Coop's Corner

A lot of ink gets spilled debating technology's next big frontier. I'll leave that to the clairvoyants, but this much is a no-brainer: figuring out ways to engineer a safer, cleaner environment is going to create a lot of new fortunes.

Last year, alone, venture capitalists poured some $3 billion into clean tech. And what's really interesting is that the battle against greenhouse gas emissions is no longer caricatured as simply a "greenie" obsession. In fact, there's no shortage of policy statements on the topic from CEOs at Fortune 500 companies like Duke Energy and General Motors.

EDF President Fred Krupp

(Credit: Env. Defense Fund)

It's not yet exactly the equivalent of the proverbial lion laying down with the lamb. But it is a breathtaking change when you consider the previous polarization between environmentalists and big business in the U.S.

A lot of the credit for that change goes to Fred Krupp, who heads the Environmental Defense Fund. Krupp was trained as an environmental lawyer and so naturally, you'd expect him to spend a lot of time hauling polluters into court. But after arriving at the EDF in 1984, he adjusted his approach.

Not that the EDF has foresworn filing lawsuits. But thanks to a policy shift engineered by Krupp, the EDF has made headway by emphasizing cooperation over confrontation. That more nuanced approach has given the EDF a seat at the table alongside the movers and shakers in the conversation about how to curtail the emission of greenhouse gasses.

And now with all three of the remaining presidential contenders favoring a cap and trade policy for carbon emissions, Krupp envisions more federal leadership from the White House on this issue. He also says the private sector is going to have a vital role in coming up with solutions. In a recently published book, Earth: The Sequel, which he co-wrote with journalist Miriam Horn, he highlights some of the innovators and the technology they're using in the fight against global warming. I had an extended conversation with Krupp on Friday. Here are excerpts from that interview:

Q: Do you think there's a place for nuclear energy as a part of any environmental solution?
Global warming is so serious that how could we possibly take nuclear off the table? I think we have to be open-minded about it. At the same time, I'm tired of the nuclear industry thinking all they have to do is get the endorsement of environmentalists and it's off to the races. We haven't yet solved the technical and political situation of where all this stuff goes. Until we answer that question, we won't advocate building a new fleet of nuclear power plants. But we all have interest in resolving that.

How do you think carbon capture and storage is most likely going to get resolved technology-wise?
There aren't many remaining technology challenges. But we have to show it can work in scale. There now is an array of companies working out how to pump (carbon) underground, and then how to monitor and make sure it stays underground. The EPA has to write regulations for underground sequestration and after all of our urging, they've finally started to do that.

Cap and trade is in the news and a lot of people believe this offers a way to get a handle on greenhouse gas emissions. I read recently where John Doerr even called cap and trade "the largest economic opportunity of the 21st century." What's your take?
I agree with him. Nobody really needed PCs and there wasn't this urgent need for the Internet. But we all need energy. In fact, energy is now a $6 trillion part of our economy. Once the government puts caps on carbon and demands that we have green energy--which is what the government basically did a century ago with trash; they said clean it up--it changes everything about the economics. It will give an incentive to energy efficiency, and it will give a huge boost to wave power, wind power, and solar power.

What about the costs to consumers? Isn't it likely that businesses will pass along the costs, and well, folks already are dealing with high energy costs and stagnant wage growth.
Absolutely. There's no getting around that there will be costs in the short term. But it turns out that when economists look at these costs, they consistently overestimate how much it will cost.

We've had a national stalemate over climate-change policy seemingly forever. Do you think that might change soon?
There's a 90 percent chance that within the next 18 to 24 months, we will get a strong cap and trade bill. It will be here because all three presidential candidates have come out in favor of the idea.

But why has Washington dodged the question on how to deal with greenhouse gas emissions from fossil fuels for so long?
The science is overwhelming. Why haven't politicians moved more quickly? There are entrenched interests which want to keep the status quo...We've made this our main priority by far but we're up against big, vested interests. Also, the issue's been polarized and become part of the political divide in this country. It's been identified with liberal Democrats and there's been an almost religious conviction among almost half the population that this can't be true. They hear their opinion leaders like the president and (Sen. James) Inhofe saying it can't be true. Getting past that divide has been really, really hard. But I think we're past that.

Looking back on where you were one or two decades ago, I'm sure you must feel a sense of achievement. But what's been the biggest disappointment?
I definitely would have liked to see a faster pace of change on climate change. Although there's a lot more media coverage, it doesn't make me feel at all satisfied until we actually put that carbon cap in place.

I've had it. Watching years of endless debate over global warming play out without a final denouement, why not face the hard truth that we're going about it all wrong? Both sides invariably trot out reams of competing statistics or quote scientific tomes to support their positions in a conversation that goes stale fast.

But I've got a better idea. If you could sit down with a big global warming skeptic like United States Sen. James Inhofe, or even with President Bush, forget the "woe is us routine." Instead, why not appeal to their capitalist greed--and I don't mean that in a pejorative sense. You don't have to believe in global warming to agree that fossil fuel emissions aren't doing any good for the air we breathe. But the sharp disagreements flare up when the topic turns programmatic. That is, how do you go about the cleanup without wrecking the economy? Good question, but unless the smart money is wrong, the answer will make fortunes for a lot of people.

EDF President Fred Krupp

(Credit: Environmental Defense Fund)

While the pace of investment in Web 2.0 start-ups is waning, clean tech is booming. Venture capitalists sank more than $3 billion into the sector in 2007, and they'll break that record this year.

The environmental movement got hip to that idea awhile ago, making the right calculation that appealing to business' self-interest would pay dividends later on. Apropos, I was reminiscing on Friday with Fred Krupp, who heads the Environmental Defense Fund. Time was when the EDF's informal motto was, "Sue the bastards." But Krupp, who joined EDF in 1984, has become a big proponent of working with business on this issue.

Call it constructive engagement, if you will, but he's making progress even though there remains much skepticism among business interests. But in the last year, a number of heavy-hitter CEOs have made strong statements about climate change, including Jeff Immelt from General Electric, Rick Wagoner at General Motors, and Jim Rogers at Duke Energy. We're not exactly talking about Abbie Hoffman and Jerry Rubin here. These are members of the U.S. corporate aristocracy, and if these boys are singing a new tune, change is in the air. Check out the United States Climate Action Partnership, which is an alliance between big-time companies and climate and environmental groups teaming up to support a market-driven approach to climate protection. At the same time, there's a pending bill in Congress, S. 2191, better known as America's Climate Security Act, designed to help reduce U.S. greenhouse gas emissions.

I wouldn't exaggerate the swing of the political pendulum--there's still a lot of resistance--but as the Bush administration finishes out its term, there's suddenly more movement on this front than at any time in the last eight years. I'll be publishing a Q&A on Saturday with Krupp where he talks in more detail about technology's likely role. In the meantime, here's the nagging question I still can't answer: Is this issue so bound up with interest-group politics that hopes for a national movement are just a pipe dream? The debate seemingly goes on and on without resolution. Now that there's new hope for real change just over the horizon, I hope we're not about to get let down again.

Now it's your turn to weigh in.