Why Is the Opportunity for a Thriving, Clean Economy Tied Up in Court?

Authors

Sissel Waage, Senior Advisor, BSR

A little more than a year ago, the Paris Agreement on climate change launched a cleaner, more stable, job-generating economy, with the global opportunity for US$13.5 trillion dollars in investments. The story about this new economic opening was easy to miss, as the press coverage focused more on what the climate agreement meant in terms of degrees Celsius and parts per million in the atmosphere than on what it means as a business opportunity. But the Paris Agreement—and all of the work to address climate change—is an important opportunity to create a thriving, clean-energy future for society and business alike.

Unfortunately, in the United States, an essential component of the national climate commitment is now stalled out in the courts—despite support from many businesses, including a strong voice from companies that submitted an amicus brief in support of the Clean Power Plan.

A panel of 10 judges currently holds the key to unlocking a new wave of economic opportunity, and business stability, through a case before the U.S. Court of Appeals for the District of Columbia Circuit that began hearing oral arguments on September 27.

The good news, according to a report from an Environmental Defense Fund (EDF) attorney and other oral argument summaries, is that a majority of judges appeared receptive to arguments in support of the Clean Power Plan. The bad news is that the case still hangs in the balance and is very much in need of support.

With legal deliberations underway, now is the time for more corporate leaders to join a growing chorus of business voices and weigh in about the opportunity for economic stability and growth presented by the Clean Power Plan.

While the legal question is technical—pivoting on whether or not the U.S. Environmental Protection Agency (EPA) can regulate carbon dioxide from the power sector under section 111(d) of the Clean Air Act—the core issue is about the future of our society and the context in which we all do business. Simply put, do we allow climate change to continue, unchecked, or do we act in every way we can to avoid the unmanageable and manage the unavoidable?

U.S. businesspeople should be asking: Why is forward movement on the path to a cleaner economy—with significant job and health benefits—now tied up in court? Why is an economically robust plan—as EDF and EPA have detailed—that will address one of the top 10 business concerns stalled out in legal proceedings? And, most importantly, how can my company voice support to get this plan out of legal limbo and into action so we can benefit from the plan’s incentives for business innovation?

As country after country moves forward with the Paris Agreement, as tracked by the United Nations Framework Convention on Climate Change, the United States sits in a quagmire.

The Clean Power Plan is an essential piece of policy that the United States, the planet, the economy, and people need. Consider the benefits of the plan, which will reduce power plants’ carbon pollution through investments in renewable energy: The White House estimates that the Clean Power Plan could save consumers up to US$155 billion from 2020-2030 by providing cheaper energy, while concurrently delivering public health and climate benefits worth an estimated US$34-54 billion per year in 2030. These benefits far outweigh the EPA-estimated costs of US$8.4 billion needed to ensure cleaner power plants. The plan will also create new and better job opportunities, grow the economy, and increase the competitiveness of U.S. businesses in the global marketplace.

Already, the plan has support from a broad and diverse coalition, which includes 18 states, 60 cities, power companies, businesses, public health and environmental organizations, consumer and ratepayer advocates, and many others. In addition, legal experts—including former EPA administrators from the Nixon, Reagan, and Bush (Sr.) administrations—have expressed the strong legal basis for the Clean Power Plan. In addition, a Voices of the People poll showing that a large majority of Americans support the Clean Power Plan—including in states challenging the rule in court.

An impressive set of business leaders also support the plan, as exemplified by the 365 companies and investors who wrote letters to encourage governors across the country to finalize their implementation strategies. In an opinion column in the Virginian-Pilot, Mars, Inc. Chief Sustainability Officer Barry Parkin explains that the core of plan follows a strong business rationale: “The business logic for us is straightforward,” he writes. “A shift to renewable energy cuts costs, hedges our investment risks, and helps ensure a reliable supply chain to secure our business.” He further asserts that “smart policies that promote the expansion of clean energy help our bottom line.”

Despite all of this support, 27 states have taken the plan to court, and the U.S. Court of Appeals for the D.C. Circuit is expected to reach a decision in the coming months on whether the plan should be implemented.

Make no mistake what this case is really about. It is about business stability and opportunity. With government commitments to address climate change comes certainty for business and investors. The current legal challenge to the U.S. Clean Power Plan seeks to move us backward—toward national uncertainty and away from economic opportunity.

The Clean Power Plan is key in moving the United States—and its economy—forward. But for that to happen, we need to hear more from business. So our question is: Does your company support a thriving, clean energy economy? Please raise your voice in favor of the Clean Power Plan.