Leading U.S. Businesses Call on Congress to Enact an Economy-Wide Carbon Policy
New initiative focused on working collaboratively with lawmakers to explore policy options
(WASHINGTON – May 15, 2019) The CEOs of 13 U.S. and Global Fortune 500 companies or their subsidiaries, in collaboration with four leading environmental groups, today issued a call for action on climate change, including an economy-wide carbon pricing policy to meet the climate challenge at the lowest possible cost.
This new initiative, known as The CEO Climate Dialogue (The CEO Dialogue), urges the President and Congress to put in place a long-term federal policy as soon as possible, in accordance with a set of six Guiding Principles for climate legislation. The group aims to build bipartisan support for climate policies that will increase regulatory and business certainty, reduce climate risk, and spur investment and innovation needed to meet science-based emissions reduction targets.
Companies involved in The CEO Dialogue include BASF, Citi, Danone North America, Dominion Energy, Dow, DTE Energy, DuPont, Exelon, Ford Motor Company, LafargeHolcim, PG&E, Shell Oil, and Unilever. With input from four leading environmental groups – the Center for Climate and Energy Solutions, Environmental Defense Fund, The Nature Conservancy, and World Resources Institute – the group is committed to working with lawmakers to explore various policies designed to address carbon pricing.
The CEO Dialogue advocates the following six principles to inform and accelerate federal climate legislation:
- Significantly reduce U.S. greenhouse gas emissions so that the U.S. is demonstrably a leader on global efforts to effectively limit climate change. Specifically, U.S. policy should ensure the country is on a path to achieve economy-wide emissions reductions of 80% or more by 2050 with aggressive near- and mid-term emission reductions commensurate with this goal.
- Effective: A key test of any climate policy is whether it will deliver timely emissions reductions across the economy and includes mechanisms that provide certainty that emission goals are met. The timeline for reductions must allow capital intensive industries to adjust in an economically rational manner. Policies must encourage investment and planning decisions consistent with the timeframes needed. Policies must focus on emissions reductions outcomes, not specific resources or technologies.
- Market-based: An economy-wide price on carbon is the best way to use the power of the market to achieve carbon reduction goals, in a simple, coherent and efficient manner. We desire to do this at the least cost to the economy and households. Markets will also spur innovation and create and preserve quality jobs in a growing low-carbon economy.
- Durable and Responsive: Well-designed and stable policies will deliver predictable results and increase public support over time, providing durability across time and political cycles. Policies should be adaptive over time in terms of pace and scope of reductions as our understanding of climate change, policy impact, and technological changes evolves.
- Do no harm: Policies must support the competitiveness of the U.S. economy. Policies must address emissions leakage that can undermine climate objectives. Policies must also safeguard against negative impacts on biodiversity, land, and water.
- Promote Equity: Unabated climate change is a major threat to the U.S. economy. Therefore, policies to address climate change, which may also entail some cost, must provide transparency and promote affordability while distributing costs and benefits in such a way that promotes equity. Policies must include mechanisms to invest in American workers, and in disadvantaged communities that have the least resources to manage the costs of climate change.
With these Guiding Principles, the CEO Dialogue will initiate constructive and ongoing discourse with members of Congress, focusing on the need for market-based policy solutions.