If you still don't understand how the cap-and-trade market for emissions trading works, talk to Tom Cushing, the senior vice president of the
Chicago Climate Exchange (CCX).
He is quick to point out the CCX is a voluntary trading system, in which companies agree to reduce their carbon emissions over a set period of time or buy carbon allowances to make up the difference, but he has a larger message: It won't be voluntary forever.
"Carbon emission regulations are going to be here soon and the companies that understand how to reduce emissions and trade carbon will be quantitatively ahead of the competition," he said last week in Chicago at the 2009 Environmental Summit sponsored by
Boise Inc. "The E.U. already has restrictions in place for the highest emitting industries. The only questions left are what forms those requirements are going to take in the U.S., and how soon."
Cushing, like the rest of the event's speakers, offered two important conclusions for the more than 100 attendees: carbon management will likely be a mandatory requirement for doing business in the U.S. by 2010, at least for heavy emitting industries like paper and pulp; and if done correctly, the reduction effort can be a cost-saving endeavor that adds social, environmental and financial value to the company.
Many companies have already seen impressive environmental and financial results from cutting greenhouse gas emissions and waste, according to Rachel Bechardt, project manager for the
Environmental Defense Fund.
She laid out a bevy of examples of companies that have partnered with EDF to achieve remarkable bottom-line results, including
McDonalds, which has saved $3 billion since the '90s by eliminating polystyrene clamshell boxes and bleached virgin paper for bags; and
United Parcel Service, which now saves $1 million a year since eliminating bleached paper and increasing recycled content and reusable containers.
The companies she mentioned also saw impressive environmental results, with packaging waste reduction numbers hitting 70 to 90 percent at McDonalds, and water use reduced by 17 percent at UPS. But the point that hit home: Sustainability efforts drive business incentives.
"Environmental gains are only replicable to the end that they can enhance the bottom-line," she pointed out. "The business benefits of going green are what get industries and companies on board for change."
