Royal Dutch Shell Chair Backs Carbon-Trading System
October 15 2009 - 4:50PM
Dow Jones News
Royal Dutch Shell (RDSA) and Nokia Corp. (NOK) Chairman Jorma
Ollila has some advice on the best way to reduce air pollutants
that some believe are causing global climate change: price them and
trade them, rather than tax them.
A system to cap and trade pollution credits would be preferable
to taxing polluters, and more palatable to politicians who know
that those who raise taxes "typically are not re-elected," Ollila
said Thursday in a National Press Club speech.
Ollila acknowledged that devising a system to trade pollution
credits won't be easy, but he expressed confidence that it can be
done and suggested that broad agreement on that goal might be
reached in December at a United Nations climate-change summit in
Copenhagen.
A definitive agreement resolving climate-change concerns is not
needed in order for the Copenhagen summit to be a success, Ollila
said in response to a question about the event. However, he said he
hopes the summit will produce consensus on ways to reduce air
pollution, such as carbon trading, even if the details have to be
worked out later.
Commercial systems to capture and store carbon dioxide emissions
are needed as well, according to Ollila, who also is the incoming
chair of the World Business Council for Sustainable Development. He
said carbon sequestration technology has been tested successfully
on a small scale, but noted that development costs remain "quite
formidable" and may require public-private financing.
China's voracious appetite for energy - it commissioned 60
mega-sized coal-fired power plants last year, more than one a week
- underscore the need for rapid development of cleaner, alternative
energy sources and pollution-reducing technologies, according to
Ollila.
Ollila urged companies and governments to collaborate on
developing electrical "smart grids" and energy-efficient "smart
buildings," and predicted that firms that don't jump on the
green-energy bandwagon won't survive in the long haul.
Despite cost-cutting measures, Shell hasn't compromised on its
sustainability agenda, including its commitment to alternative
energy development, added Ollila.
Shell's support for U.S. climate-change legislation has put it
at odds with the U.S. Chamber of Commerce, yet Ollila hinted that
Shell isn't likely to quit the chamber over the matter, as Apple
Computer (AAPL), Exelon Corp. (EXC), PG&E Corp. (PCG) and PNM
Resources Inc. (PNM) have done.
Ollila said walking out on the business lobbying group would be
an extreme reaction to a dispute over one issue, and isn't
necessary since everyone knows "there is a disagreement between
Shell's position and in this case, the chamber's position."
He declined to say whether Shell is cooperating with a Justice
Department investigation of allegations of corruption involving
former U.S. Interior Secretary Gale Norton, saying that's a matter
for Shell's management team.
-By Judith Burns, Dow Jones Newswires; 202-862-6692;
Judith.Burns@dowjones.com