 Cap-n-Trade Coalition Dropouts: Conoco, BP, Caterpillar Wednesday, February 17, 2010 ● Sean Higgins; INVESTOR'S BUSINESS DAILY View Original Article Here: http://www.investors.com/NewsAndAnalysis/Article.aspx?id=521301&Ntt= . The nation's capital is still scooping up last week's snow, but at least one thing appears to be melting fast: the business and environmental coalition pushing for cap-and-trade climate legislation. ConocoPhillips (COP), BP (BP) and Caterpillar (CAT) all said Tuesday that they would be pulling out of the U.S. Climate Action Partnership, a coalition of green groups and leading corporations pushing for a cap-and-trade bill to curb emissions of carbon dioxide. The three announcements deal a serious blow to the already-faltering effort to push a climate change bill through the Senate. USCAP was intended in part to bring Republicans on board by saying big business wanted a deal. With some members now taking a hike, the opposite message is being sent. Climate Bill's Death Knell? Sen. James Inhofe, R-Okla., a leading critic of cap-and-trade, cheered it as the legislative death knell. "With cap-and-trade virtually dead this year and the credibility of the U.N.'s global warming science collapsing, it is no surprise that companies are questioning whether job-killing global warming legislation — no matter how beneficial to their own bottom lines — is really a sound policy after all," Inhofe said in an e-mailed statement to IBD. When President Obama swept into office with huge Democratic majorities in Congress, many corporations felt they needed to get on board to try to influence the seemingly inevitable legislation. Under cap-and-trade, businesses would need tradable permits to emit CO2. The goal is to reduce emissions at a lower cost than outright caps. Many businesses also sought lucrative permit giveaways. But cap-and-trade stalled in the Senate, the Copenhagen climate treaty talks failed, and a slew of embarrassing revelations came to light about global warming data and forecasts. The three corporations themselves all indicated that their leaving was based on disputes within USCAP over the direction the legislation was taking in Congress. They argued that it was now tilted towards coal-based energy producers. In other words, they feared that the latest version of the global warming bill would have melted their bottom line. "The transportation industry carries a disproportionate burden of the cost and the emissions reductions," said Ronnie Chappell, a spokesman for energy giant BP, formerly British Petroleum. He added that the bill didn't do enough to promote natural gas. Conoco, a major producer of natural gas, had similar complaints. Spokeswoman Nancy Turner put it this way to IBD: "Critical work" was being done on the bill regarding the transportation industry, and that was why Conoco left the coalition. "We felt we could add valuable insight to those decisions, which was something USCAP could not provide," she told IBD via e-mail. It's an ironic result. Earlier efforts to get a climate change bill through Congress had foundered in part because of the reluctance of Democrats from states that use a lot of coal-fired electricity. Those Democrats feared that the bill would target coal, jacking up energy costs in their states. Apparently their concerns are being addressed at the cost of pushing away others in the coalition. In any event, all three companies indicated that they believed the USCAP coalition had run its course and they could better advocate for change on their own. With the exit of BP and Conoco, Shell (RDSA) is the only oil company still in the coalition. USCAP tried to downplay the news in a statement, saying that its membership changes periodically, so move along, nothing to see here. Exactly why all three announcements came on the same day was not clear. Spokesmen for BP and Caterpillar said they had not coordinated with the other companies. Caterpillar notified USCAP of its intent to leave on Feb. 6, company spokeswoman Kate Kenny said. BP's Chappell said the decision had been made several days ago, though he could not specify when. Conoco's Turner did not directly respond to a question on the timing. The news follows several bad months for the task of getting a climate bill through Congress. While the House passed its version, efforts to have a bill on Obama's desk before December's global climate summit in Copenhagen failed. The Copenhagen talks themselves then failed, as major players like the U.S. and China could not see eye to eye. The Chinese even publicly snubbed Obama. At the same time, scandal erupted in the scientific community devoted to studying climate change when leaked e-mails from the Climate Research Unit in East Anglia appeared to show manipulation of data and private doubts among the scientists. More recently, scandal hit the United Nations' Intergovernmental Panel on Climate Change after it was revealed that data on the melting of glaciers in the Himalayas was wrong and Chairman Rajendra Pachauri initially defended the error-ridden data. IPCC has since admitted other errors. Calls for Pachauri's resignation have come from Greenpeace and other groups, saying he has lost credibility. Fans of the climate change bill are still trying. Obama on Tuesday announced more than $8 billion in loans for the first new nuclear power plants in years, hoping to drum up support for an energy bill. "I believe there's real common ground here. And my administration will be working to build on areas of agreement so that we can pass a bipartisan energy and climate bill through the Senate," Obama said, proving if nothing else that optimism is a completely renewable resource.
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