Cool reaction to warming pact
By Staff -- Industrial Distribution, 3/1/1998
Newton, Mass.--While manufacturers oppose a proposed global warming treaty as being too costly for the economy, industrial distributors are just beginning to read the fine print.Industry groups such as the National Assn. of Manufacturers say the pact's goal for the U.S. to reduce its carbon dioxide emissions 40 percent by 2112 is flawed. The accord reached in Japan in December, which faces uncertain Senate ratification, would commit the U.S. to expensive reductions but does not require developing nations to sharply reduce their own omissions, critics say.
President Clinton proposes increased research and tax incentives totaling $6.3 billion over five years to develop more efficient industrial processes, power generation, fuel-efficient cars and energy-efficient buildings. Tax credits and new funding for industrial research alone would total more than $1 billion.
Not everyone thinks the treaty is bad for business. A recent U.S. Department of Energy study reviewed by industry and academic experts concludes the country can reduce greenhouse gases without increasing its energy costs or harming the economy. The study by five DOE laboratories found the price of meeting climate change goals could be contained through technological solutions such as advanced natural gas turbines, biomass and biofuels and energy-saving appliances.
NAM supports Clinton's tax incentives package, but NAM vice president Mark Whitenton says, "we are skeptical that these measures will make a very large dent in the 40 percent decrease in greenhouse gases. The problem is the treaty's goals are flawed and they should not be adopted. That is a staggering reduction requirement...if you don't bring in the Third World."
Some distributors believe the treaty would result in increased energy costs and higher prices for manufactured goods. "Obviously the distributors will have cost increases. Whether or not they can pass them on to customers remains to be seen," says Kathee Baker, director of government affairs for the National Assn. of Chemical Distributors.
Ralph Nappi, president of the American Machine Tool Distributors Assn., says it's not a concern for most of his members. "It's not an issue that's on their screen," Nappi says.
Many companies are taking steps to become more energy efficient on their own. Arkansas-based Baldor Electric Co. began replacing inefficient lighting in its facilities six years ago and saves $125,000 a year. The electricity Baldor saves prevents an estimated 3.6 million pounds of carbon dioxide emissions annually, says Ron Reid, a facilities engineer with the company. Baldor hopes to implement a new water-based heat pump heating and cooling system at its plants to save more energy.
"It all goes hand in hand," Reid says. "The less power you consume, the less energy you're going to emit."
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