It was a stunning decision. Tearing into the Bush Administration's failure to act, the Supreme Court ruled in April that climate science was clear enough to mandate greenhouse-gas emission controls under the Clean Air Act.
For businesses, the lesson is indisputable: In a low-carbon future of EPA-mandated incentives and penalties, energy efficiency, alternative energy sources, and carbon capture become worth investing in. While Big Auto whines about (and sues over) the prospect of carbon-dioxide limits on cars in Vermont and California, the smart money is riding the "cleantech" tide. Venture capital will pour more than $30 billion into such startups this year, three times the total in 2005.
In Europe, of course, companies already must reduce their greenhouse emissions or buy "offsets"—often in the form of investments in clean energy. In the past year in China, offsets have made possible hundreds of new power plants and other projects. Emissions controls in the United States would also prompt new research and development and entrepreneurship. That's a good thing—and a huge opportunity for businesses that embrace it. Behind all the legalese and wrist slapping of the administration, that's what the Supreme Court decision is really all about.
—Daniel C. Esty, coauthor, Green to Gold: How Smart Companies Use Environmental Strategy to Innovate, Create Value, and Build Competitive Advantage
"The harms associated with climate change are serious and well recognized.... EPA does not dispute the existence of a causal connection between man-made greenhouse-gas emissions and global warming... . That EPA would prefer not to regulate greenhouse gases because of some residual uncertainty ... is irrelevant."
—Opinion of the U.S. Supreme Court in Massachusetts et al. v. Environmental Protection Agency et al., April 2, 2007