Business voices come out in support of Clean Power Plan
Eight corporate giants speak out forcefully about the business benefits of the federal plan to mitigate carbon emissions, using friend-of-the-court briefs to jump into the controversy.
Tech titans Apple, Google, Microsoft and Amazon as well as global brand companies Ikea, Mars, Adobe and Blue Shield Blue Cross Massachusetts told a U.S. court Friday that they need the federal Clean Power Plan for economic reasons.
In two separate Amici Curiae briefs filed in U.S. Circuit Court supporting the EPA’s plan for reducing carbon emissions from the nation’s power plants by 32 percent, the corporate giants said without a "national carbon mitigation plan," they face "undesirable business risk," energy price volatility and higher costs.
With these arguments, the businesses seem to have flipped prospects for the Obama administration’s centerpiece climate change policy, which only a month ago looked dim after the U.S. Supreme Court ruled to delay its enforcement.
Since the eight companies collectively employ about 1 million people, account for nearly $2 trillion in market capitalization and are major energy consumers — the tech companies alone use 10 million megawatt hours of electricity a year — they have clout.
Their briefs refute some claims made by 27 states that are plaintiffs in the State of West Virginia, et al vs. U.S. Environmental Protection Agency case challenging the Clean Power Plan as an overreach of federal authority by the EPA in a way that would harm jobs and raise electricity prices.
Among the companies' most interesting refutations? Their expansion plans depend partly on how they can procure low-carbon electricity.
"A factor in siting larger infrastructure projects, upgrading existing facilities, and planning supply chain paths has been the availability, reliability, and price of electricity they could receive from utilities. Today, the generation source of electricity is a growing concern for companies, and the uncertainty that lingers around the future of high-carbon emitting fuel sources, both domestically and internationally, makes assessing long-term business decisions a difficult challenge," said the brief from Ikea, Mars, Adobe and Blue Cross.
Both groups of companies were filing in favor of defendant EPA in the West Virginia, et al suit filed in October by 27 states' attorneys general, led by West Virginia Attorney General Patrick Morrisey.
The states argue that the EPA does not have jurisdiction over state utility regulation and energy commerce and that the requirements will cause states harm.
"The Power Plan will also require massive and immediate efforts by State energy and environmental regulators, imposing irreparable financial harms upon the States," the challenge states.
To reach a goal of reducing the nation's carbon emissions 32 percent below 2005 levels by 2030, the Clean Power Plan would require that each state develop and implement a plan to reduce emissions from that state's utilities and requre that their utilities meet efficiency performance benchmarks.
Morrisey has repeatedly called it harmful to business. "EPA’s actions will upset the careful balance of ensuring reliable, affordable electricity while encouraging job growth and responsible protection of the environment. Because EPA's actions are destructive to West Virginia, the Office of Attorney General is taking every reasonably necessary action to stop them," he wrote to state constituents in introducing the law suit.
But the "Tech Amici" of Google, Apple, Microsoft and Amazon — all icons of the most successful U.S. industry — come to a different conclusion.
"Tech Amici’s experience suggests that the Clean Power Plan will provide considerable benefits to electricity purchasers and that the Plan will not only be good for the environment, it will be good for business," they wrote in the brief.
"Unlike fossil fuel-powered generation, renewable energy technologies such as wind and solar have low and stable marginal costs, and so permit energy consumers to hedge fuel price volatility and future increases in electricity rates," they stated.
"Renewable electricity generation can be generated or purchased at or below the cost of fossil fuel-generated power sources,” they continued in the brief, citing a 70 percent drop in the solar PPA prices between 2009 and 2014 driven by a 50 percent drop in deployments costs and the support of investment tax credits.
Apple, Google, Amazon and Microsoft, each of which is aggressively pursuing 100 percent renewable power for their operaitons, made clear that they have been very willing to skip utilities' power in this quest.
"Tech Amici have been using various strategies to procure renewable energy (such as wind and solar generation), including developing their own facilities, and purchasing the output of renewable energy facilities from developers and utilities. Such strategies are also available to owners of power plants regulated under the Plan."
But with the Clean Power Plan fully implemented, they perhaps would not have to be in the business of power generation.
Long sought business voice
Climate Change warriors such as former U.S. Vice President Al Gore, scientist James Hansen and philanthropist and climate activist Tom Steyer have been urging businesses to make their voices heard in Washington, D.C. But while many businesses have taken bold steps in their own operations to reduce carbon footprint, they've been timid on lobbying about climate change, Gore and Steyer told GreenBiz audiences last fall.
That changed some in December when business showed up in force at the Paris at the COP 21 United Nations climate negotiations and committed to actions while urging their respective governments to also commit.
Now with the Clean Power Plan — the centerpiece of the U.S. commitment to the COP 21 process — at risk from the court challenge by Republican attorneys general, they are speaking out again.
Environmental NGOs applauded the moves.
BSR Managing Director Edward Cameron said in a commentary, "The message is as clear today as it was in Paris: Business leaders welcome the ambitious climate commitments the United States made as part of the Paris Agreement. Many of these companies have taken action themselves and are pledging to do more."
Cameron noted that the entire Paris Accord is at stake — and that these companies know it.
"Should the United States waver on its commitment, there is a risk that other countries may use this as an excuse to step back from their own Paris commitments. The state of U.S. climate policy is therefore critical to ongoing success around the globe. In the short term, the successful implementation of the Clean Power Plan is integral to significant global momentum.
Environmental Defense Fund Vice President Tom Murray wrote, "I’m inspired by the growing number of companies and business organizations standing up for the most significant step in U.S. history toward reducing climate pollution," in an EDF blog post about the Amici Curiea briefs.
"The bar continues to rise for companies that want to lead on sustainability, and it’s great to see companies aligning their corporate sustainability strategy and policy advocacy."
The World Wildlife Fund found that 60 percent of the Fortune 100 companies have set public sustainability and clean energy goals.
Despite all the goals and commitments, few corporations have lobbied Congress on climate change or on federal clean power legislation. But the court briefs are controversial.
The Amici Curiae briefs were filed as the US Court of Appeals for the DC Circult prepares to hear arguments June 2 on the challenge filed by 27 states' Attorneys General and some coal and oil industry trade associations.
West Virginia AG Morrisey wrote, "The Office of the West Virginia Attorney General continues to lead the fight against EPA's rules regulating carbon dioxide emissions from new and existing coal-fired power plants. As these rulemakings have made clear, EPA is attempting to shut down existing coal-fired power plants and to stop new plants from being built. These rules will cause West Virginia coal miners to lose their jobs and West Virginians’ electricity bills to skyrocket.
In a subsequent filing which seeks a delay on enforcement of the law, the Attorneys General argue "Absent an immediate stay, the States are and will continue to be irreparably harmed by the displacement of sovereign priorities and the steps they must take to begin reordering the way their citizens receive and consume energy."
It appears the four tech titans and four global brand companies favor a reordering of the way consumers receive and consume energy.