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Gore Gives Business Warning On Carbon

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By JOHN HEILPRIN, The Associated Press

Published: February 15, 2008

UNITED NATIONS - Al Gore advised Wall Street leaders and institutional investors Thursday to ditch businesses too reliant on carbon-intensive energy - or prepare for huge losses down the road.

"You need to really scrub your investment portfolios, because I guarantee you - as my longtime good redneck friends in Tennessee say, I guarandamntee you - that if you really take a fine-tooth comb and go through your portfolios, many of you are going to find them chock-full of subprime carbon assets," the former vice president said.

Carbon dioxide from burning fossil fuels is the leading component of "greenhouse gases," which scientists say are playing a key role in warming the globe.

Gore's remarks before a high-profile business crowd that collectively controls about $20 trillion in capital were intended to unleash a financial ripple effect that could force the world to start putting a price on carbon emissions.

Gore, who shared the Nobel Peace Prize for his efforts to warn about climate change, compared the financial risks facing investors in carbon-using industries with the meltdown in the market for subprime mortgages given to people with blemished credit records or low incomes.

"Similarly, the assumption that you can safely invest in assets that come from business models that assume carbon is free is an assumption that is about to go splat," he said. "You have lots of assets, many of you do, in your portfolios right now that truly do deserve that epithet 'subprime.'"

The U.N. hosted nearly 500 financial leaders and institutional investors who came searching for insights on shifting business currents as the world shifts to cleaner energy sources and fuels.

"As soon as people believe carbon has a price, it's going to have a price," said Vinod Khosla, a venture capitalist who was one of the co-founders of Sun Microsystems.

Peter Darbee, chairman and CEO of PG&E Corp., an energy-based company in San Francisco, said cleaner-burning utilities should be rewarded and "those that burn coal should have to pay for clean energy."

The conference was organized by the U.N. Foundation, Ceres and the U.N. Fund for International Partnerships.

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