Canadian Business Leaders Issue Call to Action to Prime Minister in Advance of Montreal Conference on Climate Change

MONTREAL, Canada, November 17 /PRNewswire/ --

- "Greater Integration of Climate Change and Energy Needed in Post-2012 Regime"

Corporate leaders, representing a broad cross-section of the Canadian economy, today released a call to action on climate change and energy in advance of the November 28 - December 9, 2005 United Nations Climate Change Conference: Montreal 2005.

The Executive Forum on Climate Change October 7, 2005, was asked by Prime Minister Paul Martin to provide the Government of Canada advice on how to move forward in the international climate negotiations and in Canada.

"Through our collective actions, Canadian business is demonstrating that it is possible to foster a climate for change while maintaining competitive excellence, growth, and profitability. All governments and citizens, corporations and consumers have a responsibility to actively reduce greenhouse gas emissions and to develop long-term mechanisms to minimise the global impacts of climate change," said Travis Engen, President and Chief Executive Officer of Alcan Inc., on behalf of Executive Forum signatories.

The advice, submitted to the PM November 16 (available at www.climateforchange.ca) urges a sustainable development strategy to 2050, with clear markers along the way, to assure strong economic growth, allow the discovery of long-term value for carbon emission reductions and address the need for adaptation in the face of climate change.

The Canadian Chair of the United Nations Climate Change Conference should aim at:

- Launching a process and work plan that would support development by 2008-2009 of a climate friendly post Kyoto (after 2012) regime that includes both developed and developing countries. - Sending a clear political signal that the post-2012 regime will target development and deployment of low-carbon technology and will continue to develop market-based-instruments including the Kyoto mechanisms. - Improving the operation of the Clean Development Mechanism. - Agreeing to an adaptation package to invest in hazard information, risk assessment and warning systems and best practices in resilient infrastructure and buildings.

With respect to Canada, corporate leaders strongly urge the Prime Minister to:

- Develop, respecting provincial/territorial jurisdiction and the need to maintain a competitive national economy, a long-term energy strategy that positions Canada at the vanguard of new transformative energy technology. - On an urgent basis, target strategic investments and incentives in world-class carbon dioxide capture, transport and storage and low- impact renewable energy, including green power, green heat and advanced bio-fuels. - Develop a climate extremes strategy that encourages investment in public infrastructure, homes and buildings so they are more resilient to severe weather. - Engage consumers as they have a vital role in addressing climate change. Executive Forum Statement signatories: Travis Engen, President & CEO, Alcan Inc. Bob Elton, President & CEO, BC Hydro Mr. Laurent Beaudoin, Chairman of the Board and Chief Executive Officer, Bombardier Inc. Russell Horner, President & CEO, Catalyst Paper Corporation John Murray, President, CH2M HILL Alban D'Amours, President & CEO, Desjardins Group Doug Muzyka, President & CEO, E.I. Dupont Canada Inc. Derek Pannell, President & CEO, Falconbridge Limited Annette Verschuren, President & CEO, The Home Depot Canada John R. Wells, President & CEO, Interface Americas Brian Foody, President & CEO, Iogen Corporation Jack Cogen, President & CEO, Natsource Asset Management André Desmarais, President & Co-CEO, Power Corporation Clive Mather, President & CEO, Shell Canada Frank Dottori, President & CEO, Tembec Inc. George Cooke, President & CEO, The Dominion of Canada General Insurance Company David Wilmot, Chair, Institute for Catastrophic Loss Reduction Gregg Hanson, President & CEO, The Wawanesa Mutual Insurance Company

Executive Forum on Climate Change Call to Action on Climate Protection, Energy and Sustainable Development United Nations Climate Change Conference: Montreal 2005 November 2005

Dear Prime Minister:

As corporate leaders representing a broad cross-section of the Canadian economy, we believe that all governments, corporations, consumers and citizens have responsibilities under the Kyoto Protocol and that the world must act urgently to stabilise the accumulation of greenhouse gases in the atmosphere and minimise the global impacts of climate change.

Our organisations accept that a strong response is required to the strengthening evidence in the scientific assessments of the Intergovernmental Panel on Climate Change (IPCC). We accept the IPCC consensus that climate change raises the risk of severe consequences for human health and security and the environment. We note that Canada is particularly vulnerable to the impacts of climate change.

We know significant steps are needed to stop the growth in greenhouse gas emissions and that the timing of those reductions affects the rate and ultimate level of climate change.

We believe strongly that the growing global demand for energy services and the need to ensure sustainable development require a continued focus on reducing greenhouse gas emissions while providing energy services and ensuring economic growth. We need a focus on energy supply and demand to resolve climate change. We need all countries to play their part.

A more effective global effort must rapidly increase deployment of low- carbon, zero emitting, renewable energy, and carbon dioxide capture and storage, conservation and energy efficiency technologies.

Where possible, we are adapting our business practices to reduce greenhouse gas emissions and to minimise the adverse impact of climate change. Some of us are major users and producers of energy, and have launched emission reduction programs and participate in emissions trading markets. We believe that purchasing and producing renewable energy, investing in low carbon technologies, working to improve energy efficiency and offering new products and services aimed at reducing emissions are meaningful strategies for the business community to undertake. Many of us have improved company productivity and profitability as a result. Some of us help society manage the threat of climate extremes, and we are investing in research to identify more resilient building design and construction practices, adapting our internal practices based on emerging science about future risks, and educating our consumers about preparedness and loss prevention.

To help us do more, we need policy certainty for post-2012. We need a strategy now for the next 50 years, with short and medium-term targets to guide us. Governments must set clear markers along the way to unleash competitive market forces and allow the discovery of a long-term value for carbon emission reductions. Only then will we secure the deep reductions needed to prevent human interference with the climate system.

Principles

From a business perspective, we recommend that governments strive for a climate regime that is guided by these important principles:

- Good science and rational economics. - Minimises uncertainty through an announcement well before 2012 of significant long-term quantified objectives to 2020, 2030, 2040 and 2050. - Ensures Canada's competitive position through a regime that is fair and flexible with broader, equitable and cost-effective participation of developed and developing countries and a more global harmonised approach in keeping with common but differentiated responsibilities. - Focused on energy, including technology options. Greenhouse gas targets and commitments for post-2012 should include energy supply and demand related milestones, including targets for green power; green heat and advanced bio-fuels; carbon dioxide capture, transport and sequestration; and energy efficiency and conservation. - Makes effective use of market-based mechanisms, economic instruments and full-cost pricing as part of an integrated regime of regulation, standards, fiscal incentives and policy measures. - Stimulates innovation and significantly expands investment in research and development through public/private and international partnerships. - Creates incentives to lower consumption and to change consumer behaviour. - Considers climate change in the broader context of sustainable development. - Emphasises city regions as emerging players in achieving long-term energy goals, particularly a new more distributed energy system. - Facilitates adaptation to climate change and the adverse impact of climate extremes. - Encourages sustainable forestry and agriculture, particularly reductions in deforestation in developing countries, and rural economic development through bio-refineries, advanced bio-fuels and bio-products.

Montreal conference

We encourage governments to: - Build on the foundation provided by the United Nations Framework Convention on Climate Change and the Kyoto Protocol to launch a process and work plan that would support development by 2008-2009 of an inclusive and climate friendly post-2012 regime. - Send a clear political signal that the Kyoto Protocol's mechanisms (Emissions Trading, Joint Implementation and Clean Development Mechanism) will be made to function effectively in the near term and will continue to operate after 2012. - Reform the operation of the Clean Development Mechanism, including: - Governments providing stable funding for 2006 - 2008 to: - Hire professional staff team to manage day-to- day operations and technical panels and to support oversight by the Executive Board. - Retain consulting expertise to expedite completion and approval of methodologies. - Increase communication and capacity among stakeholders and governments. - Agree to an adaptation package, that supports the building of adaptive capacity through: - Investment in hazard information, risk assessment and warning systems. - Identification of best practices for building new homes, retrofitting existing buildings and public infrastructure. - Financial support for local investments in resilient public infrastructure. - Public education to establish a culture of disaster preparedness.

We recommend that Canada, respecting federal and provincial authority:

- Develop a long-term energy strategy that positions Canada at the vanguard of new transformative energy technology, particularly where we have a comparative advantage. Prioritise domestic investments (over international) to reduce greenhouse gases in the Canadian economy. On an urgent basis, target strategic investments and incentives in world-class carbon dioxide capture, transport and storage and low-impact renewable energy, including green power, green heat and bio-refineries and advanced bio-fuels. - Set objectives to meet global best practice for energy production and consumption through regulated standards, procurement, financial and tax incentives and market-based approaches like emissions trading and trading of energy efficiency credits. - Align government and corporate procurement policies with these objectives. - Make and recognise longer-term investments in domestic and international emissions markets as a sign of confidence in a post-2012 regime that embraces market- based solutions. - Ensure the New Deal for Cities and Communities factors loss prevention and adaptation to climate change into long-term sustainability plans, infrastructure planning and investments with a focus on building resilient, sustainable communities. - Facilitate our domestic adaptation response through investment in a risk assessment of 2 degrees Celsius global average warming in Canada. - Develop a climate extremes strategy focused on investment in public infrastructure, homes and buildings so they are resilient to damage from severe weather. The strategy should also include investment in hazard safety research and public education. In this respect, and on an urgent basis, strengthen building efficiency and resilience through the National Building Code. - More effectively engage consumers as they have a vital role to play in addressing climate change. Business and government need to collaborate directly with the public to establish a shared understanding about change in the climate, and actions required.

Conclusion

Business and government must continue to work together to address climate change. We can jointly identify and implement policy measures that create meaningful and effective solutions, while at the same time ensuring long-term value. We look forward to working with you and to receiving your feedback on this advice.

Properly designed programs and incentives will unleash the power of the market to accelerate deployment of low carbon technologies and adaptation to climate extremes, engaging both producers and consumers. We are firmly committed to do our part on climate change. A coordinated response from the Government of Canada and the other participants in the Montreal Conference will allow us to do even more.

Sincerely yours,

Travis Engen, President & CEO, Alcan Inc. Bob Elton, President & CEO, BC Hydro Laurent Beaudoin, Chairman of the Board and Chief Executive Officer, Bombardier Inc. Russell Horner, President & CEO, Catalyst Paper Corporation John Murray, President, CH2M HILL Alban D'Amours, President & CEO, Desjardins Group Doug Muzyka, President & CEO, E.I. Dupont Canada Inc. Derek Pannell, President & CEO, Falconbridge Limited Annette Verschuren, President & CEO, The Home Depot Canada John R. Wells, President & CEO, Interface Americas Brian Foody, President & CEO, Iogen Corporation Jack Cogen, President & CEO, Natsource Asset Management André Desmarais, President & Co-CEO, Power Corporation Clive Mather, President & CEO, Shell Canada Frank Dottori, President & CEO, Tembec Inc. George Cooke, President & CEO, The Dominion of Canada General Insurance Company David Wilmot, Chair, Institute for Catastrophic Loss Reduction Gregg Hanson, President & CEO, The Wawanesa Mutual Insurance Company

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