Air Date: Week of February 15, 2002

President Bush has announced his plan to address climate change and greenhouse gas emissions. Host Steve Curwood talks with Eileen Claussen of the Pew Center on Global Climate Change and Eric Holdsworth of the Edison Electric Institute about this alternative to the Kyoto Protocol.

Transcript

CURWOOD: Welcome to Living on Earth, I'm Steve Curwood. When the Bush administration rejected the Kyoto treaty on global climate change last year, it said it would offer an alternative. On February 14th, the president finally unveiled his plan to address greenhouse gas emissions. He said the problem with the agreement that almost every other nation has endorsed is the economy.

BUSH: The approach taken under the Kyoto protocol would have required the United States to make deep and immediate cuts in our economy to meet an arbitrary target. It would have cost our economy up to 400 billion dollars, and we would have lost 4.9 million jobs.

CURWOOD: The president said his plan will use a voluntary system of greenhouse gas reductions by industry and nearly five billion dollars in tax incentives for industry and consumers.

George W. Bush makes remarks on climate change
and clean air during his visit to the National Oceanic
and Atmospheric Administration on February 14, 2002.
(Photo: Alex Wong/Getty Images)

BUSH: Our immediate goal is to reduce America's greenhouse gas emissions relative to the size of our economy. My administration is committed to cutting our nation's greenhouse gas intensity - how much we emit per unit of economic activity - by 18 percent over the next ten years. This will set America on a path to slow the growth of our greenhouse gas emissions. And as science justifies, to stop and then reverse the growth of emissions.

CURWOOD: With me now to discuss President Bush's remarks are Eileen Claussen, the Executive Director of the Pew Center on Global Climate Change and the former assistant secretary of state for President Clinton. And Eric Holdsworth, who is Director of Climate Change with the Edison Electric Institute, an association of investor-owned companies that represents the majority of power generators in the US. Thank for joining me.

CLAUSSEN: It's a pleasure to be here.

HOLDSWORTH: Thank you.

CURWOOD: Now from your perspective, Ms. Claussen, what's the good news here in the president's announcement?

CLAUSSEN: Actually I think you have to look long and hard to find very much good news. I think the energy intensity target the president talks about is really just business as usual. Greenhouse gas emissions have been declining per unit of economic output for the last two decades, and his proposed objective would continue that same trend.

CURWOOD: Mr. Holdsworth?

HOLDSWORTH: Well, we think the plan is a welcome change and in fact reflects a far more realistic way of addressing the climate issue: allowing for flexibility and continued economic growth which will help spur and continue the flow of capital, which will lead to the investment and development of the next generation technologies, which are really in the long term perspective one of the most critical areas to address in looking at the issue of climate change.

CURWOOD: Ms. Claussen, tell me how does the president's proposal compare to the targets set by the Kyoto agreement, which would have meant cutting greenhouse gas emissions to seven percent less than what they were in 1990, over the next ten years?

CLAUSSEN: Well, when we calculated what it might mean in terms of actual emissions, we believe that by 2012, which is the end of the first budget period in Kyoto, rather than being seven percent below 1990 levels, which I agree was probably not achievable, we would be about 30 percent above 1990 levels. Which, as I said, is really just business as usual.

CURWOOD: By the way, the president said Kyoto would have cost America nearly five million jobs and 400 billion dollars. How accurate is that, Ms. Claussen?

CLAUSSEN: Actually, that's totally off the charts, in my view. And I say that because he really used the economic models with the assumptions and policies modeled that were totally unrealistic and not reflective of Kyoto at all. That said, I think that the economic analyses that said implementing Kyoto would be free or would even be a profit are equally off the mark.

HOLDSWORTH: While I would agree on the analyses that say Kyoto would be free are off the mark, I think there's a wide range of economic analysis that would back up the president's assertion. Certainly that's been our view of this issue for quite a long time, particularly since the protocol was negotiated, that it would have these massive economic impacts. Which is one reason why we have been so resistant to that type of approach and find the president's approach a refreshing change of pace and perhaps a way that we can get at the issue and start reducing greenhouse gases.

CURWOOD: Now, Mr. Holdsworth, ten year's ago President Bush's father initiated a program that was voluntary, like the one that he's talking about now, that asks companies to monitor their greenhouse gas emissions and think about ways to reduce them, what's different in this plan?

HOLDSWORTH: First of all, the numbers that will be reported will be tighter, there'll be stricter methodology applied, which I think will make those numbers more credible to many people. There's a few other important differences. This voluntary program now actually has a goal attached to it. The earlier one was really a way of encouraging companies to go about reporting emissions reductions, here we have a goal of this 18 percent reduction in emissions intensity over the next ten years, that's a different step. And this voluntary program, the reporting program the president has talked about, will also include baseline protection and what's called credit for early action. In other words, making sure that companies that take action now won't be penalized if there is some other type of regime down the road, perhaps a regulatory approach or even a more aggressive voluntary approach. You'd hate to be penalized for taking actions now and perhaps lowering what your emissions base is down the road. You're being a good actor; you should get credit for that. What the president is talking about would do that, we think that's going to really help encourage and spur action.

CURWOOD: Ms. Claussen, I'll come back to you in just a moment, but let me follow up on Mr. Holdsworth here. Eric, I'm a little puzzled here about the signal that the White House is sending to domestic industry by acknowledging the possibility of mandatory emissions cuts in the future. Why not just face this issue right now?

HOLDSWORTH: Well, I don't think they're acknowledging that mandatory approaches are forthcoming. They've indicated future, perhaps reviewing in 2012 where the situation stands and perhaps taking on additional voluntary measures, additional programs. We certainly would never advocate a mandatory approach as is enshrined in the Kyoto protocol. We don't think that's the right way. We feel this is the right approach and the president's sending a clear signal that voluntary initiatives can work and here's a chance for industry to go and show what it can do.

CURWOOD: Ms. Claussen?

CLAUSSEN: Well, I actually think you need to put some of this in perspective. My colleague here from Edison Electric said that the president's program is different because there is a goal. Perhaps he's forgotten that the 1992 Rio Convention, which was negotiated by the first President Bush, actually had a non-binding goal in it as well, which was to reduce emissions in the year 2000 to 1990 levels. And the bottom line of that with all of the voluntary programs that were initiated over the last decade was that our emissions grew by roughly 15 percent over 1990 levels. So we didn't do a very good job of reducing our emissions or meeting our non-binding goal.

HOLDSWORTH: That is correct that the framework connection contains that aim. That wasn't of course linked to the voluntary program here in the US, the way the president has made this link. But it was a goal, but unfortunately it was again looking at an absolute sort of reduction, returning to a certain year by a certain level. This is an approach that looks at the intensity of the emissions, or your amount of carbon per unit of output, which we think is a better metric, and will allow for continued growth while also helping to slow the growth of greenhouse gas emissions.

CURWOOD: Ms. Claussen, you work with a number of Fortune 500 companies at the Pew Center, you might mention a couple of those for us, and my understanding is that some companies are already significantly reducing emissions on their own initiative. What are they saying about the White House policy now, and how do they think this will affect their business over seas?

CLAUSSEN: Well, we work with 37 major companies, they range from Alcoa and Boeing and Weyerhaeuser on the one hand to United Technologies to American Electric Power, and we cover almost all sectors, mostly big multinational companies. All of them are engaged in some forms of emission reductions. Twenty of them have real targets and programs in place to meet those targets and some of those targets are really ambitious. I mean much more ambitious than the Kyoto targets. I mean you could look at a company like DuPont who's going to be reducing their emissions 60 percent below 1990 levels by the year 2010 and is well on its way to achieving that goal. Alcoa which is going to reduce its emissions by a minimum of 25 percent below 1990 levels by 2010. So there are companies that are doing really serious things to reduce emissions. I think the problem is having 27 or 37 or 50 companies that are reducing emissions is just not enough. And I think that's why we look to some kind of a mandatory program as a way to level the playing field and to actually get all of the actors doing what needs to be done if we are actually going to change the trajectory of emissions.

CURWOOD: How does this effect your multinational members of your association as they operate elsewhere around the world which will be under the Kyoto accord if things go as people say?

CLAUSSEN: All of them will have to comply with whatever domestic programs are implemented in countries in Europe or in Asia to reduce emissions. What it really means I think in a negative way is we're not a party to Kyoto and we're not playing in the same game. They won't be able to look company-wide and decide where the efficiencies could be greatest for emissions reductions. They'll have to look only at plants in countries with hard and fast regulations. So for them, it's an inefficiency and like in many other kinds of cases beyond environment, they are going to have one set of rules in one place and a different set of rules in another place. I think from their perspective they'd much rather have a uniform set of rules.

CURWOOD: Ms. Claussen, you're a former Assistant Secretary of State. Japan and the E.U. have been waiting more than a year to hear a concrete climate policy from the Bush administration. How are they responding to this plan?

CLAUSSEN: I think everyone was slightly confused when it was first announced, because they couldn't understand what a greenhouse gas intensity target meant or what an 18 percent reduction in greenhouse gas intensity actually meant. The reports that I've seen and the conversations I've had suggest that not only is this not a substitute for Kyoto, but it's not an ambitious program and it's barely a program at all. I think that's the reaction abroad.

HOLDSWORTH: I wouldn't think that's going to be the case. I think a number of companies are going to welcome this initiative. The president is obviously on his way to Asia to talk to various Asian nations about it. They've already signed some bilateral cooperation agreements with both the Japanese and the Italians, the Central Americans. In fact, I think that as this moves forward he may find a number of companies getting very interested in this kind of approach. A number of the developed countries I think are very fearful of the Kyoto targets and what's that going to mean to their economy and are frankly looking for an approach that perhaps makes more sense in the face of economic growth.

CURWOOD: Eric Holdsworth is director of climate programs with the Edison Electric Institute and Eileen Claussen is the executive director of the Pew Center on Global Climate Change. Thank you both for joining me today.

HOLDSWORTH: Thank you.

CLAUSSEN: Thank you.

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