Wednesday, July 30, 2008
HARTFORD, Conn. – Two top executives from US industry told a congressional panel on Monday that the country should assign a dollar cost to carbon emissions to encourage investment in efficiency and tackle climate change.
“We need to reaffirm the principle of predictability,” George David, chairman of United Technologies Corp, told the House of Representatives Select Committee on Energy Independence and Global Warming.
“We need to say to our world that we are going to have a cost of carbon, whether it’s cap-and-trade or a carbon tax,” he told a hearing in Hartford, Connecticut, where United Tech, the world’s largest maker of elevators and air conditioners, is headquartered. “There’s got to be an understanding that the cost of energy is going to be high for a long time.”
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While oil prices have quadrupled in the last four years, he noted past price spikes have been followed by sharp declines.
David declined to back a particular approach for assigning a cost to emissions of carbon dioxide, the primary greenhouse gas associated with global climate change.
But John Rice, a General Electric Co vice chairman, said GE sees cap-and-trade as the way to go.
GE, the second-largest US company by market value, makes both energy-producing devices from equipment for coal plants to windmills and energy-consuming products like jet engines.
“We believe that a cap-and-trade program can provide a reliable market pricing mechanism for carbon,” Rice said.
With cap-and-trade, regulators issue companies permits to emit a certain amount of carbon dioxide. Those that emit less than allowed can sell permits to those who top their limits.
While the European Union already has a cap-and-trade system covering more than 1,000 industrial sites, the US Senate last month defeated the most recent effort to adopt such a system.