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A decade ago environmental attorney Marco Monroy approached food giant Nestle with a novel proposal. If the company converted boilers at its ice cream factory in Chile from coal to natural gas, it could cut emissions of carbon dioxide by up to 50 percent.
It wasn’t an easy sell.
The conversion would cost $100,000, and on top of that natural gas was more expensive. But Monroy had a surprising pitch. He explained that the reduced carbon emissions could be sold on the world market and were worth $50,000 a year.
The concept, known as carbon trading, was still new, and it took a while for Nestle to agree.
“At first people didn’t believe what I was saying, said Monroy, 40. “It took a lot of persuasion.”
Nestle eventually took his advice, selling the carbon “credits” to a Japanese utility that was looking to offset its emissions to meet low carbon regulations.
The Nestle deal became one of the very first projects in an emerging market for the trading of greenhouse gas emissions, which scientists say cause global warming. Monroy has since completed hundreds more carbon-reduction projects around the world, turning his small Miami startup company, MGM International, into a global leader.
A lot has changed since the early days. “Most people now understand that we need an international system to deal with global warming,” Monroy said.
That system, known as cap and trade, is suddenly on everyone’s lips from Tallahassee to Washington, where last week a version of a cap-and-trade bill passed the House energy committee. The legislation would have major implications for industry, especially power companies that are the largest emitters of greenhouse gases such as carbon dioxide.
“It’s a huge new frontier we are on the verge of,” said Susan Glickman, a prominent St. Petersburg environmental activist. “Companies are coming to the fundamental realization that the way we have been operating is a thing of the past.”
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Don Pratt
on May 27th, 2009
@ 1:37 am:
How much are carbon credits worth? If no one wants to buy they are worthless. Change from coal to gas, easy. Until there is no more gas. China uses coal as its main energy source. It can undercut the price of virtually all manufactured goods. How much do they spend on carbon credits? Sweet zero. Guess who pay when the rest say. Why the good old UK. We have coal, we used to have gas until we gave it away. Now we use King Coal and pay and pay.