Michael de Laine

By Michael de Laine, Copenhagen, 26th November 2008

We must start to act to clean up the emissions leading to climate change, and businesses can make money from environmental technology. But there are tough negotiations ahead of next year’s UN climate summit in Copenhagen, COP-15, where 192 countries must reach agreement on limiting emissions.

The world has the time and the money for environmental technology to clean up the emissions leading to climate change, but we must act now, sustainable development guru Hunter Lovins told the Copenhagen Voice.

“Yes, we do have the time, if we go about it very, very quickly,” Lovins said. “In fact, we have no time to delay. The changes from global warming are coming faster than the models predicted. The Arctic is melting faster, droughts are occurring, and diseases are spreading north. This is a problem that we cannot delay in solving.”

Speaking to the Copenhagen Voice at the Nordic Climate Solutions conference at Copenhagen’s Bella Center on 25th November, the environmental issues advisor and founder and president of Natural Capitalism and co-founder of the Rocky Mountains Institute, said, however, that there is good news for the business community.

“If we start now investing in the solutions, then we’ll make a boatload of money,” she said. There are many studies showing “that the investments we need to solve the problem of climate change are investments in society and we’ll get a higher rate of return from investing in energy efficiency and renewable energy than in anything else.”

The only solution to solving the financial collapse is to start investing at the bottom, in houses, communities and distributed energy technologies, as this will help cleantech companies and generate economic growth.

“If we are to continue to throw billions of dollars at the banks to pay dividends and bonuses, then the future is very bleak indeed,” Lovins said. “And if we do not invest in clean technologies, the future is bleak.”

Will the US agree to meet emissions cutbacks expected at the UN climate summit, COP-15, next year in Copenhagen?

“I am cautiously optimistic about President Elect Obama, and I say that for two reasons,” said Lovins. “One of his primary advisers, John Podestra, wrote a report called ‘Green Recovery’. He clearly understands the connection between solving the economic problems and solving climate change.”

In addition, Lovins said, over 900 mayors around the US, Canada and Mexico have committed to abide by Kyoto. And many states are following California in massive carbon cuts. Fully implementing a Californian carbon-cut plan would the basis of over 400,000 new jobs in California, and billions of dollars added to the economy. Numerous companies are also calling for one single, national energy policy.

“With all that pressure on Mr Obama, I think he will do the right thing,” Lovins said.

Lovins sees coal’s share of the energy market falling sharply – partly because it is carbon-intensive. “But also because it’s costs are soaring at the same time as the costs of the renewables are coming down,” she told the Copenhagen Voice. A maker of solar cells for producing electricity told her recently that solar cells now produce electricity cheaper than burning coal. “When we have grid parity, we’re going to see solar sky-rocket and coal fall,” Lovins said of this price movement.

“But can we get a shift away from oil and coal in the developing countries?” Lovins asked. “China is adding a new coal plant every couple of days, India is right behind. If they continue on the route they are on now, then it doesn’t matter what we do in Europe or the US. We will hit the increase in the concentrations of CO2 in the atmosphere that will lead to runaway climate change. Life as we know it on Earth will be gone within a hundred years.”

However, Lovins was concerned about the US attitude to binding cuts in emissions, which are expected to be the method to be used at COP-15 as a follow-up to Kyoto.

“The US will look on binding targets as impinging on its sovereignty,” Lovins said. “But that doesn’t matter – the Earth needs cuts in emissions.”

Connie Hedegaard, Denmark’s climate and energy minister, said she is confident that COP-15 will reach an agreement based on binding targets, but she admitted she was “pessimistic” about the amount of effort needed to achieve the agreement.

“I’m absolutely pessimistic that I’ll have an easy job getting agreement at COP-15,” Hedegaard told the Copenhagen Voice. “It’s probably the most complicated piece of international negotiations right now. On the other hand, the Danish government is not doing this alone – we are hosting it. But it is the rest of the world, all 192 member states of the UN, who last December promised one another that Copenhagen 2009 should be the deadline. So it’s not just something at Denmark is responsible for. All the countries in the world have set this deadline and they should stick to that.”

The Danish minister sees great chances for Danish cleantech businesses, which she believes will make money from helping others adapt to climate change, and for businesses providing sustainable solutions. Hedegaard also sees opportunities for partnerships between private and public companies.

“But we must get started immediately,” Hedegaard told the climate conference. “From China to the US, we need political change to land an ambitious climate treaty next year at COP-15. Chinese businesses are aware that great economic gains are to had from investments in new, clean and green climate technology.”

Hedegaard took a trip in a solar-powered taxi, but it will be some time before such vehicles are commonplace, she said.

“This was, to say the least, a pilot project, but I think there are interesting aspects in this type of alternatives as well,” the Danish minister told the Copenhagen Voice. “However, I do think that in Denmark, with a huge component of wind energy, that it’s very interesting to elaborate further electric cars because they have the huge advantage that they can store surplus wind energy in their batteries, so the end result is that we get much more use of the wind potential that we have already.”

Hedegaard does not see fossil-fuel-driven vehicles banned from city centres in Europe for several years.

“Three or four years is probably too early,” she said. “But it seems that in the not too distant future we will have many more electric cars, we will have some hybrids and other kinds of new technology where we are less dependent on fossil fuels for transport. But I think you will only see it very widespread from say 2020 and onwards. When you start this, people must actually get the cars. Due to the investment for a car, it takes a number of years before wide circles of cars are running.”

Representing Powertech Labs, an energy systems engineering unit of Canadian power hydro-electricity generating company BC Hydro, Allan Grant told the Copenhagen Voice that the company “sees itself as a clean energy company and really helping communities and customers to find the right balance” between various possible energy supply sources.

“Energy efficiency is a big part of this,” Grant said, adding the 50% of the company’s incremental load has to be met through conservation.

British Columbia has introduced a carbon tax, but this has not affected BC Hydro dramatically, Grant said. “We are 90-95% hydro-electric. In terms of our actual costs, I think it’s more on transportation. The British Columbia energy plan has a bunch of very innovation concepts around things like carbon neutrality, zero carbon emissions for all electricity production, zero-emission coal plants.”

There is a spin-off from this – energy security, Grant explained. His company will be able to capitalise on that to improve its competitive position and will be able to export its expertise to other countries.

BC Hydro helps consumers reduce their consumption. “We have one of the world’s leading demand-side management programmes, PowerSmart, which started back in the late 80s,” Grant said. Getting people to save energy is a more cost-effective path for power company as it does not need to build new plants, which would mean raising rates.

“We have very low embedded costs based on the plants built back in the 60s and 70s, and we want to avoid having to build new and expensive plants. Demand-side management helps people save money, but it is also a very attractive alternative for a utility, as it doesn’t have build new plants for power generation.”

The Nordic Climate Solutions conference was arranged by MandagMorgen, a Danish think tank and weekly news magazine, and the Nordic Council of Ministers.