Today, in a press release timed to coincide with publication of the Summary for Policymakers of Climate Change 2007, also known as the Fourth Assessment Report of the Intergovernmental Panel on Climate Change, DuPont calls for legislation to curb greenhouse gas emissions, stating: "We believe that voluntary measures, while constructive, are not sufficient to address an issue of this magnitude by themselves." The media--for example, USA Today--treat pronouncements like this as newsworthy, as if some climate shift had occurred in U.S. politics. In reality, energy-rationing profiteers have been pushing Kyoto-style policies for years, beginning with that erstwhile darling of eco-activists, Enron. As for Dupont, it has been promoting carbon regulation since the year 2000 or before. A document I retrieved courtesy of Archive.org explains DuPont's business strategy vis-a-vis carbon cap-and-trade schemes. Page 2 of the document ("Positive Returns on Greenhouse Gas Investments," Dec. 2002) says that in the late 1990s, DuPont invested $50 million to reduce nitrous oxide emissions from adipic acid production. Nitrous oxide is a greenhouse gas (GHG) with roughly 300 times the global warming potential of carbon dioxide (CO2). Here's the key part:
"By 2000, DuPont had reduced GHG emissions across the company by 63% from the base year of 1990, for a reduction equally 56.2 million metric tonnes (on a CO2-equivalent basis). In a hypothetical market for emission credits, assuming that (a) DuPont was awarded a tradable allocation amounting to 90% of its 1990 emissions, and (b) an average market price of $10 per metric tonne of CO2, then the GHG reductions as of 2000 have a potential market value of $472 million per year--an extraordinary return on investment."Extraordinary indeed--more than a 900% return on investment. Explanation:
- Nitrous oxide emissions are among the low-hanging fruit of GHG reductions. For example, under Sen. Jeff Bingaman's (D-NM) cap-and-trade proposal, in 2020, GHGs other than energy-related CO2 account for nearly 66% of the reductions, according to the Energy Information Administration (see p. vii).
- Although cheaper to reduce, nitrous oxide, as noted, has almost 300 times the global warming potential of CO2.
- Therefore, if emission credits are awarded on a CO2-equivalent basis (as in the Bingaman cap-and-trade proposal), each comparatively cheap ton of nitrous oxide reduced "earns" buckets of carbon dioxide credits.
- Bottom line: DuPont reaps windfall profits.