World’s Largest Mining Company Admits Climate Change is Real

This is a guest post from Rosana Francescato, a blogger for Mosaic, an online marketplace for investing in solar.

We hold these truths to be self-evident: that fossil fuels cause climate change and the extreme weather we’ve been seeing — and that the world needs to wake up and kick the fossil fuel habit.

Sure, those of us who call ourselves environmentalists take those as truths, but a major coal company? Yet that’s exactly what the Australian BHP Billiton, the world’s largest mining company, has just copped to.

Explaining the company’s decision to retrofit one if its coal-exporting facilities against significant weather events, BHP Billiton executive Marcus Randolph was quoted as saying, “As we see more cyclone-related events … the vulnerability of one of these facilities to a cyclone is quite high. So we built a model saying this is how we see this impacting what the economics would be and used that with our board of directors to rebuild the facility to be more durable to climate change.”

Yes, you read that right: climate change. You gotta love the irony. Not only is this major coal company acknowledging that climate change is real, but they’re investing in protections against the effects of said climate change — which they helped cause. They’re making a significant investment to protect themselves — from themselves.

At what point will a company like this decide that the costs of producing coal and other fossil fuels are no longer worth the return on investment? Weak prices have already led some coal companies, including BHP Billiton, to cut jobs. Add to this the cost of protecting their facilities from storms, and the ROI diminishes even more.

And there are other costs, as we’ve seen recently with Superstorm Sandy. We can’t put a value on people’s lives, the damage to communities, and the emotional effects of the storm. In pure financial terms, though, Sandy could cost $50 billion. What amount of retrofitting would it take to make cities like New York safe? Won’t we get a better ROI by investing in prevention?

Prevention would mean moving from fossil fuels to renewables. And Randolph seems to agree that we must at least limit fossil fuels. Referring to Australia’s carbon tax, he says, “there is not a qualifier saying it is okay to emit more greenhouse gases if the carbon tax is eliminated. An absolute ceiling is an absolute ceiling. Even if there isn’t a carbon tax, it still needs to be an issue we devote a lot of attention to.”

Randolph has even gone so far as to state, “In a carbon constrained world where energy coal is the biggest contributor to a carbon problem, how do you think this is going to evolve over a 30- to 40-year time horizon? You’d have to look at that and say on balance, I suspect, the usage of thermal coal is going to decline. And frankly it should.”

Strong words from a major contributor to the “carbon problem.” Why is BHP Billiton taking this position? Because climate change is affecting what the company cares about the most: their bottom line. Their main concern is profitability. Climate change is a threat to profits. So they’re doing what any sensible hard-nosed ballsy capitalist would do: they’re protecting their profits by investing in more durable facilities.

Could that same concern for profits lead beyond protecting against the effects of climate change to actually trying to prevent it? Maybe the lesson for environmentalists and policy makers is to understand what motivates fossil fuel companies. Forget about appealing to a green economy, solving world energy needs, and so forth. Tell them climate change is going to rob you blind unless you invest against it. And that means first admitting that climate change is real — real enough to affect your profits and maybe even put you out of business.

Randolph’s statements, and the company’s actions, are already making news — and they’re sure to make waves. If a large coal company like this one acknowledges the effects of fossil fuels, who are the climate deniers to turn to? Perhaps it’s time they faced reality and started working to reverse climate change. Perhaps concern for profits will force them to do so.

 

Related Stories:

Stop Dooming the Rest of Us, Climate Change Deniers

Irony Alert: American Petroleum Institute Calls For Obama To Aid ‘Economic Catastrophe’ Due To Warming-Fueled Drought

GOP-Backed Bill Would Destroy America’s Wilderness

 

Photo from Thinkstock

99 comments

Robert Hardy
Robert Hardy3 years ago

It is not just those who provide the poison, it is those of us who take it. We need solutions but we also need a collective effort to use the solutions in place of the problems. The market works more than one way.

Gabriel Reichler
Gabriel R3 years ago

Thanks

Duane B.
.3 years ago

Thank you for sharing.

Suheyla C.
Suheyla C3 years ago

Thanks for sharing.

David Andrew Murray

Thanks

Bill K.
Bill K3 years ago

a bit of good news, but sad too that the only way to get some people to act for good is out of greed. then there are those, like some comments below, who still prefer keeping their head in the ever increasing warming sand.

Mark P.
Mark Porrey3 years ago

There's no global warming this carbon tax is nothing but another Wall Street heist The climate scientist were even caught cheating on the facts of global warming and that was Even proven Do you know what really is causing global warming it's called geo-engineering Or what you people like to call us conspiracy Terrorist Bill gates supports geo-engineering Because he's a eugenics Person May I also mentioned his big ties with a corporation like Monsanto Who likes to poison the food we Eat Do your homework connect the dots Wake up you liberal sheep Give me a break here comes Total enslavement agenda 21 Follow the money behind all of this and it's from the elites To totally enslave us

Jessica Sutton
Past Member 3 years ago

I love when good things come from greed!

That's what I remind everyone when they say something pessimistic about doing small acts of good. Supply and demand!!! We can slowly manipulate the economy to where more ethical companies are putting the crap ones out of business because we are buying more products from companies that care, and not as much from ones that don't.

I see this every day. I live in Alabama. Vegetarian meals and menus used to be non-existent in the small Alabama city I live in - now almost every restaurant has options... when I go to the regular grocery store? Occasionally I find organic produce and Fair Trade Certified items. :-)

We have the real power... NOT the CEOs.

rene davis
irene davis3 years ago

that's one for the books.

Magdika Cecilia Perez

good