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Greenhouse Market Mania

International Groups


Despite the strategic differences between corporate climate lobbies on both sides of the Atlantic, they work closely together in a number of powerful international coalitions. At the UN climate negotiations, these groupings coordinate their lobbying efforts to achieve optimal political impact. The US lobby groups campaigning against ratification of the Kyoto Protocol work hand in hand with Europe-based groups that pursue a more 'constructive' image to shape the Kyoto 'rulebook' in the interests of transnational corporations.

Two groups operating at the international level, the World Business Council for Sustainable Development (WBCSD) and the International Chamber of Commerce (ICC), have been very diligent in lobbying for the right climate for industry, through their mastery of the doctrine of corporate environmentalism. The main success of this strategy has been to portray corporations as part of the solution, and not the problem. They have co-opted the debate in such a way that there is now general acceptance among many governments, the public, and even several environmental groups that any realistic solutions to global environmental problems has to avoid regulations and trust the market to deliver the right responses. Work on environmental issues by both groups has always been closely intertwined. Back in 1992, they cooperated to successfully hijack the Rio Earth Summit (UNCED, skilfully preventing debate on the need for international regulation of corporations. [132] This corporate coup slowed down global progress in the fields of international environment and development policy in the 1990s.

The WBCSD is the result of the 1995 merger of the environmental arm of the ICC, the World Industry Council for Environment, with the then free-standing Business Council for Sustainable Development. The WBCSD, a coalition of some 140 CEOs of transnational corporations, soon evolved into the dominant business voice on sustainable development and the environment. Its desires have always been echoed by the ICC, comprising over 7,000 companies worldwide, and dominated by 50-100 of the world's largest and most powerful TNCs. By promoting self-regulation and spouting sustainable development rhetoric, the WBCSD has helped its member TNCs to simultaneously green their public images and push for deregulated economic growth and free market globalisation. It is worth noting that the corporations active in the supposedly green WBCSD -- including Dow Chemical, Shell and DuPont -- have also been involved in aggressive campaigning against binding agreements on greenhouse gas emission reductions.

Both groups have developed strong links with various UN agencies, and have kept close tabs on the negotiations spawned in Rio, including those on the Framework Convention on Climate Change. Before the Kyoto negotiations, the groups followed a classic corporate strategy. While not denying the existence of climate change as boldly as other groups did, they sought to avoid regulation using the now quite standard corporate line of promoting voluntary agreements by industry and market-based 'solutions' so as not to harm international competitiveness.

A typical activity was the 'International Conference on Business Initiatives for Mitigating Climate Change', which the WBCSD and the ICC organised together with the Japanese industry lobby Keidanren during the Kyoto climate summit. The message was that if responsibility for solving the climate problem were left to them, the result would be the swift introduction of technological improvements and increased energy efficiency. Both the WBCSD and the ICC tout the Clean Development Mechanism (CDM) as the most promising solution to the climate crisis. This is not surprising, as it will provide ample opportunities for TNCs to win new markets in Southern countries as the carbon economy continues to take hold.

Both groups have kept busy on various fronts since Kyoto. The WBCSD runs the 'International Business Action Plan on Climate Change' which promotes CDM projects between its corporate members and Southern countries, working together with the UN Development Program (UNDP) to facilitate the involvement of the private sector in these projects. It is simultaneously involved in three major attempts to accelerate the creation of global CO2 emissions trading markets: one coordinated by the UN Conference on Trade and Development (UNCTAD), the World Bank carbon trading fund and the newly established International Emission Trading Association (IETA). IETA promotes corporate emissions trading and counts major polluters such as BP Amoco, Royal Dutch Shell, Statoil, Endesa and Tokyo Electric Power among its members.

The two groups have nearly identical demands for the climate debate. They want to, "bring developing countries on board," promote voluntary industry agreements as the preferred regulatory option, oppose any restrictions on the use of the flexible mechanisms, and include nuclear, coal, large hydroelectric and plantation forestry as carbon sinks under the CDM and JI. The ICC is also particularly keen on self-monitoring by industry and on avoiding binding non-compliance measures such as fines or penalties.

The ICC's enormous resources give it a formidable lobbying capacity. Its Working Group on Climate Change consists of over 70 executives from different corporations. [133] The ICC plays a coordinating role for business lobby groups at UN negotiations, organising daily information exchanges and strategy meetings as well as meetings with UN officials. [134] But the ICC is also working on the regional level, like in the EU. "We are working in Brussels and with the EU delegations," Juan Santaholma of the ICC's Energy Commission explains, "and maybe most important is working together on the national level, with national governments."[135] All ICC statements are transmitted directly to national governments through the national ICC branches.

Indicative of the ICC's privileged political access was an international meeting in Dakar, Senegal just two weeks before the Buenos Aires Climate Summit. A 30-person delegation from the ICC and WBCSD joined representatives from Shell, LaFarge, Texaco, Mobil and Chevron in discussions with with energy and environmental ministers from more than 20 African countries. The agenda was to tempt these Southern governments with promises of technology transfer and foreign investment in exchange for political support for the CDM. A follow-up meeting was organised in the spring of 1999.

During COP-4 in Buenos Aires, the ICC, together with Keidanren, the WBCSD, the USCIB, the World Wide Fund for Nature (WWF) and the United Nations Environment Programme (UNEP) organised a 'Workshop on Voluntary Initiatives on Climate Change'. The ICC's lobbying contingent of over 100 business representatives took the lead in the heavy industry lobby that contributed to postponing decisions on the implementation of the flexible mechanisms until COP-6. Both the ICC and the WBCSD have made good use of this interlude to continue lobbying industrialised and developing countries to shape the Kyoto rulebook in the most business-friendly manner possible. If they succeed at COP-6, it would mean a severe setback for meaningful attempts to counter the looming climate crisis.

The International Climate Change Partnership (ICCP)

The ICCP, with members from a wide range of industrial sectors, claims to be, "committed to constructive and responsible participation in the international policy process concerning global climate change." [136] The reality behind this corporate newspeak is an aggressive lobby campaign against any form of limitations on the marketisation of carbon as enshrined in the flexible mechanisms of the Kyoto Protocol. Locking-in the undiluted use of the Kyoto mechanisms is the ICCP's top priority for COP-6. The ICCP's membership includes Japanese, European and US-based corporations, [137] but the lobbying efforts are strategically focused on ensuring that the US government maintains a hard-line position which would ensure maximum benefits for industry. The ICCP has excellent access to the US negotiators. [138] In a September 2000 letter to the US government, the ICCP rejects any measure that would, "hamper the ability of the private sector to cost-effectively pursue the flexible market mechanisms." [139] Limits on emissions trading and the use of sinks as well as the exclusion of nuclear energy "threatens the very foundation of the Kyoto Protocol agreement, thereby limiting its chances for ratification," the ICCP not too subtly warns.

The ICCP's "constructive and responsible" approach also includes rejecting the proposals for public involvement in the Clean Development Mechanism. [140] The ICCP also bluntly rejects any reference to equity considerations, as these "are not specified in the Protocol and should not be part of project evaluation." [141]


The International Petroleum Industry Environmental Conservation Association (IPIECA), headquartered in London, is another industry coalition heavily involved in lobbying for the interests of the oil industry. Its 'Global Climate Change Working Group' has operated since 1988, making it one of the absolute veterans of the carbon club. It has stepped up its activities recently as the Kyoto Protocol has made climate change, "the most important public policy issue facing the industry." [142] The working group cynically demands that governments adopt policies, "that strike a balance between the projected consequences of potential climate change and the estimated costs of response." [143]

The Transatlantic Dimension

Another vehicle for corporate power within the climate debate is the Transatlantic Business Dialogue (TABD). Through the TABD, EU and US-based corporations develop policy recommendations which governments on both sides on the ocean have committed themselves to implementing. [144] While mainly a tool for deregulation and the creation of a transatlantic free trade area, the TABD has since 1997 had an active 'issue group' on climate change. This working group is made up of representatives of European and US corporations, with a co-chair from each side of the Atlantic. The current European co-chair is Diettrich Wittmeyer of VCI, the German chemical industry group. [145] Apart from meeting with high-level government representatives at the annual TABD conferences, EU-US summits and other occasions, the TABD has a close, "almost daily," working relationship with high-level civil servants in the US administration and the European Commission. [146] For instance, the TABD's climate working group has its 'contact point' in the environmental directorate (DG-XI) of the Commission, ensuring permanent access. [147]

While there are significant differences in the strategies pursued by EU and US corporations in their domestic contexts, the TABD positions reflect the common ground between the two sides. The group stresses that business wants to be involved in the decision-making process, "creating the framework within which business is expected to operate." [148] The TABD mirrors general industry demands on climate, promoting itself as a forum in which EU and US authorities can "discuss with business and industry options for co-operative approaches which would prioritise market-based response, voluntary agreements and effective use of flexible mechanisms at GHG abatement and reduction." [149] The central demand is that the EU and US start "speaking with one voice" in the UN climate negotiations, together promoting "a market-based approach." [150]

Apart from ensuring that the EU and US negotiating strategies in the UN climate talks are in line with corporate priorities, the TABD also has very clear positions on domestic climate policies: voluntary industry action and 'market-based solutions' instead of "heavy-handed regulation and inappropriate fiscal measures" such as energy taxes. [151]

The Emission Brokers Lobby

The greenhouse gas brokers have organised themselves in lobby groups such as the Emissions Marketing Association (EMA). Working with the slogan of "Serving the International Emissions Trading Community," [152] EMA brings together over 140 consultancies and corporations from around the world, including Mitsubishi, Cargill, Enron and Dow, as well as lobby groups like the Global Climate Coalition. The EMA, which publishes the monthly newsletter, 'The Emissions Trader', lobbies against any kind of restrictions or limitations on the use of the emissions trading mechanisms.

The EMA is intensifying its efforts in the run-up to COP-6. From October 1-3, it organised an international conference entitled: 'Dawn of the Deal: Emissions Trading on the Eve of COP-6' in Toronto, Canada. [153] The group had 15 lobbyists registered for the last negotiating session before COP-6 (SB-13 in Lyon 11-15 September 2000), representing consultancy companies like Environmental Financial Products and Environmental Markets, [154] and it will send a major delegation to The Hague.

The Nuclear Lobby

The top priority for the nuclear lobby at COP-6 is clear - to get nuclear energy included under the Kyoto Protocol's flexible trading mechanisms. [155] Lobbyists from the European Atomic Forum (Foratom), the European Nuclear Society (ENS) and their sibling organisations in the US, Canada and Japan will be working tirelessly to prevent any move to exclude nuclear power as an option for countries to reduce greenhouse gas emissions worldwide. [156] The nuclear industry had a significant presence at this year's preparatory negotiations (SB-12 and SB-13), but it is concentrating its efforts on COP-6 itself, where it is expected to have a sizeable delegation. [157]

Nuclear energy, according to groups like ENS, is part of the solution to the "de-carbonisation of the energy supply." [158] Therefore, any investment in nuclear power - whether building new plants or upgrading and prolonging the life of existing ones - should be rewarded with carbon credits. In the words of the International Nuclear Forum, COP-6 should decide on "an emissions trading system that is non-discriminatory." [159] The nuclear lobby uses any argument it can think of to make the case for nuclear energy to be included in the Kyoto rulebook, including its self-proclaimed concern for the sovereignty of developing nations, which "should be free to choose for themselves which technologies they adopt in their search for sustainable development." [160]

The stakes for the nuclear industry are high. This is not only due to the tremendous new commercial opportunities that would arise from nuclear energy being subsidised through the Clean Development Mechanism. (CDM), but also because the exclusion of nuclear energy from the Kyoto Protocol would raise further political and environmental doubts about the use of this technology. As a nuclear industry analyst put it, "If the climate change benefits of nuclear energy are not reflected in national and international climate change policies, then the existing inequities in the treatment of different electricity generation technologies will be made worse."[161] First priority for the nuclear lobby will be to make sure that nuclear energy is not explicitly excluded from the Kyoto mechanisms. Some industry observers believe that nuclear energy will most likely not be officially included at COP-6, but only at a later stage, because its early inclusion would make it difficult for the environmental movement to support any agreement coming out of The Hague summit. [162]

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