Kimberley Strassel’s If the Cap Fits: Why our CEOs are warming to Kyoto shows that the U.S. Climate Action Partnership (USCAP or CAP for short) includes many companies that seek corporate welfare in the form of government-mandated purchases of their services or products. Many of USCAP’s members do not, in fact, even claim to produce a product or service, and are dependent on donations or grants. The recent performance of USCAP’s portfolio also suggests that the Climate Action Partnership is Wall Street’s Oscar the Cat: a harbinger of bankruptcy, desperate mergers, and generally poor business performance.
Let’s begin, however, with what Kimberley Strassel has to say.
- There was a time when the financial press understood that companies exist to make money. And it happens that the cap-and-trade climate program these 10 jolly green giants are now calling for is a regulatory device designed to financially reward companies that reduce CO2 emissions, and punish those that don’t.
Four of the affiliates–Duke, PG&E, FPL and PNM Resources–are utilities that have made big bets on wind, hydroelectric and nuclear power. So a Kyoto program would reward them for simply enacting their business plan, and simultaneously sock it to their competitors. Duke also owns Cinergy, which relies heavily on dirty, CO2-emitting coal plants. But Cinergy will soon have to replace those plants with cleaner equipment. Under a Kyoto, it’ll get paid for its trouble.
DuPont has been plunging into biofuels, the use of which would soar under a cap. Somebody has to cobble together all these complex trading deals, so say hello to Lehman Brothers.
…Finally, there’s General Electric, whose CEO Jeffrey Immelt these days spends as much time in Washington as Connecticut. GE makes all the solar equipment and wind turbines (at $2 million a pop) that utilities would have to buy under a climate regime. GE’s revenue from environmental products long ago passed the $10 billion mark, and it doesn’t take much “ecomagination” to see why Mr. Immelt is leading the pack of climate profiteers.