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DuPont’s new gameLawrence Solomon 27 Jun 2009 Financial Post DuPont made a killing in the battle over CFC regulation. Now it's poised to do it all over again with carbon dioxide
This corporate strategy, explains chairman Chad Holliday, is both principled and fundamental: "DuPont's sustainability commitments aren't just good for business - they are our business." DuPont's commitment to sustainability began in 1997 when it decided to abandon its membership in The Global Climate Coalition, a high-powered lobby created by the oil, gas, coal, automobile and chemical companies to counter fears of global warming In doing so, DuPont took a page out of its own playbook. In 1980, DuPont had spearheaded the creation of the Alliance for Responsible CFC Policy, a lobby group that would successfully fight off regulation of CFCs, a chemical that many companies manufactured. Then in 1986, with patented alternatives to CFCs in hand, DuPont had a change of heart. In a move its Alliance partners considered a betrayal, DuPont switched sides, called CFCs a danger to the planet, and lobbied the Reagan Administration to ban CFCs. So successful was DuPont that Ronald Reagan became the world's first head of state to personally push his government to ban CFCs. DuPont's efforts culminated in the Montreal Protocol, a treaty Reagan described as "a monumental achievement." Others were ambivalent about what had transpired. As put by Mostafa Tolba, the Executive Director of the UN Environment Programme, "The difficulties in negotiating the Montreal Protocol had nothing whatever to do with whether the environment was damaged or not. It was all who was going to gain an edge over who; whether DuPont would have an advantage over the European companies or not." The advantage went to DuPont, which soon controlled the rich replacement market for CFCs. Du Pont's Freon Division Director, Joseph Glass, laid out DuPont's coup succinctly: "When you have $3-billion of CFCs sold worldwide and 70% of that is about to be regulated out of existence, there is a tremendous market potential." DuPont is now keen to duplicate its "monumental achievement" with other regulatory coups in the richest regulatory environment of all - that of global warming. To this end, it helped found the United States Climate Action Partnership (USCAP), a coalition of blue-chip business and environmental groups, to lobby the U.S. government for legislation that will suit their agenda. From DuPont's point of view, USCAP has been another monumental achievement. Yesterday, the U.S. House of Representatives passed a global warming bill - largely a USCAP product - that represents the largest transfer of wealth from U.S. consumers to corporate interests in history. As DuPont's Holliday told the committee with evident satisfaction, "we are pleased to see that many of the ideas we have developed are reflected in this bill." As well he should be. The mammoth bill's cap-and-trade system The bill, though endorsed by environmental groups happy with the grand bargain being made, is not without controversy. Greenpeace opposes the bill on numerous grounds, not least because of its corporate giveaways and because it would spur a new generation of coal and nuclear power plants. Other environmentalists deplore its boost to biofuels, and the effect that carbon offsets After it helped found USCAP two years ago, DuPont predicted that by 2015 it would be able to grow its annual greenhouse-gas related revenues by at least $2-billion a year, and that its sales of renewable materials that displace fossil fuels would double to $8-billion. If the bill does indeed become law, DuPont's estimates will look awfully sustainable. As will those of the legions of other corporations whose lobbying has made climate change the world's largest industry with the world's largest payoffs for those skilled at gaming the system. Lawrence Solomon is executive director of Energy Probe and Urban Renaissance Institute and author of The Deniers: The world-renowned scientists who stood up against global warming hysteria, political persecution, and fraud. Read next or previous article in the Climate Profiteers series. Other Climate Profiteers articles: Enron's other secret Further reading:
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In the 1800s, DuPont's first century as an industrial concern, it cashed in on the money to be made in explosives. In its second century, the 1900s, DuPont morphed into a money machine in chemistry and energy. In this, its third century, DuPont sees green in a new cash cow, one it projects will take it to unprecedented profitability - sustainable development.
