Tackling climate change is a monumental challenge. Power-company CEOs discuss long-range plans for a climate-friendly energy economy.
Michael Burr is editor at large at Public Utilities Fortnightly.
When the Edison Electric Institute (EEI) and Electric Power Supply Association (EPSA) both announced new climate-change policy principles in early 2007, they signaled the U.S. power industry was going through a dramatic climate shift of its own.
Rather than emphasizing voluntary efforts to reduce emissions of greenhouse gases (GHG), as past policies did, the new climate policies focus on regulatory actions that encourage technology R&D and reward companies for investing in those new technologies.
These new policies demonstrate that U.S. power companies expect carbon constraints to become mandatory in the foreseeable future, probably before the end of the decade. And rather than fighting a losing battle against a rising policy current, they are trying to direct that current in ways their stakeholders can accept—and even support.
This change in thinking also confirms what analysts and consultants have been saying—that carbon constraints can represent a major business opportunity for the electric-power industry, as efficiency and conservation become core value propositions for companies that traditionally have been rewarded for building capacity and selling volume.