future clean tech

No. Absolutely not. And yet the conservative Wall Street Journal yesterday implied that America should, in a column entitled, “Down Under: Can the US Learn From Australia’s Emissions Plan?”

It’s easy to see why the Journal is pumped about Australian Prime Minister Kevin Rudd’s “Carbon Pollution Reduction Scheme” (that’s what they’re calling the Aussie ETS): it’s a sop to heavy polluting industry and the conservative opposition that supports it. The amended legislation gives a free ride to the carbon mafia, delaying really significant cuts in CO2 and passing on the residual costs to the average punter. The minimum “guaranteed” reduction is 5% by 2020 – talk about rearranging the deck chairs on the Titanic. Only this time there won’t be an iceberg in sight.

Interestingly, conservative Opposition leader Malcolm Turnbull chose to lay his leadership on the line over this issue. His Liberal Party is severely divided over the legislation and the Liberals’ usual political bedfellows, the Nationals, are united against it.

Turnbull is an ideological descendant of the old, pre-John Howard Liberal Party: liberal on social issues, and to a greater or lesser extent conservative on economic issues. Global warming is a social issue with serious economic repercussions (and, what conservatives tend to discount, serious opportunities) and so it is no surprise that an old-school Liberal like Turnbull would support a sort of diluted version of action on climate change – but action nonetheless.

Turnbull’s dilution of the CPRS bill is worrying enough, but the really interesting thing is that much of his party thinks he’s gone too far. Former Prime Minister John Howard was almost singlehandedly responsible for the conservatisation of Australian politics, and the conservative rump of the party Howard left behind is about to commit collective suicide by declaring war on Turnbull for being too progressive. Turnbull, whose leadership is in serious trouble, is probably the best hope the Opposition has of breaking through the Government’s approval numbers anytime before 2013.

There is no lesson for America here. Australia’s electorate is overwhelmingly in favour of action on climate change, whereas the American electorate is somewhat more divided. I’d like to be able to say that Australia offers a warning to conservatives overseas not to oppose climate change action, but it seems like the Liberal Party, much like the Republican Party, is trending rightward.

From a policy perspective, Australia’s recent experience is a total disaster. It represents a triumph of politics over policy. The US and the EU are both looking at 17% and 20% cuts respectively by 2020, which is nowhere near enough. We need to cut 80% by 2020. Australia’s promising 5%. No lessons here.

Why are we not surprised about this latest report? The global energy lobby is working to kill progress on climate change, says the Huffington Post, reporting on a recently released study by the Center for Public Integrity.

Here’s the whole article.

NYTimes carried this story in its greeninc blog today: Solar Industry Takes on Coal and Oil Lobbies. Highlights:

A solar industry leader smacked down the oil and coal industries on Tuesday, calling for renewable energy proponents to open their wallets to level the playing field in Washington. [...]

Oil and coal interests “are spending millions of dollars on lobbying, P.R. and advertising, and much of it is financing a deliberate effort to discredit our industry,” Mr. Resch added. “At the end of the day in Washington, good intentions won’t stand a chance against millions of dollars and intense political pressure. We have relied on good will long enough, and if that’s the only arrow in our quiver, we will lose.” [emphasis added] [...]

But Mr. Resch said fossil fuel industries received $72 billion in federal subsidies between 2002 and 2008 while the solar industry scored less than $1 billion. “Taxpayers are forced to subsidize companies like ExxonMobil, companies that are the richest in the history of the world,” he said.

His solution: Start playing the influence game, raising big money for politicians and mobilizing constituents to pressure Congress to support the solar agenda. “In 2008, the oil industry contributed $22 million to political candidates, the utility industry $21 million,” said Mr. Resch. “The solar industry: $138,000. We cannot compete with the entrenched energy interests unless we step up our game.”

Having spent a great deal of time observing the campaign financing system that governs Washington DC, I tend to agree with this analysis. Why are supremely profitable fossil fuel companies receiving $72 billion in federal subsidies over a six-year period? The answer is not good public policy, of course, but the influence of money.

The public interest does not necessarily prevail in American politics. Well-financed “special interests” win. The only way the public interest can possibly win, alas, is if it is equally or even better-funded than narrow special interests. The public interest needs to clothe itself as a special interest.

While campaign finance reform remains a noble and necessary goal, even the powerful Senator and former presidential candidate John McCain has been unable to slow the burgeoning supremacy of money over good public policy.

I have observed and voluntarily assisted one particular Beltway lobby whose cause I believe strongly in, and I saw firsthand how, as the Green Inc article states, no amount of good intention could possibly achieve anywhere near the kinds of policy outcomes that are achievable through well-funded public affairs work.

19th-century industries like burning fossilized plant remains (that’s what coal is!) still receives billions in federal funding because the entrenched fossil fuel lobby knows how to do politics.

The cleantech industry needs to very quickly learn how to effectively fundraise and target that funding into appropriate, powerful, game-changing campaign financing.

In today’s America, the best ideas will not win unless they are better-funded than the very bad ideas. A viable, contemporary, professional, well-funded and politically-savvy cleantech lobby is urgently required in this country. The fossil fuel dinosaurs must be beaten at their own tawdry “special interests” game.

EDIT 11/11: This from the Center for Public Integrity:

If the public is unaware, more than 1,150 companies and advocacy groups are very tuned in, and they have deployed about 2,810 climate lobbyists to Capitol Hill, an increase of more than 400 percent from six years earlier, according to an analysis of disclosures filed with the Senate Office of Public Records. Spending on the lobbying this year so far in the United States is at least $47 million. Senate advocates aim to build support much as it was achieved in the legislation that narrowly passed the House this summer — by giving a boost to businesses that fear they’ll be hurt by measures raising the cost of the coal that supplies half the nation’s electricity. But the concessions have not won over opponents like Don Blankenship, chief executive of Massey Energy, the largest coal producer in central Appalachia, who forcefully disputes the science of global warming. Although that makes him an outlier in the public debate, his argument that the bill will cost jobs at the same time “it will increase global pollution by moving production to unregulated countries like China” causes worry on Capitol Hill.

Blankenship is just one of the business opponents who have worked to rally citizen ire — a campaign that has resulted in hundreds of alarmed phone calls to Senate offices. Given the power of industry lobbying in Washington, advocates see the best hope for the legislation’s passage as the competing U.S. businesses that support action, ranging from power companies that want predictable energy policy to high-tech firms that aim to market climate solutions.

More here.

It is good to see companies vying to qualify for NGO certification, like the Rainforest Alliance’s green frog seal (pictured). Much is made of the issue of government regulation – the “stick” approach – but corporate “carrots” can also be effective. The profit motive is the cornerstone of our economic system, and we might as well use it to good effect.

This week, the Sydney Morning Herald was gushing about corporate uptake of the seal: companies are eager to qualify for the logo by meeting, in this case, Rainforest Alliance’s 10 criteria for sustainable farming (set by the Sustainable Agriculture Network).

This is certainly a good thing, just as the idea behing “Dolphin Safe” products was and remains a good thing.

My only concern is the phenomenon of greenwashing. In New York, I see it every day at the supposedly earth-friendly super-grocer, Whole Foods, where product after product is packaged in green and other earthy colours and marketed as “organic” (”organic” is the new “natural” in corporate branding terms). All kinds of tricks are used; companies know that savvy customers prefer plain cardboard packaging and certain types of simple fonts that hark back to an idyllic age without industrial-sized tractors, artificial animal growth hormones and tumour-inducing chemical pesticides.

In the case of the green frog certification, my only concern is that only 30% of a company’s product needs to come from SAN-certified farms. (Mother Earth News complained about this earlier in the year.) The trouble, of course, is that if a higher percentage were mandated by the Rainforest Alliance, fewer firms would join the program, and less overall produce would be sourced from certified farms. I get it – they’re trying to find the sweet spot.

My personal preference is that, when such programs become reasonably successful, the government ought to step in and set up strict mandates. The increase in price for the consumer would be negligible compared to the benefit it would provide, and a mandate would level the playing field for all firms.

Of course, this would remove the competitive advantage from firms who were early adopters of the certification – but, in my view, the huge advantage of being an early adopter is more in the bragging rights than anything else.

Green Inc reports that New Jersey will double its solar power through small-scale, telegraph pole-mounted solar PV installations. This will “maintain New Jersey’s position as the nation’s second-ranked state for solar photovoltaic installations, behind only California.”

$515 million for 80 megawatts, however, sounds a bit rich to me. I mean, seriously? The peak power output of this project is likely to be more like 24 megawatts. $515 million? Surely there are better things to do with ratepayers’ hard-earned cash, particularly during this downturn.

The Wall Street Journal reports that California is “spending $3.3 billion on subsidies, hoping to get 3,000 megawatts installed.” Now that’s more like it. Of course, that means that Sacramento isn’t footing the bill for every megawatt.

Still, the NJ utility’s chief executive, Ralph Izzo, makes a good point: “We’ve got to stop pretending solar power will lower the cost of energy. It’s going to increase the cost, and people have got to understand why it’s worth more.” The WSJ continues: “He listed the names of pollutants produced by coal or gas incineration that don’t occur with solar technology.”

More talk of reducing emissions from deforestation. I think if we could choose one dangerous human activity that we could magically end right now, it should be deforestation. That’s because we can’t get old-growth forests back in our lifetimes. Period. This is why the terms of the discourse on developing countries’ deforestation interests me – the very fact that we talk about “emissions” from deforestation is disturbing. They are not emissions in the same way that coal-fired power plants produce emissions; these are of a totally different quality and magnitude.

Unfortunately, in order to save them, we need to put a price on them, which is why pricing the carbon stored in these forests is no bad thing, especially at a time when society is so sensitive to the harmful effects of carbon pollution.  The only danger is the Tasmanian experience which I’ve written about before – or, indeed, the Indonesian and Malaysian oil-plantation experience – where monoculture plantation forests are equally or more valuable, in present dollar terms, than infinitely richer old-growth forests. Any new plan needs to price old-growth forests significantly above any other alternate use for the same land.

Last week, Terry McCrann – “Australia’s foremost business commentator” – published a piece entitled The enormous cost of hot air. It would be charitable to call the title of the article ironic.

Terry McCrann, allegedly "Australia's foremost business commentator"

McCrann parrots the rest of the world’s skeptics in citing a Spanish paper whose most outrageous claim is that each green job created leads to the destruction of at least 2.2 jobs in the wider economy.

This is, of course, utter nonsense. The Spanish article makes this spurious claim simply by dividing the amount of renewables subsidies per worker (€571,138) by the average amount of resources the private sector employs per worker (€259,143). Voila, 2.2. The problem with this calculation are many, including, but not limited to, the following:

• No account is taken of the amount of subsidies given to the dirty energy sector, or any other economic sector for that matter.
• While government subsidies represent an opportunity cost, it is a stretch to call the use of those resources “job destruction” when no actual jobs are being destroyed.
• State subsidies are always going to be higher for nascent industries. Afterwards, economies of scale will accrue.

Here’s Terry McCrann’s credulous take on it:

While it would be inappropriate to translate Spain’s experience directly to the US, the Obama Administration’s claim that “green energy” could create 3-5 million jobs is likely to directly wipe out 6.6 million to 11 million jobs elsewhere.

Why? Because of the costs to production and employment, principally in metallurgy, non-metallic mining and the food processing, beverage and tobacco industries.

It is not clear whether the study factors in the jobs that would be lost from reduced consumer spending because of the higher power costs.

But don’t panic. Because none of this is real. It’s fiction in the mind of a skeptic. In reality, yes, some jobs will be lost. And that is no bad thing – jobs are in a constant state of destruction and creation. Punch-card computer operators were reskilled. Asbestos workers had to find other work when we finally figured out how toxic asbestos is. And now, as we finally acknowledge what we’ve known for a long time – that dirty industry is killing us and our planet – jobs in dirty industries will be lost.

But jobs will be created in clean industries, and they will far outweigh the number of jobs that will be lost in dirty old industries – no matter how much tricky mathematics some heretofore unheard-of academic and “Australia’s foremost business commentator” try to spring on the unsuspecting public. You simply can’t say that 2.2 jobs will be lost for every green job created on the basis that significant government expenditure is going into the clean energy space right now. Much of that is capital spending. To say that this initial spend is “destroying jobs” is to compare apples and oranges. It is doing nothing of the sort. The fuel costs of renewable energy are generally zero, and so in the long run, we’ll be saving money on energy and freeing up resources to create even more jobs.

Frankly the illogic is enough to give a man a seizure. But it is so silly that it has been taken seriously by the kinds of elements that take silly things seriously (to wit: the Washington Post (which deigned to sneer at the president’s press secretary for calling the premise of the article “weird” and “simply flat wrong”), the New York Post, and “Australia’s foremost business commentator”, among others) that I just had to take it on.

There’s more to say about this, but I’ll leave it for next time, because there will surely be a next time.

Excellent article in today’s New Matilda – The Unavoidable Green Future (will open in new tab/window). It’s an interview of Ben McNeil, author of The Clean Industrial Revolution. Here’s my favourite bit:

“Right now we’re in the same position in Australia as GM was in the 1990s. We’re protecting high-carbon assets. We’re protecting coal, we’re protecting oil and we are looking at carbon price, a carbon cost in the future. There is no doubt that the world is going to value carbon, and that means higher carbon costs. So how the hell is coal going to survive in a world moving to low carbon? It’s not going to.”

McNeil points to research by Chris Reidy at the University of Technology Sydney which estimated a public subsidy of $9-10 billion on 2005-06 figures for the transport and electricity industries alone.

“When people say let’s do nothing, let’s just play that scenario out,” McNeil continues, “if we do nothing in terms of emissions, it’s essentially saying let’s rely on these old relics for our future prosperity in terms of economic growth. But Japan and the EU, who buy most of our coal, are de-carbonising their economies. Why would they be buying coal? They’ll be getting gas, they’ll be getting renewables, they’ll be getting more nuclear, they’ll be doing other things. So someone who says this will be devastating to our economy — it doesn’t make sense.”

But what about the argument, often voiced by the Opposition, that Australia should wait until the rest of the world puts a price on carbon before it acts?

“It’s funny. When someone says there is no current price for carbon they’re just living in la-la land. There’s a very strong shadow price for carbon right now, irrespective of the Government. Last year, 45 coal-fired power stations went off the books in terms of planning. They didn’t go off the books because of coal technology — we’ve had coal for a long time. They [were cancelled] because of the financiers, the Wall St bankers. They said ‘Actually, in a carbon constrained world, where you’ve got a 50-year asset, the carbon price could go from $20 a ton to $200 a ton within 10 or 20 years, so we’re talking about huge carbon liabilities here.’”

“These guys in the coal industry are just delusional, completely delusional.”

To read more, click here.

This article appeared in the Sun Herald today: “Emissions scheme’s $6bn boost to the economy“.

An internal report by National Australia Bank seen by The Sun-Herald suggests the emissions trading debate in Australia has been dominated by claims about the short-term costs, and scant attention has been paid to new investment opportunities.

“The average year-on-year investment created by the [Carbon Pollution Reduction Scheme] could be up to 60 per cent greater than that committed for infrastructure in this year’s budget,” the report says.

It warns there has been “little consideration of the investment stimulus” that would be created as the economy becomes less greenhouse-intensive.

“This is unfortunate, as discussion of any costs should be balanced with an examination of the opportunities.”

Duh. The only reason the scheme has been delayed in Australia is because the only industries set to lose from its implementation – heavy polluting ones – have lobbied to have it delayed. And they’ve convinced the public with their false dilemma of environment vs jobs. Here’s how the article ends; don’t worry, I’m not spoiling anything for you. Trust me:

Treasury modelling produced for the Government concluded the emissions trading scheme would only have a small net impact on employment.

But the Minerals Council says the mining sector will lose 23,510 jobs over the next decade if a 5 per cent target is adopted.

And, as I’ve written before, punch-card computer operators lost their jobs when technology improved. My question is: um, so?

Two excellent clips showing the contours of the debate going on in the US. Note that even the “skeptics” are simply querying the viability of raising capital during the GFC – they are not questioning the value of switching to clean energy. Particularly, as is referenced, in the wake of December’s disaster at a Tennessee coal plant (which only goes to prove that eliminating coal is an imperative whether or not climate change science turns out to be accurate).

Can Wind and Solar Replace America’s Coal Plants?

Clean Energy – Wind vs Coal