank high for per capita emissions – US, Australia, Canada, Saudi Arabia, and Russia are the top five – who should really be changing their pollution regulations.

With Republican Senator Lindsey Graham off the new American Power Act, just presented by Senators Kerry and Lieberman, and the need for 60 supporters to make it filibuster-proof, it’s hard to say whether it will pass.

The bill is not particularly satisfying for environmentalists or energy companies.  Pledges to fund clean coal technology and natural gas show governmental support for something very far from renewable energy sources. Support for offshore oil and gas drilling is featured despite the recent disaster in the Gulf of Mexico, although a draft of the bill calls for impact studies before leasing (hopefully along the lines of the more stringent Environmental Impact Study under NEPA, instead of the lax Environmental Assessment). However, support for voluntary renewable energy markets and research into electric transportation, as well as commitments to improving efficiency and expanding nuclear energy, are promising steps.

The American Power Act also features cap and trade for CO2e emissions, which include carbon dioxide, methane, nitrous oxide, sulfur hexafluoride, hydrofluorocarbons, perfluorocarbons, and nitrogen trifluoride, and will be regulated by the EPA. However, there is a cap and floor for the price of CO2e. This will definitely affect trading and markets.

The bill states steep emissions reduction goals with a 2005 baseline: 17% by 2020 and 83% by 2050. As Andrew Revkin of the New York Times states, this long term goal “is in the realm of fantasy baseball so is not worth pondering.”

Read a section-by-section summary here, or the entire bill here.

There’s been a lot of talk about “green” energy: solar, wind, hydro, thermal. Although these sources of power reduce green house gas emissions, they are not completely without environmental impact. Take hydroelectricity, which supplies 24% of the world’s and 12% of the United States’ energy. Hydroelectricity is most often obtained from dams. Power is generated by water that would naturally flow freely, but instead is retained and forced through turbines, creating cheap and GHG-free energy for millions of people.

However, dams release approximately 104 million tons of methane every year, often because of the plant decomposition that occurs in the unmoving, warmer-than-typical water. For comparison, that’s about as much methane as the yearly output of coal mining and manure management in the US. With methane being a greenhouse gas that is 20-25 times more potent than CO2, these emissions make dams less atmospherically friendly than one would think (not to mention less environmentally friendly, with the other ecological and habitat impacts of altering the natural flow of a major river).

So what’s the alternative? One suggestion is the collection of released methane from these dams, which could be used as natural gas. Another is run-of-the-river hydroelectricity, which diverts some water and uses its kinetic energy as it flows away from the river, instead of the potential energy from retained water, to power the turbines. This method reduces water stagnation, resulting in decreased damage to the river ecosystem and therefore less methane production.

Unfortunately, no energy source is without environmental impact, but there are definitely some options that are more “green” than others.

Calpine is going where no power company has gone before by initiating the first power plant that will be more efficient than proposed GHG emission reduction criteria at both the federal level and at those of California cap-and-trade regulations set to go active Jan 1, 2012. Construction is set to begin next year on the 600-megawatt natural gas-fired plant. The Russell City Energy Center, spanning 15-acres, will reside just east of the San Francisco Bay.

With the EPA moving toward GHG regulation from large emitters under the Clean Air Act, and cap-and-trade on the horizon, Calpine is taking the lead by developing in a direction makes them both more ecologically as well as economically sustainable. Calpine is already one of the worlds largest geothermal producers, and by advancing gas-fired power generation that produces GHG emissions at less than 50% that of coal-fired power plants, they are poised to be the company that helps California achieve it’s energy needs for the future and leads the way for power providers nationally.

The Russell City plant will handle base load power demand, but Calpine is promoting use that is supplementary to other cleaner and more renewable technologies as they evolve and roll out. Pacific Gas and Electric Company, the purchaser of the electricity, will have the option of balancing and dispatching from all energy sources and using the gas-fired plant when solar and wind cannot meet demand or are unavailable.  Sierra Club chief climate counsel David Bookbinder said “Calpine is leading the way and showing how it’s possible to generate all the electricity that America needs with half the greenhouse gases.” Linda Adams, secretary of the California EPA commended, “We applaud the BAAQMD and Calpine for going beyond existing federal law and being the first in the nation to require an enforceable greenhouse gas limit.”

Despite the turbulent energy environment, it is not surprising that Calpine is being discussed as a top stock pick.

In 2004, Peter Cartwright, founder and CEO of Calpine, earned recognition as a Business Leader of the Year by Scientific American. They noted the companies outstanding environmental record, dramatically lower emissions relative to the rest of the industry, and a stated commitment to cut those emissions even further for all future developments. The company was also recognized for their use of combined-cycle technology that captures energy that is wasted in the single cycle systems that currently predominate.

Then in 2005, they became the first independent power producer to achieve the distinction of Climate Action Leader and voluntarily disclose GHG emission information to the public. In the press release, Neal Pospisil, Calpine’s vice president of safety, health and environment stated: “Being at the forefront of environmental accountability is a priority for Calpine and taking inventory of our carbon emissions profile is one of the first steps in finding new ways to manage our carbon dioxide emissions…Having a third party certifying that inventory further ensures that Calpine’s reporting meets objective, uniform standards.”

Calpines steady efforts and climb to leadership shows that it really pays off to find out where you are and take a good look around so that you can move confidently to where you want to go.