Report: Climate Change Disclosures and the SEC

[On behalf of my firm, Green Strategies, and the Clean Air Task Force, I submitted the following comments in response to the SEC’s recent consideration of requiring climate-related financial disclosures.]

Green Strategies and the Clean Air Task Force fully support the Securities and Exchange Commission’s (SEC or the Commission) process to consider requiring disclosures related to climate change so as to better inform investors of relevant risks, impacts, and opportunities. High-quality and accurate information increases the efficiency and stability of capital markets. Investors are increasingly seeking such information about issuers’ climate change-related risks, actions to mitigate climate impact, and/or ability to incorporate complex climate-related factors into strategies for value preservation and accretion. Exercise of the SEC’s regulatory authority to require consistent and accurate disclosure of climate change-related information is warranted.

Full Report

See below for a downloadable PDF of the full text. To download, find the download icon on the bottom banner of the embedded PDF. 


Not Black or White: Minding the Green Swan

While the Federal Reserve and U.S. financial sector regulators are well behind, central banks and regulators around the world are waking up to the macroeconomic consequences of climate change. Roger Ballentine published an article in Japan on “Green Swan” risks and the steps that we should be taking to address them.

Read the full piece here:

Recycling: not your father’s environmental issues

The U.S. recycling market is broken and the impacts of its failure are increased greenhouse gas emissions (GHG), floating plastic detritus and the exposure of underprivileged communities to harmful pollutants. We can revive the recycling industry and mitigate these problems, but we need a policy fix.

I wrote the following opinion piece in February 2021 on why we need to enhance the recycling market to move towards a more “circular” economy.

Click here for the full article in The Hill on how to address our recycling crisis.

Why corporate energy buyers should “go to 11”

[As I often do, I’m coming here to share an article I published in GreenBiz in February 2021, along with my colleague Armond Cohen.]

Large buyers have deployed around 25 new gigawatts of new renewable capacity over the last five years. Traditional corporate procurement methods have led to this success story, but the planet requires we move even faster and more effectively to adopt clean energy. In our GreenBiz article, Why corporate energy buyers should ‘Go to 11’, Armond Cohen and I discuss how corporate procurement “best practice” can evolve to decarbonize the grid more aggressively and result in greater carbon impact than current practices.

Please follow the link above to view the full article!

The Road to Net Zero

[I’m here to share a talk I gave at the Edison Electric Institute’s (EEI) National Fall Key Accounts Virtual Experience in October 2020. I spoke to attendees about the urgent need to achieve net zero emissions in the electricity sector and the role of corporate clean energy procurement in reaching this goal.]

To watch my presentation, please click play on the video below and follow the link to view on YouTube:

Roger Ballentine Joins Energy Central’s Network of Experts

[Last summer – 2020, during the throes of the pandemic – I was interviewed by Energy Central as a new expert in the Clean Power Community. Please view the original post on Energy Central.]

Clean power is the train that everyone wants to get onto these days. Transitioning away from fossil fuels is necessary to meet climate goals, it benefits public health, and it’s the right move for organizations looking to bolster their bottom line today and even more so in the future. But clean energy is not a new trend and it’s not something that sprang up out of nowhere, rather the push to make clean energy a mainstream goal has been many years in the making, and we have numerous early leaders in the sector to thank

for the progress that’s already taken place. Today, I’m excited to share an interview with Roger Ballentine who is one of these long-standing leaders for clean energy and overall action towards sustainability and preventing climate change.

Roger is newly a part of Energy Central’s Network of Experts, specifically as a part of the Clean Power Group.  Today, Roger is President of Green Strategies Inc., but he brings with him decades of experience across a spectrum of clean power groups, initiatives, and more. His presence as a Clean Power expert on Energy Central only serves to make the community that much more connected and informed, but don’t take my words for it. Roger agreed to sit down with me for an introduction interview so the community could get to know him more as a part of our Energy Central Power Perspective ‘Welcome New Expert Interview Series’:

Matt Chester: Thanks for joining our network expert and bringing your unique perspective and expertise to the Energy Central Community, Roger. To start, can you introduce yourself quickly so your fellow members know where you come from, your history in the utility sector, and what expertise and experience you bring to the table today?

Roger Ballentine: I’ve been in this space, which I would define as energy, energy transition, climate change, energy and environmental policy, energy and environmental business strategies and sustainable for 25 years.  Early in my career, I was a partner at a big law firm in Washington DC with a very vibrant legislative policy practice, so I have been involved in policy longer than 25 years.  I then went to work at the White House during the Clinton administration, where I was the President’s liaison to Congress on energy and environmental issues.  Then, I transitioned over to run the White House Climate Change Task Force, which was a pretty large group of folks around the government who were detailed over to the White House and reported to me.  We handled every aspect of energy- and climate-related policy development and outreach.

It’s actually that experience that led me, at the end of the Clinton administration, to decide to go into consulting.  In the time that I spent working on these issues in the White House, I found and realized that the potential for the private sector to have a major impact on these issues that I cared about like climate change was profound and had tremendous, untapped potential because I firmly believed then and firmly believe now that there was significant business upside in a positive relationship between the private sector and environmental issues at large, clean energy and climate change in particular. In the early days, that was a pretty quiet street.  Now, of course, it’s a vibrant part of the private sector.

Since that time,  I’ve been a strategic advisor to a wide range of companies and financial institutions and investors.  In the energy sector, that includes energy providers, utilities, technology providers, service providers; and then importantly, I also work with the large energy consumers and corporate buyers.

While my work has been very broad across energy and sustainability  I’d say I spend more time on the electricity sector than any other.  I have also been 10 years with a small private equity firm.  We make investments and clean energy companies and other sustainable businesses.  For the past six to seven years, I’ve co-chaired the clean energy, energy innovation, and decarbonization program at the Aspen Institute, so I’ve been involved outside of my regular business on these issues, as well as through the many Boards and advisory boards I have sat on.

MC: So you’ve spent a large amount of time not only looking to get clean energy technologies off the ground, but also in progressing energy and climate law. Between tech and law/policy, do you have a sense of which of those will have a greater impact in the next few years? And which are faces more challenges and obstacles, in your opinion?

RB: You know, actually, Matt, I’m going to go back and revise your question a little bit.  I think that there’s a third piece there which is the business case.  There’s the old construct about how energy innovation sits on a three-legged stool of technology, policy, and finance.  I’ve got perspective and experience in all three of those things.  Again, I’ve been doing policy for 30 years.  And I know enough to keep up with technology and technology development.  What distinguishes us from others is that additionally we bring a very sober and sophisticated business perspective to these things.  I would say the question– what’s really going to drive change in the energy sector is all three: technology, policy, and finance.  Sorry, it’s a bit of a cop out, but let me give you an example.

Solar is our fastest-growing sector in energy, but what caused that success?  In this case, it’s all three of these things.  It’s policy.  Early on, federal government adopted tax credits, so the tax incentives are very important.  Various states adapted renewable portfolio standards with the top-down supply-side policy mandate.  Well, all of that ultimately worked in the marketplace because we combine that with the advancements in technology which you can translate into reduction in cost.  The technology advancements, coupled with the policy, grew the solar sector tremendously.  And what is now taking it further?  What is taking it further is the demand side, such as companies to seek out and innovate in how to procure renewable energy.  Now, you’re seeing a demand-side pull which takes the renewable industry beyond even where the technology advancements and the policy incentives would have taken it.  It’s all three of those things in combination that are really creating the success story we’re seeing in renewable energy.

You need all three.  My bias is that probably the least important of those three is technology.  What I mean by that is not that there’s not tremendous innovation going on out there, but if I ask what’s the challenge today, the challenge today is we’re not even fully utilizing the technologies we have to the degree that we could and the degree that we need to.  That is a function of either and probably both policy and business model innovations.

MC: I’d also love to hear more about your time as Chairman of the White House Climate Change Task Force under President Clinton. During this time, climate change awareness and urgency did not reach as far as it did today— how did that impact the work that your prioritized in that role? And what would someone in that role today need to do differently than how you did it back in the 90s?

We were dealing with this at a time when there was no broad consensus that climate change was even real.  We were pushing back against that, and we actually faced bipartisan opposition. I had some of my most fierce debates and conflicts over climate change with Democrats.  It was a very, very different time.  But we were committed and President Clinton was highly committed to this issue.  He was way, way ahead of his time and firmly believed that while climate change was an existential challenge, it was also an extraordinary economic opportunity. But we had a really tough time convincing people of any of that, and we were facing a Republican-controlled Congress that severely limited our ability to do things, so it was a much more controversial issue in the policy and political world then than it is now.

It is also fair to say, and I think this is really what you meant with your question, that in terms of public consciousness it was not nearly as high as it is today, which was also why I gravitated towards the private sector.  The few companies that were taking action were doing so in spite of the fact that there was no broad, public calling for action.  That really made a light bulb go off for me as to how enlightened private sector leadership could break through the politics. And looking ahead, I saw that the political world was going to remain very much divided and complicated around this issue, and I, in a sense, lost patience for that.  I said that I’m going to go where those types of debates are less important than the ones of what can we do, what are the benefits, and how do we finance it?  That was in the private sector, and it still is.

MC: Another key area over the course of your career has been in assisting major corporations to increase their strategy by implementing sustainability. When making this case to companies, how much of it comes down simply to financial costs vs. benefits, and how much do you think is governed by longer-reaching or less immediately tangible goals? And how has that changed over the years?

RB: It’s a good, complex question with a complex answer.  First, to say, not every company is the same.  I will talk about where the leading edge, and the leading edge is getting larger, not smaller.  It’s becoming the mainstream deal.  There are lots of different reasons that companies adopt sustainability or climate or clean energy goals and objectives.  Certainly, it helps and is important that there’s a financial case for action.  The financial benefit, or more broadly, the business benefit, takes several different forms.  The simplest case would be that if you make this efficiency investment, your return on that investment will be this much by this time. It’s the best use of your capital regardless of whether it’s good for the world or not, so we’ll do that. That’s fine, and that happens.  Similarly, well, I can execute a fixed-price power purchase agreement for renewable energy power that insulates me from price volatility based on natural gas prices or whatever it is.  Maybe there’s just a stone-cold business case there as well.

Typically, there’s more that goes into a company making sustainability and climate commitments.  Some of it may be reputational, just purely branding, but again, I found very, very, very few companies that make this decision just on that basis.  Increasingly, you have companies that see more than just a corporate citizenship role, but they see a strong business case to do so.  As only one example, employees love it, so it helps employee retention and commitment.  That’s increasingly the case as the Millennial generation becomes the largest source of workers.  People want to work for companies that have these types of commitments and sense of responsibility and ability to make an impact.  Is that a financial return?  It’s certainly a business return and a business value return.

MC: As you’ve started to get involved with Energy Central, what do you find to be the value that the platform brings to you and to the industry? Why do you participate and stay so engaged, and how do you hope to bring value based on your experience and knowledge to fellow Energy Central users?

RB: These issues are becoming more important, not less important, but they are not becoming simpler.  If anything, they are becoming more complicated.  The benefit of having a platform like this where thought leaders can come and learn and share and ask questions, it’s really important, and I think there hasn’t been a real good way to do that. Is this the only way?  No, but I think it’s an important contribution, so I certainly look forward to the opportunity to not only share my experience and views with people but to learn from others as well.  One thing I like about my job is I learn something new every day, and we’re all going to need to keep learning if we’re going to have any success in tackling these issues because they are becoming more important and not less complex every day, so I think platforms like Energy Central is really, really important right now.

TEDxFoggyBottom: Fighting Climate Change with Capitalism

[I know that people and corporations are motivated primarily by profits. Until now, this has come at the expense of the environment and future generations. But, what if I suggested a way to harness the emphasis on profit to advance climate solutions? Take a look at my TedTalk on Climate Capitalism to see how money and profit can be used to solve the climate crisis.]

Decarbonizing the Electricity Sector & Beyond

[I co-authored The Aspen Institute’s Summary Report of their 2019 Winter Energy Roundtable: Decarbonizing the Electricity Sector & Beyond along with Jim Connaughton and Dave Grossman. I was co-chair of the Aspen Institute’s Clean Energy Forum for seven years.]

Aspen Institute Report Contents

The latest Intergovernmental Panel on Climate Change (IPCC) report has intensified the focus on measures to achieve deep decarbonization. For the United States, most experts say that, if the aim is to be on a 1.5°C pathway, the United States must transition to a net-zero carbon profile economy-wide by around mid-century, going negative thereafter.

At the 2019 Aspen Institute Winter Energy Roundtable, February 25-28, ~50 executives, entrepreneurs, policy makers and thought leaders gathered to tackle how the US can achieve economy-wide decarbonization on a scientifically called-for timeline while ensuring national economic competitiveness and a just transition.

Aspen Institute

During these discussions, the group agreed that there are five basic elements necessary to decarbonize the energy system: (1) employ energy efficiency to the maximum degree; (2) decarbonize the electricity supply; (3) electrify other sectors as much as possible, including heat, transportation, and industrial processes; (4) use zero-carbon fuels for the areas that cannot be effectively electrified; and (5) use carbon capture, utilization, and storage (CCUS) and carbon dioxide removal (CDR) for areas where fossil fuels are still needed and for achieving negative emissions.

Read the report to learn more about these five elements

Burning Garbage Is No Part of a Cleaner Future

[As I do often on this blog, I’m sharing an op-ed I wrote which was originally published in Bloomberg Environment in 2020.]

The burning of municipal waste seems to be included as a qualifying source of “clean energy” in a recent House proposal to transition the United States to a sustainable, low carbon future.

A key plank of the CLEAN Future Act proposal, introduced in January by House Democrats, is achieving “net-zero emissions from the electricity sector” through the use of a Clean Energy Standard (CES), which Democrats will likely pass this year ahead of the election.

The CES would require retail electricity suppliers to obtain 100% of their electricity from “clean energy sources” by 2050. That is the right way to go.

However, according to the Environmental Protection Agency, burning municipal solid waste (MSW) emits nearly as much CO2 per unit of energy as coal—and almost twice as much as burning natural gas. This is not the way to get to net-zero.

EU Policy Excludes Waste Burning

The European Commission announced in December 2019 a new classification system to guide the growing number of private and public capital investors who want to put capital to work in ways that will not only generate strong returns, but will also have a positive environmental impact.

Democrats in the House understand that the Europeans are on to something: reducing waste and investing in low carbon development is both an ecological imperative and a roadmap for economic growth. But these lawmakers may be overlooking one important plank in the European sustainable growth plan: don’t burn garbage to make electricity.

The EU classification system tells investors what types of projects and activities should be considered “green.” To put it mildly, burning municipal solid waste (MSW) to make electricity did not make the list.

Waste incineration is included in the commission’s list of activities that could cause “significant harm to environmental objectives.” (Article 12). Two of those environmental objectives are climate change mitigation and the promotion of a “circular” economy.

The commission was likely well aware of European analyses finding that waste incineration for energy production is almost twice as carbon intensive as the EU grid average and thus works against the goal of a zero carbon grid. In Article 9, the commission lists “minimising incineration” of waste as among the activities that can make a “[s]ubstantial contribution to the circular economy.”

Burning Garbage Hurts Recycling Sector

Incentivizing the burning of our garbage also undercuts incentives for waste reduction and hurts the recycling sector—and at a very bad time. The U.S. recycling industry is in crisis. At the end of 2017, China severely restricted the import of U.S. recyclables.

Prior to that, we were exporting about a third of waste plastic for recycling to China; in 2018 that number was less than 5%. Hundreds of towns and cities across the United States have either shut down or greatly reduced their recycling programs.

The language in the House Clean Energy Standard appears to suggest that the eligible waste incineration facilities should be limited to those that use “postrecycled” waste. Given the collapsing of our recycling industry, waste truly void of recyclable materials may only exist in theory.

Even before China’s import restrictions, half of the carbon dioxide emissions from waste incineration came from plastic; today even less is being diverted. While not yet in the legislative text of the CLEAN Future Act, the authors note that other issues to be addressed include “recycling and waste management.” But any additional—and badly needed—policies to promote recycling will be hindered by the voracious appetite for fuel posed by waste-to-energy facilities.

A more sustainable and lower carbon economy means a more resilient, efficient, and equitable economy that can grow and create more wealth by mitigating the headwinds of climate change and resource constraints that are otherwise a drag on economic growth.

We need lower carbon energy; we need to reduce waste; and we need to create clean economy jobs. We do not need to burn our trash for energy.

This column does not necessarily reflect the opinion of The Bureau of National Affairs, Inc. or its owners.

Don’t Look at the Energy Sector to Solve Our Waste Problem

[But do take a look my commentary on this issue, originally published by Energy News in 2019.]

Working on environmental issues for a living is not for the faint of heart. It always feels like there are too many problems and too few solutions — and even the solutions can turn out to be problems.

One big problem getting a lot of attention is plastic waste. Everyone has heard the admonition to “reduce, reuse, and recycle.” The increasingly ubiquitous use of reusable water bottles, shopping bags, and straws are signs that we are getting better at reducing and reusing. When it comes to recycling, however, we may be heading in the wrong direction. Prior to severe new international restrictions on imports enacted in 2018, the U.S. was sending 4,000 shipping containers of materials per day to China for recycling — including about a third of our waste plastic. In 2018, China accepted only about 4.5% of our plastic. Since these restrictions took effect, hundreds of towns and cities across the country have either shut down or greatly reduced their recycling programs. Our waste is piling up.

And perhaps the mother of all environmental problems is climate change. The International Panel on Climate Change (IPCC), the world’s leading authority on the issue, has declared that in order to avoid the worst effects of climate change we need to transition to a net-zero carbon economy by mid-century. Such “economy-wide” decarbonization includes electricity, heavy industry, transportation, and agriculture. Of these sectors, electricity might be the most important. If we can decarbonize the grid, we not only eliminate the tremendous amount of greenhouse gases we emit in producing electricity, we also then can electrify other sectors (like transportation, the production of heat, and some industrial processes) knowing they in turn will be powered by climate-friendly energy. But today, about two-thirds of our electric grid is powered by greenhouse gas-emitting fossil energy. We have a long way to go.

What do these two problems have to do with each other? One of the ways we have dealt with municipal solid waste in the U.S. is to incinerate it. And through incineration, you can produce electricity that is then put on the grid (termed “waste-to-energy” or “WTE”). Some states deem WTE to be “renewable energy” and include it in policies that subsidize and support other forms of renewable energy, like wind and solar. Now, in the face of mounting waste including more and more plastic, the incineration industry believes that we can kill two birds with one stone: dispose of our mounting waste with more incineration and help fight climate change with more “renewable energy.” Sounds great, right?

Um, no.

Regarding “bird #1” — the plastic and waste crisis — incineration is not the answer. In addition to causing local air pollution and health impacts, more demand for waste streams that include otherwise recyclable materials will further undercut the economics of our already struggling recycling. And if incineration is seen by consumers as a “solution” to our plastics crisis, it could undermine our progress on improving reduction and reuse behaviors. The WTE stone might just kill the wrong bird.

“Bird #2” — climate change — is the big bird, and unfortunately, the WTE “stone” badly misses its target. Whether WTE is “renewable” is debatable. It’s also irrelevant. What the climate cares about — and what matters in our efforts to decarbonize the grid — are greenhouse gas emissions. Those of us who work on climate change support wind and solar because they are zero emission, not because they are “renewable.” To decarbonize the grid, we need all forms of zero-carbon generation — and we need a lot more of it. Stated differently, we need to stop adding carbon-intensive generation — such as waste incineration — to our energy mix and rapidly phase out the dirty generation we have.

Adding more waste-to-energy generation would set us back in our critical need to decarbonize the grid. Even before China’s import restrictions, half of the carbon dioxide emissions from waste incineration came from plastic. Plastic is made from fossil fuels and contains a lot of embedded carbon which is released to the atmosphere when combusted. With declining recycling rates, we will have only more plastic in our waste stream. The dirty secret (literally) is that the energy produced from this mixed waste incineration is nearly as greenhouse gas intensive as coal and worse than natural gas. To make matters worse, some states include WTE in “renewable” energy subsidy programs, which means this dirty source of energy competes directly with zero emission renewables like wind and solar.

The urgent task of decarbonizing our electric grid is immensely challenging. At a time that we must rapidly add clean energy to the grid, we cannot afford to take a step backward with waste-to-energy. Our only option is to move forward.

Roger Ballentine is the president of Green Strategies, Inc. He served as chairman of the White House Climate Change Task Force under President Bill Clinton.