Cap n Trade Out for the Count

Conoco, Caterpillar, BP Quit Alliance For Cap-And-Trade

Sen. James Inhofe, R-Okla., a leading critic of cap-and-trade,”with cap-and-trade virtually dead this year and the credibility of the U.N.’s global warming science collapsing, it is no surprise that companies are questioning whether job-killing global warming legislation — no matter how beneficial to their own bottom lines — is really a sound policy after all,” Inhofe said in an e-mailed statement to IBD.

ConocoPhillips (COP), BP (BP) and Caterpillar (CAT) all said Tuesday that they would be pulling out of the U.S. Climate Action Partnership, a coalition of green groups and leading corporations pushing for a cap-and-trade bill to curb emissions of carbon dioxide.

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The three corporations themselves all indicated that their leaving was based on disputes within USCAP over the direction the legislation was taking in Congress. They argued that it was now tilted towards coal-based energy producers. They feared that the latest version of the global warming bill would have been bad for their bottom line.

“The transportation industry carries a disproportionate burden of the cost and the emissions reductions,” said Ronnie Chappell, a spokesman for energy giant BP, formerly British Petroleum. He added that the bill didn’t do enough to promote natural gas.

Conoco, a major producer of natural gas, had similar complaints. Spokeswoman Nancy Turner put it this way to IBD: “Critical work” was being done on the bill regarding the transportation industry, and that was why Conoco left the coalition. “House climate legislation and Senate proposals to date have disadvantaged the transportation sector and its consumers, left domestic refineries unfairly penalized versus international competition, and ignored the critical role that natural gas can play in reducing GHG emissions,” [CEO Jim] Mulva continued. “We believe greater attention and resources need to be dedicated to reversing these missed opportunities, and our actions today are part of that effort. Addressing these issues will save thousands of American jobs, as well as create new ones.”

A couple weeks ago, Arizona decided to withdraw from the Western Climate Initiative, which plans to enact a regional cap and trade system between several American and Canadian states. Last week the Wall Street Journal reported that Utah is also considering removing its support. Further, only four of the 11 members of the WCI have started work on the system, and even climate-friendly California is considering a moratorium. Assemblyman Dan Logue, R-Chico, is pushing an initiative to halt California’s cap-and-trade program until unemployment in the state drops below 5.5 percent. It is 12.4 percent now. Unemployment was last as low as 5.5 percent in April 2007.

ConocoPhillips has decided to focus on developing natural gas, a lower-emission fuel, to reduce emissions and create jobs.

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