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There is one question I am asked a lot these days: why is a low-carbon revolution not happening?
The answer is certainly not lack of intent. A remarkable political consensus now exists in support of moving to a low-carbon economy. Ambitious targets are in place. The chorus of people saying the same thing in conferences around the world is deafening.
Nor do we lack a blueprint for what needs to happen. The answer is fourfold:
- Take energy out of global GDP by revolutionising energy efficiency;
- Take carbon out of energy by deploying renewables, nuclear and carbon capture and storage;
- Preserve carbon sinks through improved forest and land management;
- Help vulnerable people to adapt to climate change.
There are no real technology barriers. A good deal of innovation is still needed. But the challenge of putting up hundreds of wind turbines in the North Sea, or of reconfiguring the grid, is hardly insurmountable compared with the engineering feats of the past 50 years, not least in the offshore oil and gas industry.
Business willingness is also not the problem. Businesses will invest anywhere they can see an attractive balance between risk and return. My career has taught me never to underestimate the markets ability to innovate if the right incentives are there.
Whats missing is political leadership as governments shift focus from goal-setting to delivery.
If I were to add a few climate-change recommendations to the advice being offered to the G20 summit, I would make four points.
Make climate-change efforts mainstream
This is in large part a matter of political framing. Environmental protection is too often treated as an option or a luxury, rather than as something that is essential for society to flourish. Environmental protection must be accorded its place at the heart of society.
Practically speaking, that means all levels of government local, national and international and all government departments must be involved in the solution.
President Barack Obama understands this. His administration is leading the mainstreaming of low-carbon energy and energy efficiency. Last months American Recovery and Reinvestment Act contained a substantial green-energy component, with more low-carbon legislation likely to follow.
Other countries should follow suit. Targeting just 10% to 20% of the several trillion dollars expected to be spent on fiscal-stimulus packages around the world to low-carbon infrastructure would be a triple win. It would help to create jobs and diversify economic activity away from property and financial services, as well as enhance national security and protect the environment.
Dont be thrown off course by interest-group politics
It is clear from every analysis I have read that cost is not the biggest obstacle. But there will be winners and losers, leading to difficult political decisions.
Consumers will need to pay more for energy over time. Measures to address fuel poverty will be critical. However, consumers will pay significantly less in aggregate than the increase in fuel and electricity prices borne recently as a result of the spike in fossil-fuel prices.
Get government intervention right
The market remains the most effective delivery unit available to society. But the market needs a framework of incentives and regulations laid down with a firm hand by the state.
This is justified on economic grounds because energy security, climate-change mitigation and accelerated innovation will go unrecognised until they are
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