A Blue Chip Shift You Should Know About

The international climate-change discussion recently held in Doha, Qatar, ended up being a dud, with little or no progress made in addressing urgent issues, which are even described as reaching crisis proportions. Remember Superstorm Sandy?

However, here's some good news: Some of the biggest blue chip companies are moving in a positive direction with their own energy policies despite the lack of public policy support.

According to a new report from Calvert Investments, Ceres, and World Wildlife Fund, many massive companies aren't relying on the government's blessing (or coercion) to begin making more sustainable energy choices.

Moving past the deadlock
The report, "Power Forward: Why the World's Largest Companies are Investing in Renewable Energy," shows that most Fortune 100 companies have actually committed to sustainable energy solutions, through vowing to reduce greenhouse gas (GHG) emissions and/or setting renewable energy commitments.

Massive companies like Google (NASDAQ: GOOGL  ) , Wal-Mart (NYSE: WMT  ) , Sprint (NYSE: S  ) , and Johnson & Johnson (NYSE: JNJ  ) are cited as among the companies that are taking a forward view of sustainable energy policies within their businesses.

According to the report, 56% of the companies examined have created GHG reduction goals, and 13% have even outlined specific goals for renewable energy use. Meanwhile, many of the companies are shifting from the passive purchase of temporary Renewable Energy Credits to active, long-term strategies such as Power Purchase Agreements and on-site projects.

Many investors turn a blind eye to progress in this area, without even recognizing that sustainable, renewable energy can actually result in cost savings and increased stability for companies that tackle it now, not to mention a future world that's safer for economic growth and human habitation.

The fact that huge companies like these are taking voluntary action should tell skeptical investors what they need to know. This issue is not only socially significant, but makes economic and business sense, too.

Targeting the right kind of change
Progress from simply talking about renewable energy to actually setting specific targets is significant. Here are a few examples of goal-setting by some of the major companies examined in the report:

  • Google's long-term goal is to utilize 100% renewable energy; it recently announced that it will use wind energy from the Canadian Hills Wind Project to juice its Oklahoma data center. 
  • Johnson & Johnson has committed to 50 MW of renewable energy by 2015; one of J&J's interesting spins on tackling the topic is setting up a $40 million annual capital relief fund to help finance its energy efficiency and renewable energy projects. 
  • Sprint-Nextel commits to 10% renewable energy by 2017; Sprint's claim to fame includes its willingness to work on policy, with CEO Dan Hesse meeting with U.S. Department of Energy leaders, publicly speaking, and urging Congress to continue to support wind energy through the Production Tax Credit, or PTC.
  • Wal-Mart joins Google in aiming for 100% renewable energy over the long term; the more renewable energy it purchases, the lower the costs. In just one example of Wal-Mart's heft in this area, it currently has more than 180 renewable energy projects globally, providing 1.1 billion kW of renewable energy annually. Remarkably, each project is cost-competitive with traditional power.

Of course, even while many big companies are making their plans, some aren't, even a few that might come as a surprise given their strong brands and positive reputations with consumers.

For example, Amazon.com (NASDAQ: AMZN  ) and Apple (NASDAQ: AAPL  ) were both among the companies listed as having set no targets in these areas.

Focusing on positive change
The United Nations meeting in Doha -- a thought-provoking location given the fact that Qatar is the largest greenhouse-gas emitter in the world -- did extend the Kyoto Protocol, but lacked news of additional progress on emissions policies. No new pledges were made during the conference, despite dire word of warming expected to reach double the levels deemed in 2010 as "safe."

And of course, the Kyoto Protocol lacks some pretty major support, since the U.S. never signed on and major nations like Canada, Russia, and Japan dropped out. Even worse, developing countries aren't included, and they're renowned for having rapidly caught up with more developed countries' heavily polluting ways .

Doha may have been a dud, and many are still pointing out that international governments need to make major policy changes in order to move the world to safer standing given the prospect of climate crisis, which appears to already be beginning.

Still, the fact that so many major companies are proactively working to change their mind-set on their energy usage is heartening. Investors should pay attention to the environmental policies and carbon footprints of the companies they own, and remember the risk that looms not only for those companies' futures, but for economic health across the globe, including our own.

The word's out: It's time for businesses to stop spreading the damage and devise sustainable ways to run their operations. These changes may not only help reduce environmental burdens, but they can help save money, too. That's the true long-term view, and could result in positive change at that.

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Check back at Fool.com for more of Alyce Lomax's columns on environmental, social, and governance issues.


Read/Post Comments (4) | Recommend This Article (8)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On December 16, 2012, at 2:59 PM, wmtworker wrote:

    I think people believe in global warming like a religouse belief and i wonder how much scientific proof there realy is.

  • Report this Comment On December 17, 2012, at 3:54 PM, Darwood11 wrote:

    Good article.

    My favorite?

    "Google's long-term goal is to utilize 100% renewable energy; it recently announced that it will use wind energy from the Canadian Hills Wind Project to juice its Oklahoma data center. "

    Yes, we have to go to Canada to get renewable energy, I do wonder how many additional wind turbines could have been built with the assistance our government provided to Solyndra?

    Of course, Google (and Amazon and Apple) all have a financial incentive to reduce their energy costs and profile.

    Perhaps Apple can import electricity from China? (Just kidding, but if they could, they would!).

  • Report this Comment On December 18, 2012, at 9:55 AM, SuntanIronMan wrote:

    Canadian Hills has nothing to do with Canada. It is Canadian Hills, as in Canadian County, Oklahoma.

    http://www.canadiancounty.org/

  • Report this Comment On December 31, 2012, at 3:05 AM, thidmark wrote:

    Let's save the planet while unborn children are slaughtered ...

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