Cap and Trade: It ain't easy, being green.

Last week Exelon, a giant utility company, announced that it was ending its membership in the US Chamber of Commerce, citing opposition to the Chamber’s positions on climate change and the EPA’s recent moves to regulate carbon dioxide emissions as an immediate threat to human health and safety. Other high profile companies that have recently left the Chamber are Pacific Gas & Electric, PNR Resources (another utility), and Apple Computer. Nike has resigned from the Board of Directors of the Chamber, but is retaining their membership.

It looks like the progressive companies, the leaders of the future, have embraced the need for a carbon free future, and are willing to do whatever it takes to accomplish that future.

The funny thing though, is that none of those companies is going to suffer very much from supporting climate change legislation.

Exelon, for example, like Pacific G & E and PNR Resources, owns lots of nuclear power plants. So under carbon cap and trade legislation currently under consideration, these companies would be awarded what are called carbon offsets. Utilities that have a lot of coal fired power plants (big carbon emitters), would have to purchase those offsets to compensate for the amount of carbon they emit.

Basically, Exelon stands to make a lot of money from cap and trade legislation. If I could pick up an entirely new revenue source, without having to do any work for the extra money, I’d be in favor of that too. Exelon doesn’t even have to worry about upsetting their customers. The utilities that are buying offsets from Exelon have to deal with that headache, when they raise their customer’s rates to pay for the offsets.

Now let’s look at the other two examples, Nike and Apple. What I notice is that neither of these companies has significant manufacturing operations in the US. Both are essentially design and marketing operations that outsource all of the actual work of building their products to Asian contractors.

So you can put all the restrictions you want on carbon emissions associated with manufacturing. It won’t hurt those guys’ feelings in the least. After all, they’ve got no skin in the game.

Now, maybe we really do need to make huge reductions in the amount of carbon we emit as a society. And maybe the best way to do that is to place restrictions on large point sources like power plants, instead of forcing individuals to change their behavior. Maybe.

My point is that it is easy to be in favor of something when somebody else is going to have to pay for it. Easy, but not particularly virtuous or laudable.