Dear Scott Pruitt,
BY JONAH KURMAN-FABER, MAY 3rd, 2018
Between ethics violations and attempts to rollback environmental policy, the entire nation has you under a microscope. While your excessive personal spending, improper industry ties, and attempts to dismantle historic federal programs are well within the administration’s political agenda and sloppy ethics culture, they have left you with dwindling support from all camps –– Democrats, Republicans, state officials, Congress, scientists, and even corporate polluters. That’s right –– despite your claim that environmental efforts hurt businesses, some of the worst polluters in history are shaking their heads.
Why is this happening? Because your view on the private sector is out of touch. Through actions and statements, many big corporations are pushing a new message –– climate change is happening, and acting on it is good for everyone. Without realigning your political agenda to a changing business community, you will fail to serve the interests of the very community you claim to protect.
THE ENVIRONMENTAL ROLLBACKS
A central component of your agenda as head of the EPA has been to dismantle signature Obama-era regulations on greenhouse gas emissions from motor vehicles and power plants. Your efforts have been sloppy at best –– the courts have struck down your attempts six times already. This past week, 18 jurisdictions announced a lawsuit against your agency in order to defend clean vehicle standards. Led by California, this coalition constitutes over 40 percent of the domestic auto market. Should you be successful in repealing the federal regulation, many of these states will stick with stricter requirements, creating a “civil war” in automobile standards. This would be devastating for business –– new cars may be eligible for sale in one state but ineligible in another. Even automakers who had previously sought weakened regulations are now fighting to keep us on a unified national program.
Meanwhile, massive global companies and automakers alike are leading the shift to low emission vehicles. EV100, a global campaign to commit to electric vehicles, now boasts membership from 18 massive global corporations including HP, Ikea, and Mercury. Automakers are global companies, meaning they will continue to aggressively explore electric and low-emission vehicles to comply with the stricter standards of vital markets such as the European Union and China. Should the United States strip away its own emissions standards, it could fail to capitalize on the market disruption and enormous profit potential of electric vehicles in this global market.
COMPANIES HAVE SPOKEN
While the administration which you serve continues to drag its feet, businesses have stepped up to fill the leadership void. Following your administration’s announcement to withdraw from the Paris Agreement, 25 companies, including Facebook, Google, Apple, and Microsoft, published full-page statements in disagreement. Since then, over 1,800 businesses have declared that they will still honor the Paris Agreement. Even ExxonMobil and General Electric, having previously fought to dismantle the Clean Power Plan, have both now advocated for the Paris Agreement as a vital initiative for future business success.
Actions speak louder than words, and many companies are already taking climate policy into their own hands. Last year nearly 1,400 companies disclosed current practices or plans to use internal carbon pricing, up from only 150 in 2014. This list includes over 100 Fortune 500 companies, with collective revenues exceeding $7 trillion annually. The very companies you seek to protect, such as petroleum producers, automakers, and other large-scale polluters, are setting their own price on pollution. Shell has used an internal carbon price between $40 and $80 per metric ton of CO2 for nearly 20 years. Mining company BHP has used a shadow price of $24 to $80 per metric ton of CO2 since 2004, leading to improved energy efficiency, reduced GHG emissions, and a diversified portfolio.
Microsoft has been a champion of emissions for years. Since 2012, they have not only used carbon emission fees to reduce electricity consumption and employee travel behavior, but also have been carbon neutral in global operations for 6 years running. Why would companies take these measures? Because it prepares them for the future. Companies such as Air Canada, LG Electronics, and Volkswagen see carbon pricing as a way to manage future risks associated with carbon pricing legislation. Other companies such as Hitachi Chemical and Royal DSM see it as a tool to reveal potential opportunities that may emerge during the globe’s shift to a low-carbon economy. Further yet, some companies simply have the desire to reduce their total emissions.
Even in the face of lagging federal legislation, the number of American companies implementing or planning carbon pricing continues to grow. In fact, 203 US companies disclosed last year that they already participate in an emissions trading scheme, or plan to by 2019. These companies recognize that in order to remain globally competitive, they need to align with the 42 national and 25 subnational jurisdictions that are already pricing carbon. Preparing for the future is good for business. Aligning with the rest of the world is good for business. Climate change policy is good for business. Our largest companies have recognized this and are advocating through their words and actions. So while Congress presses you on your unethical practices and state officials fight your environmental rollbacks, the most pressing issue of your tenure is your antiquated notion of private sector interests.
JONAH KURMAN-FABER COMMUNICATIONS AND POLICY FELLOW