Market Strategies for

Climate Change

What’s Climate Change?

http://www.youtube.com/watch?v=uvqU_L5PZtk

Climate Change Effects Businesses

What three industries are most affected by climate change?

1. Energy

2. Transportation

3. Insurance

The Kyoto Protocol

A protocol for the United Nations aimed at fighting global warming

Large, multinational companies actively lobby governments around the world to support the Kyoto Protocol

191 Nations involved now, but the Protocol is said to be too loose, have unreasonable goals, and be full of loopholes

Kyoto Protocol (cont.)

United Kingdom –

United States–

Mexico –

The Netherlands –

Yes

No

Yes

Yes

ExxonMobil in bad and good light…http://www.youtube.com/watch?v=Mf_NAfKFvXg

http://www.youtube.com/watch?v=XhExwgiSxt8

http://www.youtube.com/watch?v=T0XWATD-ElA

Lets Suppose You Work for ExxonMobil…

How would you go about reducing your Green House Gas emissions to go green?

What Companies Like ExxonMobil are doing

Increasing energy efficiency

Increasing use of renewable energies

Reducing carbon offsets

Increasing green office standards

Global Climate Change and BP Amoco

It’s the 80’s

Journey’s hit, Don’t Stop Believing, tops charts in 1982

It’s the first time scientists begin to link CO2 levels with the average global temperature.

Brent spar Disaster

T/F?

Facts about environmental safety help sway public opinion.

False!

All the facts were on Shell’s side but the public didn’t care.

It was completely environmentally safe to ditch Brent spar into deep water.

1996, Sir John Browne, CEO

“Industry, particularly the oil and gas industry, should co-operate with governments and others in seeking economically sound and international agreed solutions.”

1st Step…T/F

Join the Global Climate Coalition (promoted global warning skepticism)

False

The Global Climate Coalition, like many other coalitions, are lobbyists based in Washington D.C.

Official Statement (simply): “The time is now to take Global Warming seriously, no more discounting or debating”

Bp the companyThird largest energy company

Fourth largest company in the world

3.8 million barrels of oil produced a day

18.3 billion barrels of reserves

So what percentage of carbon emissions does it contribute to the Earth’s atmosphere?

Only 1%

Next question…

Are you regulated for the amount of acid rain your company produces?

Yes.

The Clean Air Act was the product of BP Amoco and the Bush Administration, this lowered the cost of acid rain control by millions

This placed BP Amoco as the leader for environmental reform

1997 – Joins Kyoto Protocol

BP Amoco sets 10% emissions reduction goal

T/FTo offset the costs of 10% reduction, BP Amoco got involved in the solar energy industry, and as a result, reaped major profits.

True

Over $95 million in sales after the Kyoto agreement

Biggest risk?

A. The financial strain

B. Not meeting the 10% reduction

10% reduction because…

Green Premium – new idea, no one buys until they see a problem

Pressure Competitors – rationally ahead of the curve

Better Government Relations – industry is tightly regulate

Money saved - $23 million cut from expansion

Agree or disagree?

“The smart thing to do is not to take a position on the science, and BP has not. But you can be an agnostic on the science and still think 10% reduction in CO2 emissions is a good idea. A refinery with less CO2 will always be more profitable than one with more, because pollution represents a misplaced resource.”

Dank U Wel

“Customers want energy that is not only affordable and accessible but also clean. So there is tremendous long term opportunity. The question was how to exploit this opportunity given short-term economic pressures.”

-Lee Edwards