Report Sees Economic Opportunities in Fighting Global Warming

Lincoln Journal Star
Jun 06, 2006

SYNOPSIS: Climate change may generate new business opportunities, according to a report released by the University of Texas at Dallas.

DALLAS — Human-induced global warming threatens civilization with economic woe, coastal destruction, monster storms, deadly droughts and other challenges.

Now for the good news: climate change might also generate new business opportunities, according to a report released by the University of Texas at Dallas.

Large-scale changes typically create both winners and losers, says UTD political economy professor Lloyd Jeff Dumas, and what could be more far-reaching than global climate change?

In "Seeds of Opportunity: Climate Change Challenges and Solutions," Dumas spies large potential profits in everything from rising demand for renewable energy sources to the widespread trading of carbon credits.

"It has been said that within every problem lie the seeds of opportunity," Dumas wrote. "Global warming is no exception to that rule."

Opportunities include:

Building more energy-efficient homes, buildings and vehicles.

Boosting the efficiency of alternative energy sources such as wind, solar and biomass.

Disposing of some carbon, possibly by injecting harmful substances deep underground.

Enlisting financial markets in reducing carbon emissions. Carbon trading, which rewards companies that cut emissions, already exists on the Chicago Climate Exchange.

A strong scientific consensus has emerged in recent years that human activity has caused a rise in average global temperatures, due to the buildup of greenhouse gases such as carbon dioxide.

There’s also broad-based agreement that reducing carbon emissions can help avert some of the most dangerous potential consequences of climate change, such as rising sea levels and shifting weather patterns.

The business community has argued that limiting carbon consumption would hamstring the economy and destroy jobs. Lately, however, while there’s little doubt that climate change is apt to impose serious costs, corporate attitudes have been shifting.

"They’re really coming around to the opposite view, which is that if we want to protect the economy we have to deal with this problem," said Andrew Logan, an analyst with Ceres, a nonprofit group in Boston that seeks business solutions to environmental problems. "The other thing companies are realizing is that there are huge potential opportunities."

In a recent study, Ceres praised such companies as oil giant BP PLC which is investing heavily in alternative fuels, and General Electric Co., which is developing climate-friendly technologies.

Meanwhile, Ceres said, American Electric Power is using "clean coal" technology, which seeks to reduce greenhouse gas emissions. Companies such as E.I. du Pont de Nemours and Co. and Alcoa Inc. have long had strategies in place for climate change governance.

Dumas prepared the report for the Civil Society Institute, a nonprofit group near Boston, with assistance from Irene Ngugi, Kruti Dholakia and Nazia Arbab.