U.S. Chamber President and CEO Thomas J. Donohue-Major Economies Business Forum on Energy Security and Climate Change

September 21, 2009
Thank you very much, Karen, and good evening everyone. The U.S. Chamber is very pleased to be hosting this event. I know many of you met at the Confederation of Danish Industry in Copenhagen earlier this year, and we are glad you made the trip to Washington to be with us tonight. We’re gathering together because of the upcoming global climate change meetings in Copenhagen in December. Business would welcome an agreement—but, it must be a good agreement. It’s important that we get it right, and we think the Copenhagen meeting will be a positive step forward. As these negotiations progress, the business groups represented in this room have a special responsibility. Our countries represent about: • 70% of the world’s economy • 50% of the world’s energy production • 70% of the world’s energy consumption • 70% of the world’s greenhouse gas emissions. Our countries also have the resources and knowledge base to develop the technologies of the future. Tonight I’d like to offer some observations on a few topics: • First, how we can fashion a workable, achievable, commonsense climate change agreement without ruining our economies; • Second, where things stand in the United States on climate change and energy; and • Third, how we can make our voices heard in this debate. Keys to a Successful Climate Change Agreement Let’s start by facing a fundamental fact. We will not achieve a workable climate change agreement unless the governments and business communities represented here tonight agree on some fundamental principles. Let me suggest what some of those principles should be. First, any agreement should ensure global participation. Climate change is a global problem that requires a global solution. As well all know, that’s been easier said than done. Finding consensus among developed and developing nations has proven elusive in the international negotiations. We need a new approach that can bridge differences between the various stakeholders and that can motivate action. We need an approach that recognizes and accommodates a wide range of national circumstances that’s as simple as possible to implement. And it should be flexible enough so that new ideas can be introduced as they emerge. Under such an approach, each nation could design its own strategies that reflect its unique circumstances, such as its stage of economic development, resource mix, and economic needs. Each nation could decide for itself the right mix of tools and technologies to achieve results that are measurable and environmentally effective. A flexible agreement would have many advantages. It would preclude the possibility of nations gaming agreements to achieve a competitive advantage. It would recognize that different countries have different economic needs and circumstances, and different things to contribute to addressing climate change. And it would allow and encourage innovation, which will be key to mitigating climate change risks. While our strategies may be different, we share a common responsibility to reduce greenhouse gas emissions while keeping our economies growing. This leads me to a second principle—whatever we do should not harm our economies or destroy jobs. Our policies must recognize—indeed, embrace—the aspirations of people everywhere for economic growth, abundant and affordable energy, an improved quality of life, and a clean environment. We should never stand in the way of progress that reduces poverty, measurably improves health and living conditions, and restores human dignity. The fact is, we can’t have healthy environments without first having healthy economies. A third principle is recognizing the fundamental role technology must play in any solution. It’s the key to tackling climate change. For far too long, there was this view that you could tackle climate change or you could tackle energy security, but you couldn’t do both. Now we know better. These challenges share a common solution: technology. By developing new low-emission technologies, we can meet the growing demand for energy and at the same time reduce air pollution and greenhouse gas emissions. Look, we can cut emissions to any level we want using 1950s technology, but that would ruin our already fragile economies. No one wants that. What we need are new technologies that can keep our economies humming while we cut emissions. That’s the real challenge, for governments and for business. Indeed, the pace at which we develop and adopt advanced technologies will be the single most important factor determining how quickly and at what cost greenhouse gas emissions can be reduced. We’re going to need an “all of the above approach” to energy sources … We’re going to need fossil fuels … clean coal technology … nuclear power ... wind and solar … and further efficiency gains. We can continue to make advances and improve our environments in all these areas right now—we don’t need to wait for an international agreement. Those are principles I think we can all agree on. But there are certain things we must agree not to do. For example, we must fight any attempts to weaken intellectual property protections for clean energy technologies. Without them, new technologies will be slower in coming just when we need them most. Developing countries’ governments must be convinced that such protections are in their interests as well as ours. Their businesses know this already. Emerging economies now account for roughly 20% of patents, up from 5% in 1998. In addition, we must resist the urge to use protectionist trade policies to gain domestic advantages in the name of the environment. Slapping carbon tariffs on the products of countries we don’t think are doing enough to reduce greenhouse gas emissions is a failed and dangerous approach. Such policies could spark a devastating trade war when the global economy is already on the ropes. They are also a blatant violation of WTO rules. Instead, our governments should be working within the WTO to remove trade barriers to environmental goods and services in a non-discriminatory manner, so nations that need the right technology to improve their environment can get it. We need to deliver a strong message about lengthy and unpredictable regulatory mazes that delay, if not halt entirely, the construction of new energy projects, even renewable projects. It’s a big problem here, and I know it is elsewhere. Our governments need to know that one of the best things they can do to promote green jobs is to prove predictable regulation so that project developers can move ahead with confidence. U.S. Situation If achieving these goals were easy, we would have done it by now. But they are not. Look at what’s happening in this country … Our Congress has been deadlocked over a solution to climate change risks for some time. There are wide divisions among different states, regions, and industries … and the divisions between our elected officials are growing deeper by the day. But make no mistake, the American business community would welcome legislation. We have not ruled out all cap-and-trade systems or a carbon tax. The Chamber has laid out five core principles for action that we believe constitute a sensible approach to climate change. First, climate legislation must preserve American jobs and the competitiveness of U.S. industry. Second, it must provide an international solution that that includes the widest possible participation. Third, it must accelerate the development and commercial adoption of clean energy technologies. Fourth, it must reduce barriers to the development of climate-friendly energy sources. And fifth, it should encourage energy conservation and efficiency. Our policy folks, our advocates, and our communicators—in conjunction with our Institute—are working everyday to build consensus, advance our principles, and make real progress on these issues. We remind everyone we talk to that this debate is not just about the climate; it is about a path forward to ensure that the United States has a long-term supply of secure and affordable energy … energy that drives our economy and underpins our quality of life. Making Our Voices Heard The path to progress in the United States is difficult, just as I am sure it is difficult in your country. Americans do not see eye-to-eye on this issue, just as our countries do not see eye-to-eye. Clearly, we are not always going to agree with each other. But, we must get behind certain principles and communicate them with a united voice to our elected officials. There’s an old saying around this town: “If you don’t have a seat at the table, you’ll find yourself on the menu.” The stakes are too high in this debate to sit on our hands and hope for the best. That won’t cut it. If we speak with a united voice, we can have a huge impact. And we should. We will be largely responsible for developing and deploying the solutions that might emerge both from the U.S. Congress and from these international negotiations. We need to raise voices among our leaders. So far, we are not speaking loud enough. We need to emphasize that we’re the experts on the private sector, we understand how things work, and we know what kind of impact their decisions will have on the economy. We are not the problem, we are the solution. So when you go back to your respective countries, light a fire under your members. Get them talking to their elected officials. Get them behind these principles and have them recruit others to support them. Our goal is clear—an international approach to energy security and climate change that considers growing energy needs; sets realistic goals; ensures global participation; promotes the development and trade in clean energy technologies and services; protects intellectual property; and builds stronger economies. That goal is within reach—if we act together, if we act now, and if we act aggressively. It is within our power to improve the environment, secure our energy needs, and fulfill our responsibility to create jobs. The U.S. Chamber is ready to get to work … we hope you are, too. So we thank you for coming, we’re glad you’re here, we’re going to have more great discussions tomorrow, and we’ll be meeting again. But for now, relax and enjoy the evening. Thank you very much. # # #