Getting Small Firms to Think Green

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With big fish like Al Gore and General Electric tackling climate change, it seems there isn't much room in the debate for minnows. "Small business has never had a seat at the table, so they always get screwed," says Byron Kennard, founder of the Center for Small Business and the Environment. However, not only do small businesses consume about half the nation's commercial energy output, but they are also on the front lines of helping address the problem. In 2004, more than $1 billion of venture capital went to start-ups researching clean technology. So any new policies coming from climate-change politics will have a big impact on smaller companies. Still, none of the more than 50 climate-change bills making their way through Congress even address small businesses, Kennard says.

So it was a pretty big turnaround last week when the Senate Small Business Committee took up the issue of what companies with fewer than 500 employees can do about reducing greenhouse gases. It was the first time the U.S. Congress gave small-business interests a chance to raise their voices. Last summer, California passed a bill capping greenhouse gases, with help from small-business interests worried about the effects of global warming on industries like skiing and wine, says Kennard. After that, some in Washington, D.C., became more interested in winning new supporters for environmental bills.

The Senate hearing was intended to check up on the small-business provisions of the two-year-old Energy Policy Act. Sens. John Kerry of Massachusetts and Olympia Snowe of Maine both scolded federal agencies for ignoring small businesses and not doing enough to get them to cut back on energy consumption. Snowe said few small businesses have invested in efficiency programs.

As energy costs rise, investing in more-efficient machinery can help energy-intensive businesses like restaurants with their bottom line, Kennard notes. "The chief problem is inertia," he says. If a piece of equipment breaks down, a small-business owner is looking for the cheapest and fastest alternative, not necessarily one that may produce savings in the long run, he says.

Bill Wehrum, acting assistant administrator of the Environmental Protection Agency's Office of Air and Radiation, argued that his group was making progress, noting that last year there were 130,000 visits to the agency's Energy Star Small Business Program's website. But he also admitted that the small-business program has only two employees.

Small-business interests want programs like Energy Star expanded so more small businesses know about setting up efficient operations from the get-go. They also want the government to spend more money on small companies researching clean technology through existing programs like small-business innovation research grants.