Insights from Copenhagen: To Be or Not To Be…Establishing a Low Carbon Market

As COP15 heads into the second and crucial week of negotiations, both Channing and I spent a considerable amount of time talking to individual companies and attending sessions that featured a diverse set of business perspectives on the negotiations.  For those businesses attending the conference, several themes emerged outlining the “gotta haves” for them to make the type of investments that will usher in a low-carbon economy.

1. Clearer rules: Businesses here are looking for certainty in any regulatory scheme that evolves from these negotiations.  Clearer rules will help give investors the confidence to put money into clean technology.  One CEO told us “clean tech is one of the largest emerging markets the world has seen.”
2. Level playing field: In climate change terms this means an international carbon market that ensures carbon price stability, as well as unified and reliable measurement, reporting and verification.  This will enable fair competition and a meaningful comparison of companies’ performances.
3. The cost of carbon: Business is looking for price signals to emerge from the negotiations and the type of emissions trading that will be established.
4. Clear emissions reduction target: Without clear reduction goals and market mechanisms companies may hold back on investment, despite having the technology and the know-how to deliver the required solutions.

Business interests here at the conference are also actively trying to impact the direction of the negotiations.  In advance of COP 15, the Prince of Wales Foundation submitted to the U.N. a Copenhagen Communiqué on Climate Change that outlined the components of any agreement.  The communiqué was signed by more than 800 global companies, including U.S. companies like Nike, Starbucks and Yahoo.

Additionally, this past Saturday evening, business leaders met at Kronborg Castle, the castle that allegedly inspired Shakespeare to create Hamlet.  Several U.S. companies outlined the current low carbon products and activities they currently have on the market.  These companies have a clear commitment to climate change and have identified the key obstacles they hope are removed during this conference so that they can even more aggressively capture the waiting low carbon market.

That said, there’s a sense here that the companies in Copenhagen don’t reflect the mainstream of corporate America, where big lobbies like the U.S. Chamber of Commerce and the National Association of Manufacturers oppose the climate bills pending in Congress.  Still, they are hoping that the negotiations at the COP 15 do not turn out to be, as Shakespeare once wrote, “much ado about nothing.”