Coming Soon...National GHG Reporting
Greenhouse gas reporting is a crucial step in setting a price on carbon emissions, since it would be very hard to implement a cap-and-trade system or even a carbon tax effectively without some transparency about how much carbon is being emitted from where. For the first time, large emitters across the economy will have to conduct greenhouse gas inventories and report them to the federal government.
The Bush administration missed a preliminary September deadline submitting rules, putting it in danger of missing a final deadline of this coming June. With the Obama administration, this rulemaking appears to be a priority and there’s reason to believe the agency can complete its work this spring in time to start collecting data in 2010.
According to a source quoted by InsideEPA.com (subscription required) the proposed rule would mandate reporting for any facility releasing 25,000 tons of CO2e on an annual basis.
The SEC is Getting Hot and Bothered over Climate Change
Publicly-traded companies should evaluate whether global warming (or, if you prefer, climate change) is reasonably likely to have a material impact on the company's future financial performance. If the company concludes that there is a material impact, it must disclose that conclusion to the US Securities Exchange Commission (SEC) in various periodic reports.
As the Intergovernmental Panel on Climate Change (IPCC) stated in its 2007 report, evidence of climate change "is unequivocal, as it is now evident from observations of increases in global average air and ocean temperatures, widespread melting of snow and ice, and rising global average sea level" (see IPCC Report, Summary for Policymakers, in Climate Change 2007: The Physical Science Basis at 5). Thus, the only question is whether the potential consequences of these physical effects of global warming on the company - such as damage to company property, interruption of revenue streams that such property generate, increased costs to comply with regulations attempting to minimize global warming, and potential liability in lawsuits seeking damages from parties perceived as causing global warming - are "reasonably likely" to have a "material" impact on a company's financial performance.
How to interpret and apply these two expansive and as-yet poorly defined terms in the context of climate change, given the unknown time horizons during which the financial impacts may arise, is the $64 or $640 million question publicly traded companies must now answer. [summary]
