Climate Change: EPA and DOE Should Do More to Encourage Progress
Under Two Voluntary Programs (25-APR-06, GAO-06-97).
To reduce greenhouse gas emissions linked to climate change, two
voluntary programs encourage participants to set emissions
reduction goals. The Climate Leaders Program, managed by the
Environmental Protection Agency (EPA), focuses on firms. The
Climate VISION (Voluntary Innovative Sector Initiatives:
Opportunities Now) Program, managed by the Department of Energy
(DOE) along with other agencies, focuses on trade groups. GAO
examined (1) participants' progress in completing program steps,
the agencies' procedures for tracking progress, and their
policies for dealing with participants that are not progressing
as expected; (2) the types of emissions reduction goals
established by participants; and (3) the agencies' estimates of
the share of U.S. greenhouse gas emissions that their programs
account for and their estimates of the programs' impacts on U.S.
emissions.
-------------------------Indexing Terms-------------------------
REPORTNUM: GAO-06-97
ACCNO: A52439
TITLE: Climate Change: EPA and DOE Should Do More to Encourage
Progress Under Two Voluntary Programs
DATE: 04/25/2006
SUBJECT: Air pollution control
Climate
Greenhouse gases
Private sector
Program evaluation
Standards
Strategic planning
Voluntary compliance
Program goals or objectives
DOE Climate VISION Program
EPA Climate Leaders Program
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GAO-06-97
* Report to Congressional Requesters
* April 2006
* CLIMATE CHANGE
* EPA and DOE Should Do More to Encourage Progress Under Two
Voluntary Programs
* Contents
* Results in Brief
* Background
* Some Climate Leaders and Climate VISION Participants Have Not
Completed Program Steps as Soon as Expected, and Both Agencies
Lack a Written Policy for Dealing with Such Participants
* EPA Expects Firms to Complete Certain Program Steps, but Not
All Have Done So
* EPA Is Developing a System to Track Participants' Progress,
but It Lacks a Written Policy for Dealing with Firms That Do
Not Complete Program Steps in a Timely Manner
* DOE Expects Trade Groups to Complete Two Steps, but Not All
Have Done So
* DOE Plans to Track Participants' Progress in Completing
Program Steps, but It Lacks a Written Policy For Dealing
with Those That Do Not Progress as Expected
* Working with Federal Agencies, Most Participants in Both Programs
Have Set Quantitative Emissions-Related Goals, Although Some
Climate VISION Goals Were Qualified Based upon the Asserted Need
for Reciprocal Federal Actions
* EPA Helps Firms Set Goals
* More Than Half of the Participants in Climate Leaders Have
Set Goals, and These Goals Vary
* DOE and Other Agencies Worked with Groups to Establish Goals
Before Joining the Program, and Certain Groups' Goals Were
Developed for Participation in Other Voluntary Programs
* Fourteen Climate VISION Participants Have Set Goals, and
These Goals Vary
* Many Climate VISION Participants Said Goals May Be Difficult
to Achieve without Reciprocal Federal Actions
* Both Agencies Have Estimated Their Programs' Coverage and Are
Working to Estimate Their Impact, but It Will Be Difficult to
Determine Specific Emissions Reductions from Each Program
* Both Agencies Estimated the Share of U.S. Emissions
Generated by Current Program Participants
* While Both Agencies Are Working to Estimate Program Impacts,
It Will Be Challenging to Determine Specific Emissions
Reductions Attributable to Each Program
* Conclusions
* Recommendations
* Agency Comments and Our Evaluation
* U.S. Government Voluntary Climate Change Programs
* Scope and Methodology
* Comments from Environmental Protection Agency
* Comments from the Department of Energy
* GAO Contact and Staff Acknowledgments
* app3.pdf
* Climate VISION Participant Qualifying Statements
Report to Congressional Requesters
April 2006
CLIMATE CHANGE
EPA and DOE Should Do More to Encourage Progress Under Two Voluntary
Programs
Contents
Tables
Figures
April 25, 2006Letter
The Honorable John McCain The Honorable John Kerry United States Senate
For over a century, scientists have known that concentrations of carbon
dioxide and other greenhouse gases can alter the atmosphere in ways that
affect the earth's climate. Humans continue to release large quantities of
carbon dioxide and other greenhouse gases into the atmosphere through,
among other things, the combustion of fossil fuels, industrial and
agriculture processes, landfills, and some land use changes. In 1992, the
United States ratified the United Nations Framework Convention on Climate
Change, which has as its objective the stabilization of greenhouse gas
concentrations in the earth's atmosphere but does not impose specific
goals or timetables for limiting emissions. In response, federal agencies
developed a plan for reducing greenhouse gas emissions, primarily through
voluntary efforts by companies, state and local governments, and other
organizations. Since that time, federal agencies have sponsored voluntary
programs that encourage private and public sector entities to curb their
greenhouse gas emissions by providing technical assistance, education,
research, and information sharing. The administration has promoted such
voluntary programs, along with other measures, as an alternative to
mandatory emissions reductions.
In February 2002, the President announced a Global Climate Change
Initiative to reduce the rate of increase in greenhouse gas emissions in
the United States. Specifically, he established the goal of reducing the
emissions intensity of the United States by 18 percent between 2002 and
2012. Emissions intensity is a ratio calculated by dividing emissions in a
given year by economic output for that year. In support of this goal, the
President announced two new voluntary programs aimed at securing private
sector agreements to voluntarily reduce greenhouse gas emissions or
emissions intensity.
o Climate Leaders, an Environmental Protection Agency (EPA)-sponsored
government-industry partnership established in February 2002, works with
firms to develop long-term climate change strategies. According to EPA
officials, as of November 2005, 74 firms were participating in the
program.
o Climate VISION (Voluntary Innovative Sector Initiatives: Opportunities
Now), introduced in February 2003 and coordinated by the Department of
Energy (DOE) in cooperation with EPA and other federal agencies, works
with trade groups to develop strategies to reduce their members'
greenhouse gas emissions intensity. Most industries participating in the
program are represented by a single trade group. As of November 2005, 14
industry sectors and the Business Roundtable-an association of chief
executive officers representing diverse sectors of the economy-were
participating in the program. According to DOE, the trade groups
participating in Climate VISION typically have high energy requirements.
This report examines the progress EPA and DOE have made in implementing
their respective programs. Specifically, for each program, this report
discusses (1) the key steps that the agencies expect participants to
complete (such as preparing a plan for measuring emissions and reporting
data), the progress participants have made in completing these steps, the
agencies' efforts to track participants' progress, and the agencies'
strategies for dealing with participants not progressing as expected; (2)
the types of emissions or emissions intensity reduction goals being
established by participants in this program; and (3) the agencies'
estimates of the programs' current coverage (that is, the share of U.S.
emissions that participants contribute to total U.S. emissions) and impact
(in terms of emissions reduced). In addition, as you requested, a list of
other federal voluntary climate change programs is presented in appendix
I.
In conducting our work, we reviewed and analyzed EPA and DOE documents on
the Climate Leaders and Climate VISION programs, as well as other
voluntary climate programs and met with these agencies' officials. For the
sake of brevity, we refer to all participants in the Climate Leaders
programs as firms, even though one of them, the National Renewable Energy
Laboratory, is a federal research laboratory. Similarly, we refer to all
Climate VISION participants as trade groups, even though one participant,
the Tennessee Valley Authority, is a utility. For the sake of consistency,
we describe both Climate Leaders and Climate VISION participants'
emissions or emissions intensity targets as goals, even though DOE
describes Climate VISION participants' targets as commitments. Most of the
information in the report, except where otherwise noted, reflects the
status of the two programs as of November 2005. As of March 2006, an
additional 10 firms had joined Climate Leaders. To assess the reliability
of the EPA, DOE, and other data, we spoke with agency officials about data
quality control procedures and reviewed relevant documentation. We
determined that the data were sufficiently reliable for the purposes of
this report. We conducted our work between June 2004 and March 2006 in
accordance with generally accepted government auditing standards,
including an assessment of data reliability. Additional details on our
scope and methodology are presented in appendix II.
Results in Brief
EPA and DOE each expect participants in their voluntary emissions
reduction programs to complete a number of actions; however, participants'
progress toward completing those actions, as well as the agencies' efforts
to track accomplishments, has varied. For example, within about 1 year of
joining the program, EPA expects firms to enter into discussions with the
agency to establish an emissions reduction goal and to complete these
negotiations, generally within another year. As of November 2005, 38 of
the 74 firms had established goals, while most of the other 36 firms,
including 13 that joined in 2002, were still working to establish goals;
most of the remaining firms had joined the program recently and had not
yet established goals. EPA officials told us that they were developing a
system for tracking firms' progress in accomplishing the key steps
associated with program participation, but are still in the process of
obtaining and validating data from participants. While EPA officials told
us that they would be willing to remove participants from the program if
they were not progressing as expected, they have not specified the
conditions under which they would do so. DOE asks that trade groups
participating in its Climate VISION Program develop a work plan for
measuring and reporting emissions information within about 1 year after
joining the program and later report their emissions levels. As of
November 2005, 11 of the 15 participating trade groups had completed their
work plans and 5 groups had reported on emissions. As of November 2005,
DOE officials said that the agency did not have a system for tracking how
long each group takes to complete its work plan and report emissions data.
Furthermore, they said that DOE would remove groups from the program if
they did not seem to be taking sufficient action. However, DOE has not yet
established specific deadlines for reporting emissions. Because DOE does
not have a system for tracking how long participants take to complete key
program steps--and neither agency has established written policies for
taking action against entities not progressing as expected--it will be
difficult for the agencies to ensure that all participants are meeting
expectations, and hence that the programs are contributing to meeting the
President's emissions intensity reduction goal.
The specific types of emissions reduction goals being established by
Climate Leaders firms and Climate VISION groups varied. Of the 38 firms
participating in Climate Leaders that had established emissions reduction
goals as of November 2005, 19 committed to reduce their total greenhouse
gas emissions, 18 committed to reduce their emissions intensity (emissions
per unit of output), and 1 firm committed to reduce both its total
emissions and its emissions intensity. Furthermore, firms' goals differed
in their geographic scope and the time period they covered. For example,
Cinergy Corporation pledged to reduce its total U.S. domestic greenhouse
gas emissions by 5 percent from 2000 to 2010, while Pfizer, Inc., pledged
to reduce its worldwide emissions by 35 percent per dollar of revenue from
2000 to 2007. In contrast to EPA's program, 14 of the 15 trade groups
participating in Climate VISION established an emissions-related goal in
collaboration with DOE or another federal agency upon joining the program.
(The remaining group, the Business Roundtable, did not establish a
quantitative emissions goal because of the diversity of its membership.)
According to a DOE official, participants need not establish new goals as
a condition of joining the program. Nine of the 14 groups set goals to
improve their emissions intensity, 2 groups established a goal of reducing
emissions of specific greenhouse gases, 2 groups set goals to improve
energy efficiency, and 1 group established a goal of both reducing its
total emissions and improving its energy efficiency. For example, the
American Forest & Paper Association pledged to reduce emissions intensity
by 12 percent between 2002 and 2012, while the American Iron and Steel
Institute agreed to a 10-percent, sector wide increase in energy
efficiency by 2012. Some of these groups stated that their goals would be
difficult to achieve without reciprocal federal actions, such as tax
incentives or regulatory relief.
EPA and DOE both estimated the share of total U.S. greenhouse gas
emissions attributable to participants in their respective programs and
are working to develop an estimate of the programs' impacts. EPA estimated
that Climate Leaders participants accounted for at least 8 percent of U.S.
emissions. This is a conservative estimate, according to EPA, because it
was based solely on emissions from the program's first 50 participants.
DOE estimated that Climate VISION participants account for over 40 percent
of U.S. greenhouse gas emissions and noted that this estimate is
conservative. Both agencies are participating in an interagency process to
estimate the effect of their programs on reducing emissions, which is
expected to be completed in 2006. However, preparing accurate estimates of
these programs' impacts will be difficult. First, there is considerable
overlap between these two programs and other voluntary programs. For
example, 60 of the 74 Climate Leaders participants also participate in one
or more other EPA programs, and 3 of the 14 Climate VISION participants
with quantitative goals also participate in EPA voluntary programs. Such
overlap makes it difficult to determine the effects that are attributable
to a given program. Second, it will be difficult to determine how much of
a firm's or trade group's emissions reductions can be attributed to its
participation in the program because the level of a participant's
emissions in the absence of the program is unknown. For example, higher
energy prices or changes in business operations could produce emissions
reductions, making it difficult to distinguish reductions attributable to
participation in the program versus other causes.
To ensure that the Congress and the public have information with which to
evaluate the effectiveness of these voluntary programs and to increase the
opportunities for these programs to contribute to the President's
emissions intensity reduction goal, we are recommending that DOE develop a
system for tracking participants' progress in completing key steps
associated with the program. Also, we are recommending that both EPA and
DOE develop written policies that establish the actions the agencies will
take if participants are not completing program steps on time. We provided
EPA and DOE with a draft of this report for their review and comment. EPA
did not comment on our recommendation to the agency. DOE stated that the
report provided a useful overview of the Climate VISION program. It agreed
with our recommendation on a tracking system and said it will consider our
recommendation regarding a written policy. EPA's and DOE's written
comments are included in appendixes IV and V, respectively.
Background
Carbon dioxide is by far the most prevalent greenhouse gas emitted in the
United States, as shown in table 1. The other principal greenhouse gases,
in order of percentage of emissions in 2003, are methane, nitrous oxide,
and three types of synthetic gases-hydrofluorocarbons (HFCs),
perfluorocarbons (PFCs), and sulfur hexafluoride (SF6).
Table 1: Shares, Sources, and Global Warming Potentials of U.S. Greenhouse
Gas Emissions, 2003
Greenhouse gas Major sources Percentage of Global warming
2003 emissions potentiala
Carbon dioxide Fossil fuel combustion, 85 1
nonenergy use of fuels, iron
and steel production
Methane Landfills, natural gas and 8 21
petroleum systems,
agriculture, coal mining
Nitrous oxide Agricultural soil 6 310
management, transportation,
manure management
Synthetic gases Substitution of 2 140 to 23,900
ozone-depleting substances,
electric power transmission
and distribution, aluminum
production
Source: EPA.
Note: Components do not sum to 100 percent due to independent rounding.
aSince greenhouse gases differ in their potential to contribute to global
warming, each is assigned a unique weight, called a global warming
potential, which is based on its heat-absorbing ability relative to carbon
dioxide over a fixed time period. This provides a way to convert emissions
of various greenhouse gases into a common measure, such as carbon
equivalent. Thus, each molecule of methane, for example, has 21 times as
much effect on warming as a molecule of carbon dioxide.
In response to the May 1992 United Nations Framework Convention on Climate
Change, the United States developed the Climate Change Action Plan aimed
at reducing domestic greenhouse gas emissions. As a part of this plan,
programs were developed during the 1990s to provide information and tools
to encourage participants to voluntarily undertake changes to reduce their
emissions of carbon dioxide, methane, and other greenhouse gases. The
intent of programs such as Energy STAR is to help organizations improve
energy efficiency, thereby helping to reduce emissions. Other programs,
such as the Coalbed Methane Outreach Program, encourage emissions
reductions in other greenhouse gases, such as methane.
The amount of energy used to generate each dollar of national output has
declined over time. The ratio of energy used to economic output is called
energy intensity. According to the Energy Information Administration
(EIA), the independent statistical and analytical agency within DOE,
energy intensity declined between 1990 and 2003, at an average rate of 1.8
percent
per year.1 The rate of decline was the result of, among other things,
energy efficiency improvements in industrial and transportation equipment
and in commercial and residential lighting, heating, and refrigeration
technologies.2 In early 2006, EIA projected that energy intensity will
decline at an average annual rate of 1.8 percent between 2005 and 2025.3
The U.S. economy has also become more efficient in terms of emissions
intensity. (According to EIA, energy and emissions intensity are closely
related because energy-related carbon dioxide emissions make up more than
80 percent of total U.S. greenhouse gas emissions.)4 U.S. emissions
intensity declined between 1990 and 2003 at a rate of 1.9 percent a year.
The reasons for the decline include general improvements in energy
efficiency and a long-term shift toward a service economy. Other reasons
include greater use of nuclear power, development of renewable resources,
substitution of less emissions-intensive natural gas for coal and oil, and
the use of transportation fuels with biogenic components, such as ethanol.
EIA projected in early 2006 that between 2005 and 2025, emissions
intensity will decline at a rate of 1.7 percent per year (see fig. 1).5
Figure 1: U.S. Energy and Emissions Intensity Trends, 1990-2025
Note: These data are used for background purposes only to demonstrate
trends in U.S. energy and emissions intensity. We did not assess the
reliability of the data.
aEmissions intensity is defined as metric tons of carbon dioxide
equivalent per million constant (2000) dollars of gross domestic product.
bEnergy intensity is defined as thousand British thermal units (Btu) per
constant (2000) dollars of gross domestic product.
The goal of the President's 2002 initiative was to reduce the emissions
intensity of the U.S. economy by 18 percent between 2002 and 2012, a
reduction 4 percentage points greater than would be expected absent any
new policy. In particular, according to EIA projections cited by the
administration, without the initiative, emissions would increase from
1,917 million metric tons of carbon equivalent (MMTCE)6 in 2002 to 2,279
MMTCE in 2012. Under the initiative, emissions will increase to 2,173
MMTCE in 2012, which is 106 MMTCE less than otherwise expected.7 In 2002,
EIA projected that U.S. emissions intensity would decline (improve) by 14
percent between 2002 and 2012 without any new policy. In 2006, EIA updated
its estimate, projecting a decline in emissions intensity of 17 percent
between 2002 and 2012. According to EIA, further reductions in emissions
intensity are projected to result from, among other things, increasing
energy prices that will tend to reduce energy consumption growth below
prior estimates. Nevertheless, according to this estimate, total
greenhouse gas emissions will continue to rise. Specifically, EIA
projected in 2006 that total emissions would increase by 14.2 percent
between 2002 and 2012.8
The President's 2002 initiative comprised about 30 elements. In addition
to challenging businesses and industry to voluntarily reduce emissions, it
included tax incentives for renewable energy and conservation,
transportation programs, and other efforts. Climate Leaders and Climate
VISION are two of the federal government's newest voluntary climate
programs. According to a DOE official, they are the only federal programs
that ask potential members for an emissions or emissions intensity
reduction goal in order to participate. According to EPA, for firms that
are already participating in other EPA voluntary programs, Climate Leaders
can serve as a coordinating umbrella to comprehensively manage their
voluntary climate change activities.
Some Climate Leaders and Climate VISION Participants Have Not Completed
Program Steps as Soon as Expected, and Both Agencies Lack a Written Policy
for Dealing with Such Participants
According to EPA officials, all program participants agree to complete
four program steps, and EPA guidelines suggest that these steps generally
be completed within about 1 year, although the goal negotiation process
can take as long as 2 years. The first step is to prepare a greenhouse gas
emissions inventory; the second step is to prepare an inventory management
plan (IMP); the third step is to enter into negotiations with EPA
regarding a goal; and the fourth step is to report annually. (However, EPA
does not insist that firms perform all four steps in that order). Overall,
we found that some firms were taking longer to complete these steps and
that EPA has no written policy for dealing with such firms. According to
DOE officials, all program participants agree to complete two program
steps: the first within about 1 year of joining the program, and the
second after they have finished training their members in the use of
reporting protocols, most in 2006. Overall, we found that some groups had
not completed the first step within the specified time frame. EPA has
started to develop a system for tracking participants' progress; DOE does
not yet have such a system. Neither agency has written criteria detailing
expected time frames for meeting expectations or the consequences of not
meeting expectations.
EPA Expects Firms to Complete Certain Program Steps, but Not All Have Done
So
First, firms complete their base-year inventories, which EPA encourages
and expects them to do, on average, within 1 year of joining the program.
The base-year inventory contains the data that will be used to measure
firms' progress toward their goals. As of November 2005, 61 of the 74
firms had submitted base-year inventory data to EPA. After the inventory
has been submitted, the participant works with EPA to refine its
inventory. Eleven of the 61 inventories had been finalized and approved by
EPA. The other 50 were still in development or review. An EPA official
noted that some firms did not submit inventories earlier because EPA's
reporting guidelines were not completed until April 2004. In addition,
these officials told us that it often takes firms more than a year to
prepare their base-year inventory because firms start at different levels
of sophistication with respect to developing an inventory. Some firms
start with no knowledge of how to develop an inventory and no
infrastructure in place for doing so. Furthermore, some corporate
inventories may take longer due to their complexity, including complicated
corporate structures, a wide variety of emissions sources, and the lack of
available emissions data. Corporate reorganizations and staff turnover
also contribute to delays. An EPA official told us that the average amount
of time it takes firms to complete their base-year inventory once they
join the program has been 2 years, but the average amount of time firms
have taken since EPA completed its reporting guidelines is 1 year.
Firms have two options for having their inventories reviewed. They can
either submit their data to EPA for review, or they can choose third-party
verification, in which an outside organization, such as an environmental
engineering firm with greenhouse gas verification experience, reviews
their data.
After they have submitted base-year inventory data to EPA, firms work with
EPA to refine the inventory, usually resulting in some revisions. In
reporting data, firms are to follow guidance developed by EPA that is
based on a standardized reporting protocol established by the World
Resources Institute and the World Business Council for Sustainable
Development.9 The protocol consists of corporate emissions accounting
standards developed by representatives from industry, government, and
nongovernmental organizations.
Second, EPA officials told us that EPA expects all firms to prepare an
IMP, which is the firm's plan for collecting data, preparing the
inventory, and managing inventory quality. EPA officials informed us that,
as of November 2005, 60 of the 74 firms had submitted draft IMPs. Firms
that choose to have EPA review their emissions inventories must also
submit their IMP to EPA, while firms that choose to undergo third-party
verification must submit a letter from the third party stating that all
the specified components of the IMP checklist are in place and that at
least one site visit was conducted. The IMP checklist consists of 30
components in seven major categories, including, among other things,
boundary conditions (i.e., which parts of the facility will be covered
under the program), emissions quantification methods, and data management
processes. Nineteen of the 30 IMP components are to be in place within 1
year of joining the program and must be in place for base-year reporting
to be finalized. Fifty-four of the 60 firms completing IMPs submitted
their IMPs to EPA for review, while the other 6 chose to have their
inventories and IMPs reviewed by third parties. According to EPA
officials, the remaining 14 firms had not submitted a draft IMP or
informed EPA of their intention to choose third-party verification,
although eight of these firms joined the program within the past year and
so, according to EPA officials, would not be expected to have completed
these steps. EPA officials told us that these remaining firms are still
working on the necessary documentation.
EPA conducts at least one site visit per firm to review facility-level
implementation of the IMP to determine whether there are ways to improve
the plan's accuracy, among other things. The site to be visited is
mutually agreed upon; EPA aims to review the company facility with the
highest overall risk to the accuracy of reported emissions. (Such a site
should be a large emitter, have many of the largest emission types, and
represent the firm's most common business activity, among other criteria.)
As of November 2005, EPA had conducted 25 site visits (about one-third of
all firms), with 10 more visits scheduled before the end of 2005.
The base-year inventory is not considered final until EPA has reviewed
both it and the IMP and conducted a site visit. An EPA official told us
that initial inventories generally contain about 95 percent of each
member's total emissions, so only minor and incremental revisions are
needed at the on-site review stage.
EPA provides up to 80 hours of technical assistance to help each firm
complete its base-year inventory and develop and document its IMP.
Technical assistance can include implementing greenhouse gas accounting
methods as well as measuring, tracking, and reporting emissions. After the
firm's base-year inventory is complete, EPA experts continue to offer up
to 10 hours annually of technical assistance during subsequent years.
Since Climate Leaders provides technical assistance to each firm as it
develops and documents its inventory and IMP, an EPA official stated that
most major issues that might arise in inventory design and development are
addressed informally at the technical assistance stage. However, according
to EPA, some issues are identified during the site visits. In general, the
site visits have identified only a few areas where EPA asked for
revisions. These usually involved missing small sources of on-site
emissions (such as those from propane for forklifts or on-site diesel
purchases for a yard truck). EPA officials told us that most of the items
they identified during the site visits were minor calculation errors or
ways to improve the firm's data quality assurance and quality control
processes. They said that the majority of these areas are corrected on
location during the site visit, and any others are verified by the
submission of an updated IMP and greenhouse gas reporting form that
describe respectively, the changes to the inventory process and the
greenhouse gas emissions that were made in response to the findings.
As noted earlier, firms choosing third-party verification instead of EPA
review are to submit an independent verifier's report stating that at
least one site visit was conducted and that all the necessary components
of the IMP checklist were successfully implemented. As of November 2005,
six firms had chosen to have their data verified by a third party, and all
of these firms had undergone their third-party verification. Three firms
had submitted inventory data and initial auditor reports to EPA. EPA is
awaiting letters from the other three firms indicating that all of the
components of the IMP checklist are in place and that any corrective
actions identified in the verification process have been addressed.
Third, EPA officials told us that the agency expects firms to enter into
negotiations with EPA to set their reduction goals once their base-year
inventory is finalized, generally within about 1 year after joining the
program, and to complete negotiations within 1 year after that. However,
we found that some firms have taken longer to do so. Thirty-eight of the
74 participating firms had set goals as of November 2005.10 Of the 36
firms without goals, 20 were working with EPA to develop goals. Seven of
these 20 firms were still working on their base-year inventories, and 9
had joined the program within the past year and hence would not be
expected to have set goals. The 36 firms without goals included 18 firms
that joined the program in 2002 or 2003. Specifically, of the 35 firms
that joined in 2002, the program's first year, 22 had set goals, 9 firms
were in the process of negotiating their goals with EPA, and 4 more had
not begun such negotiations. Of the 16 firms that joined in 2003, 11 had
set goals, 3 were in negotiation with EPA regarding goals, and 2 had not
yet begun such negotiations. According to EPA officials, the 6 firms had
not begun negotiations because their base-year inventories were not
finalized.
In describing why it may take a long time to set goals, EPA officials told
us that many firms require considerable time to develop their inventories,
which can be complex. Firms must also obtain internal approval of their
emissions reduction goals from their senior management, and some firms
lack enough resources to devote to inventory development to meet the time
frame of EPA's reporting guidelines. Other reasons also exist. For
example, one firm disagreed with EPA regarding whether to report a certain
type of emission in its inventory and needed to come to agreement with EPA
on addressing those emissions. Another firm is involved in litigation that
will likely affect its future emissions levels and does not want to set an
emissions reduction goal until the case is resolved, while yet a third
firm is facing regulation that could affect its ability to meet an
aggressive reduction goal.
Finally, according to EPA's reporting guidelines, all firms agree to
report to EPA annually on their emissions using EPA's Annual Greenhouse
Gas Inventory Summary and Goal Tracking Form. This form describes the
firm's emissions at a corporate level broken out by emissions type for
both domestic and international sources and details progress toward the
firm's emissions reduction goal. As of November 2005, 10 of the 11 firms
with finalized inventories had submitted annual data through 2004 to EPA.
An EPA official told us that the other firm was currently resolving some
outstanding issues and would likely submit a report in early 2006.
Although all firms are expected to complete all four steps listed above,
EPA officials told us that firms do not need to complete the steps in any
particular order. For example, some firms may choose to finalize their
base-year inventory before submitting annual reports with multiple years
of data, while other firms may choose to submit annual data before the
inventory is fully finalized.
EPA Is Developing a System to Track Participants' Progress, but It Lacks a
Written Policy for Dealing with Firms That Do Not Complete Program Steps
in a Timely Manner
EPA officials told us that they had started to develop a database to track
firms' progress and are currently in the process of entering and
validating the data. Although some firms are not completing the various
program steps as quickly as EPA expected, the agency has not yet
established a written policy for dealing with such firms. An EPA official
noted that firms that voluntarily agree to participate in the program are
aware of program expectations and are generally proactive in meeting them.
EPA officials further stated that the agency has three options for dealing
with firms that do not appear to be proceeding in a timely manner: (1)
telephone calls from EPA or its contractor to reinvigorate the process,
(2) a letter to firms urging them to act more expeditiously, or (3)
removal from the program if the firm is not putting forth a good-faith
effort to meet the program's expectations. However, EPA believes that it
is better for the environment to work with firms that are making a
good-faith effort to implement appropriate management systems than to
remove them from the program. To date, EPA has not removed any firm from
the program for lack of progress, although one firm voluntarily left after
realizing it did not have sufficient resources to continue participation.
According to EPA officials, as of November 2005, two firms did not appear
to be working toward completing their reporting duties in a timely manner,
and EPA anticipated sending letters to those firms. EPA officials noted
that, since Climate Leaders is a voluntary program, it is difficult for
EPA to sanction firms that do not meet all of the program's expectations
in a timely manner. These officials said that, although they do not
currently have a written policy on how to deal with firms that are not
progressing as expected, including specific standards for time frames and
consequences, they expect to begin developing such a policy in the near
future.
DOE Expects Trade Groups to Complete Two Steps, but Not All Have Done So
DOE has defined two program steps that it expects participating trade
groups to complete: developing a work plan and reporting emissions data.
According to agency officials, after establishing its goal to reduce
emissions, each industry group is asked to develop a work plan following a
standard template developed by DOE, generally within 1 year of joining the
program. The template includes four items: (1) emissions measurement and
reporting protocols; (2) plans to identify and implement near-term,
cost-effective opportunities; (3) development of cross-sector projects for
reducing greenhouse gas emissions intensity; and (4) plans to accelerate
research and development and commercialization of advanced technology.
However, DOE officials explained that specific elements of each industry
group's work plans are different because each industry is different. The
work plans are intended to help ensure that the trade groups' goals and
activities are significant, clearly understood by the public, and aimed at
producing results in a time frame specified by the group.
Preparing the work plan is a collaborative process between the trade
groups and program officials. Each work plan is reviewed three times by
(1) a representative of the federal agency having the lead for that
industry (e.g., DOE for the American Chemistry Council, and DOE and the
Department of Agriculture for the American Forest & Paper Association);
(2) Climate VISION program staff; and (3) a DOE contractor to ensure that
the plan provides a suite of activities that will enable the group to meet
its reduction goal. DOE officials told us that all work plans completed to
date were subjected to at least one round of revisions before being
finalized and posted to the program's Web site.
According to DOE officials, as of November 2005, 11 of the 15 trade groups
had completed their work plans. Of the four groups that had not completed
their work plans, two were new members, joining Climate VISION in 2005;
the other two-the Association of American Railroads and the National
Mining Association-were original members, joining in 2003. DOE officials
said they were still working with the groups to finalize their work plans.
They also noted that getting the trade groups to adhere to DOE's time
lines can be challenging because the groups often have to clear all their
activities through their individual member companies or through their
boards of directors, which can be time consuming.
In addition to developing a work plan, trade groups are expected to report
data on their greenhouse gas emissions. As of November 2005, 5 of the 15
groups had reported data: 2 groups reported data to DOE, and 3 groups that
have been working with EPA as participants in EPA-sponsored programs
reported to that agency. According to a DOE official, as the trade groups
finish developing and training their members in the use of reporting
protocols, they are expected to begin reporting on their emissions, most
in 2006. DOE will then ask the groups to report annually. Program
officials explained that, at least in one case, a group did not report
earlier because, among other things, DOE was revising its interim final
voluntary emissions reporting guidelines, which were released in late
2005.
DOE does not specify a particular format that trade groups should use in
reporting emissions data, since all industries are different and the
nature of the goals differ. However, the program encourages the groups to
have their individual members report using EIA's Voluntary Reporting of
Greenhouse Gases program11 or another appropriate reporting system, such
as EPA's. Trade groups have developed or are developing reporting
protocols as part of their work plans.
DOE officials told us that once they receive data from the trade groups,
they would arrange for a contractor to review these data and check them
against EIA or EPA data for the reporting industry's sector for accuracy.
The officials also told us they would post trade groups' emissions reports
on DOE's Web site to provide transparency, thereby providing an incentive
for groups to report accurate information. An industry may also choose on
its own to hire an independent expert to review reports for accuracy. For
example, the American Chemistry Council has required third-party
certification of each of its member companies' environmental, health, and
safety and security management systems, including the program under which
members measure and report greenhouse gas emissions.
DOE Plans to Track Participants' Progress in Completing Program Steps, but
It Lacks a Written Policy For Dealing with Those That Do Not Progress as
Expected
Program officials told us that they do not have a system for tracking
participants' actions, including completing work plans, reporting, and the
other steps identified in its work plan, but they said a contractor is
working to establish a reporting system for 2006. The officials also said
that DOE would remove trade groups from the program if they did not appear
to be taking actions to complete program steps, but DOE has not yet
established any deadline by which groups' emission reports must be
submitted. However, the officials stated that they are currently working
on setting such a deadline. The officials said that they do not believe it
will be necessary to remove groups, since the groups are very enthusiastic
about the program and understand the political stakes involved. Therefore,
these officials expressed confidence that the groups will meet DOE's
expectations to the best of their abilities.
Working with Federal Agencies, Most Participants in Both Programs Have Set
Quantitative Emissions-Related Goals, Although Some Climate VISION Goals
Were Qualified Based upon the Asserted Need for Reciprocal Federal Actions
EPA worked with firms to set emissions-related goals, and more than half
of the firms participating in Climate Leaders have set goals for reducing
their emissions or improving their emissions intensity. The firms' goals
vary in terms of the metric used, their geographic scope, and the time
period covered. DOE or another federal agency conducted discussions with
the industry groups on establishing their goals, and all participating
groups had established a goal before joining Climate VISION. The
participants' goals varied in terms of the type of goal (emissions,
emissions intensity, or energy efficiency) and the period covered by the
goal (start and end dates.) Finally, many groups qualified their goals
based upon their stated need for reciprocal federal actions, such as tax
incentives or regulatory relief.
EPA Helps Firms Set Goals
EPA works with all firms to set goals and offers flexibility in
goal-setting, since each firm has a unique set of emissions sources and
reduction opportunities. First, as discussed earlier, EPA works with firms
to develop inventories and IMPs to document their base-year emissions.
Second, EPA creates an industry standard, or benchmark, against which to
evaluate each firm's goal. EPA uses a suite of modeling tools and
statistical tables to develop the benchmark for each industry sector. The
firm's goal is evaluated against a projected emissions improvement rate
for its sector; EPA expects every firm's goal to be markedly better than
the projected benchmark for the firm's sector. EPA also checks each firm's
reported emissions data over the goal period to ensure that the firms are
not reducing emissions simply by shrinking their size or by outsourcing.
EPA encourages each firm to set a goal that is aggressive but that also
considers company and sectoral variations. Nonetheless, each goal must be
(1) entitywide (including at least all U.S. operations), (2) based on the
most recent base year for which data are available, (3) achieved over 5 to
10 years, (4) expressed as an absolute emissions reduction or as a
decrease in emissions intensity, and (5) aggressive compared with the
projected greenhouse gas emissions performance for the firm's industry.
More Than Half of the Participants in Climate Leaders Have Set Goals, and
These Goals Vary
As of November 2005, 38 of the program's 74 firms had set emissions or
emissions intensity reductions goals. The remaining 36 firms were working
with EPA to set goals. The firms' goals vary in terms of three
characteristics: (1) the metric used (absolute emissions or emissions
intensity), (2) the geographic scope of the goal (reductions at U.S. or
worldwide facilities), and (3) the time frame in which the reductions will
occur.
First, 19 firms pledged to reduce total emissions, while 18 pledged to
reduce emissions intensity, and 1 pledged to reduce both total emissions
and emissions intensity. Of the 19 companies with intensity goals, 15
measured emissions intensity in terms of their physical units of output
(such as tons of cement or barrels of beer produced), while the other 4
firms measured emissions intensity in financial terms (such as dollar of
revenue.) In addition, EPA expects that many firms that meet their
intensity goals will also achieve absolute emissions reductions. In fact,
EPA projected that four of the five firms that were expected to reach
their goals in 2005 would also achieve absolute emissions reductions, even
though only one of them has an absolute target. Second, 29 of the 38
companies established goals relating to their U.S. or North American
facilities only, while the other 9 established goals relating to their
global facilities. Third, the time periods covered ranged from 5 to 10
years, and all goal periods began in 2000 or later because EPA asked firms
to use the most recent data available when establishing the base year for
their goal. EPA did this to prevent firms from counting reductions made
prior to joining the program and to prevent them from selecting as their
baseline a year in which their emissions were particularly high, hence
making reductions appear steeper than they actually were, relative to
average conditions.
Reflecting various combinations of the three characteristics, the firms'
goals are expressed in different terms. For example, Cinergy Corporation
pledged to reduce its total domestic greenhouse gas emissions by 5 percent
from 2000 to 2010, while Miller Brewing Company pledged to reduce its
domestic greenhouse gas emissions by 18 percent per barrel of production
(a unit of production intensity goal) from 2001 to 2006, and Pfizer, Inc.,
pledged to reduce its worldwide emissions by 35 percent per dollar of
revenue (a monetary intensity goal) from 2000 to 2007. Table 2 presents
information on the 38 firms' goals.
Table 2: Climate Leaders' Goals as of November 2005
Metric Geographic
used and scope of
percent goal
to be
reduced
Company Emissions Emissions Metric for United Global Time
intensity measuring States period
emissions covered
intensity
3M 30 x 2002-07
Advanced Micro 40 Manufacturing x 2002-07
Devices, Inc. index
American 4 x 2001-06
Electric Power
Ball 16 Production x 2002-12
Corporation index
Bank of 9 x 2004-09
America
Corporation
Baxter 16 Unit of x 2000-05
International production
Inc. value
Calpine 4 Megawatt hour x 2003-08
Caterpillar 20 Dollar of x 2002-10
revenue
Cinergy 5 x 2000-10
Corporation
The Collins 18 x 2000-10
Companies
Eastman Kodak 10 x 2002-08
Company
Exelon 8 x 2001-08
Corporation
First Net 0a x by 2008
Environment,
Inc.
FPL Group, 18 Kilowatt hour x 2001-08
Inc.
Frito-Lay, 14 Pound of x 2002-10
Inc. production
GAP, Inc. 11 Square foot x 2003-08
General 1 x 2004-12
Electric
General Motors 10 xb 2000-05
Corporation
Green Mountain Net 0a x 2005-09
Energy Company
Hasbro, Inc. 30 x 2000-07
Holcim (U.S.) 12 Ton of cement x 2000-08
Inc.
IBM 10 4 Energy use x Average
Corporationc annual
reduction
2000-05
Interface, 15 Unit of x 2001-10
Inc. production
International 15 x 2000-10
Paper
Johnson & 14 x 2001-10
Johnson
Marriott 6 Available x 2004-10
International, room
Inc.
Melaver, Inc. Net 0a x 2006-09
Miller Brewing 18 Barrel of x 2001-06
Company production
National 10 Square foot x 2000-05
Renewable
Energy
Laboratory
Pfizer, Inc. 35 Dollar of x 2000-07
revenue
PSEG 18 Kilowatt hour x 2000-08
Roche Group US 10 x 2001-08
Affiliates
SC Johnson 23 Pound of x 2000-05
product
Staples, Inc. 7 x 2001-10
St. Lawrence 15 Ton of x 2000-10
Cement product
Sun 20 x 2002-12
Microsystems
United 16 Dollar of x 2001-06
Technologies revenue
Corporation
Xerox 10 x 2002-12
Corporation
Source: GAO analysis of EPA data.
aNet zero means that the company will substitute emissions it produces by
some other activity such that no new, additional emissions are produced.
Green Mountain Energy, for example, is substituting emissions from fossil
fuel-based energy, such as coal or gas, with the purchase of renewable
energy that produces few greenhouse gas emissions relative to fossil
fuels.
bGeneral Motors pledged to reduce total greenhouse gas emissions from its
North American facilities.
cIBM pledged to achieve a reduction in its average annual carbon dioxide
emissions equivalent to 4 percent of the emissions associated with the
company's worldwide energy use. IBM also pledged to reduce its
perfluorocarbon emissions from its semiconductor manufacturing processes
by 10 percent from 2000 to 2005.
DOE and Other Agencies Worked with Groups to Establish Goals Before
Joining the Program, and Certain Groups' Goals Were Developed for
Participation in Other Voluntary Programs
According to program officials, DOE or another federal agency, such as EPA
or the U.S. Department of Agriculture (USDA), conducted discussions with
the industry groups on establishing a goal upon entering the program.
These officials stated that, since a key element of the program is
allowing industry groups to take ownership of their goals, DOE and its
partner agencies generally did not actively negotiate the goals' specific
terms. DOE officials told us that the agency remained flexible on goal
setting because some groups had initiated their own internal emissions
reduction programs before joining the program or had an existing
arrangement with another agency, such as EPA. In addition, DOE officials
believe it is important for the groups to establish goals that meet their
unique circumstances. The officials told us that they compared the trade
groups' goals with projected emissions for their respective industries to
gauge their robustness. DOE calculates expected conditions for many
industrial sectors using EIA data, where they are available. (We did not
independently review EIA's data or DOE's analysis of the data.) Further,
DOE officials also told us that the trade groups have an interest in
ensuring that their goals are credible.
According to a DOE official, participants need not establish a new goal as
a condition of joining the program, and certain trade groups had already
initiated internal emissions reduction programs before joining Climate
VISION or had an existing arrangement with a voluntary program at another
agency, such as EPA. For example, the nine firms in the aluminum industry
established a goal of reducing perfluorocarbon emissions by 30 to 60
percent from a 1990 baseline as part of EPA's Voluntary Aluminum
Industrial Partnership. In 2003, as part of Climate VISION, the Aluminum
Association updated this goal. Similarly, the Semiconductor Industry
Association's goal was established in 1999, also in conjunction with an
EPA program. The International Magnesium Association likewise participates
in an EPA program but did not establish a quantitative goal for reducing
emissions until it joined Climate VISION in 2003.
Fourteen Climate VISION Participants Have Set Goals, and These Goals Vary
Fourteen groups established quantitative emissions-related goals. More
specifically, nine pledged to take actions to improve their emissions
intensity. For example, the American Forest & Paper Association stated
that it expected to reduce emissions intensity by 12 percent between 2002
and 2012. Another two groups aimed to reduce emissions of specific
greenhouse gases. For example, the Semiconductor Industry Association
pledged to support efforts to reduce PFC emissions by 10 percent over 1995
levels by 2010. Two more groups established a goal for improving energy
efficiency. For example, the American Iron and Steel Institute agreed to a
10 percent, sectorwide increase in energy efficiency by 2012, relative to
2002. Finally, one industry-the National Mining Association-established a
goal of both reducing its overall emissions and improving its energy
efficiency. The Business Roundtable did not set a quantified emissions
reduction goal, owing to the diversity of its membership. Table 3 outlines
the type and time frame of industry group goals.
Table 3: Climate VISION Trade Groups' Goals as of November 2005
Type of
goal
Industry/ Reduce Reduce emissions Improve Goal metric Start and
participant emissions intensity energy end dates
efficiency
Aluminum 53% Combined direct carbon 1990-2010
emissions intensity
o Aluminum based on PFC
Association reductions and reduced
anode carbon
consumption
Automobiles 10% Carbon dioxide 2002-12
emissions per vehicle
o Alliance of produced
Automobile
Manufacturers
Cement 10% Carbon dioxide 1990-2020
emissions per ton of
o Portland cementitious product
Cement produced or sold
Association
Chemicals 18%a Greenhouse gas 1990-2012
emissions intensityb
o American
Chemistry
Council
Electric power Ratio of carbon 2002-02
equivalent emissions to
o American to generation in 2010-12
Public Power megawatt hours
Association The equivalent of
o Edison
Electric 3 to 5%
Institute
o Electric
Power Supply
Association
o Large Public
Power Council
o National
Rural Electric
Cooperative
Association
o Nuclear
Energy
Institute
o Tennessee
Valley
Authority
Forest 12% Greenhouse gas 2000-12
products intensity
o American
Forest & Paper
Association
Iron and steel 10% Millions of British 2002-12
thermal units per ton
o American of steel produced
Iron and Steel
Institute
Lime 8% Fuel used per ton of 2002-12
lime produced
o National
Lime
Association
Magnesium 100% Sulfur hexafluoride by 2010c
emissions
o
International
Magnesium
Association
Minerals 4.2% Greenhouse gas 2002-12
emissions from fuel
o Industrial combustion
Minerals
Association
North America
Industry/ Reduce Reduce emissions Improve Goal metric Start and
participant emissions intensity energy end dates
efficiency
Mining 10% Energy efficiency 2002-12
25 MMTCE Methane emissions in 2002-12d
o National million metric tons
Mining carbon dioxide
Association equivalent per year
2 MMTCE Million metric tons of 2002-15e
carbon equivalent
Oil and gas 10% Energy efficiency 2002-12
o American
Petroleum
Institute
Railroads 18% Transportation-related 2002-12
greenhouse gas
o American emissions intensity
Association of adjusted for traffic
Railroads levels in ton miles
Semiconductors 10% PFC emissions in 1995-2010
million metric tons of
o carbon equivalent
Semiconductor
Industry
Association
Source: Climate VISION Web site.
aAccording to the American Chemistry Council, the U.S. chemistry industry
reduced its greenhouse gas intensity by 12 percent from 1990 to 2000, with
projections to 2002.
bThe American Chemistry Council measures its greenhouse gas emissions
intensity using a special index that is particularly suited for an
industry with a diverse product base. The index measures changes in the
physical quantity of production, and where these data are unavailable, the
index is based on changes in electricity consumption and production worker
hours.
cThe International Magnesium Association committed to eliminate all SF6
emissions by 2010 and did not define a baseline year because of the nature
of its goal.
dThe National Mining Association committed to maintain annual reductions
in methane emissions achieved since 1990.
eThe National Mining Association committed to maximize efforts to reduce
annual carbon reductions projected as a result of the partnership with
DOE. These projections are 600,000 metric tons of carbon equivalent by
2010 and 2 million metric tons by 2015.
As shown in table 3, the majority of the groups' goals were based on time
frames that began shortly before the program's initiation in 2003.
Specifically, nine groups used 2000 or 2002 as a base year. For example,
the National Lime Association stated its intention to reduce emissions
intensity by 8 percent between 2002 and 2012. However, four goals had a
base year of 1995 or earlier. For example, the Portland Cement Association
pledged to reduce its emissions intensity by 10 percent between 1990 and
2020. DOE officials told us that, even though some participants are using
1990 or another pre-2003 year as a base year, DOE will count only
reductions occurring between 2002 and 2012 as part of the program's
contribution toward the President's 18 percent emissions intensity
reduction goal.
In addition to setting emissions-related goals, some groups also set other
kinds of goals. For example, the American Petroleum Institute committed to
100 percent member participation in EPA's voluntary Natural Gas STAR
program (which helps U.S. natural gas companies adopt technologies and
practices to reduce emissions of methane) and DOE's Combined Heat and
Power Program (which works to eliminate barriers to the adoption of
combined heat and power technology systems.) Similarly, the Business
Roundtable established a goal of 100 percent member participation in
voluntary actions to reduce, avoid, offset, and sequester greenhouse gas
emissions.
Many Climate VISION Participants Said Goals May Be Difficult to Achieve
without Reciprocal Federal Actions
Although all Climate VISION participants established goals, a majority of
the groups qualified their participation by stating that their ability to
meet their goals would depend on some reciprocal government action. This
includes 9 of the 14 groups with a quantitative goal as well as 5 of the 7
electric power groups. For example, the American Chemistry Council stated
that "it will be difficult, if not impossible, for the chemical industry
to do its share to reach the President's goal of reducing emissions
intensity" without an aggressive government role in removing barriers to
progress and providing incentives, such as tax code incentives. Similarly,
the American Petroleum Institute stated that "future progress will be
particularly difficult because of the increased energy and capital
requirements at refineries due to significant tightening of gasoline and
diesel fuel specifications in the coming decade." The group said it would
look to the administration "to aggressively work to eliminate any
potential regulatory barriers to progress in these areas." Likewise, the
Association of American Railroads stated that the industry's efforts will
depend upon DOE's continued funding of a government/rail industry
cooperative venture to improve railroad fuel efficiency. Appendix III
lists the reciprocal federal actions outlined in participants' statements.
Both Agencies Have Estimated Their Programs' Coverage and Are Working to
Estimate Their Impact, but It Will Be Difficult to Determine Specific
Emissions Reductions from Each Program
EPA and DOE both estimated the share of U.S. greenhouse emissions
attributable to their participants. Both agencies are also working to
estimate the effect of their programs on reducing emissions, and they
expect the estimates to be completed in 2006. Preparing such estimates
will be challenging because there is considerable overlap between these
two programs and other voluntary programs.
Both Agencies Estimated the Share of U.S. Emissions Generated by Current
Program Participants
EPA estimated in 2005 that participating firms accounted for at least 8
percent of U.S. emissions on average for the years 2000 through 2003. EPA
based this estimate on emissions data from the first 50 program
participants and believes the estimate is conservative, in part, because
(1) it does not reflect data from the other 24 participating firms and (2)
it does not include all types of emissions from each firm. For example,
the estimate does not include indirect emissions (such as emissions from
the use of purchased electricity or steam) or what EPA refers to as
"optional" emissions, such as employee commuting and employee business
travel.
Because the electric utility sector accounts for about one-third of U.S.
greenhouse emissions, we used an EPA database to determine the share of
greenhouse gas emissions produced by Climate Leaders firms12 in that
sector. As shown in table 4, we found that participating firms accounted
for nearly 18 percent of carbon dioxide emissions from U.S. electricity
generation (i.e., power plants only) in 2000 (latest available data), or
about 6 percent of total U.S. emissions.
Table 4: Climate Leaders' Carbon Dioxide Emissions from Electricity
Generation (i.e., Power Plants Only), 2000a
Climate Leaders firms Carbon dioxide emissions Percent of U.S. carbon
(millions of tons) dioxide emissions
American Electric Power 225.9 8.5%
Calpine Corporation 4.2 0.2%
Cinergy Corporation 66.8 2.5%
Entergy Corporation 50.8 1.9%
Exelon Corporation 16.7 0.6%
FPL Group, Inc. 45.0 1.7%
Green Mountain Energy 0.07 b
Company
Nisource Inc. 20.0 0.8%
PSEG 18.2 0.7%
We Energies 26.0 1.0%
Total - Climate Leaders 473.7 17.9%
Total - U.S. electricity 2,652.9 100%c
generation
Source: GAO analysis of EPA data.
aEmissions data are for the year 2000 but have been updated to reflect
corporate structures as of December 2002.
bLess than 0.05 percent.
cThe "100 percent" refers only to those power plant emissions captured by
the e-GRID database, about 90 to 95 percent of the U.S. total.
EPA program managers said they have set a participation goal of 200 firms
by 2012, and EPA is almost on track to meet this goal. However, a program
manager told us that EPA has not tried to estimate the share of U.S.
emissions that the 200 firms might account for because it is difficult to
predict with any accuracy the size and types of firms that may join the
program in the future and the firms' emissions reduction goals.
Climate Leaders program staff, with assistance from contractors, recruit
new participants through various means. For example, they attend industry
sector meetings and corporate environmental meetings as well as meetings
of participants in other EPA programs, such as Energy STAR. In addition,
EPA publishes public service announcements in trade and industry journals.
According to DOE, the thousands of individual companies that are members
of the participating trade groups (not including Business Roundtable
members) contribute over 40 percent of total U.S. greenhouse gas
emissions. DOE officials told us they believe this estimate, based largely
on EIA and EPA data, is conservative, because the utility sector alone
accounts for one-third of U.S. greenhouse gas emissions. (We did not
independently review EIA's or EPA's data or the estimate based on these
data.)
DOE officials told us that they regularly seek to recruit new members and
expect at least one more trade group to join the program, but they do not
have a specific goal for the number of new participants expected to join.
DOE also does not have a goal for the share of U.S. emissions contributed
by future participants.
While Both Agencies Are Working to Estimate Program Impacts, It Will Be
Challenging to Determine Specific Emissions Reductions Attributable to
Each Program
EPA and DOE are working, as part of an interagency program, to estimate
their programs' effect on reducing U.S. greenhouse gas emissions. Agency
officials said that the estimates would be completed in 2006, in
fulfillment of a U.S. commitment under the 1992 Framework Convention on
Climate Change. (Under the Convention, the United States committed to
report periodically on policies and measures undertaken to reduce
greenhouse gas emissions.)
In 2005, EPA estimated that participating firms' actions were reducing
U.S. emissions by 8 MMTCE a year. This amount is equivalent to the annual
emissions of 5 million automobiles and represents less than one-half of 1
percent of U.S. emissions in 2003 (the latest year for which data are
available.) EPA derived this estimate by adding up the average annual
expected emissions reductions for the first 35 firms that had set goals.
(Three other firms set goals later.) However, EPA officials cautioned that
this figure does not represent an official estimate of emissions
reductions attributable to the program because many Climate Leaders firms
participate in other voluntary programs to which their emissions
reductions may be credited.
A DOE official said that, to determine the emissions reductions
attributable to the Climate VISION program, DOE will compare participating
trade groups' reported emissions with comparable EIA projections for the
time period. If the trade group comprises an entire industry, DOE will use
the EIA projection for the entire industry; if the trade group comprises
less than the entire industry, DOE will prorate the industry total based
on the trade group's share of the industry.
Estimating the effect of the two programs, as opposed to other voluntary
programs and other factors, will be challenging for two reasons. First,
because the firms and trade groups participating in these two programs may
also participate in other voluntary programs, it will be difficult to
determine the two programs' effect on reducing emissions, as opposed to
other programs' effects on reducing emissions. Unless EPA and DOE find an
effective way to disaggregate the emissions reductions attributable to
each program, there is the possibility that total emission reductions from
voluntary federal programs will be overstated because the same emissions
reductions reported by organizations participating in Climate Leaders,
Climate VISION, and other programs will be counted by more than one
program. EPA officials told us that they recognize the challenge of
attributing the effects of the various voluntary programs and stated that
they are trying to avoid double counting of the programs' results. Second,
the reductions in a participants' emissions that are due to a program are
the difference between its actual emissions generated during a period of
time and the amount of emissions that it would have generated for that
period if it were not participating in the program. Although a participant
can estimate its future emissions based on its estimate of future
conditions (e.g., energy prices and other factors), all of these
conditions may change during the time period. Any such change would need
to be assessed to determine how it might have affected the participant's
emissions.
There are three types of overlap involving the firms and trade groups
participating in Climate Leaders and Climate VISION. First, as of November
2005, most Climate Leaders firms also participate in other voluntary EPA
programs. Specifically, 60 of the 74 firms took part in one or more other
programs, while the other 14 firms did not take part in any other
programs, as shown in figure 2. Of the 60 firms, 36 took part in one to
three other voluntary climate programs. For example, Calpine participated
in three programs, including the Combined Heat and Power Partnership, and
Natural Gas STAR. Another 18 firms participate in four to six other
programs. For example, Cinergy Corporation participated in EPA's Coalbed
Methane Outreach Program, Combined Heat and Power Partnership, and Natural
Gas STAR, among others. Additionally, six firms participate in seven or
more programs. IBM, for example, participates in 11 other programs,
including Energy STAR and the PFC Emissions Reduction Partnership for the
Semiconductor Industry.
Figure 2: Climate Leaders Members' Participation in Other EPA-Sponsored
Voluntary Programs, as of November 2005
Second, some firms participating in Climate Leaders are members of trade
groups participating in Climate VISION. We identified such firms in the
automobile manufacturing, cement, electric power, and paper industries.
For example, General Motors, a Climate Leaders participant, is a member of
the Alliance of Automobile Manufacturers, a Climate VISION participant.
Finally, three of the Climate VISION trade groups also participate in EPA
voluntary programs. Specifically, the Aluminum, Magnesium, and
Semiconductor Associations also participate in industry-focused EPA
programs. Further, the Aluminum and Semiconductor Associations previously
developed their goals in conjunction with other EPA voluntary programs.
The fact that there is overlap among the organizations participating in
both Climate Leaders and Climate VISION, and among participants in these
programs and other federal voluntary programs, creates the possibility
that their emissions reductions will be counted more than once. For
example, the emissions reductions claimed by firms participating in
Climate Leaders who are also members of trade groups participating in
Climate VISION may be counted twice-the individual firm's achievement may
be credited under the Climate Leaders program, while the same achievement
may be counted toward the trade group achieving its goal under Climate
VISION. Further, for those trade groups that participate in Climate VISION
and other EPA voluntary programs, it is possible that the same actions and
the same emissions reductions will be counted by both programs. If
participants' emissions reductions are counted by multiple programs, it is
possible that any attempt to estimate the overall impact of voluntary
federal climate change programs on greenhouse gas emissions will be
overstated.
In addition, it will be challenging to accurately estimate the programs'
effects because it is difficult to determine the level of emissions for a
firm or trade group in the absence of these programs and other factors.
For example, increases in energy prices can be expected to reduce energy
consumption, which is significant because carbon dioxide emissions from
energy use account for more than 80 percent of U.S. emissions. According
to EIA's 2002 estimate, which was reflected in the President's February
2002 plan, U.S. emissions intensity was projected to improve 14 percent by
2012. However, according to EIA's 2006 estimate, largely because of an
increase in energy prices, emissions intensity is now projected to improve
17 percent over the same period. If participants had anticipated such an
improvement, they might have projected lower emissions over time. This
means that the difference between their reported emissions and their
projected emissions would be smaller, which would decrease the emissions
reductions attributable to participation in a voluntary program.
Conclusions
The administration has chosen to pursue voluntary rather than mandatory
activities to reduce greenhouse gas emissions. Given the potential gravity
of the climate change problem, programs such as Climate Leaders and
Climate VISION will need to be especially robust and involve a substantial
portion of the economy if they are going to achieve the desired results.
To date, according to EPA and DOE estimates, these two voluntary programs
involve companies and industries representing less than one-half of total
U.S. emissions, which immediately limits their potential impact. This
makes it all the more important that the voluntary programs maximize the
extent to which their potential is achieved.
To this end, we found that opportunities remain to improve the management
of both programs. First, while many participants appear to have made
considerable progress in completing program steps in a timely manner, some
participants in both programs appear not to be progressing at the rate
expected by the sponsoring agencies. For example, although EPA expects
that firms will generally take about 2 years to establish their emissions
reduction goals, of the 51 firms that joined in 2002 and 2003, the first 2
years of the program, 18 firms had not done so as of November 2005.
Second, while 12 of these 18 firms are currently negotiating their goals
with EPA, 6 others had not begun negotiations because their inventories
had not been finalized. Similarly, although DOE expects that groups will
generally complete their work plans within about a year of joining the
program, of the 13 groups that joined during 2003, the program's first
year, 2 had not completed their plans as of November 2005. EPA is
developing a system for tracking firms' progress in completing key steps
under Climate Leaders, but DOE does not have a system for tracking trade
group's progress under Climate VISION. We believe that, without a system
to track how long participants take to complete key program steps, DOE
cannot ensure that the program's goals are being accomplished. Moreover,
neither agency has a written policy on what action to take when a firm is
not making sufficient progress in setting goals and completing other key
program steps. We believe that, by establishing written policies regarding
consequences for not completing these steps on schedule, the agencies
could more easily ensure participants' active involvement in the programs,
thereby increasing the opportunities for contributing to the President's
emissions intensity reduction goal.
Both agencies are working this year to estimate the emissions reductions
attributable to their programs. No matter how many firms and trade groups
have joined the programs and how well they are meeting program
expectations, to demonstrate the value of voluntary programs-as opposed to
mandatory reductions-the agencies will need robust estimates of the
programs' effect on reducing emissions. However, as we noted, making this
estimate will be challenging for two reasons. First, the overlaps between
organizations participating in these two programs and other voluntary
programs make it difficult to attribute specific emissions reductions to
one program. EPA and DOE will need to find a way to determine the
emissions reductions attributable to each program so that the same
emissions reductions reported by organizations participating in Climate
Leaders, Climate VISION, and other voluntary programs are not counted by
more than one program. Otherwise, estimates of total emission reductions
from voluntary federal programs could be overstated. Second, it will be
difficult to determine the emissions reductions stemming from
participants' involvement in the program, as opposed to higher energy
prices or other factors, because it is difficult to determine what
participants' emissions would be in the absence of these programs. It will
therefore be difficult to evaluate the merits of these voluntary programs.
Nevertheless, it will be important for the agencies to overcome these
challenges in determining their programs' emission reduction
contributions.
Recommendations
To ensure that the Congress and the public have information with which to
evaluate the effectiveness of these voluntary programs and to increase the
opportunities for contributing to the President's emissions intensity
reduction goal, we are recommending that DOE develop a system for tracking
participants' progress in completing key steps associated with the
program. We are also recommending that both EPA and DOE develop written
policies establishing the consequences for not completing program steps on
schedule.
Agency Comments and Our Evaluation
We provided a draft of this report to EPA and DOE for their review and
comment. EPA did not comment on our recommendation, but rather provided a
summary of the program's accomplishments, noting that 85 firms now
participate in Climate Leaders and that 5 firms had met their emissions
reduction goals (see app. IV). DOE stated that, overall, the draft report
provided a useful overview of the Climate VISION program and agreed with
our recommendation regarding a tracking system and said it will consider
our recommendation regarding establishing a written policy (see app. V).
However, DOE stated that the Climate VISION Web page contains a wealth of
information on the program, which may be sufficient to ensure the active
involvement of participating groups. Because DOE's Web site does not
contain information regarding the expected time frames for completing key
program steps or the consequences for groups not meeting the agency's
expectations, we continue to believe that DOE should establish a written
policy regarding what actions it will take when a trade group is not
making sufficient progress in completing key steps. Although DOE agreed
with our statement that Climate VISION participants account for at least
40 percent of total U.S. greenhouse gas emissions, it noted that the
program covers about four-fifths of total U.S. industrial- and
power-related greenhouse gas emissions, which makes the potential impact
of the program substantial. Also, although DOE agreed that higher energy
prices may lead to lower emissions overall, it noted that, in the power
sector, higher energy prices may lead to greater emissions. This can occur
if electric power producers use less oil or natural gas (which produce
fewer emissions per unit of electricity) and more coal (which produces
more
Appendix I U.S. Government Voluntary Climate Change Programs
In addition to Climate Leaders and Climate VISION, the U.S. government
supports numerous other voluntary programs that encourage participants to
reduce their greenhouse gas emissions, as shown in the following table,
arranged alphabetically by sector. For the purposes of this report, we
define voluntary greenhouse programs as those programs that
o do not involve regulation, government-sponsored research and
development, tax incentives, financial assistance, or government/industry
cost-sharing components;
o were created for the specific purpose of reducing greenhouse gases or
were created to reduce other pollutants but had the additional benefit of
reducing greenhouse gases; and
o involve only dissemination of information to nonfederal parties.
Table 5: Other U.S. Voluntary Greenhouse Gas Emissions Reduction Programs
Sector/Program Affected Implementing Purpose
greenhouse agencies
gases
Energy: commercial,
and residential
Emerging Technologies Carbon DOE Increase demand for, and
dioxide bring new, highly
efficient technologies to
market for buyers, while
assisting manufacturers,
energy service companies,
and utilities. The focus
is on highly
energy-efficient products
for commercial and
residential building
applications.
Energy STAR for the Carbon EPA Promote strategies for
Commercial Market dioxide strong energy management
by engaging top company
leadership, promoting
standardized measurement
tools to assess
performance of buildings,
and providing information
on best practices in
energy efficiency.
Energy STAR - Labeled Carbon EPA/DOE Provide information to
Products dioxide consumers and homeowners
so that they can make
sound investments when
buying a new home or when
undertaking a home
improvement project.
Energy STAR for the Carbon EPA Provide guidance for
Residential Market dioxide homeowners on designing
efficiency into kitchen,
additions, and whole-home
improvement projects and
work with major retailers
and other organizations
to help educate the
public.
Federal Energy Carbon DOE Promote energy efficiency
Management Program dioxide, and renewable energy use
(FEMP) methane, in federal buildings,
nitrous facilities, and
oxide operations.
Voluntary Reporting of All DOE Record the results of
Greenhouse Gases voluntary measures
Programa undertaken by companies
and other organizations
to reduce, avoid, or
sequester greenhouse gas
emissions.
Energy: Industrial
Best Practices Program Carbon DOE Offer industry tools to
dioxide, improve plant energy
methane, efficiency, enhance
nitrous environmental
oxide performance, and increase
productivity.
Energy STAR for Carbon EPA Enable industrial
Industry (formerly dioxide companies to evaluate and
Climate Wise) cost-effectively reduce
their energy use through
established energy
performance benchmarks,
strategies for improving
energy performance,
technical assistance, and
recognition for
accomplishing reductions
in energy.
Industrial Assessment Carbon DOE Provide no-cost energy
Centers dioxide assessments to small- and
medium-sized
manufacturers to help
identify opportunities to
improve productivity,
reduce waste, and save
energy.
Transportation
Best Workplaces for Carbon EPA and Advocate
Commuters dioxide, Department of employer-provided
Transportation commuter benefits and
methane, highlight the efforts of
nitrous employers to help get
oxide employees to work safely,
on time, and free of
commuter-related stress.
Clean Cities Carbon DOE Advance the Nation's
dioxide, economic, environmental,
methane, and energy security by
nitrous supporting local
oxide decisions to adopt
practices that contribute
to the reduction of
petroleum consumption.
SmartWay Transport Carbon EPA Reduce emissions from the
Partnership dioxide freight sector by
creating partnerships in
which partners commit to
measure and improve the
efficiency of their
freight operations using
EPA-developed tools,
reducing unnecessary
engine idling, and
increasing the efficiency
and use of rail and
intermodal operations.
Industry/Agriculture
AgSTAR Methane EPA and Reduce emissions from
Department of livestock waste
Agriculture management operations by
promoting the use of
biogas recovery systems.
Coalbed Methane Methane EPA Reduce emissions by
Outreach Program promoting the profitable
recovery and use of coal
mine methane by coal
mining and other types of
companies.
High GWP Environmental High GWP EPA Aim to limit emissions of
Stewardship gases HFCs, PFCs, and SF6 in
Initiativeb several industrial
applications:
semiconductor production,
refrigeration, electric
power distribution,
magnesium production, and
mobile air conditioning.
Natural Gas STAR Methane EPA Reduce emissions from
U.S. natural gas systems
through the widespread
adoption of industry best
management practices.
Waste Management
Landfill Methane Methane EPA Promote the use of
Outreach Program landfill methane gas as a
renewable, green energy
source. The program's
focus is on smaller
landfills not regulated
by EPA's New Source
Performance Standards and
Emissions Guidelines.
Climate Change and All EPA Encourage recycling and
Waste Program waste reduction for the
purpose of reducing
greenhouse gas emissions.
Provide technical
assistance for waste
prevention, recycling,
and buying recycled
products.
Other
Clean Carbon EPA Encourage states to
Energy-Environment dioxide, develop and implement a
State Partnership methane, comprehensive strategy
Program nitrous for using new and
oxide existing energy policies
and programs to promote
energy efficiency,
renewable energy, and
other clean energy
sources.
State and Local Carbon EPA Enable state and local
Climate Change dioxide, decision makers to
Outreach Program methane incorporate climate
nitrous change planning into
oxide their priority planning
to help them maintain and
improve their economic
and environment assets.
Sources: U.S. Department of State, U.S. Climate Action Report 2002; DOE
Web site, EPA Web site. Selection of programs is based on a list of
current U.S. climate policies and measures provided by EPA.
aThis initiative cuts across all sectors and greenhouse gas emissions
sources. However, for the sake of simplicity, we list it here under
commercial and residential energy.
bThis initiative consists of six separate programs: the Voluntary Aluminum
Industrial Partnership, the HFC-23 Emission Reduction Program, the
PFC/Climate Partnership in the Semiconductor Industry, the SF6 Emissions
Reduction Partnership for Electric Power Systems, the SF6 Emission
Reduction Partnership for the Magnesium Industry, and the Mobile Air
Conditioning Climate Protection Partnership.
Appendix II Scope and Methodology
To determine the steps participants are expected to complete under each
program and the expected time frames for completion, we reviewed agency
documents, where available, and interviewed agency officials within the
Environmental Protection Agency's (EPA) Office of Air and Radiation and
the Department of Energy's (DOE) Office of Policy and International
Affairs. We also obtained energy and emissions intensity data from Energy
Information Administration (EIA) staff. To ascertain the extent to which
agency officials assist participants in setting emissions reduction goals
and the types of goals established, we reviewed agency documents and
interviewed agency officials. We also reviewed commitment letters sent to
DOE by the various trade groups, since each group prepared individualized
letters, but we did not review the paperwork submitted by Climate Leaders
participants to EPA, since each firm signed a standardized membership
agreement with EPA.
To determine the extent to which participants' reductions are reported in
each program, we reviewed agency guidance on reporting and verification
and interviewed agency officials. In addition, we reviewed the recommended
reporting protocols for each program, including EPA's Design Principles,
which is EPA's emissions reporting guidance, and DOE's Draft Technical
Guidelines for Voluntary Reporting of Greenhouse Gases Program. We also
reviewed EPA's annual greenhouse gas inventory summary and goal tracking
form, the Inventory Management Plan (IMP) desktop review form, the on-site
IMP review facility selection form, and the IMP on-site review form.
To determine how EPA quantified the share of U.S. greenhouse gas emissions
covered by Climate Leaders and the total reductions expected from the
program, we interviewed EPA staff. To assess the size of the electricity
generating sector participating in Climate Leaders, we used EPA's e-GRID
database, which contains information on the environmental characteristics
of almost all electric power generated in the United States. To ascertain
how DOE quantified its estimate of Climate VISION coverage, we reviewed
DOE documents and interviewed DOE staff. To determine the agencies' plans
for future coverage and impact, we reviewed performance plans and an
annual report (for EPA) and interviewed agency officials for both
agencies. To assess the reliability of the EPA, DOE, and other data, we
talked with agency officials about data quality control procedures and
reviewed relevant documentation. We determined the data were sufficiently
reliable for the purposes of this report.
To ascertain how many firms participating in Climate Leaders also
participate in other EPA voluntary climate programs, we cross-referenced a
Climate Leaders roster against EPA lists of membership in other EPA
voluntary programs. Similarly, we reviewed membership in DOE's Climate
VISION program and cross-referenced selected individual trade group
members with the list of Climate Leaders members.
Finally, to create a list of other government-sponsored, voluntary
greenhouse gas emissions reduction programs, we requested information from
EPA on all current U.S. policies and measures designed to reduce
greenhouse gas emissions. We narrowed the list to those programs that were
voluntary. We defined voluntary programs to include only those programs in
which private sector parties agree, of their own free will, to reduce
greenhouse gas emissions. Therefore, we excluded regulatory programs. We
also excluded programs consisting primarily of research and development,
tax incentive, or financial assistance, and government/industry cost share
arrangements. However, we determined that voluntary programs can include
programs in which the government provides information to private sector
parties, individuals, or state and local governments. We also included
programs that were created both for the specific purpose of reducing
greenhouse gas emissions and that were created to reduce other pollutants
but have as a side benefit the reduction of greenhouse gases. We included
programs that are supported by the Departments of Agriculture, Energy, and
Transportation, as well as EPA.
We conducted our review from June 2004 through March 2006 in accordance
with generally accepted government auditing standards.
Appendix IV Comments from Environmental Protection Agency
Appendix V Comments from the Department of Energy
Appendix VI GAO Contact and Staff Acknowledgments
John Stephenson (202) 512-3841 or [email protected]
In addition to the contact named above, David Marwick, Assistant Director;
John Delicath; Anne K. Johnson; Chester Joy; Micah McMillan; and Joseph D.
Thompson were the major contributors to this report. Kisha Clark, Heather
Holsinger, Karen Keegan, Jean McSween, Bill Roach, and Amy Webbink also
made important contributions.
(360529)
www.gao.gov/cgi-bin/getrpt?GAO-06-97.
To view the full product, including the scope
and methodology, click on the link above.
For more information, contact John Stephenson at (202) 512-3841 or
[email protected].
Highlights of GAO-06-97, a report to congressional requesters
April 2006
CLIMATE CHANGE
EPA and DOE Should Do More to Encourage Progress Under Two Voluntary
Programs
To reduce greenhouse gas emissions linked to climate change, two voluntary
programs encourage participants to set emissions reduction goals. The
Climate Leaders Program, managed by the Environmental Protection Agency
(EPA), focuses on firms. The Climate VISION (Voluntary Innovative Sector
Initiatives: Opportunities Now) Program, managed by the Department of
Energy (DOE) along with other agencies, focuses on trade groups.
GAO examined (1) participants' progress in completing program steps, the
agencies' procedures for tracking progress, and their policies for dealing
with participants that are not progressing as expected; (2) the types of
emissions reduction goals established by participants; and (3) the
agencies' estimates of the share of U.S. greenhouse gas emissions that
their programs account for and their estimates of the programs' impacts on
U.S. emissions.
What GAO Recommends
GAO recommends that DOE develop a system for tracking groups' progress in
completing program steps. Also, GAO recommends that both agencies develop
written policies on what to do about participants not progressing as
quickly as expected. EPA did not comment on the recommendation, and DOE
agreed with the recommendation on a tracking system and said it will
consider the recommendation on establishing a written policy.
EPA expects Climate Leaders firms to complete several program steps within
general time frames, but firms' progress on completing those steps is
mixed. For example, EPA asks firms to set an emissions reduction goal,
generally within 2 years of joining. As of November 2005, 38 of the
program's 74 participating firms had set a goal. Of the 36 firms that had
not set a goal, 13 joined in 2002 and thus took longer than expected to
set a goal. EPA is developing a system for tracking firms' progress in
completing these steps, but it has no written policy on what to do about
firms that are not progressing as expected. Trade groups generally
established an emissions reduction goal before joining Climate VISION, and
DOE generally expects them to develop a plan for measuring and reporting
emissions within about 1 year of joining. As of November 2005, 11 of the
15 participating groups had such a plan, but 2 of the groups without a
plan joined in 2003, the program's first year. DOE has no means of
tracking trade groups' progress in completing the steps in their plans and
no written policy on what to do about groups that are not progressing as
expected. A tracking system would enable the agency to ascertain whether
participants are meeting program expectations in a timely manner, thereby
helping the program to achieve its goals. By establishing a written policy
on the consequences of not progressing as expected, both agencies could
better ensure that participants are actively engaged in the programs, thus
helping to achieve the programs' goals.
The types of emissions reduction goals established by Climate Leaders
firms and Climate VISION groups vary in how reductions are measured and
the time periods covered, among other things. For example, one Climate
Leaders firm's goal is to reduce its domestic emissions by 5 percent over
10 years; another's is to reduce its worldwide emissions per dollar of
revenue by 35 percent over 7 years. Similarly, one Climate VISION group's
goal is to reduce emissions of one greenhouse gas by 10 percent, while
another's is to reduce its emissions per unit of output by 12 percent. GAO
noted that some Climate VISION groups said meeting their goals may be
linked to reciprocal federal actions, such as tax incentives or regulatory
relief.
EPA officials estimated that the first 50 firms to join Climate Leaders
account for at least 8 percent of U.S. greenhouse emissions. DOE estimated
that Climate VISION participants account for at least 40 percent of U.S.
greenhouse gas emissions. EPA and DOE are working through an interagency
process to quantify the emissions reductions attributable to their
programs; the process is expected to be completed in 2006. However,
determining the reductions attributable to each program will be
challenging because of the overlap between these programs and other
voluntary programs, as well as other factors.
Appendix III Climate VISION Participant Qualifying Statements
Source: Information from DOE's Web site.
*** End of document. ***