(New York) – Speaking today to state treasurers, leading institutional investors and other investment community leaders at the 2008 United Nations Investor Summit on Climate Risk, Peter A. Darbee, Chairman, CEO and President of PG&E Corporation (NYSE: PCG), stated firmly that global warming can be combated effectively with technologies available today, if private sector incentives are properly aligned with forward-looking public policies.
“In conversations with other business leaders, I’ve heard more times than I can count that it’s impossible or impractical to make much headway on greenhouse gases until we have better technology,” Darbee said. “That is not the case. It’s a red herring. . . . The biggest obstacle right now is a lack of will – not invention.”
Darbee pointed to California’s success in holding per capita energy use flat over the past 30 years, while the rest of the country has seen a 50 percent increase. The state adopted aggressive energy efficiency standards for buildings and appliances, funded programs to commercialize more efficient technology, and allowed utilities to earn a fair return by promoting energy savings rather than increasing energy sales.
“The key in California was smart policy that aligned all the incentives,” Darbee said.
Darbee’s remarks came during a panel titled, “Unleashing the Business Potential for Clean Energy.” The panel, moderated by Timothy E. Wirth, President of the United Nations Foundation, also included Nobuo Tanaka, Executive Director of the International Energy Agency, and Vinod Khosla, Founding CEO of Sun Microsystems and Founder of Khosla Ventures. The summit, which also included an address by former Vice President Al Gore, is part of a day-long forum at the UN Headquarters focused on ways investors can advance solutions to climate change and realize the economic opportunities of a global transition to clean energy.
Darbee called on the federal government to create clarity for business and provide a constructive context for solutions by setting long-term national targets and timetables for reducing greenhouse gases. In addition, he said, government should offer incentives for utilities to pursue energy efficiency programs, tax benefits to promote long-term investments in renewable generation, and support for building of new transmission and distribution infrastructure to bring renewable power to customers.
Darbee urged the financial community in turn to support calls for greater transparency by the private sector on greenhouse gas emissions and company strategies for coping with climate change. According to Darbee, a higher level of transparency is essential for quantifying risk and will become one of the basic drivers for market-based strategies to reduce emissions.
“When analyzing a company, I would encourage the investment community to try to separate those companies that are truly internalizing an understanding of climate change and its impact on their business, versus those that may not be,” Darbee said.
“If the investment community begins to recognize and reward this kind of thinking, it could go a long way,” Darbee added. “It would drive innovation. It would help the industry and our country turn the corner on this challenge – at the same time, creating significant value and growth opportunities.”
For the full text of Darbee’s remarks see http://www.pgecorp.com/investors/pdfs/080214UNClimateRemarks.pdf.