Multifaceted Environmentalism & Greentech

Whether you think it will stop climate change, reverse the acidification of the ocean, or help nations achieve energy independence, the political momentum to raise the price of fossil fuel appears unstoppable.

With that as a given, then, the current debate should focus on what mechanism should be used, how much the price should be raised, and how the resulting funds should be allocated—all of which boil down to choices between practical environmentalism and emotional environmentalism, head vs. heart.


If we’re to adhere to Nobel laureate Al Gore’s “pledge,” for example, we must stop burning coal within 20 years — this despite the fact that coal is the cheapest and most abundant fossil fuel on Earth, that nearly 25% of all energy produced on the planet comes from coal, and that the U.S. Energy Information Administration predicts coal’s use will increase by 74% between now and 2030 (mostly in countries like China, which will do whatever their economic interests dictate, despite anything the IPCC has to say about the matter). It would take huge price increases to price coal out of existence within 20 years, and it would require the cooperation of every major nation on earth—tough challenges.

That’s why trying to precipitously phase out coal rather than simply clean the emissions from it while making an orderly transition to alternative fuels represents a policy agenda that’s deeply flawed. Accept for a moment that anthropogenic CO2 is the cause of global warming and that global warming is going to become a serious problem for humanity. If these assumptions are true, there’s little we can do at this point. As Rajendra Pachauri, chairman of the IPCC, has said, “The inertia of the system that we have is such that climate change would continue for decades and centuries even if we were to stabilize the concentrations that are causing this problem today, which means that adaptation is inevitable.”

So think about this instead: If the funds collected through taxes and carbon offset payments assessed on CO2 emissions were used to adapt to the effects of global warming rather than to attempt to eliminate global warming altogether, the amount spent would equal a fraction of what it would cost to halt global warming. The Danish economist Bjorn Lomborg in his 2007 book Cool It: The Skeptical Environmentalist’s Guide to Global Warming calculated the costs of mitigating global warming and came up with a premise that’s hard to challenge: Pouring money collected from a carbon tax into the development of the economies of the equatorial nations would make these nations wealthier—and in turn enable them to afford to mitigate the negative impacts of global warming.

High-tech entrepreneurs who are hoping to fund their companies through carbon taxes now have a vested interest in global warming—and suddenly public policy rather than product superiority has become the key to success. These entrepreneurs, after all, don’t stand to benefit if policymakers determine that a tax of just $2 per ton of carbon will fund economic development throughout the world and enable everyone, everywhere to adapt to global warming. These high-tech entrepreneurs should remember their roots: Silicon Valley did not change the world by fomenting or condoning irrational panic and feeding at the tax trough; it did so by innovating and providing superior products that responded to real customer needs.

Another issue to debate as we contemplate raising the price of energy is whether the source of that increase should take the form of a tax or be based on a “cap and trade” mechanism. With cap and trade, energy producers that emit CO2 are required to spend a designated amount per ton to finance projects that facilitate CO2 absorption. This means that if you were to operate a coal-fired power station, for example, you’d pay to plant hundreds of square miles of forest. But there are huge problems with cap and trade: As it turns out, exactly what constitutes a CO2 “offset” is grossly subjective. European CO2 offset credits, for example, created a market for biofuel imported from the tropics that in turn unleashed a devastating wave of ongoing rainforest destruction to grow oil palms and other fuel crops. Tropical deforestation to grow biofuel is a global catastrophe and has probably contributed as much to climate change as CO2 from fossil fuels ever will.

Environmentalism is multifaceted: There’s what one might call practical environmentalism, which supports policies designed to eliminate pollution and other toxic hazards as well as to preserve and protect reasonable amounts of wilderness and endangered species, and then there’s emotional environmentalism. Occupying the latter category are many of today’s environmentalists. Overly driven by ideology and emotion, they’re well meaning but fanatical, and they engage in an unwittingly cynical and synergistic dance with all kinds of powerful forces with hidden agendas.

To wit: Restricting energy production enriches the cartels that produce and sell most energy (since prices and profits go up). Declaring nearly all land to be protected “open space” makes housing prices skyrocket (thereby raising property taxes and building fees, and enriching public sector entities). And cap-and-trade schemes enrich not only traders on Wall Street but also every private company (or cash-strapped public entity) who can sell (to public sector regulators and environmentalist nonprofits tasked with vetting these plans) a project to produce an “offset” and collect a fee.

Environmental organizations enjoy tax-free status. They also employ litigious attorneys who tie economic development and private entrepreneurship up in knots: For these folks, the growing alarm over global warming represents the best financial windfall they’ve ever witnessed. Environmentalism, as we’ve seen, delivers huge benefits. But when it goes too far—as it often does—the costs are staggering.

Green-tech entrepreneurs need to decide what version of environmentalism they want to believe in—practical or emotional, market driven or government mandated. Hopefully they’ll embrace the same rules that made the Silicon Valley great, winning in the competitive market with solutions people choose to buy, and not through lobbying, litigation, and government subsidies. If rationality and market competition are left intact, the global economy and the global environment will both be better off as we manage the transition to clean and renewable energy.


5 Responses to “Multifaceted Environmentalism & Greentech”
  1. Lou Gold says:

    Ah Ed,

    I gotta quarrel with you again. This is not about “head versus heart” environmentalism. It’s about achieving, after a long separation, an approach that involves both head and heart. Survival and future abundance depend on it.

    Now, let’s get some facts straight — no one has ever planted a forest anywhere on earth. Tree plantations are planted, and they are cut again for commercial purposes — as with eucalyptus grown in Brazil for “green charcoal” for the steel mills. Carbon credits might be used to keep the new trees standing forever and to reduce deforestation of already standing forests. Is this what you are advocating? I hope so.

    You say the cap-and-trade is difficult because it’s hard to measure sequestration? Well, how about agrichar? The amount of inert charcoal put into the soils as an amendement can be measured precisely.

    And, as I keep seeing four GM E85 ads surrounding this post, I am moved to quote a snippet fro Tom Friedman writing in todays NY Times:

    “… I got together with three engineering undergrads who helped launch the Vehicle Design Summit — a global, open-source, collaborative effort, managed by M.I.T. students, that has 25 college teams around the world, including in India and China, working together to build a plug-in electric hybrid within three years. Each team contributes a different set of parts or designs. I thought writing for my college newspaper was cool. These kids are building a hyper-efficient car, which, they hope, “will demonstrate a 95 percent reduction in embodied energy, materials and toxicity from cradle to cradle to grave” and provide “200 m.p.g. energy equivalency or better.” The Linux of cars!

    They’re not waiting for G.M. Their goal, they explain on their Web site — vds.mit.edu — is “to identify the key characteristics of events like the race to the moon and then transpose this energy, passion, focus and urgency” on catalyzing a global team to build a clean car. I just love their tag line. It’s what gives me hope:

    “We are the people we have been waiting for.”

    This is the kind of head AND heart environmentalism that I applaud.

    Maybe you do too?

  2. Ed says:

    Lou: To make a point I positioned Head vs, Heart as opposites – but in a larger sense I agree that mixing the two as you state, Head AND Heart, is the only way. Read “Was Churchill Wrong? ” or “The Radical Center” for reasons why head and heart have to work together.

    With regret I have to pretty much agree with your comment “no one has planted a forest anywhere on earth, tree plantations are planted…” although there are cases of genuine reforestation out there – read “Profitable Reforesting;” the problem with that model is it yields less dramatic near term profit and therefore probably will not take hold on a global scale without some kind of additional incentives.

    As for your comments about the car of the future – we write about them all the time. We don’t typically cover engineering school projects, not because they aren’t laudable, but because we are looking for the car that’s closest to being built and put on the road by the hundreds of thousands.

    And I kid you not, after 10+ years of vigilant search, I believe the Chevy Volt is the breakthrough automotive innovation we’ve been looking for. Read “Cars Are Green” or “The Case for the Series Hybrid” for information on this technology. Aptera and Fisker are new entrants with credible programs to deploy a series hybrid within the next two years, but GM’s Volt and Flextreme (European version) are currently in the lead to deliver the highest volumes in the shortest time. Not one other major automaker has yet announced a series hybrid.

    The issue that ties all of this together in my opinion is that today, carbon offset trading is causing deforestation by encouraging biofuel plantations in the tropics. Carbon offset trading needs to create incentives for reforestation, proper reforestation, and on that point I would hope enough of us would passionately agree to see changes in that system.

  3. Bret Jenkins says:

    Dear Ed:

    Thank you for your gracious words. Your words hold much thought and much wisdom. As I understand your thoughts, you aspire for and envision a world where governments no longer serve the interest of the public nor the interests of giant cartels of wealth and power, a world where entrepreneurs are movitated both by their desire to serve the interests of all members of the community in which they operate and the desires of shareholders to reap a substantial return on their financial investment.

    Such a world could indeed solve many of our most challenging problems. I do wonder, however, will Wall Street patiently wait and invest in today’s Thomas Edison’ numerous failed light bulbs before pulling the plug as you so readily point out and want to pull the plug on Government investment in alternative energy? Are shareholders and corporations, most notably coal mining companies, now willing to take on the expense of cleaning up the mess their activities produce? Today communities near mountain top coal mining in Kentucky and Virginia see their water ruined their entire quality of life destroyed. Will these companies suddenly change their dirty habits without government oversight and restraint or are we to simply toss them aside as mere collateral damage, placing profit before families? Are consumer’s willing to pay more for goods produced and fossil fuels extracted in a socially responsible and and sustainable ways?

    Perhaps they are indeed, Ed, if they are provided with more information and knowledge so they can make these kind of choices which will enable us to build a better world and solve many of the problems we face today.

    Part of the problem we face today, Ed, as I see it, is our eagerness to point out government’s failings yet our unwillingness to recognize how often business has worked hand in hand with the government in producing these failings. Additionally, many of the problems created by companies,we seem to gloss over, saying, “Well, that’s just business.”

    Why should business get a free pass if government does not? Both our creations of people and therefore both suffer from man’s flaws. And we cannot address a problem if we gloss over it or give an institution a free pass.

    To solve problems we must admit the light bulb didn’t deliver as promised, go back to the drawing board and figure out how to make a better light bulb. However, if the company is already making a substantial profit and if the government has already invested substantial amounts of resources in continuing the success of the status quo even if it is a inferior light bulb, why would a business want to develop a better light bulb? Why would Wall Street? It is, after all, far more cheaper and far more profitable to continuing manufacturing the inferior light bulb. Furthermore, this company certainly would not want to see the government to stop providing special treatment in the form of securing its interest on foreign soil, government subsidies, or legislations that establishes a competitive advantage. Nor would it accept government money being spent on the development of a potentially competing industry. While dipping its hands in the goverment’s pockets, another words, it would scorn any government assistance to a technology it perceived as a threat. Such a scenario is the other invisible hand working in the market place we seldom discuss or even admit.

    In order for alternative, clean and sustainable energy technologies to compete on a level playing field, the playing field must be level. This can be accomplished by either a) the government assisting in the development of alternative energies and the public being willing to accept the failed light bulb designs along the way or b) the removal of all government assistance to fossil fuels, including the clean up of all the toxic waste and damage fossil fuel extraction and processing produce.

    Ed, I think you and I actually agree on this topic and people. I think we really are ready to make better choices. So I opt for plan b.

    Though Edison’s light bulb was created in a vacuum and would not work without a vacuum, the Silicon Valley you praise, however, was not created in a vacuum. The success of the PC development depended greatly on the government sponsored programs that paved the way. Without the NASA and the ARMY contracting for the development of computers as well as the huge number and data crunching mainframes employed by the US government, the wonder of Silicon Valley would remain improbable.

    When we believe one thing holds all the answers, Ed, we fail to see how all things are truly interconnected.

    And once again, thank you for sharing your thoughts. I sense you are deeply committed to this project.

    Bret

  4. Dr Coles says:

    Over 400 World Wide Prominent Scientists Disputed Man-Made Global Warming Claims in 2007. See http://tinyurl.com/2dv6nz

  5. Gastao Ponsi says:

    06/05/2008 – Action civil prohibits public sewage mixed in Sao Borja – Brazil.

    The second Vara Federal Justice of Uruguayan has won cause of the Civil Public Action against the City of San Borja condemning the:

    a) so immediately, to refrain from deploying new network of drainage pluvial-cloacal (mixed) and expand the existing network of drainage pluvial-cloacal (mixed);

    b) carry on until one (1) year, the lifting of many economies are linked to the network of drainage pluvial-cloacal (mixed) in San Borja / RS, and until 8 (eight) years, adopt the necessary measures to dejection that today are the object of the network of sewage mixed are not released in water bodies of the city without the necessary and appropriate health and treatment in accordance with the standards of environmental quality set by CONAMA or sucessor.Semestralmente, the defendant must prove that the file is fulfilling the obligation, upon demonstration of what measures have been adopted for that purpose. The deadlines for compliance with obligations begin on the date of the subpoena of the defendant about the terms of sentença.Para the case of breach of obligations object of items “a” and “b”, including with regard to the demonstration half-making arrangements Without prejudice to the responsibility in criminal and administrative spheres (improbidade), now fixed daily fine in the amount of U.S. $ 5,000.00 (five thousand reais), based on the provisions of art. 11 of Law No. 7.347/85. “The ACP was sponsored by the environmentalist lawyer Dr. Gastão Ponsi and was successful with the second Vara Federal Civil Justice of Uruguaiana. Yet be final.

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