Companies back US carbon price to cut greenhouse gases

More than a dozen companies, including large US electric utilities and major oil refiners, are joining together to push the federal government to put a price on greenhouse gas emissions.

The 13 companies today launched the CEO Climate Dialogue, an effort to convince Congress to pass legislation to drive major reductions in US GHG emissions.

The coalition, which includes BP, Shell, Dominion Energy, Exelon and Pacific Gas & Electric, issued a set of principles they say should guide any legislation, including the need for an economy-wide carbon price, certainty for its emissions-reduction timeline and ultimate goal of at least an 80pc cut in US GHG emissions by 2050.

An effective carbon pricing policy "is one of the strongest levers we can pull to foster innovation, inspire new technology and drive lower carbon consumer choices," Shell US president Gretchen Watkins said.

The companies said they plan to initiate "constructive and ongoing discourse" with members of Congress, and will try to build support for climate legislation "in their home states and districts and in the public sphere."

One of the most vocal supporters of congressional action, senator Sheldon Whitehouse (D-Rhode Island), called today's announcement a good sign but said more companies need to break with industry trade groups that have been "relentlessly hostile" to federal efforts to cut emissions.

"The test will be whether these companies make good on their promise," he said.

Near-term action is unlikely, as President Donald Trump and the Republican-controlled Senate remain opposed to setting limits on domestic GHG emissions. Democrats in the US House of Representatives are working on legislative proposals to build support for future action and to put political pressure on the White House and Republicans.

Many of the companies that make up the group are also members of other efforts to seek a federal price on GHG emissions or are covered by existing state programs, such as in California and the northeast US, that use a carbon price to drive emissions cuts.

For example, BP and Shell are among five oil sector companies in the Climate Leadership Council, which is pushing for a federal carbon tax to reduce emissions. The new CEO Climate Dialogue is not specifically calling for a tax or system such as cap-and-trade to serve as a pricing mechanism.

Other members of the dialogue include BASF, Citi, Dow, DTE Energy, DuPont, Ford Motor Co., LafargeHolcim, and Unilever, with support from environmental organizations the Center for Climate and Energy Solutions, Environmental Defense Fund, the Nature Conservancy, and World Resources Institute.