(Repeats March 5 story without changes to headline or text)
By Nichola Groom
SANTA BARBARA, March 5 Although U.S. business
leaders say they support a national carbon-capping program to
tackle global warming, disagreement over the details bodes
poorly for the plan President Obama aims to push through
Congress this year.
The chief executives of some of the biggest U.S. companies,
at a Wall Street Journal conference in Santa Barbara this week,
said they generally support a plan to cap greenhouse gas
emissions and require companies that emit more than the limit
to buy emissions permits.
But many said they had trouble with the specific plan laid
out by the Obama administration last month. Others said they
doubted whether legislators would pass such a measure during a
deep economic downturn.
"I hope that we can get something done, but I'm not
necessarily confident yet," said Xerox Corp (XRX.N) Chief
Executive Anne Mulcahy, who served on Obama's economic
Building consensus around cap and trade in the business
community is still "a work in progress," Mulcahy said, adding
that the issue of how emissions permits are distributed was
Obama has said he wants a so-called cap-and-trade system
that would put a price on emissions of climate-warming carbon.
Companies that emit more than the limit would have to buy
emission permits; companies that emit less could sell emission
In the European Union's Emissions Trading Scheme, emissions
credits were given away to polluters at first.
The head of the United States' largest burner of coal for
power generation said he was disappointed by Obama's proposal
even though he supports cap and trade in principle.
"If you auction all of the credits, then it's just a carbon
tax," American Electric Power Co Inc (AEP.N) Chief Executive
Michael Morris said on the sidelines of the conference. "So
let's forget the game. Let's call it a carbon tax, and let's
see if the populace wants to have a carbon tax."
Morris also said he disagreed with the government's plan to
use a portion of the expected $800 billion in revenue generated
in the program's first decade to make a new tax credit for
working families permanent. He would rather see all the revenue
used to fund investments in clean energy technologies.
"I just think that's wrongheaded thinking," Morris said.
The debate over whether the U.S. should scrap the
cap-and-trade plan altogether and simply tax carbon dioxide
emissions is still alive.
Autonation Inc (AN.N) CEO Mike Jackson said cap and trade
was "complicated, expensive and could introduce volatility" in
gasoline prices, a scenario the No. 1 publicly traded auto
dealership group "is absolutely opposed to."
"I would much prefer just straight forward gas taxes, like
they've done in Europe and Japan, to get the consumer to value
fuel efficiency," he said in an interview. "You don't need to
start them now in the economic recession, but just announce in
2012 or 2011 we're going to have higher taxes on gasoline. And
people will factor it into their decisions today."
Speaking at the conference, former U.S. Vice President and
climate change activist Al Gore said he favored both a carbon
tax and a cap-and-trade system, but added cap-and-trade was the
best way to create a global market focused on reducing
Even the CEO of an alternative energy company that stands
to benefit from such a program raised doubts about whether such
an initiative could be passed during a recession.
"I'll believe it when I see it," said Bill Roe, CEO of
cellulosic ethanol start-up Coskata. "When you've got an
economy that hasn't hit bottom yet, do you do that? Our history
says...this would not be a particularly great time to be
putting what many will construe as another tax in place."
Google Inc (GOOG.O) CEO Eric Schmidt, while he didn't
disagree with the idea of a cap-and-trade program, warned that
the program would take years to take effect and that more
immediate action on climate change was also needed.
"The problem that I see is not that the intent is incorrect
but that the implementation of cap and trade or a carbon tax is
multi-years away, even if you had it today, because it's
complicated to build," he said. "We can't wait."
(Reporting by Nichola Groom, editing by Leslie Gevirtz)