A Message on Cap and Trade

Dedicated conservationist Kevin O'Donovan had this to say about the climate bill

Dear Fellow DU Members,

I understand that there has been a lot of discussion about recent legislation related to climate change. This legislation has spurred healthy debate in many organizations including my own company, Shell Oil and my favorite conservation organization, Ducks Unlimited.

As a government affairs representative for Shell Oil and an at-large member of the DU Board of Directors, I hope I might be able to provide a unique perspective on the Waxman-Markey bill that recently passed the House and will be debated in the Senate this Fall. As background, I would also note that I worked on these issues as a domestic policy advisor for Vice President Cheney prior to joining Shell in 2005.

Shell Oil has not endorsed this specific legislation but we support mandatory curbs on greenhouse gas emissions and like many aspects of the Waxman-Markey bill. DU has also not endorsed this legislation but is supportive of specific components and has worked to improve provisions that will benefit wildlife broadly and waterfowl specifically. Both DU and Shell have recognized that legislation in some form is very likely to be signed into law in the next couple years and we need to take this opportunity to improve upon the proposals as they move forward.

The most important component of the Waxman-Markey bill for ducks is related to "offsets" and this also happens to be a significant issue for Shell. In a "cap-and-trade" system, where emitters must hold credits against their net emissions, "offsets" provide an opportunity to generate credits that can be sold to the market from various activities that reduce CO2 in the atmosphere. These activities are wide ranging but could include the preservation of native grasslands and reforestation of bottomland hardwoods (both very good for ducks). If the legislation is properly structured, organizations like DU or even individual ranchers and farmers, could undertake this beneficial activity and then sell the credits to the market where a company like Shell could buy them to offset emissions. The net impact is less C02 in the environment, better habitat for ducks, and a lower cost compliance option for companies (which would benefit consumers).

Climate change is no doubt a very controversial and complex issue and there is room for a wide diversity of opinion; however, the ultimate outcome of the current legislative debate is fairly certain. Given the potential positive impacts for duck habitat, I think it is very important for DU to be engaged in shaping key elements of the bill as they relate to the DU vision—wetlands sufficient to fill the skies with waterfowl today, tomorrow and forever.

Regards,
Kevin O'Donovan