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Rogers and Me

An interview with Duke Energy CEO Jim Rogers


by Amanda Griscom Little
04 Apr 2007

Meet Jim Rogers, a great American paradox. He's the top gun at Duke Energy, a huge (and hugely polluting) power company; he's also one of the nation's most dogged advocates for federal regulation of greenhouse-gas emissions.

Duke Energy operates smack in the heart of coal country in the Midwest and Southeast and derives 70 percent of its power from the dirtiest of all fossil fuels. Rogers knows full well that his company has a lot at stake when it comes to cleaning up carbon emissions -- which is why, he says, he wants to be on the vanguard of those preparing for limits.

A bridge-builder between the worlds of industry and environmentalists, Rogers played a key role in launching the U.S. Climate Action Partnership, an unprecedented alliance between corporate executives and green groups that launched in January and has proposed a federal cap-and-trade program that would cut greenhouse-gas emissions 10 to 30 percent over the next 15 years, then 60 to 80 percent by mid-century. These are goals nearly on par with the most ambitious climate bills in Congress, and in recent months, Rogers has been among the most active coalition members lobbying for them on Capitol Hill.

As chair of the Edison Electric Institute, an industry trade group representing companies that provide nearly 60 percent of America's electricity, Rogers has helped move the organization from staunchly rejecting federal global-warming policy to embracing a forward-thinking (if limited) set of climate-change principles. Rogers is also a board member of the Alliance to Save Energy, a D.C.-based nonprofit that lobbies for ambitious energy-efficiency regulations.

But Rogers is not in all areas an environmental angel, as everyone was reminded this week when Duke Energy got spanked by the Supreme Court. In a high-profile decision, the justices unanimously overturned a lower-court decision that let Duke off the hook for circumventing a Clean Air Act provision that requires the installation of high-tech pollution controls on aging power plants. Rogers also takes heat from critics for his avid support of nuclear power, and his contention that heavily coal-dependent utilities should be given more pollution permits than any others in a federal cap-and-trade scheme.

Rogers spoke to me recently from his office in North Carolina about the professional, political, and personal factors that fuel his concern about climate change.

Q: You're running a company that's one of the nation's largest producers of CO2 emissions. You're also doing more than perhaps anyone else in your industry to try to get these emissions regulated. Can you reconcile this contradiction?

A: I'm an optimist. I think there are solutions to problems -- maybe not perfect solutions today, but over time, solutions will improve. I think the probability that we'll get good solutions to climate change -- solutions that benefit both the planet and industry -- is higher if we face the problem now than if we bury our heads in denial. If you're constantly trying to define the problem, or deny it, or dispute it, it gets increasingly difficult and costly to develop a good solution.

Q: Last year you were elected as chair of the Edison Electric Institute, the power industry's biggest trade group. Did this reflect a growing acceptance within your industry of climate change and the inevitability of regulations?

A: There's undoubtedly a growing openness in our industry to this issue. I've seen several surveys that say 70 or 80 percent of the executives in our industry think there will be carbon regulation. In a sense, we're all building our business plans around the carbon scenario. The only issue is what the regulations will look like and when they'll be implemented.

Q: You've recently tried to define one approach via the U.S. Climate Action Partnership. Tell us how that alliance formed, and the process of give-and-take that got you to the final agreement.

A: Most of the executives knew each other and had had ongoing conversations with environmental groups on a range of issues, so there was a set of existing relationships that brought us all into the room. I think the pivotal moment was in December when we began to agree on how we would structure the cap-and-trade program. The really big issue was: Can coal be part of the energy equation in the future? We agreed that it will be, given the fact that 50 percent of our electricity in this country comes from coal.

The other issue was the recognition that nuclear had to play an important part in the equation. This is a tightrope that the environmental community is walking. On the one hand, they want to solve climate. On the other hand, nuclear is the best zero-carbon energy source that can reliably supply our economy, and historically they have not been supportive of it.

Q: So your environmental partners came to agree that nuclear needs to be part of the solution?

A: I wouldn't characterize them as 100 percent supportive of nuclear, but I've seen some movement in that direction. I think they are reluctant to embrace nuclear at this point, but in the face of climate change they view it as the lesser of two evils.

Q: Most of the companies involved in U.S. CAP had already been making noise about the importance of federal action on climate change. Did you try to get other industry members -- auto companies, for instance -- to come onboard?

A: It was an interesting kind of tension. On the one hand, you want enough people to have a critical mass; on the other hand, if it gets too big, you end up spending too much time sitting around the room and fine-tuning the words. Even with that fairly like-minded group [in U.S. CAP], our staff spent an incredible amount of time trying to get the right words so everybody was comfortable with them.

Q: And now you're in a process of recruiting other corporate leaders to join the CAP alliance, as I understand it. Are there major players coming to the table?

A: It looks that way. It's very exciting, but it's too soon to mention names.

Interview continues on next page.

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