World is Green

Marc Gunther of Fortune reports on the recently held conference “The Business of Climate Change: Risks and Opportunities.” by Goldman Sachs.

Some interesting ideas.

Carbon Tax was suggested as an alternative which I have suggested before.

…while conventional wisdom in the FORTUNE 500 holds that the best approach to regulation is a so-called cap-and-trade regime, one of the most impressive presentations came from a contrarian CEO named Lewis Hay III. Hay is chairman and chief executive of FPL Group, a big, forward-thinking electric utility based in Florida that has invested heavily in wind power. He argued persuasively that a carbon tax (or fee, if you prefer) would be a much simpler approach, and one that would avoid the looming political battles over how to structure a cap-and-trade approach.

On opportunities in the new world from John Holdren, a Harvard professor of environmental science and director of the Woods Hole Research Laboratory.

The first (and we’ve heard about these) are products and services that mitigate against global warming—wind, solar-thermal and photovoltaic electricity, biofuels that don’t compete with food, more efficient buildings and vehicles, and the like.

The second group (and we haven’t heard as much about these) are products and services that will help us adapt to a warmer planet—water desalinization and purification technologies because water will be in short supply, water storage and distribution businesses to deal with floods and droughts, the development of pest-, drought- and pathogen-resistant crops and trees. (“Pests will enjoy a warmer, wetter word,” Holdren remarked. He mentioned mosquito repellent.)

Holdren also talked about improved treatments for human health problems like malaria, dengue and West Nile diseases and, finally, products to cope with storms and rising sea levels like “storm-resistant construction” and “raised, strengthened and additional dikes and storm-surge barriers.” Yes, pest control and dikes.

Gunther concludes well.

It strikes me now that the fact that the conference took place is probably more important than anything that was said. The problem of climate change is so big and complicated that we’ll need all the brainpower and money we can muster to deal with it. Goldman brings plenty of both to the table. If that means that people will rich by selling wind power, fuel-efficient cars, pesticides or even dikes, so be it. I don’t see any better way out of this mess.

Chandrashekhar Dasgupta, a Distinguished Fellow at TERI, writes a sensible op-ed in Business Standard on India and Climate Change.

Climate change is not a big issue in India at this point in time. The sheer size of the poverty issue overrides any other program. Combine that with the economic development policies, foreign policy (e.g. Kashmir issue), internal terrorism (e.g. the Maoists) and it is clear that climate change is not on the top of the agenda. This is rightly so.

In this op-ed, Dasgupta outlines the issue of climate change, the IPCC report, effect on India and possible policy actions.

He points out that “the wealthy, industrialised countries are responsible for causing climate change, the main victims will be the world’s poor. Developing countries are more vulnerable because they lack the financial and technological resources needed to cope with and adapt successfully to climate change”.

In this scenario, the first task of the government is adaptation and this can only be based on rapid, sustained development and poverty eradication.

Adaptation will require a wide range of responses, including a shift to drought resistant plant varieties, economical use of water resources, water conservation measures, watershed management, protection of coastlines and disaster management. Low-income countries will be unable to implement these measures on an adequate scale.

The second goal is to moderate the use of greenhouse gases through measures which will be economically beneficial and the funds are not diverted from poverty reduction and economic development needs. This is important because funds for development are scarce in India.

There are many areas where such possibilities exist. Cost-effective energy saving and energy efficiency programmes serve our development goals and also result in lowering emissions. Policies designed primarily to reduce local environmental pollution (such as the substitution of diesel by cleaner fuel in some of our major cities) can also lead to reduced greenhouse gas emissions. The promotion of nuclear, wind and solar power not only serves our energy security interests but also results in lower greenhouse gas emissions. In all these cases, measures designed primarily to promote our developmental objectives also yield important co-benefits for climate change mitigation.

Additional programs can be achieved through the Kyoto Clean Development Mechanism and Joint Implementation.

According to Dasgupta, the third leg of the strategy should concentrate on managing the rising expectations of industrialized nations to force India to cut down on its emissions.

If the demands of these developed countries are conceded, funds will be diverted from our national priority goals of development, poverty eradication and progress on local environmental issues like air and water quality. The rate of growth of the economy will be slowed down, with the result that India will remain highly vulnerable to the impacts of climate change.

To counter the argument of high greenhouse gases emitted by India due to its population he suggests a analogy based on food consumption.

This is like arguing that India should restrict its food consumption because its total calorie consumption is very large, even though the per capita intake is inadequate! India’s per capita carbon emissions are only one-eighth that of the EU and one-twentieth that of the US. The total figure is high only because India is a very large and populous country, with a population exceeding the combined total of the US, the European community, Russia and Japan.

As with everything in India, population exacerbates the climate change issue.