Though much of my time over the past couple of weeks has been devoted to the behind-the-scenes work of bringing The Inspired Economist into the Green Options Media blog network, I've also made sure to follow the discussion regarding Wal-Mart's comments to the FTC regarding carbon offsets and renewable energy credits. In a post titled "Wal-Mart Lobbies Against Carbon Offset Guidelines," Tony Calero at Wal-Mart Watch got this discussion started by pointing to the company's comments filed in response to an FTC request:
Herein lays the scandal: Despite the company’s “green” initiatives, Wal-Mart is actively lobbying against the clarification of offset guidelines. The company’s hypocritical stance on the issue came to light last week in a hearing of the Federal Trade Commission. The FTC is attempting to modernize the “Green Guides,” guidelines issued for corporations defining acceptable marketing claims regarding environmental products and initiatives. In response to the FTC’s solicitation of retailer comment to guide the process, Wal-Mart’s Director of Energy Regulation, Angela Beehler, expressed Wal-Mart’s firm opposition towards the clarified scope and definition of carbon offsets...
As you might imagine, other media outlets picked up on this pretty quickly: Grist, for instance, noted that Consumers Union and other groups have "been advocating for clear, specific definitions to avoid misleading green claims, " and that "the FTC's definition of carbon offsets could most affect the retailer's ultra-ambitious goal to someday run on 100 percent renewable energy -- a huge amount of which would likely have to come from offsets or renewable-energy certificates." US News and World Report's "Fresh Greens" blog asked "Is Wal-Mart being hypocritical, or are its green efforts in good faith?" Eoin O'Carroll of the Christian Science Monitor's "Bright Green Blog" not only expressed a reaction similar to my own (essentially head-scratching), but also took a step further than the rest of us: he gave Wal-Mart a call. Much of the response he received followed the typical MO of a corporate communications department: the company restated its broad sustainability goals, and offered some more specific ones related to greenhouse gas emissions and energy efficiency. It addressed offsets and renewable energy credits in the last paragraph:
In order to have the best collaborative decision in the formal definition of what constitutes a Renewable Energy Certificate (REC) or an offset, there are several governmental entities and highly technical experts with vast environmental expertise that could and should be included in these important regulations, to enable the flexibility of new innovation and technology that is occurring daily across the world.
This statement seems to run counter to Wal-Mart Watch's claim that the company is "lobbying against the clarification of offset guidelines"; rather, it seems that they're questioning whether the FTC is the proper body to set such definitions. Granted, this statement was issued after the Wal-Mart Watch post, and could be interpreted as a method for drawing out the process. But. one would also have to concede that the FTC's own language on interpretation and substantiation of environmental marketing claims parallels Wal-Mart's statement:
...any party making an express or implied claim that presents an objective assertion about the environmental attribute of a product, package or service must, at the time the claim is made, possess and rely upon a reasonable basis substantiating the claim. A reasonable basis consists of competent and reliable evidence. In the context of environmental marketing claims, such substantiation will often require competent and reliable scientific evidence, defined as tests, analyses, research, studies or other evidence based on the expertise of professionals in the relevant area, conducted and evaluated in an objective manner by persons qualified to do so, using procedures generally accepted in the profession to yield accurate and reliable results.
In other words, in determining whether a marketing claim is misleading or not, the FTC expects to see scientific evidence. From my reading, the Green Guides don't establish definitions; rather, they set standards for determining whether advertising and marketing claims adhere to definitions created by those qualified to do so. It seems to me that the company isn't arguing for casual standards, but is noting that, as of now, strict definitions for carbon credits and renewable energy credits don't exist, and it's not the FTC's job to pick one.
Of course, I can't say definitively that Wal-Mart's innocent of trying to undermine the establishment of commonly-accepted definitions for these instruments; I don't think that their comments to the FTC in this instance establish anything beyond an argument for standard practice, though. If the company is purchasing third-party certified offsets and RECs, that's the best any of us can do right now. I do think a "clarified scope and definition of carbon offsets" and RECs is critical to consumer understanding and acceptance of them, and support those calling for such benchmarks. But I also think referring to Wal-Mart's actions as a "scandal" overstates the case. Let me know if I'm wrong...