Manufacturers Divided On Emissions Cap

March 7, 2007
Proposed emissions standards spur finger pointing and debate.

A consortium of U.S.-based businesses and nongovernmental organizations are calling for a flexible, market-driven cap on greenhouse gas emissions. The group, called the U.S. Climate Action Partnership (USCAP), includes manufacturers such as Alcoa Inc., Caterpillar Inc. and DuPont Co. who are calling for a "cap-and-trade" system that would allow companies to obtain emissions permits that could then be purchased or sold.

While Jeffrey Immelt, CEO of USCAP member General Electric Co., praised the organization's recommendations as balancing business needs with energy concerns, other manufacturers fear a cap would favor competitors in countries with less-restrictive standards.

According to a Wall Street Journal report, automakers and Big Oil are concerned about the impact of an emissions cap and have begun pointing fingers at each other's product development efforts. Automakers say oil companies should produce more alternative fuels while the oil industry is pushing for more fuel-efficient cars, the Journal reports. Chevron Corp. issued a statement saying, "We have a long history of working with the auto industry to create cleaner, more efficient fuels, and we will continue to support efforts to make the U.S. auto and light-vehicle fleet more fuel efficient."

The American Iron and Steel Institute has said it opposes any additional CO2 controls because that's already been addressed through the Energy Policy Act of 2005. The National Association of Manufacturers also has said it opposes an emissions cap.

More debate on the issue is expected now that the United Nations' Intergovernmental Panel on Climate Change has released its 1,600-page report on global warming that one climate scientist referred to as the "smoking gun" evidence of climate change.

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