Dan Kammen   University of California, Berkeley Institute of the Environment

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Despite record profits in both the oil and coal industries, neither are devoting much investment into research or development of alternative energy. How do you understand that? ...

I think there are a couple of explanations. The energy sector has historically underinvested in R&D relative to other areas. Biotech invests 10 or more percent of all revenues back into R&D. The energy field has reinvested a tiny fraction of revenues, under 0.4 percent, back into R&D. ... And only now are companies beginning to figure out that investing a tiny fraction of their revenues back into research is bad business. We're seeing European, Japanese companies with not only larger but also more coherent research policies. ...

[There are] major U.S. companies that have basically called on the president to enact a climate policy because they will respond to it once it's law, but they're not going to respond before it's law. ...

But the problem is that, until you get that policy, they can't know what direction really makes sense. And so everyone is waiting for clarity, and lack of clarity is worse than no policy, because it tells people that we just don't know. And I think that's the worst signal for industry that you can get.

You're talking about R&D mostly on the power generation side with those historical examples. What about ExxonMobil making $40 billion in profit -- and who knows where they're going to be at the end of this year -- and less than 1/10 of 1 percent is going into renewable energy research? What sense does that make?

It makes no sense in terms of economic opportunities or strategic opportunities.

The U.S. economy needs to reinvent itself on a regular basis. The biotech revolution, the computer and information technology revolutions all generated new waves of jobs. They took U.S. industries that were struggling and made them not only competitive but, in some sense, dominating their Japanese or European counterparts. ...

Every single indicator now is that clean energy, energy efficiency, renewable power is that next opportunity to reinvent our economy, to jump-start innovation, to get companies to become competitive leaders again. And that's the area where I think a new administration, a new industry sector is waiting to act. ...

Exxon or Chevron, or even Shell or BP, ... is there a particular reason why those companies that happen to be making the biggest profits are putting so little into renewables?

I think there's no single reason, mainly because these companies are somewhat diverse in their perspective. Some are European-based, some are U.S.-based.

But I do think that the lack of a market is critical. Now, there are some regional markets. The U.S. West, led by California and Washington and Oregon, [is] leading in building a clean energy base. The Upper Midwest and the New England and Mid-Atlantic states are building their own regional markets.

But until there is a consistent way to buy and sell greenhouse gas emissions, a so-called cap-and-trade market, there won't be a clear price on carbon, and companies respond most clearly to ... a viable price for pollution in the market.

George Monbiot   Journalist and author, Heat: How to Stop the Planet Burning

One of the major sources of resistance to change is the investment already made in energy systems around the world. But the hopeful sign here is that that investment becomes redundant quite quickly. There's need already for a wholesale global replacement of much of our electricity-transmitting grids. There's need for wholesale replacement of much of our power generation.

The International Energy Agency [IEA] recently published a report calling for $22 trillion worth of new energy investment. Well, there's no reason on earth why that can't be renewable electricity investment rather than just replicating the old investment patterns which we already live with.

But that requires a change in mind-set of agencies all over the world. But it can be done. ...

Jeroen Van Der Veer   CEO, Royal Dutch Shell

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If you a see a future in which a price is put on carbon, why are you investing so little in renewables relative [to] oil or gas?

Well, if you look at renewables, then there is no point to invest a lot of money in an existing technology which is too expensive and expected to continue to be too expensive for consumers. So the whole emphasis for technology is, how can you lower the costs so that it can compete without subsidies? ...

But that takes R&D --

Everybody knows, in research, if you put twice as [much money] in the research, it doesn't go twice as fast, so you have to go through all the steps. So we aim our research to try to find those processes that make the products cheaper for the consumers. And if we are not successful, then the consumers don't have those products. ... Only if you have found cheaper renewables for the consumers, then we can put big money behind it. And then we will do that, of course.

Do you see a future where Shell gets out of the oil business?

Well, I think we started in oil. We built a gas business. And then we even built in, from the normal pipe gas, we built [a] liquefied natural gas business. I think it is always a natural process. You don't go suddenly out of the oil [business]. ... But we think it is a very natural development if we would have a kind of [a] third leg to stand on besides the oil and the gas business. And that's what we aim for. And I hope that we are successful.

... Why not get out in front of the game here? I mean, people want leadership. Why not build more megawatts of solar, more megawatts of wind -- because you know that the price of oil is going to continue to rise?

... We built one of the largest offshore wind parks [off] the Dutch coast here in the North Sea. From a money point of view, you must have a lot of guts to do that. And why is that? Because the technology is still too expensive.

Relative to oil and coal?

Relative to oil and gas. And the only way we do it [is to build from] learning experiences so that the next project, you get a bit cheaper or lower costs, and again and again. So here, you see, you try to find a path [so] that it becomes competitive.

But the world is not served by building things which can't compete. And then we don't solve the CO2 problem. The money has to come from somewhere.

Dr. Rajendra Pachauri   Intergovernmental Panel on Climate Change

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There are very few companies that take strong leadership positions.

That's where I think you need strong government policy. ... People are not going to bring down their profits just to be able to please the public. I think the public has to put enough pressure on companies. I think the legal and policy regime has to be such that companies will move in the right direction.

In the absence of that, yes, [the companies] may do a few things here and there. But they're obviously not going to jeopardize the interest of the shareholders. So somehow what we need to do is to ensure that there's common ground between the interests of the shareholders and that of society. And this is where enlightened government legislation, regulation, incentives, disincentives, can make all the difference. ...

... You've got to be pragmatic about these things. There's no sense in living in a world of make-believe. These guys are there for a very specific purpose, and they'll find every possible way of meeting that purpose. So you've got to make it absolutely essential for them, or you're going to leave them with very few choices if you want to move them in a particular direction.

So you have to herd them? You have to change the rules of the game?

You have to. And those rules of the game being changed can come from government. But it can also come from society. It could come from consumer organizations. It can come from civil society NGOs [non-governmental organizations] and the media. It can make an enormous difference, though I must say I find increasingly that, off the record, these guys buy up the media in our country. Big money is a big danger. And with the growth that's taking place in India, these big boys are acquiring a lot more muscle.

Frank O'Donnell   President, Clean Air Watch

GE is a classic example of a U.S.-based, worldwide company that realizes we are going to see emissions reductions and that they have many divisions that can stand to capitalize on that, from those that make nuclear reactors to those that make windmills. They see green when they talk about global warming.

I think they've overstated some of their stuff to try to offset some of the bad activities that they're doing in the States on air pollution and water pollution. But the fact is they understand they can make a lot of money on global warming.

But I guess for every GE there's at least, one, two, maybe more of Exxons, Southerns [Southern Company], AEPs [American Electric Power]--

A lot of the power companies in this country that are principally using coal, like Southern Company, like American Electric Power, largely want to delay any kind of cleanup for as long as possible, because we all know that we cannot make an effective answer to global warming if we continue to burn coal the way we burn it today.

Jeffrey Ball   The Wall Street Journal

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I think these companies don't know what to make of climate change. Climate change is potentially such a game-changing phenomenon that there's a bit of a deer-in-the-headlights situation. I mean these companies -- auto companies, oil companies, coal-fired utility companies -- have grown up and thrived in an environment that hasn't fundamentally changed in decades, when the measures of success were pretty predictable. And now, all of a sudden, they're presented with the possibility that all of that or a large part of that could go out the window. How you react to that is a hugely difficult question that these guys are still trying to figure out. ... There are huge sunk costs in the infrastructure that was built around those assumptions that didn't change much over decades.

Talk about that in terms of the oil industry, if you could that give me that analysis of their sunk costs.

Sure. There's a statistic that I think is just worth keeping in mind in all of this, from the International Energy Agency in Paris. It is that 80 percent of the world's energy comes from fossil fuels today. And 20 years hence, it's going to be about 80 percent.

So when you talk about potential alternative technologies, it's worth keeping in mind that the vast majority of what's supplied is fossil fuel. That's not expected fundamentally to change in the next generation.

Now, to the oil companies, there's a system that has worked well. The oil companies pump oil out of the ground. They put in the pipelines. They put it in the ships. The ships take it to refineries. They run it through refineries. They crack it into gasoline or diesel or heating oil. They put it into pipes, and they send it off. And that works.

Now there are huge challenges to the oil industry's model of business that have nothing to do with climate change that we're in the middle of right now that are scaring the oil industry significantly. And those are fundamental concerns onto which are layered climate concerns.

So they're busy trying to figure out how to replace their reserves?

That's right. Exxon, the biggest publicly traded oil company, replaced 101 percent of its reserves last year. That is to say, it found enough new oil and gas reserves, as they're defined legally, to replace slightly more than what it pulled out of the ground.

One percent more?

One percent more. That's the worst number at Exxon in 14 years. It's still better than 100 percent, but it's not as good as it has been. And Exxon's not alone here. ...

… If you're having trouble replacing your oil reserves, why isn't this a good time to be thinking hard about diversification?

That's absolutely one possible choice. And that's a choice that quite a lot of oil companies are talking up.

The other choice is you hunker down and do a better job of what you've been doing for the past 50 years. If the problem is that you're having a tougher time finding enough oil, then you do everything you can to maximize your opportunity to find oil. …

Are they really investing in alternatives in a meaningful way?

Look, none of the oil companies are investing in alternatives in a meaningful way if you define meaningful as a sizeable chunk of their total energy investment. They are, all of them, investing the vast majority of their money in finding more oil and natural gas.

T. Boone Pickens   President, BP Capital

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We've spent some time looking at large companies, Exxon and General Motors and the utilities and coal companies. And what you see there is huge amounts of investment in existing infrastructure. ...

It's hard to change when you're doing as well as they're doing. I mean, they're making a lot of money. Stockholders are happy. The price of stock's going up. It's hard to say, "Wait, let's re-look at this and see."

But I think they do it all the time. I mean, they're constantly evaluating themselves in different areas. They become more and more efficient all the time, and --

But those are good efficiencies for business to make money. It's not about addressing a larger societal problem such as greenhouse gas emissions.

No. But I think they do address those.

Well, the question is, what does it take to get large businesses, who we need to change, to change? To offer alternatives?

Back to the same thing that we had 30 minutes ago. It's leadership.You have to have somebody that has the credentials and the leadership ability to come forth and say: "This is what we're up against. I'm not kidding you. This is it." And people say, "He's not kidding, this is it."

And you're not seeing any leadership?

No. I'm not seeing anybody that fully understands or appreciates the dilemma that we're in. So how's it going to go? It will unfold, and it will happen, because it will be forced into alternatives. And all will get a chance.

Beth Lowery   Vice president for environmental affairs, General Motors

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Do you think you're doing enough [about global warming]?

We are doing a lot and will continue to do more.

Do you think you're doing enough?

General Motors has a very strong commitment. Our product programs and portfolio are very important. We have a role to play, and it's very important that we have a broad choice across all the various vehicles. So we're looking at every aspect of the vehicle with respect to fuel efficiency. We're looking at every technology that's available today and what could be future technologies.

I'm very proud of what General Motors is doing with electric vehicles and hydrogen fuel cells. I don't know of any other company that has that many options on the table, including working on the education, public policy, marketing aspects of really trying to be part of the solution. ...

The question is, there [have] always been concept cars out there. [At] every auto show there are concept cars. But in the case of the electric vehicle, we're not seeing it yet.

What I think is really important is to look at the limitations, the technologies, and try to remove those barriers. And that's exactly what we're doing with the development -- working with battery manufacturers on lithium-ion batteries, working on the plug-in version of hybrids.

Why did Toyota beat you to the Prius?

Actually, Toyota and General Motors worked together on a number of technologies over time. Toyota looked at the hybrids and the Prius from an overall standpoint, knew there would be the loss of money for some time on the cost of that, but looked at it from an overall marketing and image standpoint, and General Motors really looked at it from a business [perspective]: Can this vehicle make money? Now certainly --

If General Motors looks at things from a business point of view, why did Toyota just report a record quarter and General Motors just report a record loss?

I was referring to [the] decision made with respect to hybrids.

I know. But you're standing on the reputation of the company to look at these things from an economic point of view. You said, "Toyota looked at the Prius from a point of view of PR and image." But yet Toyota is eating your lunch.

Well, as I mentioned before, General Motors is very committed to reducing emissions. We're very focused on bringing products to market that are going to satisfy the customers -- not only in the U.S. but globally. And so we'll be the first company to sell a million vehicles, for example, in the Chinese market, which we think is a very important developing market, [where] we just announced an energy center, a research center, making sure that as that country is developing personal mobility, that we're addressing these issues.

So I think it's very important to look at General Motors as a global company, what our commitment is on these issues.

Vinod Khosla   Founder, Sun Microsystems

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I think the oil companies today are in a position where they don't believe [changing their practices] is possible. ... They want to keep their business stable and as is.

But many of the forward-thinking oil companies, like Shell and BP, have started to look at these alternative fuels and said, "We should be experimenting." ... So they are in that experimental phase, not believing, not committing, but including it as a risk to their business models. Once these technologies get proven, I believe the oil companies will be willing and massive participants in this new area. ...

The thing to remember is oil companies don't own most of the oil on this planet. Eighty percent of the oil on this planet is owned by the national oil companies, the Saudi Arabia Aramco, the Venezuelan oil company [PDVSA]. These are nations that own the oil. So those Exxons and Chevrons don't own that much oil, and it won't be that painful for them to take their massive ability to both invest [in] as well as execute projects, their operational skills, and apply them to this new area.

But they're invested heavily in oil exploration and extraction. They're invested heavily in their oil-based refineries.

Yes, they are.

Even the companies that are forward-thinking like BP and Shell -- you mentioned them -- are not really massively investing in alternative fuels.

They're not massively investing in alternative fuels, that's right.

Is that shortsighted in your view?

They are making decisions that they think are right, based on the information they have. I don't believe they're used to innovation and the rate of innovation we are likely to see in this business, and so they are being shortsighted in my view. But that's OK. It gives new innovators the opportunity to establish the marketplace and then have [the oil companies] be participants.

In every other large business area where there has been technical innovation, the little companies get most of the innovation. They've proved their business models and often partnered with the larger companies in the later stages of that deployment. That's a natural process. Some of those [big] companies will never believe it until it's too late for them, and their shareholders will suffer.

Michael Bloomberg   Mayor, New York City

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How much can citizens really expect from business? You're a businessman.

... The purpose of government is to protect the public and improve the quality and length of their lives. The purpose of business is to earn money for the investors in the company, the stockholders. ...

The ways you get businesses to do things that the government wants them to do is to give them an economic incentive.

And we use economic incentives all the time. Tax policy is nothing but a bunch of economic incentives built around a central theme of having to raise money for public purposes. We give you a mortgage deduction in the United States because we want you to own a home. We pay a farmer to not plow, not to grow, because we want the earth to regenerate or we don't want to flood the market with a given crop. Or we want you to drill in one place and not in another, so there's economic incentives there.

I think what you need is a carrot and a stick from the government -- incentives in some cases, regulations in others. But when it gets down to the company, somehow or other you've got to convince the company that it is in their economic interest to do it.

Now, I'll give you a good example. I gave a speech at a Rupert Murdoch conference. I don't think anybody ever thought of Rupert Murdoch as a tree hugger, but Rupert Murdoch stood in front of a bunch of his employees and said, "I am going to take Newscorp" -- the company that he runs -- "green. I'm going to reduce our carbon signature. I'm going to make this a company that is more responsive to the public needs."

And he has told me since then, he has it found it easier to recruit people, because the young people want to be with socially responsible companies. So what he did was in the company's interest. I can tell you that he's got a couple young kids as well as grown kids. He's looking at them, I'm sure, and saying, "I want to have a better life for my kids."

So there's a selfish component in this, if you will. He wants to leave a better world for his own family as well as maximize the returns for his stockholders.