Encourage competition to breed innovation.

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Amory Lovins

“The earth’s climate can be protected not at a cost but at a profit.” Climate: Making Sense and Money

Amory Lovins advocates a free-market approach he calls “natural capitalism,” so called “because it’s what capitalism might become if its largest category of capital – the “natural capital” of ecosystem services – were properly valued.' A Road Map for Natural Capitalism

Lovins' non-profit Rocky Mountain Institute conducts research that has led to several spinoff corporations, and consults Fortune 500 companies such as Wal-Mart and Ford Motor Company on their product development. Lovins calls for increased efficiency of use of natural resources, advocates "closed-loop production systems, modeled on nature’s designs, every output either is returned harmlessly to the ecosystem as a nutrient, like compost, or becomes an input for manufacturing another product.” A Road Map for Natural Capitalism
 
Central to this concept is a technocratic approch to whole system thinking, in which engineers recalibrate efficiencies to locate opportunities to save resources and maximize profits: “The old idea is one of diminishing returns – the greater the resource saving, the higher the cost. But that old idea is giving way to the new idea that bigger savings can cost less – that saving a large fraction of resources can actually cost less than saving a small fraction of resources. This is the concept of expanding returns, and it governs much of the revolutionary thinking behind whole-system design." A Road Map for Natural Capitalism
 
Lovins points to Dupont as one example of this approach: “Combining closed-loop manufacturing with resource efficiency is especially powerful. DuPont, for example, gets much of its polyester industrial film back from customers after they use it and recycles it into new film. DuPont also makes its polyester film ever stronger and thinner so it uses less material and costs less to make. Yet because the film performs better, customers are willing to pay more for it. As DuPont chairman Jack Krol noted in 1997, “Our ability to continually improve the inherent properties [of our films] enables this process [of developing more productive materials, at lower cost, and higher profits] to go on indefinitely.” A Road Map for Natural Capitalism
 
Why hasn't this worked in the past? “Climate policy has been held hostage to a tacit presumption that if saving a lot more energy were possible at an affordable price, it would already have been implemented. That’s like not picking up a $100 bill from the sidewalk because if it were real, someone would previously have picked it up; or like an entrepreneur who abandons a good business idea because if it were sound, it would have been done earlier." A Road Map for Natural Capitalism
 
Large-scale efficiencies have lagged in the market because of artificial barriers due to government regulation and misplaced taxation. Lovin writes: “If such big savings are both feasible and profitable, why haven’t they all been done? Because the free market, effective though it is, is burdened by subtle imperfections that inhibit the efficient allocation and use of resources.” Climate: Making Sense and Making Money

Bjorn Lomborg

“Ensuring free trade would make almost everyone much better off.” Cool It, 45

Lomborg believes that a shift away from fossil fuels will be necessary in the long term, but shouldn't occur until alternatives become completely economically viable.  In the meantime, money should go towards raising the standard of life on a global scale (see On Prioritize Human Health and Equity).  And, he argues, we must strengthen market growth and government investment in R&D necessary to yield innovations that will eventually make climate mitigation cost-effective. 

For example, Lomborg argues that there is “compelling evidence that a tiny investment in climate engineering might be able to reduce as much of global warming’s effects as trillions of dollars spent on carbon emission reductions” and cites examples such as marine cloud whitening, where “boats spray seawater drop-lets into clouds at sea to make them whiter and thus reflect more sunlight back into space.” Cloud Control 
 
Without such improvements, Lomborg argues, it would be nearly impossible to expect a global adaptation of energy measures.  Thus ivestments in energy measure are not viable on a global scale: “We can't expect South Africa or any other nation to stop using coal or oil unless we can find practical, affordable alternatives. For example, if we had solar panels that could produce electricity more cheaply than fossil fuels, then of course South Africa would switch. But we need to develop green technology before we can ask any leaders to consign their people to poverty for the sake of the climate.” Obama Gets Reasonable on the Environment
 
To regulate this market behavior, Lomborg staunchly objects to strong carbon taxation, and a promotes minimal CO2 taxes to the “the economically correct level of about two dollars per ton, or maximally fourteen dollars per ton.”  Even still, he believes this will not make a major difference, cutting emissions by 5 percent and temperature by 0.16 F” Cool It, 152
 
“Neither such a small tax nor Kyoto nor the draconian proposals for future cuts will move us much toward finding better was for the future.   R&D in renewables and energy efficiency is at its lowest point in twenty-five years… we need to find a way that allows us to develop the science and technology in a beneficial way… to provide alternative energy technologies at reasonable prices.” Cool It, 152
 

Climate Vision

Climate Vision MOU Signature Page. Source: climatevision.gov

The heart of the Climate VISION initiative lies in the fact that it is comprised of voluntary agreements between the Department of Energy and the major emitting industries. These industries and the companies that comprise them set their own targets and develop their own methods and technologies to achieve them.  
 
" [T]he [Bush] Administration still believes that there are too many scientific uncertainties surrounding the issue of climate change to justify aggressive action.” US Business Actions to Address Climate Change  The result of these "uncertainties" is caution around the potential effects of "aggressive actions" such as hard targets for emission levels.  The fear is that setting mandatory emissions targets for industry would negatively affect the US economy, causing more harm than good.  
 
“In the on-going debate over whether it 'pays to be green,' the question of vulnerability under a climate change protocol needs to be reframed. This requires identifying for whom being green can pay and, secondly, how and when they can make that happen.” Is President Bush's Vision Impaired? The premise of Climate VISION is that by allowing the market to voluntarily regulate its own emissions, we can achieve both a healthy economy and a healthy planet.
 

Tom Friedman

"There is only one thing bigger than Mother Nature and that is Father Profit, and we have not even begun to enlist him in this struggle." Hot, Flat, and Crowded, 291

"In both the natural world and the financial world, [sustainability] means that you think and then behave in a way that literally sustains—sustains the natural world around you, sustains business relationships, sustains personal relationships, sustains your community, sustains your country, sustains the planet, and sustains your relationships with your grandchildren and with generations to come. … Don’t get me wrong: Free markets are about raw and naked competition. There are and always will be winners and losers. Sustainability is not a euphemism for charity work or socialism. It is an essential ingredient for winning." Hot, Flat, and Crowded, 53

"We are not going to regulate our way out of the problems of the Energy-Climate Era. We can only innovate our way out, and the only way to do that is to mobilize the most effective and prolific system for transformational innovation and commercialization of new products ever created on the face of the earth—the U.S. marketplace."  Hot, Flat, and Crowded, 291

USGBC

The USGBC has national memberships which it extends to corporations. Its categories for organizations, with Annual Dues dependent on Category and Gross Annual Revenue, include Contractors and Builders, Corporate and Retail, Insurance Companies/Financial Institutions, Nonprofit & Environmental Organizations, Product Manufacturers, Building Controls, Service Contractors, and Distributors, Professional Firms (Architects, Engineers, Interior Designers, Landscape Architects, Planners, Press, etc), Real Estate/ Real Estate Service Providers, etc. (http://www.usgbc.org/DisplayPage.aspx?CMSPageID=56&)

By creating more and more entries in its list of members and connecting businesses with people the USGBC has created a networking platform which makes it a convenient tool for buying and selling products and services.

USGBC has found this approach to be extremely successful, making $57 million in assets in 2008, with 28% of this from certification fees, 25% from registrations and conferences, and 18% from publications. (Marie Rohde)

Commentary

Heather Rogers

"[What are] getting a lot of investment by government and corporations are "solutions" that aren't really working. They are the types of things that leave existing systems intact. So you can still have agribusiness with bio-fuel. You can still have the auto industry with technologies that might work (might not) like building hybrid cars. But, in the meantime, the Ford Fiesta they sell in the U.K. gets 88 miles to the gallon. You know they could sell it here, but they don't because it's more profitable to sell cars that get lower gas mileage. What we're waiting for isn't the technology. We're waiting for them to figure out how to make it more profitable....

"One of the things that I'm grappling with is that there are aspects of markets that work. So I think that we can take those things and use what works, but there's a lot of restructuring of the state that needs to happen and disentangling the state from corporate finance interests. And how do you do that without a really major upheaval?"

(Underdome Interview)

References

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