The Mañana Prize

The Mañana Prize will be launched tomorrow for outstanding commitment to putting off important actions that can be left until another day. It will be judged on the length of the delay and the seriousness of the consequences. It is a celebration of the human capacity for stoical denial in the face of adversity.

In borrowing the Spanish word mañana, I intend no disrespect for the good people of Spain; it is just such a good word for tomorrow. Playing the game of mañana to the full can justify putting off action almost indefinitely. Each day the problem festers, getting slightly worse, until someone eventually does something or the problem goes away. Putting off what does not have to be done today is a good tactic to avoid bother but it is not effective as a long-term strategy. When world leaders rely on mañana to get from one day to the next, from one meeting to the next, from one summit to the next, from one policy to the next; we should be very worried.

In looking for potential winners, special mention goes to the euro zone leaders who have been playing mañana for the last two years, since the fault lines in the euro were exposed. Decisive action should have been taken over a year ago – even allowing for the slow process of European diplomacy. Each day that mañana has prevailed the crisis has got deeper; the euro is now in a deep hole but still Europe’s leaders procrastinate. They are now waiting for sovereign debt default to force change which will be unpredictable and dangerous to the world economy.

Another strong runner for the Mañana Prize must be the UN brokered climate talks where the game of mañana has been playing for nearly two decades. At the close of the climate conference in Durban the organizers announced success. You would have thought this would be to cut greenhouse gas emissions, but no; the success that was trumpeted was an agreement to start talking about an agreement that could be signed in 2015 to start cutting greenhouse gas emissions from 2020. Two decades of delay, in the context of claims that climate change could be the worst crisis in human history, makes the UNFCCC a very strong contender for the Mañana Prize.

Meanwhile, amongst the stories that do not make the front page, the UK government has agreed that the state should be responsible for nuclear waste after a nuclear reactor has come to the end of its life and stopped generating power. This policy is needed to persuade private enterprise to build the UK’s next generation of nuclear reactors. The business case relies on passing the legacy of the waste to future generations sixty, a hundred or two hundred years into the future. Taking into account the length of the delay and the severity of the consequences, the UK government is currently the frontrunner for the first award of the Mañana Prize.

Disastrous Deal in Durban

The main elements of the deal struck in Durban is that all the world’s countries will start discussions next year aimed at signing an agreement by 2015 that will come into force in 2020. The main benefit of the deal – as seen by some observers – is it has re-established the principle that climate change should be tackled through international law, not national, voluntarism. After two decades of talking, there is another conclusion that can be drawn; the world is not willing to make the compromises required for a legally enforceable and effective global carbon reduction plan.

The odds were always stacked against the main delegates in Durban who arrived with the brief to secure the best deal for their country. There is little appetite for compromising national self-interest in favour of the global good. This is not something that can be changed easily; it is deeply engrained in world politics that national self-interest dominates negotiations. This is the starting point from which the horse-trading commences and is why Durban was always likely to fail.

The bureaucratic machine of the UNFCCC will lumber on towards 2015 documenting in ever greater detail the collective failure of the world to act. World leaders can use this as an excuse not to take action at the national level until a global agreement is concluded. Spinning the output of Durban as a success is disastrous by leaving the impression that action is in hand; when clearly it is not.

The truth should be faced: the world has agreed not to agree to any action until 2020. Accepting this reality would be useful in passing the buck back to governments to decide on the next course of action.

Climate change is a clear and present danger which for some low-lying countries, such as The Maldives, is a death warrant. For other countries, the direct impacts may be less but no country will escape the disruption and potential conflict as change ripples through the ecosystem and world society. It is clear that climate change is a danger that we should be working hard to avoid; every government can see the danger and has growing support from their electorate to do something about it. If it cannot be done globally, action has to be national with each nation deciding what it can do that fits its circumstances and capabilities.

Action is needed despite Durban; national carbon reduction measures are required on a piecemeal basis with the advanced economies with sophisticated electorates in the vanguard leading the way. Of course this will put the economies of the leaders at a disadvantage, but rather than see this as a barrier, this must be recognised as the opportunity to force change in other areas where there are barriers such as trade agreements. Leading climate action at the national level will be difficult, but necessary, and require facing down opposition from countries that oppose. This is how to start to build a cohort of countries willing to take whatever action is necessary.

Don’t use Durban as fig leaf for inaction; use it as a call to leave the UNFCCC on the sidelines as the leaders get moving.

Climate Change and Globalisation

Without a global agreement on carbon dioxide emissions, countries should take unilateral action.

To cut carbon dioxide emissions requires every country to make the transition to a low-carbon economy. The developed world will have to embark on a huge program to replace infrastructure that depends on fossil fuel. The poorer countries do not have such a legacy to contend with but should build their economies using low-carbon infrastructure – not copy the mistakes of the developed world. For rich and poor this will cost more until low-carbon becomes standard across society and the economy. This is the challenge we face.

The global action required is the sum total of each country’s efforts but individual countries that take a lead will put themselves at a commercial disadvantage in the global market place. Our response to this is to wait for a global agreement so that all countries move together. This can be seen in the UK, where the previous government took a lead by enshrining bold carbon reduction targets into law. The current government is starting to indicate that, unless other countries adopt similar targets, the UK will back off.

The Climate Change talks in Durban seem to be going nowhere but we should look for the positive in this. The Copenhagen talks of 2010 showed the direction of travel, and the Durban talks seem to be confirming, that a global agreement is not forthcoming. After two decades of talking the UN brokered climate talks is not delivering a solution. This should provide the foundation stone on which to build the policy going forward. This outcome is not what was envisaged when the UNFCCC was set up but this is the reality.

Without a robust global solution, countries will have to push ahead. The UK for example should be bold and stick to its targets. The consequence, within an open global market, will be that these countries will suffer a huge commercial disadvantage. These leading countries will have to adopt protectionist measures and be willing to face down opposition from the countries that are reluctant to act on climate change – which may include breaking WTO rules. This is the price of failure to close a global climate deal, but the cost will be less than continued inaction and stalemate leading to growing carbon emissions.

Ardent supporters of free markets will complain of course but the climate crisis requires a crisis response and when the policy framework of economic globalisation starts to crack it is necessary to adopt a different macro-economic model.

Living with limits

I have been reflecting on the Grantham Institute for Climate Change Annual Lecture given by Martin Wolf: Living with limits: growth, resources and climate change. Sometimes ideas need to time to brew before their true value becomes apparent; this lecture was one such occasion.

The lecture outlined the positive sum game of economic globalisation with all the associated benefits of prosperity and alleviating poverty. This has been successful through the lens of economics and Martin Wolf, economist at the Financial Times, has been one the most eloquent proponents. He opened the lecture by declaring that he is no expert on climate but he went on to talk about areas in which he is expert explaining that, as the world reaches the limits of resources, the game cannot continue. The challenge is how to rein in expectations to live within limits. He closed by stating that he had no idea how this could be done and throwing the challenge back out to the audience.

After the lecture, the immediate impression was that he had told us nothing new, simply explaining that the world has a problem and we do not have a clue how to solve it. We adjourned to a reception where there were a number of useful and animated conversations about climate change, the economy, resources and the general theme of where next? We did not solve the world’s problems that evening, but strolling towards the train station with James Smith the new chairman of the Carbon Trust, we shared optimism that the job can be done but leaving open the question of how.

During a period of quiet reflection on Martin Wolf’s words reveals that a very useful foundation stone has been laid. Martin Wolf is a leading exponent of economic globalisation and a gifted communicator, who writes for the readership of the Financial Times – rather different to the greenies who read the Guardian. Martin Wolf has the ability to start a dialogue with the mainstream to persuade policy makers to back off from unquestioning adherence to the policies of economic globalisation. This is a vital first step in shifting the debate onto ground where it is possible to find solutions.

I wish Martin Wolf well and congratulate him on a lecture that is hugely valuable in defining the problem as the pre-stage of finding the solution.

Astride the Chasm

The bond markets have calmed a little this morning after Spain elected a government with the mandate for cutting Spain’s deficit but this snippet of news should be treated with caution. The chasm opening up within the euro zone could become a long deep depression for Europe with a credible risk of bringing down the entire global financial system. When David Cameron and Angela Merkel met last week they represented the two sides of Europe; Merkel for the 17 countries in the Euro zone and Cameron for the 10 EU countries outside. They tried to find common ground but failed. Europe’s politicians stand astride tectonic plates as they slowly move apart. Each time the earth moves, their legs open a little wider until they are stretched so wide that it becomes impossible to step back onto one side or the other. They must decide which side of the divide they choose or risk being dashed on the jagged rocks below.

Angela Merkel wants to rescue the euro zone without Germany paying the price. For a single currency to work requires that rich regions transfer capital to poorer regions. Within a country with a single currency like the UK, the government transfers funds from the relatively rich South East region to the North East and other relatively deprived areas. In the United States, there are mechanisms that transfer funds from strong to weak states. Germany has done well out of the euro; its strong export-led growth has been driven by an exchange rate that is much lower than it would have been had Germany retained the Deutsche Mark. For the euro to survive intact requires closer integration between euro zone countries which should include transfers from the strong to the weak, from North to South, from Germany to Greece.

The popular view in northern Europe is that the hardworking and frugal Germans should not have to bail out the spendthrift and lazy Greeks but these stereotypes do not give the full picture. Germans and Greeks are not the same; there are deep cultural differences between Teutonic northern European values and laid back Mediterranean ways of living. This is part of the rich tapestry of Europe to be retained and celebrated not forced into some sort of homogenised amalgamation of European values.

Germany cannot have it both ways; reaping the benefit whilst avoiding paying the price. There are two options: to draw the euro zone together into a federal structure with all the responsibilities that implies, or to dismantle the Euro – fully or in part. Whilst politicians pursue a third way, of fudging the issue, they make their lives easier from one meeting to the next, from one week to the next, but the crisis gets deeper and the resolution harder.

Europe’s politicians should stop trying to hold Europe together with parcel tape; it won’t work. Clear-eyed analysis and bold decisions are required. A sustainable Europe needs a series of credible currencies that reflect the diverse nature of Europe. The euro will have to be split; the only question is into how many bits.

FAA sticks the boot in

The US Federal Aviation Administration (FAA) has made an official submission to the UK’s Department of Transport’s consultation on Sustainable Aviation. It is unusual for a foreign government agency to get so closely involved in UK policy making, but in certain circumstances this can be useful in ensuring that policy takes into account a range of stakeholders including key allies and trading partners. In this case it looks like the FAA is lobbying to defend the status quo and resist efforts to drag aviation into the 21st century.

The UK is taking a lead in developing sustainable policy for aviation; which – if it is to be effective – must tackle deep-rooted resistance from a highly conservative and globalised industry. The current policy framework locks the industry into an outdated framework in which aviation fuel for international flights is free of tax. This anachronism dates back to the end of the Second World War when aviation was seen as a key component of building the peace and emissions from the small fleets of aircraft were not seen as a threat to the global climate. Agreed in Chicago in 1944, the Convention on International Civil Aviation still rules aviation today. Article 24 prevents countries from levying tax on fuel carried on board aircraft. No country will lead in taxing aviation fuel as airlines would reconfigure their operations not to need to pick up fuel in that country and shift long-haul hubs to other jurisdictions. There is a stalemate in which all commercial decisions are taken on the assumption that aviation fuel is tax-free and will remain so.

The green aircraft designs needed in the 21st century are on the drawing board but have little chance of getting into the air as the engineers have to compete with conventional 20th century gas guzzlers burning cheap fuel. Even the newest plane on the block, the Boeing 787 Dreamliner is just the final model of 20th century aviation, more efficient, yes, but nowhere need the efficiency needed in the future. The Dreamliner has a future beyond the introduction of a tax on aviation fuel, for passengers who can afford high ticket prices such as time-poor business passengers and the rich, but those of more modest means will fly in highly efficient, but slower, aircraft. To develop these new aircraft requires a proper business case by levelling the playing field through removing the tax exemption for aviation fuel. The oddity is that there is a much better aviation industry waiting to launch if only policy makers could understand fully the opportunity.

The FAA does not agree, according to the UK newspaper, the Sunday Times who have seen the submission. The Office of Environment and Energy at the FAA expresses their ‘serious concerns about the UK’s approach to aviation’ and climate change worried that the policy will constrain aviation rather than support sustainable growth. There is also dislike that the UK is taking a more realistic viewpoint to the extent that biofuel can replace conventional aviation fuel. My detailed examination of aviation shows that the UK government is not being bold enough in the policy it proposes. To me the FAA viewpoint looks like stuck in the past trying to defend the indefensible.

Advanced orders now being taken for Peter McManners’ next book Fly and Be Damned: What now for aviation and climate change?

Financial Transaction Tax

The Financial Transaction Tax (FTT) proposed for Europe comes from muddled thinking but, oddly, if the objectives were clarified this could be a good tax, not just for Europe but for the world.

Chancellor Merkel and President Sarkozy have proposed a Financial Transaction Tax (FTT) levied at a rate of 0.1% and expected to raise €57bn. The UK Chancellor of the Exchequer, George Osborne is opposed, arguing that such taxes need to be brought in globally if London is not to suffer at the expense of other financial centres. In the United States, Democrat Senator Tom Harkin and Representative Peter DeFazio are calling for a tax on stock, bond and derivative trades but the Republicans who control the House of Representatives have always opposed transaction taxes and will be hard to persuade of the benefits. I would like to see the deadlock broken by shifting the dialogue from raising tax to improving the operation of the financial system.

American economist , James Tobin put forward a proposal in 1978 to introduce a tax on all currency trades to limit the role of the speculator. He suggested that the receipts could be held centrally to help fund aspects of the work of the UN; it was this secondary objective that caught the headlines. The Tobin tax became the Robin-Hood Tax in common parlance.

In my book Adapt and Thrive: The Sustainable Revolution, I proposed a share transaction tax with the clear objective of reducing volatility and lengthening the time horizon used by investors so that the long-term planning needed for sustainable business becomes the norm. A Robin-Hood tax it was not. Investors that have to pay a small but significant percentage to switch ownership change their behaviour. Instead of grilling the management over their plans for the next quarter or the next year (a huge disincentive to adopting sustainable strategies) investors will examine the plans for the next decade and beyond. My proposal recognised the need to include in principle the major global financial centuries such as London, Frankfurt and New York but, crucial to acceptance, the revenue would remain with national governments to use as they see fit.

Financial markets provide liquidity and capital but an often quoted metric is that financial trading is one hundred times the level of trading required to support the real economy. Each successful speculative trade takes a profit from the market to appear in the bottom line of a hedge fund, investment bank or fund manager. If this is curtailed by the McManners tax then the market is more stable and supports the real economy better. Resistance arises because traders in the financial centres would see their incomes go down and there would be complaints that the tax was a drain on the market. What would we prefer; a stable market from which the government harvests some of its tax revenue or an unstable market in which the speculators rule?

Merkel and Sarkozy are misguided to argue for a FTT to raise money to bail out the euro zone; but a transaction tax to stabilise the financial system, brought in across all the main markets, with revenues retained at the national level, would be a step towards healing the financial system.

An Old Dream

The Boeing 787 Dreamliner is the newest, most efficient and most luxurious aircraft in the hanger, but it is the last gasp of the old 20th century aviation industry rather than the beginning of 21st century aviation. Its launch in 2007 was the most successful commercial airplane launch in history taking orders for 677 airplanes worth more than $110 billion. The Dreamliner’s maiden flight took place on 15 December 2009 and it is now entering service in 2011, three years later than intended.

For passengers, the aircraft is a step forward with a higher cabin pressure equivalent to 6,000ft – compared with 8,000ft for most other high altitude passenger aircraft – so headaches and fatigue should be reduced. The passengers on board the first scheduled flight by All Nippon Airways (ANA) last Wednesday also liked the spacious feel of the larger windows. Passenger comforts that grabbed the headlines were the toilet with a window and a bidet with a variety of spray options.

For aircraft construction, new methods have been used including the use of carbon fibre composite materials. According to Boeing, it will use twenty per cent less fuel per passenger than similarly sized aircraft. The 787 is a further evolution of the standard design, squeezing a little more efficiency and improvements from a model with similar operating characteristics to the stable of aircraft it hopes to replace. In a highly regulated and conservative industry, in which fuel is largely free of tax, this is the safe direction. The 787 is not a dream, but a statement that aviation intends to defend business-as-usual for as long as possible.

There are other designs, such as blended wing technology and the use of buoyancy as a component of lift in hybrid air vehicles, which could make dramatic reductions in the emissions from aviation, but there is no business case to bring these technologies to market until society demands that aviation is transformed for the 21st century.

Boeing will be using commercial judgement in planning its future models but it will be very wary of taking any action that may undermine sales of the Dreamliner before banking the $110 billion of advance orders. Commercial reality means that dreams of greener aviation will be kept under wraps until the Dreamliner production line has been running for many years.

Peter McManners is author of Fly and Be Damned: What now for aviation and climate change? Advance Orders now being taken on Amazon.

Health and Coal

News stories come into my inbox like a torrent of water from the base of a melting glacier in high summer. There are far too many to be able to read them all but dipping in can uncover some interesting dilemmas. One pair of news stories that I came across in quick succession last week was of a conference in London and a bill in the U.S. House of Representatives. I would like to have brought the delegates and congressmen and congresswomen into the same location for what I am sure would have been a fiery debate.

In London, the opening statement of the conference on Health and Security Aspects of Climate Change included the words:

Climate change leads to more frequent and extreme weather events and to conditions that favour the spread of infectious diseases. Rising sea levels, floods and droughts cause loss of habitat, water and food shortages, and threats to livelihood. These trigger conflict within and between countries. Humanitarian crises will further burden military resources through the need for rescue missions and aid. Mass migration will also increase, triggered by both environmental stress and conflict, thus leading to serious further security issues. It will often not be possible to adapt meaningfully to these changes, and the economic cost will be enormous. As in medicine, prevention is the best solution...We therefore call upon governments around the world to prioritise efforts to address the causes and impacts of climate change.

In the U.S., a bipartisan bill had been passed in the U.S. House of Representatives to establish a state-based regulatory framework for management and disposal of coal ash. Steve Miller, President and CEO of the American Coalition for Clean Coal Electricity (ACCCE) commended the U.S. House of Representatives for passing bipartisan legislation that would establish a state-based regulatory framework for management and disposal of coal ash.

“We support this bipartisan legislation because it would establish a sensible program to regulate coal ash and ensure the environment is protected without unnecessary increases in energy costs or putting American jobs in jeopardy.”

Coal is one of the dirtiest of fuels and a major contributor to global carbon dioxide emissions. The U.S. Environmental Protection Agency (EPA) is seeking to bring in regulations to limit emissions but whilst coal continues to be burnt it makes sense to use the ash in a variety of applications such as additives in concrete and fill material for road building. According to Miller, “This legislation [with regard to coal ash] represents the kind of balanced federal-state partnership that is needed for environmental protection. On the other hand, EPA is considering regulations for coal-fueled power plants that will raise energy prices, hurt families, and destroy American jobs.”

I note this juxtaposition of news stories to expose the disconnections as people argue their case within different policy stovepipes. Within the parameters of their own particular discussion they are making logical choices. One group of experts on human health is urging urgent action whilst an industry lobby group is protecting the very activities that need to be brought under control. We have been here before; remember the fight to deny that smoking was a danger to public health as cigarette companies defended their bottom line. There was little doubt who would win in the end but it took far too long, and too many people suffered, before the battle was won.

Airlines Fighting to Survive

There is a fight going on within the airline industry which is only the first skirmish of a major battle. The conflict is over the EU bringing aviation inside its Emissions Trading Scheme (ETS). Research by Thomson Reuters Point Carbon has concluded that it will cost airlines €1.1bn when they join the EU ETS next year rising to €10.4bn by 2020. Chinese and US airlines are particularly concerned at having to buy carbon allowances in order to fly into European destinations. The current outcry, aimed at Europe’s policy makers, is nothing compared with the fight to come as the tax-free status of aviation fuel for international flights comes under the spotlight.

That aviation fuel for international flights is free of tax is not widely advertised. It is neither in the interests of the airlines to point it out, nor in the interest of government to show how impotent they are to change the international legal framework, nor is it likely that airline passengers will vote for higher ticket prices. However society cannot remain indifferent forever to this major anomaly. It can be expected that eventually it will be removed and taxation of aviation fuel introduced to at least match the taxation on other transport fuels.

The measures being brought in under the EU ETS, presented as total consolidated costs, look huge but these figures are only massive because the industry burns such colossal quantities of fuel. The purchase of carbon allowances equates to just a few cents per litre of aviation fuel. The Sunday Times reports that the costs could be recouped by BA with an increase of 50p per ticket. Other estimates put the additional cost to airlines at between €2 and €9 per round-trip flight between European destinations. This is hardly going to make a dent in the affordability of flying, or the profits of the airlines, so it seems odd that resistance to this modest measure is so strong. The answer is to be found in my book Fly and be Damned (orders already being taken on Amazon).

I admire the tenacity of the airlines in defending the status quo. If the fight over the UE ETS dominates the headlines, it deflects attention from the bigger battle over tax-free fuel. To lose the skirmish over the EU ETS, after a bruising fight, might persuade policy makers to back off from further action. On the other hand, policy makers might read my book and see through the policy stalemate to take the action needed to launch aviation into the 21st century.

Sustainable Aviation

The consultation period for the Department of Transport’s Document, ‘Developing a sustainable framework for UK aviation: Scoping document’ closes on 20th October. Philip Hammond, Secretary of State for Transport writes in the foreword:

‘The Coalition [government] believes that a modern transport infrastructure – which emphatically includes aviation - is essential for a dynamic economy as well as to improve our well-being and quality of life. But we also believe that transport needs to be greener and more sustainable...’

The document is a valiant attempt to find a context within which to develop aviation policy but the dilemma between ensuring ‘a dynamic economy’ and being ‘be greener and more sustainable’ is a major difficulty for the government.

A question that is asked within the consultation is:
‘What do you consider to be the aviation sector’s most important contributions to economic growth and social well-being?’

The answer I provided will not be liked within an industry that is slow to understand the strategic implications:

‘A narrow focus on aviation emphasises its current role in the economy. This question is an invitation to the industry to offer a defence of the status quo. From within the aviation industry, it should be expected that a strong argument emerges emphasising the ‘need’ for continued expansion. This has parallels with the power companies trying to defend their right to sell more power. It is now accepted policy that power companies are expected to encourage reductions in demand and make profits from selling less. Aviation is similar in that the obvious sustainable solution in the near-term is to reconfigure the economy to be less reliant on aviation and for the industry to make a profit from a highly efficient reduced capacity flight network.’

Photo by Jim Donahue

Cycling Cities

Cycling can be the salvation of our cities but only if the implications are accepted that the infrastructure needs to change and restrictions applied to cars. The first costs money and the second clashes with the rights of car drivers. These are high hurdles to leap to make cycling practical and safe. There is also a third less obvious barrier, which can be just as difficult to negotiate: the rights of pedestrians. People on pavements and sidewalks do not like to be at risk of being knocked over by a cyclist. Let us examine the three hurdles of cost, car drivers and pedestrians.

First, money is tight so expenditure on major reconfiguration of the urban infrastructure will not be found easily. We must wait for the normal cycle of urban renewal so that when a new suburb is added, or an area is redeveloped, plans for bicycle provision are included. In these circumstances it is not a question of spending more but of spending differently to put the focus on people: good public transport, walkways and cycleways.

Second, the rights of car drivers should be moved down the policy agenda. This is a loud and powerful lobby but it is the broad rights of people that should be considered. I am a car driver, and I used to be a cyclist until I was knocked down by car and broke my back. The recovery from my injuries was slow and I do not now like to ride my bike on roads shared with cars. I want my rights as a car driver to be curtailed so that so that my right to travel safely by bicycle is restored. I accept that not all car drivers will agree, but if they could visualize how cities could be better it would help to win their support. Examples of high quality cycle provisions are required to bring the vision into observable reality.

Third, pedestrians have to be persuaded that a city that is friendly to cyclists will include spaces that are shared with cyclists. This is particular true in the short-term waiting for the next major redevelopment when the existing space used by both cars and pedestrians has to be reallocated to include space for bicycles. The paths of pedestrians and cyclist will cross; there will be cross words and the occasional bump but hopefully not the same severe injuries that cyclist suffer from cars.

Of the cities that I know well, Helsinki has the best provision for cyclists. It is possible to ride into the city centre from all directions on routes separate from cars. The Finns have planned carefully, invested well and it is understood amongst the city residents that on many routes cyclists and pedestrians share the same space. There is no feeling that the rights of car drivers or pedestrians have been infringed in making cycling easy and safe.

City planners should think bike and face down opposition from car drivers and pedestrians with confidence that people will like the better cities that result. If in doubt, visit Helsinki.

Secret Plans to Withdraw Greece from the Euro

It is reported this morning by the BBC that the meeting of the International Monetary Fund (IMF), held over the weekend in Washington, has considered a plan for an orderly fault of Greek debt involving a 50% write down of the debt coordinated with extra funds to bolster European Banks. This looks on the face of it like another attempt to kick the can down the road delaying real action; but this time it could be different.

It is clear that Greece cannot pay its debts so is in effect bankrupt. World bankers do not want to admit this in public but it will have been at the top of the agenda behind the closed doors of meetings amongst the inner circle of IMF officials.

The 50% write-down plan buys time in that it looks possible that Greece could pay its way out of the reduced debt burden, but this does not address the core problem. From the viewpoint of outsiders, the demands for reform in Greece may look reasonable but inside Greece these are politically impossible. Greece needs the freedom to sort out its own affairs in its own way. Greece fiddled the figures to get into the Euro and it cannot now dig itself out of the financial hole except by leaving the Euro – in addition to defaulting on its sovereign debt.

I would hope that the IMF, ECB and central bankers now have a secret plan for Greece to exit the Euro in an orderly fashion – if this is still possible at this late stage in the crisis. De La Rue, the trusted bank note printer will have been given a contract (under great secrecy) to print Greek Drachma and these are now held securely in a warehouse in London waiting to be airlifted at two hour’s notice. The plan will include freezing Greek bank deposits immediately before the public announcement to prevent a run on the banks. There will then be a firestorm through the financial system as the reality takes hold but not as bad as people fear. There might be relief that the inevitable has come to pass and, if the plan has worked out how to prevent Italy following the exit route, it is possible that stability will return.

The secret plan to eject Greece from the Euro needs a good cover story. The discussion of a 50% write down on Greek debt might be a suitable distraction to give the ECB and central bankers the time they need to prepare.

Are the IMF and ECB kicking the can down the road, in desperation or with quite confidence that they have a secret plan for real action? Over the coming months the truth will emerge.

A Curse hanging over French Guiana

The curse of fossil fuel is hanging over French Guiana. Tullow Oil, the London-based exploration company, has struck oil with its first well sunk in a new exploration block offshore. Commentators speculate that this could be the biggest new oil discovery of the year.

This small French ex-penal colony has a population of 200,000 and relies on income from an incongruous mix of its forestry industry and launching communication satellites for the European Space Agency. Agriculture is mainly along the coastal area including rice and manioc and further inland a small amount of marijuana mainly for local consumption. This beacon of stability in South America is about to be undermined in anticipation of the windfall profits from becoming an oil-exporting nation.

I lived in another outpost of Central America, Belize, for 6 months in the 1980s near a town called Punta Gorda. On first sight these were poor people but after a few months you began to realise that these were happy people with a wealth of natural resources, fruit from the jungle and fish from the sea. A Western eye could be fooled into believing that they need development but it is too hasty to jump to this conclusion.

A number of outsiders had moved into this part of Southern Belize to ‘get away from it all’. What they were actually about they were reluctant to say but it was a reasonable assumption that their business was growing marijuana for export to markets further north. In a sleepy town with ample remote jungle and good coastal access to export the drug, this was an ideal location. At the same time there was the first murder in living memory in this little town. The influx of money was starting to corrupt and undermine a way of life.

Oil production and growing marijuana are not the same; one is legal the other is not. Where they are the same is that they both bring monetary wealth, and with wealth comes the prospect of greed and corruption.

The people of French Guiana may find that oil is not the salvation it appears to be as the black gold starts to flow ashore and the discussions over money gather pace. Norway has shown how oil wealth can be used to improve the life of its people and secure long-term security. The Middle East has shown how oil wealth can corrupt and undermine society. French Guiana needs, as a matter of priority, good governance and long-term sustainable plans to ensure that the curse of oil does not strike down this South American colony.

Sustainable Development in the UK

The UK government is in trouble for using the term ‘sustainable development’ in the Draft National Planning Policy Framework in order to justify the following statement:

‘... a presumption in favour of sustainable development, which should be seen as a golden thread running through both plan making and decision taking. Local planning authorities should plan positively for new development, and approve all individual proposals wherever possible.’

The Bruntland Commission (1987) defined the term ‘sustainable development’ in the context of underdeveloped countries. Back in 1987 the concern was how to provide development without the associated path of destruction that the developed countries followed. There was an underlying assumption that there would be development so the need was ways to make it sustainable. This argument does not apply to highly developed countries like the UK.

The draft policy includes three threads:
planning for prosperity (an economic role)
planning for people (a social role)
planning for places (an environmental role)

This is the order of precedence used in the report and the bold highlighting has not been added by me; it has been used by the author to emphasise the guidance to local authorities and planning officials that:

‘... significant weight should be placed on the need to support economic growth through the planning system.’

This is a very clear example of the business as usual approach which I analysed in my book Victim of Success: Civilisation at Risk. In Chapter 13 (a coincidence of number choice) I wrote about ‘The Three-way Balancing Act’ between people profit and planet. I wrote:

‘I do not argue that we soften our focus on economics. Economic tools are quantifiable and measurable and the outcome of increased wealth is a tangible improvement. The problem is that a narrow focus on economics does not lead to sustainable outcomes. We need to bring the same level of rigour to the way we deal with social outcomes and protection of the environment.’

The UK government is leading the UK down the path that I described in the early chapters of Victim of Success on which we knowingly and stupidly continue down the path to destruction. There is no need; there is a better way; UK planning rules do need changing but the foundation assumptions of this draft (daft) policy is wrong.

Is Sustainable Development an Oxymoron?

It was not intended that ‘Sustainable Development’ would be an oxymoron when it was defined by
the Bruntland Commission in 1987 as ‘development that meets the needs of the present without compromising the ability of future generations to meet their own needs’. In the context of examining how to encourage the development of poorer countries, it was argued that this should be according to the paradigm of sustainability. Making the assumption that underdeveloped countries will need to develop was a reasonable assumption at the time. Over recent years, the term ‘sustainable development’ has been used (and misused) as a term to justify further development in the belief that sustainable development must be good.

The deeper understanding of sustainability that is slowly emerging recognises that the assumption that there must be continual development (meaning expanding the industrial and built environment) is the wrong foundation on which to build policy. The term ‘sustainable’ is now, in many cases, a contradiction when used in conjunction with ‘development’.

Sustainability is about the effective management of resources now and for future generations. That means retaining a functioning eco-system; which means preserving bio diversity; which means keeping a sufficient proportion of land for nature. Development that slowly encroaches on the bank of natural land has to be constrained before lasting damage is done. ‘Sustainable development’ now fits the definition of an oxymoron: a phrase in which two words of contradictory meaning are used together for special effect; examples from the dictionary are 'wise fool' and 'legal murder'. To these we can add ‘sustainable development’.

Aquafuel

"glycerine is... possibly the best fuel in the world. It isn’t toxic; it is water soluble; and it’s nearly impossible to ignite glycerine under normal conditions."

This is the claim made by Paul Day founder and Chief Executive of UK company Aquafuel. His company has succeeded in making a diesel engine run on glycerine (a bi product of biodiesel production) with much lower toxic emissions than an engine running on standard diesel fuel. On the face of it this is a useful process to utilise a product for which is there is little current demand. According to The Chemical Engineer magazine for every tonne of biodiesel produced, 100-110 kg of glycerine is obtained as a side product. The world supply of glycerine in 2008 was 3.2m t and the demand just 0.9m t.

It seems odd that anyone would try and run an engine on glycerine but this mad punt seems to have hit the jackpot. Where this story gets really interesting is if you decide that glycerine is better than bio diesel and, rather than try to produce biodiesel, focus on production of glycerine. It turns out that there is a strain of algae called dunaliella salina which grows in salt water and fills its body with glycerine to counteract the osmotic pressure of the salt. At high salt concentrations the amount of glycerine in the algae can be as high as 80%. Harvest the algae, extract the glycerine and there is the fuel of the future.

The algae can grow in the evaporation ponds used by the salt-making industry and there is no conflict with food production or land use. Aquafuel believes that places like Namibia could support a large industry with all the production powered by CHP units running on the glycerine and taken to market on ships powered by glycerine. This would appear to be a clean and sustainable fuel source.

I will be watching Aquafuel with interest over the years ahead and hope that governments drive up the taxes on fossil fuels to ensure that businesses such as Aquafuel are commercially viable.

The Politics of Denial

According to a US report from the Obama Administration:

‘A family that purchases a new vehicle in 2025 will save $8,200 in fuel costs compared with a similar vehicle in 2010.’

The report titled, White House Driving Efficiency: Cutting Costs for Families at the Pump and Slashing Dependence on Oil outlines the Administration’s national vehicle program, increasing fuel economy to 54.5 miles per gallon for cars and light-duty trucks by Model Year 2025. For the United States this is a big improvement, but it should be seen in context. These are figures that can be achieved now in 2011 with current technology, if there is a will. The challenge is two-fold; persuading the car makers to adjust the range of the models they offer and the willingness of drivers to sign up for the more efficient models.

The report is attempting to sell the changes using the argument that it will cost less. For an immediate change in standards, effective this year, that might be so, but not in the timescale of 2025. Oil prices are set to climb; families should be buying more efficient cars to avoid the big price rises to come. It is disingenuous to spin these improved standards as savings when in reality fuel bills will be considerable higher in 2025. Is it the American drivers who are so dumb that they cannot be trusted with the facts? Or, is it that US politicians have a very low opinion of their electorate? Either way it is a sign that US political wrangling is divorced from reality.

The Whitehouse statement is an attempt at spinning necessary change as a denial that fundamental change is needed, implying that US drivers can carry on as before ― and will actually save money. In such a political climate, progress is made at a snail’s pace.

I recently sold my 12-year old Audi estate which would consistently deliver 55 miles to each gallon. Admittedly this refers to UK galloon so does not meet the US standards for 2025 but as an old European banger it gets close.

There is much to admire about the United States but it seems at the moment to be stuck on a political rut of denial, believing that the US high consumption can go on indefinitely with only marginal changes.

The 2025 vehicle efficiency standards are to be welcomed but are too little, too late.

My Nissan Leaf

My electric car is a Nissan Leaf, one of about 400 sold in Britain since its launch earlier this year. I put my name down when Nissan first started to register expressions of interest and mine was one of the first to be delivered. We have driven about 2,500 trouble-free miles so far. It is a reliable, very quiet and I have to say rather dull family car. It is perfect for most of regular transport; my wife uses it for her commute (about 17 miles each way); I use it for my journey when I teach at Henley Business School (round trip of 32 miles). I take my children to their various activities, if we need to shop outside the village or off to see grandma in Oxford (55 mile round trip). These are all well within the range even with a very heavy right foot – the car has a respectable turn of speed and good acceleration, but if you use it do not expect to get anywhere near the claimed range of 100 miles. Flat out it will pull 90 mph and manage one motorway junction and back before the battery gives out. It is madness to compare an electric car with a conventional car (listen up Jeremy Clarkson). An electric car fits the niche of local transportation rather well; it is not designed for, and is not suitable for, long journeys.

We plan to keep the battery in tiptop shape so we seldom charge it beyond 80% using cheap night-time electricity ―unless we know we have a long journey coming up ― and do not use rapid charge. It is simpler and takes less time to plug it in each night than filling with petrol once a week. Our credit card bills are noticeable less.

Top Gear gave the car the sort of treatment you would expect; they ensured that the story had all the interesting angles, silent running of course and cheap to operate but also stranded after running out of charge. You have to be quite an idiot to get caught like this but then the presenters on the programme like to fit this description. It makes an entertaining story and good TV but does not provide a useful analysis – Top Gear is high octane entertainment not a consumer affairs programme.

My electric car fits my need perfectly. Whether the car is green or not is a different question. Using the current electricity grid, it is not a very green option but it is worth introducing the technology concurrently with driving forward decarbonising the electric supply. The greenest solution is of course to alter city infrastructure and support lifestyles that do not need the car. I suspect that by the time the government grant programme (£43 million at £5,000 a time to the first 8,600 electric cars bought) runs out in March next year the government will be able to pocket a healthy surplus. The government should thank Top Gear for obscuring the benefits of electric cars and ensuring that the grants are not taken up in full.

Bristol Green Capital

More than 50% of the world’s population live in cities; making cities sustainable is therefore an imperative in building a sustainable society. Cities are complex in terms of both infrastructure and the range of social interactions that makes the city operate. It is possible to make cities work like living organisms; capturing renewal energy, fully recycling waste and providing a vibrant, clean and enjoyable place to live. They can also appear like cancerous growth growing into mega metropolises from which the natural world is excluded.

I have just spent a very pleasant weekend in Bristol at the Bristol Harbour Festival, a celebration of culture and leisure. Throughout the city there were outdoor events ranging from concerts and circus performances to street buskers and market stalls. The theme was fun, enjoyment and entertainment; the sun shone and everybody seemed to have a good time. The hustle and bustle of people in close proximity brings joy and fulfilment but if resources are insufficient this can switch to conflict and strive. It is vital that we make our cities sustainable to reap the pleasures of communal living on show at the festival.

The City Council’s intention is to become a green city was evidenced by numerous recycling containers and policemen on bicycles. Bristol came top of the Forum for the Future’s index of UK Sustainable Cities in 2008 but has since slipped to 4th behind Newcastle, Leicester and Brighton. This competition between city leaders, to be the greenest city, should engage a virtuous cycle as each city tries hard to outdo the other.

Green aspirations are not the same as delivering green solutions. Our hotel was a prime example of how to use excess energy to little good effect; we slept very badly until we opened the window, turned off the air conditioning and let the night air waft through the room. The recycling in evidence was collecting and sorting piles of trash with little evidence of true recycling. Bristol is doing well on the relative scale presented in the Sustainable Cities Index but if there was an absolute scale from 1 to 10 ― with 1 being unsustainable and 10 being fully sustainable― Bristol would score a 1.1.

To make our cities free from fossil-fuel dependency and resources delivered through long supply chains will be a tough challenge. Bristol should be praised for taking the first step but it must be seen as a small first step on a long journey.

Note:
The Sustainable Cities Index tracks progress on sustainability in Britain’s 20 largest cities, ranking them across three broad baskets: environmental performance; quality of life; and future-proofing – how well they are addressing issues such as climate change, recycling and biodiversity.

De-risking the corporation

It is appropriate to write about risks to the world economy and the problems of the Euro zone in a blog about sustainability, not only because these are important issues but because there are close parallels between the Euro crisis and the challenge of sustainability. European politicians are taking decisions that will take them through the next three months or the next year. There is little time for the deep thinking required when the focus is on the immediate containment of the crisis. Business leaders are subject to the same pressure to deliver this quarter’s, or this year’s results. Deep thinking over the longer term has to wait until the company is doing well and short-term profitability is secured.

The operations of many businesses are unsustainable, dependent on long supply chains and relying on fossil fuels, directly and indirectly through the electricity supply. The action of many executives is to focus on the medium-term, hedging fuel costs and seeking insurance for supply chain disruption. The real solution is to think longer term, remove fossil fuel from operations and shorten supply chains to bring them under closer control. This is not primarily a CSR activity, or action designed in response to climate change – although such reasons can be cited to burnish the reputation of the corporation – these are strategic choices to de-risk operations and lay the foundations for long-term profitability.

Into Africa

David Cameron arrived into Africa today on the 93rd birthday of Nelson Mandela, that giant amongst world leaders.

The message being preached by David Cameron is that trade is the way for Africa to fix its problems. He brings with him a 25-strong delegation that includes business leaders and the trade minister lord Green. Perhaps David Cameron is right; perhaps trade is the solution to the deeply entrenched difficulties that the continent faces. However, there is a higher-level policy under which Africa will find its salvation, ‘sustainability.’ Trade can play its part, of course, but only within the context of sustainability. I enjoyed greatly my time working in Africa and wrote in the book Green Outcomes in the Real World:

‘In discussion with a colleague, the topic of Africa arose. We had both spent time on the continent and shared a high regard for the people of Africa and would like to support measures that addressed some of the problems. I attempted to steer the dialogue towards my ideas about sustainability as the way to support improvement in people’s lives. I quickly ran into a problem. My colleague was an advocate of neo-liberalism and working on deep-rooted assumptions about the benefits of globalization. His concept of equity was based on the idea that everyone should have the opportunity to live a lifestyle that matched his own, on the implicit assumption that every society should be helped to follow the development path of the West, and that free trade, open markets and free flows of capital were the way to achieve this.’

In the next paragraph, I went on to write, in the context of sustainability:

‘The world needs other concepts to replace the old concept of globalization but, until we accept that economic globalization is no longer the appropriate basis for human development, it is hard to build new structures of thought. We are forever trying to add refinements to an edifice that is starting to show cracks, when the action required is to underpin our thinking with new foundations.’

Africa is at a crucial stage in its development, with a number of countries, particularly China, looking at this resource-rich continent with a glint in their eye. Today, David Cameron should be careful to ensure that the needs of Africa are uppermost in his mind in respect for the legacy of Nelson Mandela who remains an icon of unselfish principled leadership.

Energy prices set to soar

The UK government is championing policy that means – according to the Sunday Times – that household energy bills are ‘set to double’. This makes a good headline, but relies on the assumption that household consumption remains steady as the price of energy doubles. The intention of course is to cut consumption; more expensive energy makes people careful with what they use. As the cost of energy rises, we should be looking for solutions that hold household bills in check through greater efficiency and frugal behaviour recognising that energy is a valuable and limited resource.

All professionals involved with buildings, infrastructure and industrial processes need a compelling reason to be frugal with energy. Future energy bills will be affordable, not through holding prices down but through using less energy. The logic is inescapable but politics is not a rational process. When the energy market pushes prices higher, it is accepted as beyond the politician’s control. When politicians set policy that will drive energy prices higher, politicians get the blame.

The announcement of an overhaul of energy policy expected this week comes hard on the heels of energy price rises. The rational reaction is to support tough policy because the recent increase in the cost of energy is an indicator of massive price hikes to come as energy supplies are stretched. Of course we need to move quickly to reduce consumption; that means policy to support investment; first, in energy efficiency (the biggest win), second, in generating low-carbon energy. The policy has to be to push energy prices higher; it is disingenuous for observers to argue otherwise.

Opposing tough energy policy is like lemmings opposing calls to slow down as the mass migration flocks towards the cliff edge. We are enjoying cheap energy; it makes no sense to keep it cheap and ignore the fact that the balance of supply and demand will drop off a cliff unless we take action soon.

The government should give people credit for having more intelligence than a pack of lemmings and ignore reports in the press to hold back on high energy prices. The rational silent majority expect higher energy prices; there will be complaints but people know this is the future. Let us have clarity; high energy prices are just around the corner; all decisions must be based on this unambiguous foundation to policy.

Saving Civilization

‘If we dare not – or cannot – change society we will become victim of our own success.’

Victim of Success: Civilization at Risk ISBN 9780955736919

The Space Shuttle Atlantis will be displayed at the Kennedy Space Centre in Florida, but first it will take off on Friday 8th July for one last mission. If the Economist is right in its recent editorial, this will be ‘the end of the Space Age.’

The history of manned space flight began in 1961 when Yuri Gagarin completed an orbit of the Earth in the Vostok spacecraft and reached a pinnacle in 1969 when Neil Armstrong stepped onto the moon. The vision was that this was to be the start of humankind’s expansion to other worlds and other solar systems. The aim of the Space Shuttle programme was to make space travel routine, reliable, safe and cheap, with one shuttle flight a week at a cost of less than $2,000 dollars per Kg. In the end, the Shuttle flew once every three months at a cost of over $50,000 per kilogram and two out of six shuttles crashed killing the entire crew.

I hope Atlantis comes safely home to take up its place as a museum exhibit but I hope also that this does not signal the end of human aspirations to expand beyond the confines of Earth and establish colonies on other planets.

The attraction of continuing to explore space has lessened, but the imperative to do so has increased dramatically. Robot missions have explored the planets in our solar system and found inhospitable worlds where we could only eke out an existence in sealed domes. We now understand that our beautiful world is unique and although in the long future we may find another planet in orbit around a different star it will not have the abundant natural provisions of planet Earth. The prospect of building a new life far away has lost its appeal but the imperative to find another planet is strong because of our Lemming-like dash to exploit the Earth’s resources without regard to the state of the world for future generations.

It is time for real change.

Underwater Land Tenure

Britain used to be joined to the European land mass by a land bridge until about 8,500 years ago when melting glaciers raised sea levels and formed the English channel. It is normal that over geological time the geomorphology alters, fortunately ever so slowly so that the changes from one generation to another are barely noticeable – or that is how it was. Human activity is now driving change faster than nature acting alone.

Britain’s southern coast is slowly dropping into the sea. If you buy a house with a spectacular sea view built on the cliff top there is a risk that it will collapse into the sea. This is not caused by human activity and although it can be delayed it cannot be stopped by human protection measures; this is the natural process of change at work. A house built further back from the cliff edge may not have such good views but the owner can be confident of passing a house with value and a future onto their children and grandchildren. There is a balance to be struck between enjoying the best view in the owner’s lifetime and being able to preserve the family’s inheritance.

The situation for small island states is altogether more serious and in this case humankind is culpable. The Maldives and other tropical atolls are typically no more than a metre above sea level. Sea levels have risen by about 20cm over the past century; scientists predict this trend to continue, and to accelerate, as emissions of green-house gases continue to rise unabated. Under international law, an inhabited island can claim territorial rights but this does not extend to small rocks - or to an island completely submerged by the sea.

The owner of a house on the edge of England’s south coast has traded a beautiful outlook now for a collapse that they can hope will be beyond their lifetime. The industrialised nations are making a similar trade, burning fossil fuel in the knowledge that many small island states will cease to exist as a consequence. In the former case, the house owner is playing with the inheritance of their own children. In the latter case, rich nations are destroying the inheritance of the smallest nations on the planet. Compensation is likely to be paid but how do you value the loss of, not just a house, but a location to call home and a state that ceases to exist.

Climate Change as an Opportunity

Two observations have grabbed my attention over the last 24 hours to lift climate change out of the doom-and-gloom locker and into the in-tray for bold action to make the transition to a low-carbon society.

First, Sir Nicholas Stern, the economist who led the UK study that showed that it would be cheaper to act sooner rather than later to counter climate change, gave a lecture in Dorchester last night. He started by laying down the foundations slowly, carefully and eloquently, with a distinct lack of histrionics. The science is rock solid; climate change is serious; business-as-usual will lead to catastrophic disaster.

Nicholas Stern went on to explain an optimistic scenario of coordinated action to address both CO2 emissions and poverty. In his view you cannot do one without the other. The message was clear that action is required now; further delay would make the transformation more difficult and keep society on the road to disaster.

As is often the case, it was the comments at question time where the really interesting information came out. He was asked about how people could be persuaded to accept a hair-shirt solution of reductions in consumption and restraints on lifestyle. In his reply, he explained that the financial down-turn of 2008 led to a small reduction in CO2 emissions, but this was insignificant in relation to the scale of what is required. His conclusion is that reducing growth and reducing economic activity is clearly not the solution. The solution is a transformation in the infrastructure of society which he called the ‘Energy Industrial Revolution’.

Meanwhile, this afternoon, I listened to a Press Conference on the closing day of the UN Climate Change Conference in Bonn. My attention was drawn to comments made by Jϋgen Lefevre representing the European Union. He explained that climate change had started as an environmental issue. Now, Europe is starting to look on climate change as an opportunity to help lift Europe out of the financial crisis. The agenda is opening out to a broader agenda of economic development.

Both Sir Nicholas Stern and Jϋgen Lefevre are pointing towards aspects of the broader agenda that I termed back in 2007 the ‘Sustainable Revolution;’ of which the Energy Industrial Revolution will be a part. The Sustainable Revolution will bring economic activity and jobs. Building a low-carbon society improves quality of life and reinforces energy security. The environmental imperative to act is strong, but the outcome is good for the economy and good for society.

What a shame that this carefully explained message from the experts is drowned out by misinformation from a few vocal people who want to resist change, hold back progress and grab the headlines.

Hope and Reality

Last week, World Environment Day came and went with hardly a murmur in the world press. The next day, Monday 6th June, delegates gathered in Bonn for the UN Climate Change Conference. Again, it hardly earned a mention; the world is pre-occupied with a whole range of problems ranging from Libya and Syria to the troubles of the Euro zone.

In the Middle East, long established dictators have reached beyond the ‘normal’ tools of repression to treat their own population with almost unimaginable cruelty. There is no going back for the old guard; if they lose control they will surely suffer retribution. They have no choice but to ratchet up the violence until even their own inner circle decide enough is enough. There is hope that turmoil in the Middle East will lead to an Arab Spring as democracy and respect for human rights sweep through the region. Hope and reality are not the same.

In the Euro zone, the levels of sovereign debt racked up by the Southern European members of the Euro zone are so great that default (referred to by the softer term ‘restructuring’) is inevitable. The Euro zone is desperately talking up the prospects that its members will muddle through somehow. These hopes give a warm feeling that the problems are solvable, but this denial of reality is not helpful to finding real solutions. Real solutions require clear vision and tough choices. Hope and reality are not the same.

The climate meeting in Bonn is subject to the same collective delusion that permeates world affairs. It is hoped that through the copious quantities of documents and years of talks that solutions can be found to bring climate change under control, without making substantive changes to the way we live and the way the world economy operates. It is hoped that that a successor agreement to the Kyoto Protocol (which runs out in 2012) will tie the world into a plan that will prevent dangerous climate change. Hope and reality are not the same.

Real solutions require clear vision and tough choices. World leaders must take off their blinkers and get to grips with the real choices about the future of world society and the planet.

World Environment Day

World Environment Day (WED) has been held each year on 5th June since 1973 with the aim expressed by the UNEP to, ‘stimulate worldwide awareness of the environment and encourage political attention and action.’ The theme this year is, ‘Forests: Nature at Your Service.’

A selection of reports from around the world starting with this year’s host country, India:

The Times of India
‘Bollywood actors Priyanka Chopra and Rahul Bose are to compete on the World Environment Day to motivate people to do their bit to save the mother earth. The Bollywood stars are facing off in a new video for the ultimate Environment Day Challenge - where they are calling individuals, groups, families and schools, even entire communities - to post details of their green activities online. "And for Priyanka and Rahul, this is where the battle lines get drawn. When registering a green activity on the site, people will have the opportunity to pledge their activity to either one celebrity or the other," said a statement issued by UN here.’

The Daily Times, Pakistan
LAHORE: The World Environment Day was observed in the city on Sunday with little enthusiasm, and with majority of the citizens appearing unaware about the day’s importance.

The Sunday Times, UK
I read the main section of today’s paper cover to cover and glanced through all the supplements. I cannot be certain that hiding somewhere there was a mention of world environment day but there was nothing I could spot. Have we lost interest?

Around the world there are examples of people taking action:

Costa Rica: A major success story in reforestation (having increased its forest cover from 22 percent in 1995 to 51 percent by 2010), Costa Rica is hosting participants from 15 neighbouring countries for a training course on sustainable forest management.

Nepal: UNEP is supporting a clean-up expedition to remove an estimated 9 tons of litter in and around Mount Everest. Enlisting some 60 climber volunteers, the long-term aim of the initiative is to develop more sustainable waste management facilities and recycling plants in the region.

Congo, Brazzaville: A major international summit on tropical forest basins held from 31 May to 6 June focussing on the sustainable management of forest ecosystems in the Amazon, Congo and Mekong Borneo basins.

I am left to wonder whether this will be enough. Have most people have become inured to the environmental degradation going on around them such that few people even know that 5th June is World Environment Day.

Electric Cars on Motorways

Electric cars are only good as city cars – right?

Small, low speed and short range are the type of statistics that come to mind but this image is changing. The electric car that I drove for 6 months, the prototype BMW E-Mini, was fast, cornered well and looked cool. It only had two seats (the batteries filled the space occupied by the rear seats) but for a sporty short range car it was good. It also performed well on the motorway between the two junctions of the M4 close to home; ‘a friend told me’ that with the foot to the floor and it would reach 90mph before the speed limiter kicked in. At the same time the battery indicator moved very quickly moved into the red; it was not a car for long range fast motorway driving!

For an even better driving experience, there is the Tesla, a fast sports car. The Tesla is beyond the pocket of most people, so not many will be sold, but the main impact on the industry is to change the image of the electric car. The fundamental problem of limited range remains but for the Tesla this is a whopping (by electric car standards) range of over 200 miles.

Does range limitation condemn the electric car to the role of local run-around? It works as a second car for two-car households and for the playboy wanting to look green and cool driving from the harbour where his yacht is anchored to a local restaurant but long journey’s are out. This may be about to change.

My favourite motorway services on the M6 is the family owned Tebay, the perfect place to stop on the route to Scotland. The management at Tebay have recently fitted a fast charging point for Tesla cars. This will allow Tesla drivers to stop as part of a grand tour provided the driver includes a long lunch, as a complete fill of the battery (even with the 70 Amp fast-charge point) takes three hours.

For those fortunate few that drive a Tesla, it would be wise not to plan a social event at Tebay services for fellow electric car enthusiasts; it would have to be a very long lunch indeed if everyone needed to queue for their turn at the changing point!

I drive an electric car; they are the future of local road transport but people are slow to understand that they are different. My blog entry for 7th March says it all...

The myth of the ethical consumer

Recent research led by Timothy Devinney, professor of strategy at the University of Technology, Sydney has found that most people will not sacrifice product function for ethics. The research team concluded that proponents of ethical consumerism want to believe that people make socially oriented choices that override a general appraisal of product features and functionality but that this is a delusion. This looks to me like common sense, but it is useful to have hard research to back up my gut feeling.

The ethical consumer is an elusive person. I pay a premium in my local shop for eco cleaning products as I want the shop to stay in business; it is a short walk from my front door and over the long-term I will save by spending less on transportation, but the product has to work well and the premium has to be small. Even though I am a passionate advocate for sustainability I will not be persuaded to buy a sub standard product just because it claims to be green.

Green and ethical factors will become increasingly important to close sale transactions ranging from major corporate contracts to the sale of individual items. Such factors will be the deal clincher but green will not override the prime metrics of value-for-money and fit-for-purpose. First-class green products will dominate the market place in the future; second-class products that are green will sink without trace.

Companies should not plan to rely on ethical consumerism to underpin the business. Customers want quality and value; sustainable business is about delivering the required quality at a competitive price using sustainable processes. The payback comes from being ahead of the next ratchet up of government regulation and gaining some protection from the next hike in the price of energy and other resource inputs. There are numerous reasons to put sustainability at the core of business strategy but being able to sell to ethical consumers is very low down on the list of priorities.

The Government Litmus Test

At today’s cabinet meeting, the UK government has an important decision to make over the carbon budget for the period 2013-2023. Which way this decision goes has significance beyond the particular issue; it will set the tone for the remaining term of the coalition government and either reinforce David Cameron’s intention expressed a year ago ‘to be the greenest government ever’ or show that the vision has been killed by realpolitik.

The Committee on Climate Change (CCC), the independent body of experts to advise the UK Government on setting carbon budgets, has put forward its recommendations. Chris Huhne, the Energy and Climate Change Secretary want the recommendations adopted. Vince Cable, the Business Secretary is opposed; worried at the impact on competiveness for UK industry if the UK adopted more ambitious targets than the rest of Europe.

The discussion today in 10 Downing Street is between the policy required to make progress towards a low-carbon Britain and protecting the current economy. This dilemma is right at the heart of sustainability. In a complex modern economy everything connects, every action has a consequence. Looking too closely at consequences leads to stalemate and inaction. There is always a good reason why something cannot be done.

The differences between the society we live in today and a sustainable society are huge. It is not just the need to change energy systems, to replace conventional power stations with renewable sources; it is also about demand reduction leading to different ways to design our cities and different ways to live. This is not a reversion to the past but a leap forward to a new age of prosperity measured by quality of life in place of crude economic measures.

The changes are revolutionary, and to get there requires a revolution, the Sustainable Revolution. Governments need to adhere to principle and face down the doubters and representatives of special interest groups. To agree a tight carbon budget at the meeting today, in line with the proposals from the CCC, mean that the revolution has a chance to proceed. Significant watering down or back-peddling will put progress on hold and mean that the difficulty and disruption in the long-term will be greater than necessary. The sooner we embrace the revolution the less disrupting it will be; delay because of the perceived difficulties makes acceptable solutions much harder to find.

This is the Litmus test for this government’s green credentials.

Where is the ethical consumer?

A lot of hype surrounds the opportunities to supply ethical consumers, but who are they, and how big is this new customer segment? Ethical or green consumers are people who search out green, low-carbon, fair-trade and sustainable products. Such customers read the labels carefully to understand the product, and how it has been produced, and select the product with the greenest and most ethical credentials. There is a confusing array of logos to help them make their choice, spanning the range from the Forest Stewardship Council (FSC) and Marine Stewardship Council (MSC) to the Fair Trade mark and a variety of recycling symbols. Some of these are backed up by robust certification; others can be displayed with little independent evaluation. The assumption is that a growing number of people use such labelling to change their buying behaviour.

I take a close interest in the labelling of products because it is a fascinating and evolving area and I have a very critical eye. When I spot a product with a lot of unnecessary packaging and a prominent recycling symbol, I am not impressed. When the symbol has written beside it the words, ‘packaging not currently recyclable,’ I am even less enamoured. Do the manufacturers think that my subconscious will spot the recycling symbol without reading the words; or that I will warm to the knowledge that the company is aware that it needs to improve but so far has done little to correct its operations?

I am the green marketeer’s least favourite customer. When I spot a green-spin marketing campaign my antennae are searching for substance. Where the company has made real progress and implemented sustainable change, I am suitably impressed and likely to pay a small premium. Where I sniff the aroma of ‘greenwash’, I take delight in digging deeper if there is hypocrisy to expose.

As the cohort of people who understand the sustainability agenda grows, companies that don’t get it will inflict deep self-inflicted wounds. The slick glossy advert using pictures of beautiful nature in a superficial context will come back to haunt old-school marketing executives. Some of the advertising campaigns that have used a green theme in recent years will have ridicule heaped upon them as real sustainability moves into the mainstream.

Water - Clear Gold

Water when you have copious quantities is worthless; if you don’t have any it is more valuable than gold.

Water is available in abundance on our planet and we assume that it will always be available when and where we need it. People who live in desert regions know this not to be so. On a journey from one oasis to another you have to carry enough to make the journey, trusting and hoping that the water at the next oasis is clean and potable. Living in the wet and winding isles of Britain, water has never been much of a concern. When the reservoirs run low in a long hot summer hosepipe bans are introduced to conserve supplies, but we can be confident that the water will continue to flow when we turn on the tap.

After the hottest and driest April since records began we have been basking in delightful warm weather. The farmers are not pleased at this critical stage in the development of their crops. We hope and assume that the weather will break and the dry soil brought back to life but what if our weather patterns are changing? It is highly unlikely that Britain, an island surrounded by water would become a desert but we should be aware that in places where rainfall is less certain, there is a real danger that small changes in climate lead to drought and the formation of deserts. If is possible that the UK crops could fail we would be worried; if the crops failed two years in a row we would be very worried; in the third year of no rain we would be feeling very vulnerable indeed. These are the thought we must entertain if we are to have empathy for people living in vulnerable regions.

Our local water company, Thames Water is making preparations. Last year the Beckton desalination plant was commission to make water from the Thames estuary and process it into potable water. This is the technology more normally associated with desert regions and uses energy to desalinate the water. Climate change lead to less rainfall, leads to more desalination plants using more energy leading to more carbon dioxide emissions, leading to further pressure on the climate. Am I the only person to query whether we should break this self reinforcing cycle?

There is one way to break this particular cycle; nearby there is the Beckton sewage works. It would use much less energy to take the water coming out of the sewage works and process that back into the system as potable water. Clear gold from sewage – why not?

‘Black Gold’ to ‘Dirty Oil’

Whilst the world economy is critically dependent on oil, the sticky black liquid is referred to as ‘Black Gold’ and a passport to wealth and security for any country fortunate enough to be blessed with large easy-to-extract reserves. For Norway this has certainly been the case; the country has been prudent with its oil revenue and built up huge reserves which should underpin the country’s finances well beyond the end of oil. For the Middle East, oil is beginning to look like a curse, allowing autocratic (and sometimes despotic) rulers to remain in control. Oil revenue allows them to buy off opposition and purchase weapons to enforce their rule. In addition, the economic imbalances of oil leave many exporting countries ill-prepared to pay their way in the world beyond the era of oil.

When the world makes the transition away from oil (inevitable, only the timing is uncertain) the image of oil will shift from ‘Black Gold’ to ‘Dirty Oil’ – the term already in use by environmentalists for the oil extracted from the tar sands of Canada. This image makeover is small but important, as it will signal real commitment to reducing oil dependency. Instead of countries outbidding each other to purchase black gold they will compete to lead in the technologies that make dirty oil unnecessary.

It is unlikely that the world will learn quickly to live without conventional oil whilst there are supplies that are easy to extract. As the oil price rises, making unconventional oil commercially viable, the energy intensive extraction techniques and environmental damage will be highlighted. A well head in the desert is not a particularly negative image; it is associated with power and wealth. The large expanse of wasteland from oil sand extraction, where once there was virgin forest, is a powerful negative image of dirty oil.

The shift in perception from ‘black gold’ to ‘dirty oil’ is just terminology but in a world dominated by ubiquitous media, images are a very powerful force (as advertisers know well). There is no alternative in the short-term to reliance on oil but the path to a sustainable future becomes much clearer and more politically acceptable when the image in people’s minds of ‘black gold’ is replaced by ‘dirty oil’.

Prosperity without Growth

I have been off my blog for a couple of weeks whilst I hit a deadline to finish the manuscript of my next book. That is now with the publisher so I have time to withdraw from my shell and engage with the outside world again, spend time with the family and read what others are writing.

The paperback version of Tim Jackson’s book, Prosperity without Growth: Economics for a Finite Planet landed on my doorstep last week for me to review. This is well timed and I am looking forward to reading again Tim’s ideas. His original report for the SDC (under a similar title) raised a number of important questions about the way we run the economy and the priorities that are set. These are very important questions that need to be debated to discuss how the management of society could be different.

The first stage is to question what we have. Anyone who believes that the economic system is perfect has been living on another planet for the last few years. For those who believe that it is the best system available in an imperfect world, this is a valid viewpoint but at best lacks ambition and at worst is plain wrong.

The rescue of the economy following the financial crisis has been a process of papering over the cracks and restoring confidence. If an estate agent was selling the world economy, the financial edifice would look impressive, large and gleaming with a new coat of paint but buyers should take care to examine the foundations and check what lies behind the new wallpaper. A qualified surveyor would need to be employed to do a full structural survey, who may report that the house appears to be in good order but without access to the basement or the authority to peel back the wallpaper there is no way of being sure. When I talk with economists I get a range of views. I met one in Helsinki who believed that the crisis was now behind and the world economy safe. If you have a role in selling the house, then nothing is wrong, but if you an expert impartial observer you would be very wary of claiming that the crisis is past.

Prosperity without Growth raises important questions; we need to peel back the confidence building statements of central bankers and mainstream economists to look for the answers to how the economy can support a sustainable society.

Electric Cars –To Buy or not to Buy

To buy, or not to buy: that is the question:
Whether 'tis nobler in the mind to suffer
The fumes and noise of conventional cars,
Or to take arms against our carbon troubles,
And buy an electric car.

Buying an electric car is a very small step to a greener lifestyle. The contribution to carbon reduction is minimal (until the electricity supply is decarbonised) but change has to start somewhere. The future will include electric cars and someone has to act as trailblazers to work out how an electric-car lifestyle works. There has to be a coming together of people’s expectations with the cars for sale. The car makers have to refine the technology using feedback from the early adopters to get the product optimised.

Current electric cars are being designed to deal with the expectations of conventional car drivers. Looking inside the bonnet of the Nissan Leaf, there is an aluminium cover that gives the appearance of a conventional engine; there is no need of course; the electric motor is a small item hiding away underneath.

Over time the designers will not need to masquerade their design to look like a conventional car but be able to take pride in being electric. The challenge requires innovative and cool design that appeals to the car-buying public.

I like the Nippy BMW E-mini but it is not a production car and is not on sale. I would like to buy a Tesla but that would be an expensive indulgence and not much use as a family car. I have decided to buy the slower, rather dull but practical Nissan leaf. I look forward to learning more about living with a production electric car.

Of course in all this discussion of electric cars, the much bigger step towards greener behaviour is not to use the car, by shopping locally, living close to our place of work and using the bicycle for short local journeys. The bigger challenge is not designing better electric cars but designing society better to be less reliant on the car.

National Climate Week

Here in the UK, today is the start of Climate Week with people across the country putting on events. The international climate negotiations grind slowly forward and show little prospect of an effective agreement anytime soon. Real action will come from individual governments that decide to lead despite resistance from laggard nations.

To deal with the challenge of climate change requires action from everyone, not waiting for top-down direction that is very slow in materialising. Every person, every community, every country and every region has to decide on their response. ‘We won’t do much until you act’, is not a defendable statement. ‘We act and expect you to follow’ is a much stronger mechanism to garner support and drive change.

In my local community, I co-chair the Pangbourne and Whitchurch Sustainability Group (PAWS) and we have a series of events through this week. This weekend we had an information desk in Pangbourne Village High Street and it was also our re-use day. People could put outside their house anything they no longer needed and other people could walk through the village to take it away. My pile of surplus clobber was gone within two hours leaving just one item that failed to find a new home – an old grill pan with evidence of burnt food fused into its base. So there is a limit to what can be reused!

This afternoon I will be speaking at a young people’s forum in which representatives of our local schools will be discussing what they think we can, and should, do. On Thursday evening, I will be chairing a Climate Change Open Forum in the village hall with world climate experts Sir Brian Hoskins and Professor Nigel Arnell.

PAWS is an example of action from the bottom up (perhaps it is also an example of what the government intends from the concept of ‘Big Society’). Within the group as co-chairman I can take very little of the credit, ideas arise from within our membership and working together we translate them into action. This is how to make real progress.