As this current administration in the United States continues to scrap policies from the previous administration based solely on scoring political points for a diminishing base rather than on sound social, science and economic sense, we see a further decline in the United States standing on the global stage related to environmental, social and even financial metrics. The latest debacle is the head of the EPA, Scott Pruitt, issuing a recommended rescinding of the Clean Power Plan. This Obama-era policy instituted the largest clean-energy sector growth in U.S. history and was a major boost in terms of putting the US on track to not only meet our stated goals of a 30 percent reduction in carbon emissions by 2020, but placed us as a world leader in this effort. Additionally, the CPP directly tied into our commitment to the Paris COP21 Agreement in getting to our promised goals of reducing global warming.
Now there are those who think this policy shift does not affect them or their business. This could not be further from the facts. Businesses can often fall into a sense of security or tunnel vision embracing the belief that policy makers always have their best interests in mind and that this will allow them to continue to grow their companies without wading into the morass of policy debate. This is extremely self-delusional and can often economically destroy a company, even those who don’t feel their business is connected to the cleantech Industry.
When policy change or new policy announcements are made by the government, it’s in the best interest of individual companies to take a serious look at whether or not the policy shift will impact in a positive or negative way their interests. Is the policy shift going to impact their shareholder value or other obligations to investors or their customers?
Take the CPP as an example. This policy sets standards on the reduction of carbon emissions from existing power plants by 30 percent, provides investment capital in renewables while requiring a reduction in energy use of new products or the replacement of outdated inefficient products. It also mandates off lining outdated fossil fuel based power plants to be replaced by clean energy generation technologies. This strategy outlined a path forward to serious job creation in the cleantech industry while reducing our dependence on fossil fuels. While there are certainly coal miners who are out of work, it has very little to do with this policy and more to do with market demand. Even when coal mines are reopened, or existing ones continue to operate, miners are still losing jobs because of technology that can replace the need for human labor. If a mine collapse and you only have machines in the mine, then liability goes down. The machines don’t require breaks, vacation time, sick leave, or expensive medical insurance because of the potential for black lung disease.
Additionally, these displaced coal miners have the opportunity to be retrained in the clean tech industry and many have taken advantage of this program offering high paying jobs without the safety risks of being in a mine. The cleantech industry now out employs the coal mining industry by a factor of sixteen with over 3,000,000+ workers in the cleantech industry compared to a total of 183,306 (Bureau of Labor Statistics 2016) in the coal mining industry and falling. Cleantech is one of the fastest growing industries in the U.S. economy and this policy change could become a negative growth factor in this market resulting in layoffs and stagnant wages.
So now if your company does not take a serious look at how this policy impacts its financial health, then you may not be around long. Because of this reversal, with a heavy thumb on the scale weighted towards a dying industry, energy costs will rise as it becomes more expensive to extract coal, transportation costs will increase as fuel costs increase, pollution will increase with a reduction in the funding to support cleantech initiatives and cleanup efforts — and this is potentially up and down your entire supply chain. Additionally, if you are like us and in the Information Communications Technology Industry, you very well will see a reduction in sales of your product in an IoT connected world as demand for product can decrease because of the financial loss. There is the social aspect of it to with customer demand and shareholder expectations of corporate responsibility. You may be at a disadvantage if one of your suppliers or someone you supply to is impacted in a significant way.
So what can you do? Well for starters, pay attention to these policy changes and get involved to advocate for your business. In the case of the CPP the EPA will be soliciting public comment about their intention to reverse direction. This gives you the opportunity to reach the EPA directly by email (firstname.lastname@example.org with Docket ID# EPA_HQ_OAR_2017-0355 in the subject line) and tell then your opinion about their proposed policy change. Let them know how many jobs this policy has created and where they are if that has happened in your company. Let them know how many companies are impacted within your supply chain. Let them know the cost savings the Obama era policy provides to your customers or the public health benefits and nation’s energy security. If you ship products overseas, then it will have an even greater impact on you as the European Union, the Middle East and Asia are all proponents of the CPP and signers to COP21 which may impact your sales to these foreign customers who might chose a different product that adheres to the Cleantech tenets. If you don’t know where to start or feel you are a small fish in a big pond then join an advocacy group or form one with like-minded companies or even your supply chain. Walmart is a great example of this. This is not the time to sit on the sidelines while policy changes happen that impact your company and your customers. Your customers are relying on you to have a voice. They already have one when they use their wallet.