Many large, publicly traded companies, from technology to retail, are tackling climate change and busy securing supplies of water, energy and agricultural staples. But for start-ups or mom-and-pops, what’s the Plan B—as weather-related risks, from severe droughts to flooding, threaten profitability?
Many small-business owners, in fact, are pondering such questions, according to a new report released Wednesday from the American Sustainable Business Council. Smaller employers are imagining very specific scenarios in which energy and food costs soar. Overstressed power grids spark outages. And employer health-care costs climb, as extreme hot and cold spells trigger illness—combined with potentially contaminated water sources.
About 87 percent of small-business owners cited one or more expected impacts of climate change as potentially harmful to their businesses, according to the report. A top issue was higher energy costs, which concerned about 53 percent of the business owners. The survey was conducted earlier this month. About 550 small-business owners, with up to 99 employees, were surveyed.
Beyond weather worries, about 57 percent of the entrepreneurs said they’d like to see the largest carbon emitters make the biggest reductions in emissions—and bear most of the costs of such efforts.
“Most small business owners are very concerned about climate change and already feeling the impacts,” said David Levine, chief executive of theAmerican Sustainable Business Council.
The survey is the latest report that parses the economic risks of weather shifts, which are already being experienced. There’s less water, and more rain. Heat waves are growing, and wildfires are intensifying.
On Tuesday, a coalition—including former New York City Mayor Michael Bloomberg and former Secretary of the Treasury and Goldman Sachs alum Henry Paulson—released a study on the economic costs of climate change. “I actually do believe that we’re at a tipping point with the planet,” Paulson told The New York Times.
“You’re going to see increasingly, wildfires, droughts, storms, tornadoes, etc. And we have to prepare for those,” said Paulson in a separate interview with NBR on Tuesday. “There’s an economic risk,” he said.
Greenhouse power grab
But not everyone believes in human-induced climate change, or supports emission cuts. Opponents say higher restrictions on greenhouse gases, or taxing emissions, would devastate businesses and job creation.
On Monday, the Supreme Court effectively validated the Environmental Protection Agency’s plans to regulate major sources of greenhouse-gas emissions such as power plants, but criticized the agency as overreaching.
“The Court recognized that EPA’s attempt to sweep small businesses into its greenhouse gas agenda was an unconstitutional power grab,” said U.S. Chamber of Commerce President and CEO Thomas J. Donohue, in a prepared statement.
The “EPA is now on notice that it does not have unlimited authority to impose massive costs on the U.S. economy and mandate a fundamental redesign of America’s electricity system,” Donohue said.
Where’s the wheat?
But some Main Street employers say climate change already is impacting their businesses.
Extreme weather including the drought out West has affected inventories of wheat, maple syrup and other agricultural items at the Village Bakery in Athens, Ohio. “Unreliable supplies are threatening our business,” said owner Christine Hughes.
The small business is doing its part to reduce emissions by cutting its reliance on fossil fuels. “We’re trying to be more efficient.” Hughes said.
—By CNBC’s Heesun Wee.