Why Oil Companies May Be Our Best Hope for Climate Change Legislation in Congress

In the 21 years since the Valdez oil spill in Alaska, Exxon has been a virtual poster child for corporate environmental villainy. Tied irretrievably to the notorious March 1989 spill, the company has added other environmental offenses to their record, becoming a constant target of activists whenever they needed an oil bully to kick.

But today, ExxonMobil, however unlikely, may just be a powerful potential partner for radical environmentalists who have grown weary of the give and take surrounding "cap and trade" climate legislation and have yet to give up hope for passing a meaningful climate change bill in 2010. That is, if environmental activists will be willing to work with Exxon execs.

"Climate change is an issue we take seriously and believe responsible steps should be taken to address the risk," said Ken Cohen, the oil company's vice president of public affairs,to the Washington Post a few years ago. "We believe a revenue-neutral carbon tax is a more efficient policy option to reduce emissions...and is more able to be applied on a global basis than a cap and trade system."

Then, using terms that one might expect from suspicious middle-class families, tea-partiers, and leftists, Cohen added, "We should not be creating a complex derivatives market for a new commodity called an 'emission allowance' as the recent financial crisis demonstrates. There is no need to create an opportunity for traders to extract profits from a trading system."

Cohen's critique of the proposed "cap and trade" framework -- long the favorite of Washington DC insiders -- sounds almost identical to that of the system's chief environmental critics. Under that framework, a cap would be set on carbon emissions. Then, large emitters would be able to trade for "clean air" credits created by companies either performing activities that allegedly reduce net carbon (like planting trees or controlling emissions) or deploying new energy technologies that displace carbon, like replacing coal with wind.

"The official position of the Sierra Club was that the House cap and trade bill was an excellent start, and the goal was to strengthen and improve the legislation in the Senate," said David Bookbinder, the Sierra Club's chief climate counsel. "My personal view was that the bill was terrible."

The disappointing results from Copenhagen, and changing political dynamics in Washington, DC due to Democrats recent loss of a Senate seat in Massachusetts, means that "cap and trade" may have crashed and burned for the fourth consecutive time in Congress. "In my view, there is zero chance that any [cap and trade] climate legislation will pass this year," predicted Bookbinder. "The only thing that really makes sense is a carbon tax -- but that's the big "T" word," he concluded.

Ironically enough, ExxonMobil, which has a dubious record at best when it comes to climate change, and other large energy corporations may be the last hope for climate change legislation this year. If they see an opportunity for a "Plan B" carbon tax, they could bring with them the prized 60th Senate vote environmentalists need to avoid a filibuster against climate legislation.

But can radical environmentalists work with ExxonMobil, a company that has long personified what is wrong with corporate America?

Seasoned eco-warriors like Randy Hayes, founder of the Rainforest Action Network and former head of the International Forum on Globalization, are happy to have oil companies such as ExxonMobil supporting a carbon tax.

"Either a cap and trade or a carbon tax can be made to work to reduce the damage our society does, but the carbon tax is cleaner and my choice," said Hayes. He went on to say that "I can't imagine the version [of the carbon tax] that ExxonMobil, the Wall Street Journal, or the Financial Times want is the same one that nature needs. That said, we need the captains of industry to back a plan commensurate with the scale and timing of the problem. Governments are too often lackeys to big industry. They are more often followers not leaders. And environmental groups don't hold enough cards to make a real solution happen."