February 12th, 2010 by Michel Gelobter

Yes, there are national climate laws already…

The first of what I referred to last week as “pincer actions” are the EPA’s new climate regulations, some already in force and more even proposed.

How can the EPA regulate greenhouse gasses (GHGs) when the Congress has yet to pass a climate bill?  Well, in early 2007, the Supreme Court simply ruled that climate pollution met the threshold of the Clean Air Act, one of our country’s earliest and most powerful environmental laws.  This is the law that communities use to stop urban development when a region’s air quality is bad, and it underpins many, if not most, environmental impact challenges to new construction.

Effective January 1, 2010, EPA took the first of many steps under this ruling…EPA mandated reporting of GHGs from large facilities emitting 25,000 tons of greenhouse gases or more.  But it’s the next two steps that really count… EPA followed this new reporting rule with both an endangerment finding and a proposed rule regulating large emitters.

Of these two, the endangerment finding is most fundamental.  It lays the groundwork for a broad regulatory agenda based on the facts it establishes that greenhouse gasses are a threat to human health and welfare.

What does this all mean for your climate and energy agenda?

• If you’re one of the estimated 10-15,000 facilities that burn coal or emit more than 25,000 tons of CO2, start counting now.  You have to report your emissions for this year by March, 2011.
• If you depend for energy or supplies on one of these facilities, it’s worth considering that their price is going nowhere but up until we’ve stabilized global carbon emissions.
• If neither category above applies to you, now’s a great time to start taking stock of when and how your greenhouse gas profile is going to intersect with shareholder value and your broader organizational values.  Are you at a competitive advantage because you buy your power from a greener source?  Can you deepen your relationships with employees, customers, or investors by getting ahead of the regulatory curve on global warming? Many leading organizations are already taking action to manage carbon and energy in order to improve business efficiency (reduce cost), maximize brand and shareholder value, and manage risks.

The Supreme Court’s 2007 decision started the ball rolling inexorably towards greenhouse gas regulation.  The speed and direction of that regulation is still pretty uncertain, but for some it’s here already.  For the rest of us, it’s around the corner.