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"The carbon-based free lunch is over. Breakthroughs on climate change and improving our society's energy efficiency are within reach."

Would you guess this quote is from A.) A naïve, tree-hugging environmentalist B.) Paul Dickinson, CEO of the global, non-for-profit Carbon Disclosure Project (quoted in this week's in-depth feature) or C.) John W. Rowe, chief executive of Chicago-based utility company Exelon?

I was shocked to read in an article in today's New York Times that it was Rowe of Exelon. In fact, Rowe is pulling his company out of the U.S. Chamber of Commerce to protest the pro-business group's stance on climate change regulation. And Exelon is not alone. The Times reports that Pacific Gas & Electric of Northern California and PNM Resources of New Mexico have also threatened to quit the Chamber. But before you conclude that hard-nosed capitalists are turning into altruists, read on. The story explains that Exelon, PG&E and others may stand to gain if greenhouse gases are regulated because they are less dependent upon coal than their competitors.There has clearly been a sea change where environmental causes are concerned, and the surest sign of it is that corporations are now competing to "outgreen" each other. The Toyota Prius was an early trend setter, and now there are examples in nearly every consumer products category you can think of, from energy-saving appliances to eco-friendly cleaning products to recyclable and sustainable-content-rated clothing. A cynic might question the motives and sincerity -- Toyota also makes the not-so-gas-friendly Tundra -- but the big-picture results are what matters. By publically taking a stand and raising awareness, corporations are unleashing forces that will inevitably help to achieve the desired results -- carbon emissions reductions among utilities, more fuel-efficient cars and energy-efficient appliances, and so on.

Market forces can get things rolling even in the absence of regulation. The U.S., for example, backed out of the Kyoto Accords during the Bush Administration, yet 66 percent of U.S. Standard and Poor's 500 companies are now voluntarily reporting their carbon emissions to the Carbon Disclosure Project (CDP), a non-governmental, non-for-profit group that is promoting global standards for tracking and reporting greenhouse gas emissions. SAP, Microsoft and Accenture had only good things to say about the CDP at a press conference held in New York last week. Indeed, these vendors are helping CDP with BI-based carbon-tracking and reporting capabilities. The executives in attendance -- Marty Etzel, vice president of sustainability solutions at SAP; Rob Bernard, Microsoft's chief environmental strategist; Dave Abood, executive director of the Accenture Climate Change Group -- stand to gain if tracking of carbon emissions goes from a voluntary exercise to a requirement. Comparisons were made to the Sarbanes-Oxley Act compliance frenzy, and executive shared estimates that there could be a $10 billion to $16 billion market for carbon-tracking and compliance technologies within a few short years. Are these technology vendors joining the environmental bandwagon purely out of self interest? Who cares! I'm one of those moderates who thinks capitalism and environmentalism are compatible. The most efficient and profitable companies are already tracking carbon emissions as part of their effort to curb energy use and become more efficient. There's a reason the 787 Dreamliner is Boeing's most successful new product introduction ever: promised fuel efficiency, which translates into reduced carbon emissions.

I'm not opposed to environmental regulation, but I say let's do everything we can do to promote market-based initiatives and incentives to meet the world's biggest challenges. In the '60s and '70s, most auto makers were dragged kicking and screaming into improving auto safety. But when the (private) Insurance Institute for Highway Safety and (government-based) National Highway Traffic Safety Administration started measuring car safety, manufacturers started competing for those coveted five-star safety ratings.

Where carbon emissions are concerned, the CDP is on the right track, and measurement will surely lead to better management."Breakthroughs on climate change and improving our society's energy efficiency are within reach." Would you guess this quote is from A.) A naïve, tree-hugging environmentalist B.) Paul Dickinson, CEO of the Carbon Disclosure Project or C.) John W. Rowe, chief executive of Chicago-based utility company Exelon? Don't be shocked, but the answer is C.