In 2010, for the first time ever, countries that did not industrialize first have invested more money in renewable energy than those countries that were first to industrialize, according to Bloomberg New Energy Finance. Yet within many middle-to-low income countries, large portions of the population continue to have limited or no access to electricity and other energy services. In some parts of sub-Saharan Africa, such as Uganda and Malawi, as much as 90 percent of the population is without electricity. And while there is no single standard for how energy development should take place, addressing the needs of populations with minimal or no access to energy and related services is a critical part of sustainable development. Fortunately, many regions and communities are implementing decentralized and distributed approaches to renewable energy in sustainable ways, including through locally self-determined initiatives and by engaging in international collaboration.

Wind power can be tied to large centralized grid systems or to municipal micro-grids (Source: Reuters)

 

Decentralized renewable energy

Still today, the bulk of energy financing goes to centralized, grid-connected power plants. In 2010, for example, an estimated $40–45 billion was invested in large-scale hydropower, compared to only $2 billion for small hydropower projects. One reason for this disproportionate focus is that international efforts and funds typically emphasize policy change at the national level and through capital-intensive, industrial markets. But while implementing change at these levels is important and necessary, it is not the only way.

Indeed, numerous studies and examples indicate that policies oriented solely toward centralized production and distribution of electricity are inadequate to meet the needs of marginalized people and communities. In contrast, renewable energy technologies provide the opportunity for a development path that is more culturally self-determined, giving individuals and communities control over their own energy sources. Distributed renewable energy technologies constitute an important, community-driven alternative to centralized projects that are often driven by national politics and that can be largely removed from community interests.

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Central America, distributed generation, finance, renew, renewable energy finance, rural electrification, solar power, wind power

Minister Chen speaks with Alexander Ochs, Haibing Ma, and Chris Flavin (from left to right).

“China is dedicated to low-carbon and sustainable growth,” said Chen Dawei, head of the visiting Chinese delegation to the Worldwatch Institute. “[The] Institute’s experience and current works on promoting green development are really impressive and I hope collaborative projects can be developed through this meeting,” said Mr. Chen. Back in China, Mr. Chen is the Vice-Minister of the Ministry of Housing and Urban-Rural Development (MOHURD). He is leading the Low-Carbon Economy and Sustainable Urban delegation, which consists of more than 25 high level officials from Chinese central, provincial, and municipal governments.

The visit was organized by the Global Educational Institute at Georgetown University. During the meeting, Christopher Flavin, Worldwatch’s president emeritus, delivered the opening remarks and briefly introduced to the Chinese delegation the institute’s history, program layout, and major works. Alexander Ochs, the Director of the Climate and Energy Program, detailed our work in the Caribbean region by highlighting the unique characteristics of our Low-Carbon Energy Roadmap approach. I then provided an overview of our previous and ongoing China-related research works. In addition, I used this opportunity to introduce various ideas of our future China work, including a sketch of our plan to work with different levels of Chinese government.

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China, Chinese delegation, effectiveness, efficiency, green development, green economy, green transition, Low-Carbon Energy Roadmap, MOHURD, renewable energy, sustainable development

CancunIn the aftermath of last year’s climate policy debacle in Copenhagen, South Korea is pointing the way to a creative new approach to solving the world’s climate problem.

Two events that occurred simultaneously last week in Cancún crystallized both the challenge and the opportunity facing world leaders as they wrap up the latest round of climate negotiations.

In one room in the Cancún Messe, Indian Environment Minister Jairam Ramesh convened a meeting to discuss “equitable access to the world’s carbon space.” Speakers from countries including China and Malaysia made a powerful case for an agreement that recognizes that most industrial countries have already used up their rightful share of the world’s carbon budget—and that all future emissions should be allocated to developing countries.

Meanwhile, just 100 meters away, South Korea hosted an event with a different tone. Led by former Korean Prime Minister Han Seung-soo and former World Bank chief economist Nicholas Stern, the event focused on South Korea’s Green Growth Initiative—a new program that is aimed at transforming the country’s economy from the resource- and carbon-intensive model that drove its development to a new one based on the efficient use of energy and resources.

South Korea’s initiative is groundbreaking in several ways. It is led by the country’s president, whose strong environmental credentials include having cleaned up the Han River when he was mayor of Seoul. It has broad public support, including from the major opposition party, and it is being implemented via detailed and forceful legislation. And, despite early opposition from energy-intensive sectors such as steel and cement, the initiative has been embraced by the country’s major companies. Firms such as Hyundai and Samsung have responded by creating their own “green growth” strategies, including entering into new business areas such as solar energy, wind power, electric vehicles, and zero-emission factories.

But what is really impressive about South Korea’s initiative is the “just-do-it” philosophy that drives it. The country’s leaders are frustrated by the maddeningly slow and ideological character of the climate negotiations. They are firmly—and accurately—convinced that the global economy is no longer sustainable on its current track, and that those who choose to seize the “early mover” advantage and pioneer the low-carbon, green industries of the future will strengthen their economies and create millions of jobs while also addressing a looming global crisis.

Meanwhile, speakers at the Indian Government’s “equitable access” event argued that industrial countries owe developing countries between $4 trillion and $40 trillion in “climate reparations” over the next 40 years. According to their analysis, industrial countries should be limited immediately to a small fraction of their current emissions—and any excess of emissions over that amount should trigger large payments to developing countries whose emissions should not be constrained until their per capita levels approach those in the richer countries.

This argument has a powerful moral logic. Industrial countries are indeed responsible for most of the human-related greenhouse gases now in the atmosphere, and their advanced economies were made possible in part by decades of burning cheap fossil fuels. Developing countries, meanwhile, are expected to suffer the most from the rising seas and diminishing rainfall that are expected to accelerate in the coming decades.

But it is this very debate that has bedeviled climate negotiators since the first negotiating meeting in Berlin in 1995. The near-collapse of climate talks in Copenhagen last year and the recent shift in the political balance in Washington this fall have obliterated any remaining slivers of hope that a comprehensive, binding agreement is within reach. To the contrary, it is now clear that a continued North-South debate on how much each side should cut their emissions, and how to monetize the “right to pollute,” could proceed for another 16 years of climate negotiations—with equally slender results.

It’s hard to sum up a consensus among the thousands of government officials, industry representatives, NGO activists, and other hangers-on in Cancún this week. But buzzing through the thousands of conversations was a growing chorus of voices embracing the notion that even poor countries may find a low-carbon development model more advantageous than fighting for the right to be one of the last dominos in the fossil fuel economy. This shift in thinking may have been reflected in the fact that speakers at the Indian government event spoke to a half-empty room, while the Korean event was standing-room only.

It is now clear that Copenhagen was a turning point in international climate negotiations.  We can no longer keep doing the same thing and expecting different results.  Nor can we afford to go on making the perfect the enemy of the good.

It is therefore time for the climate negotiations to focus on immediate and practical steps forward rather than the kind of comprehensive global agreement that generated such contention in Copenhagen. The longer the world waits to embrace the notion that there is a solution to the climate problem that involves economic hope and opportunity, rather than depression and sacrifice, the less chance we will have of stabilizing the climate before it’s too late.

According to the consulting firm SCI Verkehr, worldwide operations and capital budgets for passenger and freight rail were a combined $590 billion in 2008. Another study by Roland Berger consultants finds that the global market for rail goods and related services (not including operations) was $169 billion in 2007, up from $129 billion in 2006. But how do these numbers break down regionally and nationally, and what does this portend for the future?

The United States—and more broadly, the Americas—retains a big market share in freight rail but lags far behind in passenger rail compared to many countries, especially in Europe and Asia. In 2002, North and South America together accounted for 31 percent of the world’s diesel locomotives and a third of the world’s freight wagons, but for only 1.5 percent of the world’s passenger rail cars and less than 1 percent of electric locomotives.

For transit rail cars, the United States accounts for about 5 percent of the global fleet and for a correspondingly small portion of global demand for new cars. Canada and Mexico add another 2 percent, bringing the North American total to 7 percent. By comparison, Japan is home to 11 percent of the global fleet, and Europe 35 percent. Annual U.S. orders for transit cars are erratic, swinging from a range of some 200–400 cars in most years to isolated peak years of about 1,200 in the early 1980s and early 2000s.

This is where change is critical: It is not enough to have one or two years with large orders for rail vehicles. What is needed is a sustained investment program in the United States. Only then will a rail manufacturing industry re-emerge.

The vast majority of the world rail market is infrastructure-related. Rail vehicles account for close to a third of the market volume. Western Europe currently dominates the market, followed by Asia and the Pacific, although other regions lead in specific industry segments, such as services. (See Table 1.) About two-thirds of the market volume is considered “accessible,” meaning that orders are open to bids from international suppliers.

China, Europe, infrastructure, investment, priorities, rail, transportation, US, world

Harmonious Concept? (foto: Leon Rice Whetton)

This post was co-authored by Michael Renner and Gary Gardner

We continue to wrestle with the following question: is it possible to build economies that provide ample jobs, without stoking the fires of consumption? What will provide job creation if people are not spending as much on personal consumption? Below, we offer some basic principles and ideas to guide policymaking. Note that many green initiatives appear to require complementary policies to ensure that jobs are not lost as the environment is protected. We invite readers’ views.

1. Tax extractive activities like mining, logging, and oil drilling. This is a high-payoff option, because extractive industries tend to create few jobs but lots of pollution. For example, it takes only about 5 percent of the energy to create an aluminum can from recycled materials as it does to create the can from virgin ones. Taxing extractive activities could be a major stimulus for building a robust, job-creating recycling industry, and for generally boosting the durability of products.

2. Tax waste more and workers less. Taxes on air and water emissions, garbage collection, landfill use, and other forms of waste would stimulate the adoption of cleaner methods of production and consumption. Revenues could be used to reduce taxes on labor, stimulating employers across the economy to hire. Germany [large PowerPoint file] already has some experience with this kind of tax shifting.

3. Steer disposable income toward less materials-intensive uses. Fewer sales of cell phones, cars, and oversized houses, offset by greater purchases of music lessons, soccer tickets, and visits to national parks, would surely lower the environmental impact of consumption. The net effect on employment would depend on the labor intensity of the particular mix of changes adopted, but this arguably could be shaped by regulatory and fiscal incentives to favor outcomes that maximize employment and reduce materials consumption. Wages are another consideration, since manufacturing jobs typically pay far better than most service jobs.

4. Restructure manufacturing and retail to meet people’s needs in a green way. Instead of selling products with a the-more-the-better attitude, manufacturers would provide a desired service. Consumers lease or rent products rather than buy them outright. Manufacturers remain responsible for proper upkeep and repair, and ultimately recover components and materials for recycling or remanufacturing. This would create jobs in repairing and reconditioning goods, and these jobs are less likely to be automated or outsourced. In retail, proficient and well-paid sales personnel would advise consumers on the best product options available.

5. Restructure businesses to favor job creation and preservation, and to reduce environmental impact. Worker co-ops, as envisioned by University of Chicago philosopher David Schweickart, are governed by workers and capitalized from a public fund rather than private shareholders. The result is greater priority to job preservation, even as the co-ops operate in a competitive market system that requires efficient operation. Additional incentives, such as requirements for a minimum share of recycled content in products manufactured, could give Schweickart’s vision a green twist.

6. Explore the implications of a (partial) consumption shift from the realm of private to public choice. Capitalist economies thrive on making available a bevy of private choices. Think of private automobiles versus public transit, or private swimming pools versus municipal pools. In transportation, a multiplication of vehicles (millions of cars instead of thousands of buses or rail cars) doubtlessly creates more manufacturing jobs. Yet public transit involves a large number of employees running systems. The net job benefits will vary from one sector of the economy to another, and the public option may not always be the best from a jobs perspective. Yet a fundamental examination of public versus private options seems in order. Creative thinking about public provision of goods and services, as seen in the experiment with co-production—involvement of public agencies, their clients, and the larger community in the provision of services—could have some interesting employment benefits as well.

Creating vibrant green economies that provide adequate employment without depending on endless consumption as an engine of growth will require tools of all kinds and sizes, from the structure of business to incentives created at the national and international level. Although not intended to be an exhaustive list, the above ideas are our starting set. What do you think? What would you add, delete, or change? Keep the conversation going.

consumption, economy, extractive activities, government, Jobs and Environment, Policy, principles, resources, taxes, waste, workers

Like many people, I suppose, when it comes to important and complex issues I tend to be swayed by the latest plausible thing I’ve read. Following the failure of the Copenhagen conference to make any serious headway on climate change, I’ve started to think that James Hansen is right.

hansenjamesHansen is one of the most prominent climate scientists in the world, mainly because of his activism. That activism stems from his passion about the urgent need for climate action, which has led him to stick his neck farther out than any of his peers. All this is evident in his new book, Storms of My Grandchildren: The Truth about the Coming Climate Catastrophe and Our Last Chance to Save Humanity. As the title suggests, Hansen does not limit himself to cold reason and analysis, though there is plenty of that. This is a deeply personal book (sometimes a little too personal; the bit about his prostate surgery doesn’t really add to the argument) in which repeated references to his three grandchildren highlight the stakes for the coming generations if we fail to address climate change adequately now.

I won’t recap his overview of the state of climate science, except to say that it’s terrifying. (Pretty much everything we’ve been warned about is happening, only faster.) More interesting, and controversial, are his prescriptions, which will discomfit many environmentalists. Above all, Hansen believes that humanity simply must stop burning coal for energy, as well as leave most of the rest of the planet’s fossil fuels in the ground. Coal is Hansen’s chief villain, not only because of its contribution to climate change, but also because it demonstrably kills tens of thousands of people every year—year after year.

Not much argument there. But Hansen adamantly does not believe that efficiency and renewables have a prayer of replacing coal, at least anytime soon. He points to Germany and Japan, two technically advanced nations that lead the world in efforts to find renewable alternatives to fossil fuels. Germany is building more coal plants as it phases out nuclear power, while Japan—which hosted the Kyoto protocol negotiations and pledged to reduce its greenhouse gas emissions to 6 percent below 1990 levels—has seen its emissions rise to 9 percent above that benchmark. Forget the technical arguments, Hansen implies: it’s what is technically and politically possible that matters. And these nations have done the best anybody could do.

Hansen also argues that cap and trade programs are a snare and a delusion: too readily gamed and loopholed and offsetted to death by the hordes of lobbyists (repeatedly referred to as the alligator-shoe people) and greenwashers. (Hansen’s contempt for the corruption in climate policy is palpable.) And the only sensible technical solution, he believes, is nuclear power: third- and fourth-generation plants that are modular, supposedly cheaper and faster to build, supposedly much safer, and—in the form of “fast” reactors—actually capable of gradually eliminating the waste problem (they burn spent fuel from first-generation reactors).

I often found myself nodding, a bit uneasily, in agreement. He makes good points. Cap-and-trade programs do indeed look very squishy; the European experience to date sounds a cautionary note. But while Hansen’s preferred alternative, the fee-and-dividend approach (a price on all carbon, with the money rebated to consumers), sounds simpler and more workable, you just know any such proposal in the United States will be labeled a tax and immediately crash in flames.

 Moreover, concerning nuclear power, Hansen does not directly address the points made by Amory Lovins and others that nuclear power is too expensive (billions of dollars per power plant) and slow to come on line (roughly 10 years per plant). Nor does he talk about the risks inherent in fast reactor technology, which uses plutonium that can be diverted into weapons. And finally, his prescriptions beg the question of how will those same political systems, with their built-in friction and sensitivity to special interests, do any better in getting rid of coal plants or siting new nuclear plants, however benign they may turn out to be?

Which brings us to Hansen’s strategy—and I believe he’s absolutely right about this, whichever course makes sense: “The public must demand a strategic approach that leaves most fossil carbon in the ground. …Our planet, with its remarkable array of life, is in imminent danger of crashing. Yet our politicians are not dashing forward. They hesitate; they hang back. Therefore it is up to you. You will need to be a protector of your children and grandchildren on this matter. …It is crucial for all of us, especially young people, to get involved.”

At the World Resources Forum this week in Davos, Switzerland, the subject of prices bubbled up in ways that challenge the common assumption that “cheaper is always better.” I thought I’d share a few scattered examples:

–Many participants said that resources should be taxed to discourage their use and to help internalize their environmental costs. This should be done at the extraction phase—when ores are mined and trees are felled—for ease of administration and to realize greater reductions in environmental impact compared with interventions that occur later in the economic process.

– Ernst von Weizsäcker, one of the eminences grises of the materials-use community, noted that higher prices don’t have to mean poor economic performance. For example, Japan blossomed, more than many OECD nations did, during high oil prices between 1975 and 2000.

–The oft-heard conventional prescription to “get the prices right”—allowing market forces to evaluate scarcity and reflect it—has taken on a new and progressive meaning: getting prices to align with political goals, according King’s College economist Paul Ekins. For example, as Friends of the Earth UK notes in a 2008 report, the UK government’s efforts to set a price for carbon and to produce a carbon budget for the coming years has been based on climate change science, rather than on market dynamics.  

A healthy planet: priceless

A healthy planet: priceless

The idea that we might be better off in a more expensive world may seem incredible, given the “sell more” ethic of consumer societies, with its relentless drive to minimize prices. But a more expensive world of food, housing, and transport resonates for me. Greater expense might push us to choose durable over short-lived, beautiful over shabby, fewer over more, simplicity over clutter. In other words, a higher quality of life. Isn’t that what we’re after?