Businesses are Backing Climate Action
President-elect Donald Trump has voiced his denial of climate change on several occasions. And his choice of Myron Ebell, a known climate change denier, to lead the transition of the U.S. Environmental Protection Agency (EPA) demonstrates that Trump’s position may not change. However, a few weeks ago, a side event occurred at the climate talks in Marrakesh, Morocco that demonstrated just how much the business world not only believes in the occurrence of climate change, but believes in taking climate action.
Leaders of four companies talked about the benefits of investing in clean energy and efficiency, in an event sponsored by the Center for Climate and Energy Solutions (C2ES) and Edison Electric Institute (EEI). The four companies were Berkshire Hathaway Energy, Ingersoll Rand, Mars and Microsoft. All four companies also signed the American Business Act on Climate (ABAC) Pledge back in 2015, which serves as a demonstration of their support for climate change action and the conclusion of a strong Paris agreement.
“The convergence of technology and public-private partnerships are creating federal, state and local partners to revolutionize communities through an enhanced clean energy infrastructure,” Eric Holdsworth, Senior Director, Climate Programs, EEI, said at the Marrakesh event. “Through these efforts, and that of the ABAC process, we believe we can find a successful energy future together.”
Microsoft, being both a signee of the ABAC pledge and part of the Marrakesh event, serves as a good example of how business can lead the way in taking climate action. As part of the pledge, Microsoft committed to do three things:
- Maintain carbon neutral operations for its data centers, offices, labs, manufacturing facilities and business air travel.
- Purchase 100 renewable energy for the operations of its datacenters, offices, labs, and manufacturing facilities.
- Offset 100 percent of emissions from business air travel by supporting carbon offset projects that also drive social benefits in emerging countries.
Microsoft has been “operating carbon neutral since 2012," Tamara “TJ” DiCaprio, Senior Director of Environmental Sustainability, Microsoft stated during the Marrakesh event. Its operating principles, as part of that commitment, are to “operate lean by driving efficiencies, operating green by procuring renewable energy, and by operating accountable,” she said. The way Microsoft drives accountability is through a corporate carbon tax. DiCaprio explained that the company calls it a carbon fee. As a part of the carbon fee, Microsoft charges each of its 14 business groups a price on carbon for their operations. That includes operations in its data centers, offices, software development lab, and business air travel.
“We collect those funds, and we spend those funds in four different investment categories: for renewable energy, for carbon offset community projects around the world, for climate grants where we support and accelerate innovation for technology in climate related projects, and then for our tracking and reporting to increase transparency,” said DiCaprio. “As a result of that, over the last four years we have reduced carbon more than 9.5 million metric tons, we’ve procured more than 16 million megawatt hours (mWh), and we’ve impacted over seven million people around the world with our carbon offset community project investments.”
Microsoft is not the only company with an internal price on carbon. Over 1,200 companies have either currently priced their carbon emissions or plan to do so within the next two years, CDP found in its latest report on internal carbon pricing. The amount of companies disclosing that they have a carbon price has increased by 23 percent since 2015. A total of 147 companies have embedded a carbon price deeper within their business operations and strategies.
Trump has said that he will scrap the Obama administration’s Clean Power Plan, and the chances of the Republican-controlled incoming Congress passing legislation that puts a price on carbon are highly unlikely. Businesses will have to lead the way and send a clear message to the government that they are continuing their commitments to climate action through initiatives like a carbon tax.