Dedicated to the balanced discussion of global warming
San Jose Business Journal – August 10, 2007
As the loyal readers of this site know, I am not a fan of carbon credits. This article underlies much of my mistrust of this system. The article touts several companies that have bought green credits (companies that aren’t huge per capita users of energy). These companies have bought the credits because they want to do the right thing by the environment, and admittedly, they want the bragging rights of buying them.
My problem with this instance is that it is a poor use of their money. Since they are basically “donating” the money to green causes, why not call it a donation? Since some of the recipients of that money are using this new wealth for capital improvements and R&D, why don’t the donators simply invest in those companies? Surely, if Yahoo would invest in a wind turbine company they could do more good by ensuring that R&D, marketing, and capital improvements continue to accelerate.
It almost feels like these companies are Pontius Pilate and they just washed their collective hands. That is probably a little cruel, but I wish that they would use their hard earned dollars in a more proactive way.
I have written elsewhere on carbon credits so you might want to look at these articles as well:
carbon credit, carbon trading, electric, emissions, Greenhouse gas, industry, Renewable Energy Credit, solar, utility, wind, wind turbines
The demand for green energy has grown so much that the market for renewable energy credits may award the movement its greatest honor: an increase in price.
Suppliers of renewable energy are having a hard time coming up with new sources of renewable energy — mostly from wind — to meet the rise in popularity.
Each of these companies is purchasing the energy credits through Silicon Valley Power, Santa Clara’s city-owned utility, which hopes the credits will expand the capacity of renewable energy providers.
Some call this a solution to greenhouse gas emissions. More cynical observers see it as a way to burnish one’s environmental image. In fact, it’s both.
Consumers and businesses pay a 1.5-cent premium for the renewable energy credits over their normal energy bill. Silicon Valley Power charges residential customers 8.5 cents a kwh. Businesses pay from 8.2 cents to 12.4 cents per kwh, depending on the size of their purchase.
The credits are intangible. Lenny Hochschild, director of renewable energy markets for consultant Evolution Markets, calls them “green bragging rights.” And so public companies like Cisco who buy them have some explaining to do to their stockholders.
About 8.5 billion kwh of green energy was generated in 2005, which is a tiny fraction, about 0.2 percent of total U.S. electricity sales. But demand is growing.
Now producers of renewable energy are struggling to find locations to install their wind turbines and solar panel arrays, an increasingly difficult task especially close to urban areas.